DETROIT — The UAW accord with Fiat Chrysler likely offers enough in raises and other improvements to ensure ratification by the rank and file, but it notably keeps in place the divisive two-tier system for entry-level workers.
Officials from UAW locals at FCA plants convened in Detroit on Friday, Sept. 18, to hear details of the tentative four-year agreement reached by FCA CEO Sergio Marchionne and UAW President Dennis Williams three days earlier.
Among the highlights shared with local leadership: Veteran, or Tier 1, workers can expect their first wage increase in 10 years; the idea of a health care purchasing co-op will be explored to control costs; and production of numerous vehicles will be shuffled among the automaker’s plants. Output of strong-selling pickups, SUVs and crossovers will be consolidated at U.S. factories, improving the job-security outlook for workers at those plants, while output of price-sensitive cars will move to lower-wage Mexico.
And wages for Tier 2 workers were improved dramatically. The pay range, depending on seniority, advances from $16 to $19 an hour currently to $17 to $25 an hour by the end of the four-year contract.
Yet Tier 2 — which Marchionne has called unsustainable and offensive and which Williams wanted to eliminate — survives, even if the discrepancies with Tier 1 narrow. The new Tier 2 provisions never allow entry-level workers’ wages to reach the full $30 an hour that veteran workers will earn for doing the same jobs.
Still, FCA workers, UAW local leaders and labor experts said there’s enough in the agreement for everybody — including a $3,000 signing bonus — to gain passage. Ratification votes will be scheduled for FCA’s 37,000 hourly workers over the next two weeks.
“I don’t think they’ll have a problem passing it,” said Dave Cole, chairman emeritus at the Center for Automotive Research in Ann Arbor, Mich.
The 2011 UAW contract with what was then Chrysler Group had fewer bells and whistles than this year’s accord and passed with 58 percent of the rank and file voting in favor and a minority of skilled tradespeople, 44 percent, approving.
Since then, FCA has added more than 16,000 hourly workers, all earning Tier 2 wages and benefits, who will be voting for the first time on a contract that promises them significant, systematic raises over its term. Tier 2 workers now comprise about 45 percent of FCA’s hourly work force.
After an FCA contract is ratified, the UAW will intensify its negotiations with General Motors and Ford Motor Co.
Bill Parker, an assembly line worker at FCA’s Sterling Heights Assembly Plant, said he was dissatisfied with the new approach to Tier 2. He said a plan that offers no path to full veteran pay only exacerbates the factory divisiveness endemic of a two-tier system that pays workers different rates for doing the same job. “Our goal should be to unify the membership,” said Parker, who served for years as president of the Sterling Heights local, UAW Local 1700.