Jamie L. LaReau, Detroit Free Press
Wed, November 8, 2023
As the voting starts at General Motors facilities on the tentative agreement between the automaker and its union-represented workers, there is some confusion about the loss of two annual bonuses that amount to $1,500.
But the perceived loss will be a gain in the long run with the addition of a cost-of-living adjustment and wage increases, said a person with the union who is familiar with the GM tentative agreement but not authorized to speak publicly about it.
The GM tentative agreement White Book shows that a $1,000 performance bonus that was paid in June of each year since 2020 has been deleted from the contract. Similarly, a quality bonus of $500 often paid in December has been removed. Those were replaced by the union winning back its COLA formula lost in 2009 and a 25% wage increase over the 4½-year contract.
Members hit the picket line after UAW President Shawn Fain called for a strike after contract negotiations stalled with all three Detroit automakers, UAW members walked off the job at Ford Michigan Assembly Plant just after midnight on Friday, Sept. 15, 2023. The current four-year contracts with General Motors, Ford and Stellantis were in effect until 11:59 p.m. on Thurs., Sept. 14 and without an agreement, the UAW initiated a stand-up strike, a strategic plan that the union is said to have for a strike targeting certain plants at the different automakers in waves.
But some union members have reached out to the Detroit Free Press saying losing that $1,500 annual bonus is a hit unless COLA consistently holds or rises.
Not true, said the UAW person, adding, the bonuses were paid in the past in place of general wage increases and COLA. Members will do much much better with COLA and wage gains.
The current U.S. inflation rate is 3.7% for the 12-month period leading up to September 2023, according to Bureau of Labor Statistics. Inflation rose 0.4% in September from August.
But for simple math, the union person used 2.5% as a conservative yearly rate of inflation. So if the agreement is ratified, by year-end the contract shows that the new base wage for a production worker is $36 an hour. So multiply the 2.5% inflation rate by $36 an hour base wage. It is 90 cents. Then multiply 90 cents by 2,080 hours worked in a year based on a 40-hour workweek. That equals a $1,872 increase in wages for the year, well above $1,500.
And as the wages go up, that will add up to more money at the end of each year than $1,500, the person explained.
The chances that there is no increase in inflation and therefore in the COLA is "extremely slim," the person said.
For evidence, according to www.worlddata.info, the inflation rate for consumer prices in the United States over the past 62 years has moved between negative 0.4% and 13.5%. For 2022, an inflation rate of 8% was calculated. From 1960 to 2022, the average inflation rate was 3.8% per year. According to WorldData, the price increase was 903.96% meaning something that cost $100 dollars in 1960 costs $1,003.96 at the beginning of this year.
Meanwhile, voting at some GM facilities has started. Flint Assembly plant is expected to vote Thursday, Flint Engine voted earlier this week and rejected the tentative deal, as did Romulus Engine. Factory Zero in Detroit and Hamtramck voted yes on it. The UAW is working to set up a place on its website to report the overall vote at locals as they come in. Some other GM plants such as Fort Wayne Assembly and Bowling Green Assembly will not vote until next Tuesday.
The vote process is as follows: The membership votes, the UAW's election committee then certifies the ballots and the results are shared with the local union leadership and then sent to the UAW International, where they are recorded and reported to the public. On May 12, 2021, the U.S. District Court for the Eastern District of Michigan appointed Neil Barofsky of Jenner & Block LLP as the independent monitor of the UAW. If Barofsky requests to review the voting, the UAW leadership would comply.
More: UAW President Shawn Fain urges GM members to ratify tentative agreement
More: Unifor members ratify deal with Stellantis, ending Detroit 3 bargaining in Canada
Contact Jamie L. LaReau: jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter. Become a subscriber.
This article originally appeared on Detroit Free Press: GM plants start voting on UAW deal but concern lingers over a bonus
The UAW and the Big Three can turn America’s ‘Great Rebalancing’ into a win-win for both sides. Here’s how
Adam Hanft
Tue, November 7, 2023
Emily Elconin—Bloomberg/Getty Images
The United Auto Workers (UAW) was a primal David vs Goliath struggle. It triggered deeply ingrained tropes: Fat-cat, Scrooge-y bosses vs. under-paid and noble workers.
The recent strike is just one swing of the pendulum in a long struggle. For decades, the unions were losing. Membership plummeted, and support waned.
It took decades for the union movement’s brand to recover, but recover it has. Last August, a Gallup poll found that 71% of Americans approve of unions, the highest percentage since 1965. The question for the UAW is: How can it extend its economic and perceptual win to keep the momentum going?
On the other side, how can the auto industry build a narrative around the concessions it just made? This can begin the process of making the American public–especially the younger car buyers of the future– less ready to hate the auto industrial complex.
It will be a tough road ahead. Americans have always had a love-hate relationship with car companies–and that sentiment has not improved.
Cost is one reason. As analysts have noted, new cars are for well-off people–and less affluent consumers have turned to the used car market or do not own cars. If you can’t afford the industry’s cars, then it’s hard to love the industry.
Despite that reality, during the strike, the auto industry’s response was an uninspiring combination of offense (attacking UAW leader Shawn Fain for challenging the unwritten labor rules) and argumentative defense.
Automakers need a jiu-jitsu move
Now that the UAW is about to ratify the deal, the industry should seize the moment and elevate the settlement to a declaration of how much it respects and honors auto workers–trade their predictable corporate bluster for an unexpectedly humane response.
Their messaging must focus on two key audiences: younger consumers, as well as people who already own their cars. Data shows that more than half of car owners would prefer to buy from the company they purchased from previously.
To build those relationships, Detroit should praise the strikers for doing what they thought was right and standing up for what they believed in–an unexpected but necessary jiu-jitsu move.
The automakers should also speak with pride about the significant pay raises they have conceded. “We are proud to support the skilled women and men who make amazing cars right here, in America.”
Most Americans would be thrilled to get a raise of that size, and with the right framing, will be delighted that UAW members are getting it. These companies are losing the revenue anyway–they should gain the street cred.
The industry should also remind the American public of the middle class their businesses, in partnership with the unions, have built, citing objective third parties.
Of course, each auto company will need to tell this story in its own way, propelled by this narrative framework.
The union can now move on
During the strike, the UAW fell into their standard-issue spiel of corporate greed and non-living wages. Sean Fain loves wearing his "Eat the Rich" T-shirt–but data shows that "support for redistributive policies tends to be low."
Fain must rise above his opposition stance and seize this moment to leave divisiveness behind. This is an opportunity to strategically link the union's success to America’s "great rebalancing." Wherever you look, power is de-concentrating at the top: Employees are demanding remote work. Unions are organizing at Amazon and Starbucks. Hollywood actors are on strike. Children are suing energy giants. Millions are speaking up for social and climate justice.
The settlements reached with automakers must feed into that narrative: “We did our part by taking on the Big Three, which is why more than half of Americans support us. Our country is changing, and the UAW respects management for being tuned into this new reality.”
In short, position the union as a culture changer. Declare that the fight for higher wages, work-life balance, and a shorter workweek is not just auto workers’ fight–it’s everyone’s. Remind people of what history has shown: “When we fight for ourselves, you are more likely to get what you want.”
These new narratives will allow both sides to move beyond divisiveness–and achieve unity. The industry gets to take credit for its concessions and the union links its success to larger social forces. America wants and needs that. Vicious political debates have triggered a widespread chronic polarization fatigue syndrome.
Yes, it’s easier said than done. It’s tough for the UAW and the Big Three to get there because their leadership has grown up in an us vs. them environment. Today, it’s time to replace these calcified narratives with consensus thinking.
Adam Hanft is a brand strategist who advises Fortune 500 companies, some of the world’s most innovative startups, and world leaders.
Adam Hanft
Tue, November 7, 2023
Emily Elconin—Bloomberg/Getty Images
The United Auto Workers (UAW) was a primal David vs Goliath struggle. It triggered deeply ingrained tropes: Fat-cat, Scrooge-y bosses vs. under-paid and noble workers.
The recent strike is just one swing of the pendulum in a long struggle. For decades, the unions were losing. Membership plummeted, and support waned.
It took decades for the union movement’s brand to recover, but recover it has. Last August, a Gallup poll found that 71% of Americans approve of unions, the highest percentage since 1965. The question for the UAW is: How can it extend its economic and perceptual win to keep the momentum going?
On the other side, how can the auto industry build a narrative around the concessions it just made? This can begin the process of making the American public–especially the younger car buyers of the future– less ready to hate the auto industrial complex.
It will be a tough road ahead. Americans have always had a love-hate relationship with car companies–and that sentiment has not improved.
Cost is one reason. As analysts have noted, new cars are for well-off people–and less affluent consumers have turned to the used car market or do not own cars. If you can’t afford the industry’s cars, then it’s hard to love the industry.
Despite that reality, during the strike, the auto industry’s response was an uninspiring combination of offense (attacking UAW leader Shawn Fain for challenging the unwritten labor rules) and argumentative defense.
Automakers need a jiu-jitsu move
Now that the UAW is about to ratify the deal, the industry should seize the moment and elevate the settlement to a declaration of how much it respects and honors auto workers–trade their predictable corporate bluster for an unexpectedly humane response.
Their messaging must focus on two key audiences: younger consumers, as well as people who already own their cars. Data shows that more than half of car owners would prefer to buy from the company they purchased from previously.
To build those relationships, Detroit should praise the strikers for doing what they thought was right and standing up for what they believed in–an unexpected but necessary jiu-jitsu move.
The automakers should also speak with pride about the significant pay raises they have conceded. “We are proud to support the skilled women and men who make amazing cars right here, in America.”
Most Americans would be thrilled to get a raise of that size, and with the right framing, will be delighted that UAW members are getting it. These companies are losing the revenue anyway–they should gain the street cred.
The industry should also remind the American public of the middle class their businesses, in partnership with the unions, have built, citing objective third parties.
Of course, each auto company will need to tell this story in its own way, propelled by this narrative framework.
The union can now move on
During the strike, the UAW fell into their standard-issue spiel of corporate greed and non-living wages. Sean Fain loves wearing his "Eat the Rich" T-shirt–but data shows that "support for redistributive policies tends to be low."
Fain must rise above his opposition stance and seize this moment to leave divisiveness behind. This is an opportunity to strategically link the union's success to America’s "great rebalancing." Wherever you look, power is de-concentrating at the top: Employees are demanding remote work. Unions are organizing at Amazon and Starbucks. Hollywood actors are on strike. Children are suing energy giants. Millions are speaking up for social and climate justice.
The settlements reached with automakers must feed into that narrative: “We did our part by taking on the Big Three, which is why more than half of Americans support us. Our country is changing, and the UAW respects management for being tuned into this new reality.”
In short, position the union as a culture changer. Declare that the fight for higher wages, work-life balance, and a shorter workweek is not just auto workers’ fight–it’s everyone’s. Remind people of what history has shown: “When we fight for ourselves, you are more likely to get what you want.”
These new narratives will allow both sides to move beyond divisiveness–and achieve unity. The industry gets to take credit for its concessions and the union links its success to larger social forces. America wants and needs that. Vicious political debates have triggered a widespread chronic polarization fatigue syndrome.
Yes, it’s easier said than done. It’s tough for the UAW and the Big Three to get there because their leadership has grown up in an us vs. them environment. Today, it’s time to replace these calcified narratives with consensus thinking.
Adam Hanft is a brand strategist who advises Fortune 500 companies, some of the world’s most innovative startups, and world leaders.
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