Hidden Surprises in New Auto Contracts

This year, for the first time, the United Auto Workers negotiated contracts with the Big Three auto makers almost simultaneously, rather than setting a pattern at one company, sending it to members for ratification, and then negotiating with the other two.

Ratification was swift, with sizable majorities but low turnouts. In most plants, workers voted one day or less after receiving a 20-page “Highlights” bulletin.

Within a few days, though, some members got hold of their entire agreements, “unpublished letters” came to light, and the press began to reveal some hidden concessions and other disturbing provisions.

Dissidents speculated that UAW President Ron Gettelfinger had planned the simultaneous negotiations in order to minimize leakage of information about the contracts’ true contents.


Although most plants voted for the contracts with big majorities, in a few, where hidden concessions were publicized by dissident rank-and-filers and/or where workers had more time to discuss, majorities voted no.

At DaimlerChrysler’s Sterling Heights assembly plant, near Detroit, for example, a skilled trades rep distributed parts of the actual contract not mentioned in the bulletin. The language indicated that the International would impose the “team concept” and various “flexible work schedules” on locals. Skilled workers there voted the contract down by 68%, compared to 58% yes for skilled trades nationally.

At DCX’s New Castle, Indiana forge, workers voted no by over 2-1. The plant’s sale to a parts supplier, Metaldyne, will soon be finalized, and new-hires there will then start at $12.50 an hour.

At a GM plant in Marion, Indiana, workers voted down a team-concept local contract twice. Two hours after the second vote management rescinded a past practice on break time, apparently in retaliation.

At a Delphi parts plant in Coopersville, Michigan, where local leaders gave members a week before voting on the national agreement, the turndown was 2-1. But at most Delphi plants, the contract passed-even though the contract will cut drastically the wages of Delphi new-hires. (Bargainers have not made the amount public but it is believed to be around $10 an hour.)

Current Delphi workers’ wages will remain the same-for now-and they will have the right to transfer to GM plants over time. Although GM spun off its Delphi parts division in 1999, GM and Delphi workers’ votes were counted in the same pool.


The new contracts include some hidden facets:

• An unpublished letter says that UAW-DCX joint funds will pay for a benchmarking study of an assembly plant. “Benchmarking” means studying a plant believed to be the best, in order to copy its “best practices.” It appears that the plant at which company and union will study “production, safety, attendance, quality, [and] employee relations” is a nonunion Toyota plant in Princeton, Indiana.



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DCX is playing catch-up: the UAW has done such joint benchmarking with GM for years.

• In another unpublished letter, DCX and the union agreed to develop a classifications structure for skilled workers that “migrates to world class levels.” Although not spelled out, the benchmark automakers have long coveted is that of Japanese-run plants in the U.S. (some UAW-organized), which use only two skilled classifications.

Skilled workers say that, in addition to cutting jobs, such a structure dumbs down their work and allows a larger proportion to be contracted out.

• The companies will move all workers and retirees now covered by traditional Blue Cross-about 43% of the total-into a plan with “network providers.” This change was not mentioned in the union’s bulletin to Ford workers, and was mentioned merely as an “update” in the DCX bulletin. Only GM workers were informed.

Controlling health care costs had been one of the companies’ main goals, and union bargainers’ chief selling point to workers was “health care protected-no cost-shifting.” It is not known how much the switch will affect workers’ costs or choice of physicians, but it is expected to cut the companies’ costs substantially.


• The union’s bulletin to DCX workers listed “card check” as one of seven “highlights” of the new contract. This led many to believe that the language applied to Mercedes’ non-union, 2,000-worker assembly plant in Alabama, which UAW Vice President Nate Gooden had vowed would soon be organized.

Mercedes is owned by DaimlerChrysler A.G. of Germany, as is DCX in the U.S. But the company later clarified that the language does not cover the Alabama plant.

• A final shoe left to drop is the local contracts still under negotiation. New language gives the International union more power to impose changes such as the “team concept” or “Global Manufacturing Systems” that will increase productivity at the expense of shop floor rights and workers’ schedules.

The companies are also likely to make more demands for “shelf agreements,” which can foster competition for work among local unions. In such agreements, the local agrees to change work rules if new production is moved into the plant.


Rank-and-filer Gregg Shotwell agitated against the Delphi agreement in Coopersville, pointing out that current workers’ security is illusory.

Shotwell said, “This contract more than any other I have seen devastates relationships. Over the next four years I will say ‘goodbye’ to everyone I work with [as they transfer to GM or retire], and ‘good luck’ to the poor bastards who take our place. Delphi workers will be forced out, but since our pensions are tied to the sinking ship there isn’t much buoyancy in the life raft.

“When retirees speak at UAW conventions they get standing ovations. We love and respect what they did for us. I wouldn’t dare go to a UAW convention after I retire. They will probably throw eggs at us.”