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General Motors' (GM) 10% Wage Hike is 'Insulting' for UAW
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General Motors (GM - Free Report) made a counterproposal to the United Auto Workers (UAW) to avoid a costly strike. However, the offer failed to meet the expectations of Shawn Fain, president of the UAW, who called the offer “insulting.”
In its new contract, the legacy automaker offered a wage hike of 10% to roughly 46,000 of its UAW-represented workers. Newer or in-progression employees would be eligible for up to a 56% increase over the four years of the deal. Temporary workers would also receive a wage hike of 20%, which amounts to roughly $20 an hour.
The UAW members start at about $18 an hour under the current pay regime and go through a “grow-in” period of four years to reach a top wage.
General Motors’ new contract includes two additional 3% lump-sum payments, a $5,500 ratification bonus, a $6,000 one-time inflation-recognition payment, and $5,000 in inflation-protection bonuses over the life of the agreement, which in-progression employees are eligible to receive.
Although the wage increase is the biggest hike the union has ever seen since 1999, it failed to meet the demands for a 40% hourly pay increase, a reduced 32-hour workweek, the elimination of compensation tiers, the restoration of cost-of-living adjustments, etc.
Fain called the offer “insulting” because it comes nowhere near an equitable agreement for America’s autoworkers. Fain said either the automaker doesn’t care or isn’t listening to the union’s demand for economic justice. Fain asked the automaker to stop wasting its members’ time.
GM came up with the proposal a week after the UAW filed unfair labor charges against it and its rival Stellantis N.V. (STLA - Free Report) with the National Labor Relations Board (“NLRB”).
The current UAW contract with GM, Ford Motor (F - Free Report) and Stellantis will expire after 11:59 p.m. on Sep 14, 2023. Stellantis plans to make a counteroffer to the UAW this week.
Last week, Ford offered 15% guaranteed combined wage increases, lump sums and enhanced benefits over the life of the contract. However, that offer also did not go down well with Fain.
Nearly 97% of UAW members from GM, Ford and Stellantis voted in favor of authorizing a strike against the Detroit Three automakers if an agreement is not reached prior to the expiration of their current four-year contract.
Image: Bigstock
General Motors' (GM) 10% Wage Hike is 'Insulting' for UAW
General Motors (GM - Free Report) made a counterproposal to the United Auto Workers (UAW) to avoid a costly strike. However, the offer failed to meet the expectations of Shawn Fain, president of the UAW, who called the offer “insulting.”
In its new contract, the legacy automaker offered a wage hike of 10% to roughly 46,000 of its UAW-represented workers. Newer or in-progression employees would be eligible for up to a 56% increase over the four years of the deal. Temporary workers would also receive a wage hike of 20%, which amounts to roughly $20 an hour.
The UAW members start at about $18 an hour under the current pay regime and go through a “grow-in” period of four years to reach a top wage.
General Motors’ new contract includes two additional 3% lump-sum payments, a $5,500 ratification bonus, a $6,000 one-time inflation-recognition payment, and $5,000 in inflation-protection bonuses over the life of the agreement, which in-progression employees are eligible to receive.
Although the wage increase is the biggest hike the union has ever seen since 1999, it failed to meet the demands for a 40% hourly pay increase, a reduced 32-hour workweek, the elimination of compensation tiers, the restoration of cost-of-living adjustments, etc.
Fain called the offer “insulting” because it comes nowhere near an equitable agreement for America’s autoworkers. Fain said either the automaker doesn’t care or isn’t listening to the union’s demand for economic justice. Fain asked the automaker to stop wasting its members’ time.
GM came up with the proposal a week after the UAW filed unfair labor charges against it and its rival Stellantis N.V. (STLA - Free Report) with the National Labor Relations Board (“NLRB”).
The current UAW contract with GM, Ford Motor (F - Free Report) and Stellantis will expire after 11:59 p.m. on Sep 14, 2023. Stellantis plans to make a counteroffer to the UAW this week.
Last week, Ford offered 15% guaranteed combined wage increases, lump sums and enhanced benefits over the life of the contract. However, that offer also did not go down well with Fain.
Nearly 97% of UAW members from GM, Ford and Stellantis voted in favor of authorizing a strike against the Detroit Three automakers if an agreement is not reached prior to the expiration of their current four-year contract.
During the last strike in 2019, General Motors sustained a production loss of 300,000 vehicles and lost $3.6 billion in earnings. GM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Anderson Economic Group estimates that a UAW strike could cost carmakers, suppliers and workers more than $5 billion.