The United Auto Workers union is asking Detroit’s carmakers for a 40% pay increase over four years and to bulk up worker benefits, according to people familiar with the matter.
(Bloomberg) — The United Auto Workers union is asking Detroit’s carmakers for a 40% pay increase over four years and to bulk up worker benefits, according to people familiar with the matter.
The requests were part of the UAW’s opening proposals in contract discussions with General Motors Co., Ford Motor Co. and Stellantis NV, the people said, asking not be identified because the discussions are private. Their current labor pact expires Sept. 14.
Along with the raises, the UAW has also said it wants cost-of-living allowances, to improve pensions and to secure better treatment for temporary workers. The requests are among the largest ever to major corporations, and come at a tense time overall in the US labor market.
In a webcast earlier this week, UAW President Shawn Fain said he planned to ask the automakers for “the most audacious list of proposals they have seen in decades.” He argued the pay bumps were fair in light of the fact the company’s chief executive officers have gotten average raises of 40% since 2019.
On Thursday, in response to Fain’s statements, GM said the company plans to offer wage increases but said overall he was asking too much.
“The breadth and scope of the presidential demands, at face value, would threaten our ability to do what’s right for the long-term benefit of the team,” the company said in the statement.
Fain said he wants to eliminate different tiers of employment, which leave temporary workers and new hires with lower pay. UAW workers currently start around $18 an hour and can work to a top rate of $32 an hour, while temporary workers start at less than $17 an hour. Fain said he wants “double-digit pay raises” for all workers.
The union president is also seeking to restore the cost-of-living allowance that protects against inflation. UAW workers had it since 1948 and gave it up as the US automakers struggled with the financial crisis.
The union wants to go back to using a defined pension for new hires, similar to what the UAW had before 2007, according to Fain. Newer workers have a 401(k) defined-contribution plan now.
The Wall Street Journal reported on the UAW proposals earlier Thursday.
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