Activist UAW Members Look to End Tier 2, Pump Up Wages

DETROIT – The UAW executive board will have a tough time getting any tentative labor contract with Detroit’s automakers ratified if it doesn’t include major gains on issues such as ending the 2-tier wage structure that has been built into the industry’s contracts since 2007 and a pay increase for senior workers, UAW activists warn.

UAW President Dennis Williams has stated the union’s desire to “close the gap” between the first- and second-tier workers, with the latter earning less than long-serving union members, who remain paid under the union’s traditional wage scale.

But for the three dozen activists who came from as far away as Toledo, Flint and Chicago and met in the basement of a Detroit church to discuss strategy, closing the gap is only the first step.

Tony Brown of UAW Local 1700, which represents workers at the FCA US plant in Sterling Heights, MI, notes the union has lost influence over the last several years.

“I never thought I would see ‛Right to Workʼ in Michigan,” says Brown, referring to the Michigan law that now bans the “closed shop” workplace designation in which union membership is a condition of employment. “We’ve got start rebuilding the union from the ground up.”

One of the quickest ways to garner new support for a more militant brand of unionism would be to tap into the frustration apparent on the shop floor industrywide. While some younger workers are frightened by the possibility of a strike, others are angry over the discrepancy in pay and benefits fostered by the 2-tier system.

The next contract between the UAW and General Motors, Ford and FCA also should take steps to improve the benefits of second-tier workers, says Ron Lare, a retired Ford worker who helped organize and publicize the meeting. Tier 2 workers have limited choices for health care and no defined-pension benefits, though they can contribute to a 401(k) plan.

“We know there is a lot of resentment against 2-tier,” says Wendy Thompson, a long-time UAW activist, who has battled the union’s leadership over the years with some success. She also is an organizer of the “Auto Workers Speak Out” sessions held under the auspices of the Autoworkers Caravan, set up six years ago when GM and Chrysler went bankrupt.

George Windau, a shop committeeman from UAW Local 12 in Toledo, OH, notes the union has a significant amount of leverage in this year’s negotiations, suggesting the need for additional concessions has passed. Toledo is the home of the Jeep brand, which accounts for roughly 40% of FCA’s U.S. profits.

“We’re their piggybank. Even a 1-day strike would do two things. First, it would embarrass the corporations and second it would cut into their profits,” says Windau, who is involved in local negotiations with FCA US in Toledo.

Workers in the Stickney Avenue plant, which is part of the complex that builds the Jeep Wrangler, already have staged demonstrations this summer by chanting “Strike, Strike, Strike” at appointed times during certain days of the week, Windau adds. “(Management) hates that.”

Windau says workers believe they have earned the right to major improvements in the contract.

Following traditional practices, the UAW executive board has directed local unions to hold strike votes. But speakers here Sunday suggest top union officers are more interested in protecting the union’s strike fund than supporting a walkout.

Scott Houldieson of UAW Local 551 in Chicago, which represents workers at Ford’s Chicago assembly plant, says the activists can use the Internet, Facebook and other forums to show the union’s leaders that “we have expectations.”

One of the best ways to force the union’s leadership to press for a contract that raises pay for long-term workers and ends the 2-tier system is to prepare to reject the tentative agreement, says Houldieson, who persuaded his local to turn down the 2011 agreement.

Years ago the union was guaranteed a big yes vote when it presented a contract in the wake of the negotiations with the Detroit Three. But the number of no votes has risen steadily over the past few contracts as the union has traded concessions for the in-sourcing of jobs that might have drifted offshore.

More than one-third of all Ford workers voted no in 2011, and the UAW’s contract with what then was Chrysler very nearly was scuttled.

Judy Wraight, a member of UAW Local 600, notes the Internet has given activists more influence and a greater ability to set the terms of the debate.

The activists, however, are divided on one contentious issue raised by the UAW’s Williams, who told reporters earlier this summer he was willing to discuss health-care alternatives that could increase the purchasing power of the automakers. Among ideas being floated is a union-managed health-care fund that would pool workers from all three companies, somewhat mimicking a program negotiated in the last round of contract talks to cover UAW-represented retirees.

Bill Parker, a former member of the UAW committee that negotiated with Chrysler in 2007, says he is willing to at least look at the idea of multi-employer health-care system. But Lare, the retired Ford worker behind Sunday’s meeting, says he is afraid a multi-employer fund modeled after the voluntary employee benefit association (VEBA) trust for retirees potentially could run out of money.

The contract negotiations will reach a climax Sept. 15, when the current pacts expire. So far neither side is saying much, and the old-fashioned posturing has been abandoned in favor of the more measured approach that has taken hold in the past decade. But neither side wants to be seen settling short, so there likely won’t be any kind of movement until right before – or after – the deadline.

The only break in the silence came last week when UAW Vice President Cindy Estrada attacked speculation GM might export a Buick-branded CUV from a plant in China to the U.S.

GM isn’t commenting on the reports.