UAW to negotiate 1st with GM for contract

Experts say GM is
economically stronger than the other two automakers.

CHICAGO TRIBUNE

CHICAGO — With their contract deadline almost in sight, the United Auto Workers union shifted strategy on Thursday and tagged General Motors Corp. as the target for their bargaining with the big three Detroit automakers.

The UAW’s contract with GM, Ford Motor Co. and Chrysler LLC expires at midnight Friday.

Until the union’s last-minute reversal of strategy, it had been bargaining on all three fronts, a tactic it employed in its last round of negotiations with the automakers. On Thursday, it extended its talks with the two other carmakers.

Traditionally, the union has gone after one automaker and then sought to apply the same deal to the others. This has been a sacred tactic in the union’s longtime effort to maintain pattern bargaining in the auto industry.

In this case, the union chose GM “because of maximum leverage,” said Harley Shaiken, a labor expert at the University of California at Berkeley. “GM is in the best shape of the three [automakers], and the union feels that it’s best to negotiate an endgame there,” he said.

Though the union’s move sets up the possibility of a strike against GM, Shaiken predicted that the UAW would continue to talk with the company for several days beyond the contract deadline. “They don’t want to walk out,” he said.

Indeed, GM was a logical choice because it is in the best shape of the three, having posted profits the last three quarters and being the furthest along in a turnaround plan that calls for closing 12 North American plants and eliminating more than 34,000 union jobs by the end of 2008.

Retiree health care

But GM also is in greatest need of relief on retiree health care because it has by far the most retired workers: 432,000, counting union and white-collar.

GM is liable for $64 billion in current and future retiree health care obligations, while Ford has about $31 billion, and Chrysler $19 billion. GM has pushed hardest in negotiations to shift the health care burden to the UAW in a trust fund that the union would manage. But how much GM would give the union to take over the responsibility has been the main sticking point in negotiations.

The union’s bottom line in the current round of talks is not money, Shaiken suggested.

“Their core issue is middle-class jobs in a time of insecurity,” he explained. And the union, he added, is willing to take unorthodox steps in order to preserve the kind of high-paying middle class jobs that have evaporated for many other blue-collar workers.

Despite the union’s steady shrinkage, dropping to just over 530,000 members, and about 180,000 with the three automakers, Shaiken said that the UAW remains powerful because the carmakers need the union workers.

“The strange paradox is that the UAW is far smaller than at peak and with that shrinkage comes diminished clout,” he said. “The industry has cratered, but the union remains powerful.”

E-mail message

In an e-mail message to local leaders, UAW Vice President Cal Rapson, head of the union’s GM department, said GM had been selected as the lead company to reach the first contract settlement.