Ford to pay workers $6K bonuses in pact

Associated Press

DETROIT

The union that once set the gold standard for American wages is giving up pay raises in exchange for a piece of the auto industry’s profits and the promise of thousands of new jobs.

Under agreements struck with Ford and General Motors, most of the companies’ factory workers will get profit-sharing checks instead of annual raises. They’ll also get a signing bonus. In turn, the automakers will increase their work forces and invest billions more dollars in their factories.

It wasn’t all good news, however, especially for Northeast Ohio. If the contract is ratified, Ford would close its Walton Hills stamping plant. The plant, near Cleveland, is home to about 400 workers. Those workers could shift to other plants, likely out-of-state.

It’s an unusual turnabout for the United Auto Workers. For decades, its members’ pay and benefits were the envy of workers around the world, and it wouldn’t hesitate to strike to protect them. But the agreement signals a new reality. After the industry nearly collapsed two years ago, a sobered UAW no longer is fighting the Big Three but fighting to compete against rivals who pay their workers far less.

Ford Motor Co. and the UAW agreed on a four-year contract Tuesday, three weeks after the union reached a similar agreement with General Motors Co. The companies are promising at least 17,000 new U.S. jobs over the life of the contracts and are offering workers signing bonuses and profit-sharing payments. The companies save money because they won’t pay annual raises to their U.S. factory workers, and they’ll hire thousands of the new workers at lower wage rates.

Ford workers will get at least $16,700 over the four-year contract, in the form of a $6,000 signing bonus, $7,000 in lump-sum and inflation-protection payments and at least $3,700 in profit-sharing this year.

The deal is subject to a vote by Ford’s workers.