GM, UAW reach tentative agreement on new four-year contract

Associated Press

DETROIT

General Motors Co. and the United Auto Workers, sobered by the government bailout and bankruptcy just two years ago, agreed on a new four-year contract without the public acrimony or strikes that have plagued the talks in the past.

Details weren’t released, but the union said the deal reached late Friday includes some of its major goals, including improvements in profit-sharing, promises of new jobs and better health care benefits. The deal will serve as a template for contracts that still must be negotiated with Chrysler Group LLC and Ford Motor Co., setting the pay and benefits for 112,500 U.S. auto workers. It also will set the bar for pay and benefits at nonunion auto companies and other industries across the country.

The talks are the first since GM and Chrysler needed government aid to make it through bankruptcy protection in 2009.

“When GM was struggling, our members shared in the sacrifice. Now that the company is posting profits again, our members want to share in the success,” UAW Vice President Joe Ashton, the chief negotiator with GM, said in a statement.

The deal likely will include sweeter profit-sharing checks instead of raises for most of GM’s 48,500 union workers in the U.S. Also likely is a raise for entry-level workers who make $14 to $16 per hour, about half the pay of a longtime auto worker. It also will include creative ways to cut GM’s labor costs, which are still higher than those at nonunion U.S. plants owned by foreign competitors.

GM was the first of the Detroit Three to reach agreement with the UAW. Chrysler is likely to be next, followed by Ford, where little progress has been made in negotiations so far. The UAW announced the GM agreement just after 11 p.m. EDT Friday, after a little more than seven weeks of closed-door bargaining.

Workers must vote on the plan before it will take effect. Union leaders from factories around the country have been asked to come to Detroit on Tuesday to learn the details so they can explain them to members. A vote is expected within 10 days.

“We used a creative problem solving approach to reach an agreement that addresses the needs of employees and positions our business for long-term success,” said Cathy Clegg, GM’s vice president of labor relations.

The union said in a statement that it successfully fought efforts by the company to weaken its defined-benefit pension plan, which is among the best in U.S. manufacturing. The company also wanted health care cuts, but the union protected those benefits and made improvements, the statement said. But it did not say if workers will see higher co-pays or monthly premiums.