Worry and anger as autoworkers study pact

Many autoworkers, back after their strike against GM, are worried or angry about concessions the company insisted on in the new contract.

United Auto Workers leaders, representing plants across the country, approved the tentative contract on Sept. 28 and union President Ron Gettelfinger said he expects membership ratification by Oct. 10.

The union began bargaining with Ford Oct. 2 and, at press time, had yet to begin talks with Chrysler. Those workers are in a fight whose outcome is far from certain.

Major concessions

The agreement with GM includes major concessions: a new two-tier wage system and a shift of $50 billion in health care obligations to the union. The UAW gave up cost-of-living raises in exchange for a freeze on health care premium payments.

GM made open-ended promises to invest in U.S. plants and products.

Mixed reactions

While union leaders and significant numbers of workers feel the agreement was the best they could get, many at GM, Chrysler and Ford plants across the country believe the agreement is a setback.

“It’s not perfect, but it’s as close as we are going to get,” said Danny Wood, a UAW local official at the Flint, Mich., plant.

Stan Washington, a Grand Blanc, Mich., retiree who worked for GM for 35 years, said, “It’s much more concrete in the promises than I thought.”

Other workers interviewed, however, expressed worry and anger. Most, whether they supported or opposed the agreement, directed their anger at GM, not the union, which they felt was between a rock and a hard place.

Patricia O’Reilly, a 10-year employee at GM’s Hamtramck plant in Detroit, said, “This is terrible for young workers. Second-tier workers are really going to feel the pain making $14 [an hour] instead of $28 and getting lousy benefits. Their only alternative will be Wal-Mart, which will pay even less.”

She continued: “I blame the government, which encourages big business to go overseas for cheap labor and to escape regulation. Then back here we buy what they made while they throw us out on the street.”

O’Reilly said that media pundits who call workers “greedy” and “selfish” should “give it a break. It’s not the unions destroying this country, it’s GM and the government.”

Will vote ‘no’

Jim McPherson, a worker at the Flint, Mich., plant, said he will vote against the contract but doesn’t blame those who vote for it. “They work their butts off every day, skipping lunches and breaks, risking their health and safety. Managers should only be half as good as these workers. They are afraid of losing everything, and I can’t blame them.”

Yet McPherson can’t bring himself to go along with the concessions. “I am voting no,” he said, because the two-tier system and the health care scam by GM will “destroy whatever future there is in this industry. If this goes through at all three companies, the day that you want to be an autoworker is gone.”

Forces at work

These remarks reflect the context in which the autoworkers’ struggle is taking place. It’s been a 30-year fight against the political ultra-right working with transnational companies to deny workers the right to organize, to ship manufacturing jobs overseas for greater profit margins and to keep an inadequate health care system under private corporate control, again for greater profits.

Two-tier wages mean greater profits

Under the agreement, GM will be able to buy out 25,000 workers, more than a third of its work force, and replace them with “second-tier” employees earning half as much. GM’s “wage savings” will translate into greater profits for the fat cats on Wall Street.

All “non-core” work categories will be part of the second tier and the agreement adds to the “non-core” list many categories currently classified as “core” manufacturing jobs.

Jobs that will become “non-core,” according to a UAW local president interviewed by the World, are truck drivers, material and parts handlers, warehousing jobs, re-packing jobs, subassembly positions, inspectors, machine maintenance jobs and others.

A full-time “first-tier” woman worker at Chrysler’s Belvidere, Ill., plant, said, “All the good jobs people waited for most of their working lives to get — the jobs with the most overtime — go to new hires at half the pay. The ball-busting, gut-splitting jobs stay with the older workers, so they are pushed out faster. Tell me about it, I know all about it.”

Seniority lost

A plant-wide two-tier system has been in place for over a year now at Belvidere, the only auto assembly plant in the country where this has happened so far. The second-tier workers there are called “enhanced temporary employees.”

“I can understand how a full-time worker would be worried now,” said Forrest Ammons, a Belvidere line worker who, himself, is an “enhanced temporary.”

“Full-time workers might be afraid, now, that the new two-tier system can be used to destroy seniority,” he said. “Why would the company let a full-time worker with a lot of seniority bid on a less physically demanding job unless he is willing to work for less?”

The full-time woman worker further explained: “If you are now a first-tier worker in a job newly defined as ‘non-core,’ you will be grandfathered out. Up until that time you might as well walk around with a bull’s eye on your back because they now have a bigger than ever incentive to fire top-tier workers.”

Downward pressure on all wages

Ammons, who earns $18 an hour doing the same work as a worker next to him earning $29, said “all of us here at the plant have really been biting our fingernails over this.”

“Our union local has demanded elimination of our second-class status here,” he said. “We are hopeful that this will happen because the UAW was successful in getting some GM temps hired as full time, but we won’t feel better till we see it on paper.”

He said he hopes the $14 an hour wage GM will pay its second-tier workers “won’t make Chrysler think it can pay us $4 less than what we get now.”

“I have to admit,” Ammons said, “this two-tier thing has us at each other’s throats. Everyone looks out for himself rather than each other, and once you start with two tier you can expect that in five or 10 years they will bring everyone down to the second tier.”

Job security loophole

The agreement calls for a moratorium on plant closings but leaves the company a big loophole, allowing closings caused by “market-related volume decline.”

“What kind of deal is that?’’ asked Carol Garza, a worker at the GM Hamtramck plant. “If GM designs a clunker resulting in so-called market-related volume decline, they can go ahead, close a plant and lay more people off.”

Health care disaster

The plan to shift health care costs into the lap of the union through a so-called voluntary employees benefit association, or VEBA, is also drawing fire.

Paul Shrade, a former UAW regional director, said that by taking on retiree health care and managing $35 billion in cash and assets from GM, “the UAW becomes a corporation, not a union.”

“GM is let off the hook,” he said, and “the pressure is off GM to lobby for comprehensive changes to the health care system.”

Workers at Caterpillar had a VEBA similar to the one GM wants. It ran out of money in 2004. Workers there now pay $200 a month for coverage in addition to out-of-pocket costs that keep escalating.

Gettelfinger’s comment during the strike that “no matter how much workers give, it is not enough, and no matter how much executives get, it is not enough” seems prophetic after reactions to the tentative agreement this week by Wall Street fat cats as they tried to pressure Chrysler and Ford to squeeze workers even harder than GM did.

“GM may be ceding more value to the union than we previously thought — pension benefit hikes won by the union will cost over $6 billion, and their retiree health care liability appears to stay with GM until 2010, costing them another $5.4 billion,” said Goldman Sachs analyst Robert Barry in a note to investors.

A spokesman for Deutsche Bank told The Detroit News that although GM could save nearly $1 billion a year in wages as a result of the two-tier arrangement, this was not enough because the company will pay out more than that in retiree health care benefits.

The struggle continues.

jwojcik @pww.org