In the end, the New Chrysler, newly acquired by private equity firm Cerberus, got off lightly: its first strike, called on Wednesday by the United Auto Workers (UAW) union, lasted only six and a half hours before a new labour deal was tentatively agreed by day’s end, reportedly following the ‘pattern’ of that reached earlier with General Motors.
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In a statement issued around 5.30pm EST, after the strike began at 11am, UAW president Ron Gettelfinger and vice president General Holiefield issued a statement saying that the union “had reached a tentative agreement with the Chrysler Corporation.
“The strike against Chrysler at 11 this morning, following the expiration of an extension to the current labour agreement, will be recessed immediately. UAW Chrysler workers will be notified by the corporation to report to work on their next available shift,” the statement said.
“This agreement was made possible because UAW workers made it clear to Chrysler that we needed an agreement that rewards the contributions they have made to the success of this company,” Gettelfinger said.
“Once again, teamwork in the leadership and solidarity in the ranks has produced an agreement that protects jobs for our communities and also protects wages, pensions, and health care for our active and retired members,” said Holiefield, who directs the UAW’s Chrysler department.
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By GlobalDataDetails of the agreement, as is customary were being withheld pending ratification votes by UAW Chrysler workers. Separately, the union on Wednesday ratified the earlier agreement with GM.
According to the Detroit Free Press, the Chrysler deal was described as sticking with the pattern set by the landmark agreement reached on 26 September between the union and GM.
The paper said both two deals shift retiree health care costs to the UAW – a significant new role for the union and, as with GM’s deal, the Chrysler-UAW agreement includes creation of a retiree health care trust that will free the Auburn Hills automaker of billions of dollars’ worth of obligations in exchange for making some sort of up-front payment at a significant discount.
People briefed on the plan told the Detroit Free Press it protects Chrysler’s transport division and certain Mopar parts operations from sale or closure, after a tense exchange in the final hours of negotiations.
The paper said the union was planning to call its national Chrysler council to Detroit for a meeting about the terms of the agreement and to ask the council to approve the plan – a step required before it goes to 45,000 members for ratification. The date for the meeting has yet to be set.
A local leader briefed on the talks told the Detroit Free Press that Chrysler made an unacceptable offer at 10.55am, and the UAW workers walked out five minutes later but, at 4pm, Chrysler came back with an offer to spare Mopar and Chrysler Transport and the deal was done.
Citing people briefed on the plan, the paper said the deal includes protection for Mopar and Chrysler Transport, a $US3,000 signing bonus and 3% or 4% lump-sum bonuses in the final three years of the contract, the creation of a two-tier pay system for noncore jobs, with starting hourly pay of about $14 an hour and would eliminate – probably through buyouts – an estimated 160 union-represented salaried positions, likely payroll jobs.
Spokesmen for Chrysler and the UAW declined to answer questions, the paper noted, adding that Gettelfinger did not immediately hold a news conference to talk about the reasons for the strike at Chrysler, as he did after the GM break-through.
Chrysler vice chairman and president Tom LaSorda said in a statement: “The tentative agreement includes a memorandum of understanding to establish an independent retiree health care trust, as well as other changes to the national agreement. Following ratification, implementation of the memorandum of understanding is subject to approval by the courts and satisfactory review of accounting treatment with the Securities Exchange Commission.
“The national agreement is consistent with the economic pattern, and balances the needs of our employees and company by providing a framework to improve our long-term manufacturing competitiveness. At this time, we cannot discuss specifics of the agreement pending a ratification vote – an internal UAW process.”
