Why is the UAW on strike? It is their contract requirement

As the United Auto Workers enters today four of its strike against Detroit’s Big Three, the stake will be higher for car manufacturers Ford, General Motors and Stellantis. UAW President Shawn Fain has threatened to the target several factories for work stoppages if “serious progress” towards an agreement has not been reached by Friday at

What do striking auto workers want? Here is a list of contract demands the union is bringing to the bargaining table.

Wage increases and cost of living adjustments

The UAW is asking the automakers for a 36% wage increase over a four-year contract. For now, however, the sides are still far apart on a pay rise.

Stellantis – which owns Chrysler, Dodge, Jeep and Ram along with major foreign brands including Citroën, Peugeot and Maserati) – on Saturday offered a 21% salary increase over four years, with an immediate 10% bump when a new contract is signed. The union in brief declined the offer.

“It’s definitely a no-go,” Fain told CBS News. “Face the Nation” Sunday of Stellantis’ proposal. “We have made it very clear to the companies.”

The UAW also wants the Big Three to reinstate annual cost-of-living adjustments, arguing that inflation eats away at workers’ paychecks. For decades, Detroit automakers offered a COLA, but stopped after GM and Chrysler’s bankruptcy following the 2008 financial crisis.

Adjusting for inflation, auto workers have seen their average wages drop 19.3% since 2008, according to Adam Hersh, senior economist at the left-leaning Economic Policy Institute. That’s because auto workers “concessions made after the 2008 auto industry crisis were never reinstated,” Hersh said in a recent blog post“including a suspension of cost-of-living adjustments.”

End of salary step

The UAW wants the Big Three to scrap its two-tier wage structure. Under this system, top-tier workers—ie. anyone who joined the company in 2007 or earlier — averaged about $33 an hour. But those hired after 2007 are classified as lower-level and earn far less — up to about $17 an hour.

Lower-ranking employees are also not eligible for defined benefit pensions, and their health benefits are less generous. The UAW says it’s unfair to pay employees half as much to do the same work.

Defined benefit pension schemes for everyone

Currently, UAW workers hired after 2007 do not receive defined benefit pensions. For years, the union gave up general wage increases and lost cost-of-living increases to help companies control costs.

“The majority of our members don’t get a pension today. It’s crazy,” Fain complained while speaking to Ford workers last month at a factory in Louisville, Kentucky.

Art Wheaton, director of labor studies at Cornell University’s School of Industrial and Labor Relations in Buffalo, believes the union will ultimately lose its battle for repayment of pensions.

“I think the chances of them winning even most of what they’re looking for are slim to none,” Wheaton said. For example, he said, “I wouldn’t hold my breath for [the return of pension plans]. Hardly anyone in any industry is adding them today.”

“But you never ask for the minimum, you ask for more than what you want to reach a deal,” he said.

UAW worker on Ford layoffs, CEO pay and automakers’ “family” culture


Four day work week and more time off

Along with significant wage increases, more paid time off and retirement benefits, one of the changes is UAW leaders have negotiated for is a four-day work week, working 32 hours for 40 hours of pay and more time off “to spend with family,” according to the UAW website.

“Our members are working 60, 70, even 80 hours a week just to make ends meet. It’s not living. It’s barely surviving and it has to stop,” Fain said last month on Facebook Live, statement of the trade union’s demands.

Advocating for shorter work weeks is not a new concept for auto workers. Congress changed federal labor laws in 1940, which limited the work week to 40 hours, but almost 15 years earlier, Ford Motors became one of the first companies to implement a 40-hour week.

Strike, family protection

The trade union is also asking for the right to strike over plant closures.

“The Big Three have closed 65 plants over the past 20 years,” according to the UAW’s website. “It has destroyed our hometowns. We must have the right to defend our communities.”

With that in mind, the union also wants to implement a “work family protection program” that pays the UAW to do community service work if the companies close a facility.

Perhaps most important for the union is that it is allowed to represent workers at 10 electric vehicle battery factories, most of which are built by joint ventures between automakers and South Korean battery makers. The union wants these plants to receive top UAW wages. In part, that’s because workers who now make components for internal combustion engines need a place to work as the industry transitions to electric cars.

Pensioner health care

In addition to one repayment of traditional pension payment schemes and significantly higher wages for retired workers, the union is seeking health care for all retired UAW members. Workers hired before 2007 still have these benefits. But those who have been employed since – a majority of hourly workers – do not.

The UAW gave up the pension plans and retiree health care for new hires and COLA for all members when GM and Chrysler was headed for bankruptcy in 2009. But it will be difficult for the union to convince management to reinstate these benefits, Patrick Anderson saidmanaging director of Anderson Economic Group, a research firm in Michigan.

Limited use of temporary workers

The union is also demanding that automakers limit their use of temporary workers, who under the differential wage system receive the minimum wage and no benefits.

“We will end the abuse of temporary workers. Our fight at the Big Three is a fight for every worker,” the UAW states on its website.

“Audacious” claim

Fain himself has acknowledged that the union’s demands are “bold”. But he argues that automakers can afford to raise workers’ wages significantly.

Over the past decade, the Detroit Three have emerged as robust profit makers. They have amassed a net income of $164 billion, of which $20 billion this year. The CEOs of all three major automakers earn several millions in annual compensation.

“Companies have made some significant offers, but I think it should go further – to secure record corporate profits means record contracts,” President Biden said that on Friday by which he dealt with the decision The UAW’s decision to strike,

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