GM/UAW Reach Tentative Agreement
The United Auto Workers and General Motors Corp. agreed today (Sept. 26) to a tentative contract that puts the responsibility for retirees’ health care into the union’s hands and ends a two-day strike, the first national strike against an automaker in 31 years.
GM and the UAW confirmed that the deal creates a GM-funded, UAW-run trust to administer retiree health care. The two sides gave no other details, but a person briefed on the contract told The Associated Press that it also would give workers bonuses and lump-sum payments. The person requested anonymity because the contract talks are private.
The union said the deal was reached shortly after 3 a.m. E.S.T.
The contract must be reviewed by local UAW presidents and will then be subject to a vote of GM’s 73,000 rank-and-file members. The agreement is expected to set a pattern for contracts at Ford Motor Co. and Chrysler LLC.
The deal means UAW will tell workers to head back to their jobs at around 80 GM facilities across the nation. The union went on strike at 11 a.m. Monday when talks broke down.
It was the first nationwide strike during auto contract negotiations since 1976, when Ford Motor Co. plants were shut down.
The deal includes GM’s top priority in the negotiations – shifting most of its $51 billion unfunded retiree health care obligation to a UAW-run trust. GM would pay about 70% of the obligation into the trust, called a Voluntary Employees Beneficiary Association, or VEBA, the person briefed on the talks said.
The union would then invest the money and take over health care responsibilities for about 340,000 GM hourly retirees and spouses.
“I’m pleased to say that we have a VEBA in place that will secure the benefits of our retirees,” UAW President Ron Gettelfinger said at an early morning news conference inside the union’s Detroit headquarters.
Gettelfinger said he’s confident of ratification and that voting likely will start as soon as this weekend.
Union leaders will be briefed on Thursday and Friday, he said.
The UAW also expects to decide Thursday what automaker it will negotiate with next.