The 2019 negotiations between the United Auto Workers and Detroit-area automakers didn’t make major changes in the labor situation at the companies, a panel of labor analysts and former executives said today.
In particular, the talks didn’t alter the health care dynamic for the companies. UAW members at the companies contribute less to their health care than workers in other industries.
For the Detroit-based union, maintaining the current health-care system is a “go to war issue,” Arthur Schwartz, a former General Motors director of labor relations, said during a webinar organized by the Center for Automotive Research.
“This is so ingrained within the UAW, it will be very difficult” to make major changes, he said. “In their mind,” union members have accepted lower boosts in pay and benefits during good times to keep the current health care system. Schwartz said when he was with GM, “The UAW said they would never give that up.”
GM, Ford Motor Co. and FCA US last year negotiated labor agreements that called for a mix of pay increases as well as lump-sum payments, including bonuses after contracts were ratified. The contract included provisions to convert temporary workers to full-time employees.
The union was able to keep open GM’s Detroit-Hamtramck factory. But other plants targeted for closing at GM and Ford are being shut down.
The biggest event during the negotiations was the 40-day strike at GM. All three of the old labor agreements expired in mid-September. The UAW opted to concentrate negotiating efforts at GM first, with the idea the basic terms would be extended to Ford and FCA.
Despite the walkout, “The agreement basically came out as what one would expect,” said Martin Mulloy, a former vice president of labor affairs for Ford. There was “no real language that was new or a breakthrough.”
The negotiations also occurred during upheaval at the UAW. The U.S. Justice Department is conducting a corruption investigation against the union and its president, Gary Jones, stepped down under fire in the midst of talks.
“The UAW has to figure a way out of this,” Schwartz said. “They have to find a way to regain trust again.”