Vol. 71/No. 36      October 1, 2007

One of the central issues in the negotiations is retiree health care. GM is asking for a fund for retirees, aimed at cutting billions of dollars in GM’s health-care costs. The company would give a certain amount of money to the fund and the union would take over responsibility for it. The UAW has asked for job guarantees in exchange.

The trust would be invested and would grow and shrink based on the success of those investments and how much is paid out. Retirees could face higher health-care costs or a complete loss of coverage if the fund runs out of money. Along with health care, the two sides have yet to come to an agreement on wages and “cost-cutting.” The changes that GM is seeking range from getting fewer workers to take on more jobs to outsourcing work deemed not directly related to building vehicles. The company also wants to cut the cost-of-living allowance and gut the union’s Jobs Bank, through which members get most of their take-home pay while laid off.

Strike preparations began at GM plants across the United States on September 14. Lead negotiator for the UAW Cal Rapson wrote in a September 13 note to members that “a strike might well be unavoidable” if the union didn’t make more progress in negotiations.

This June, the UAW agreed to a concession contract with Delphi Corp., GM’s largest parts supplier, that included major cuts in wages, plant closings, and the elimination of the Jobs Bank.  
 
 
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