Restoring retirees’ insurance benefits and allowing workers to transfer to other plants will be key points of proposals that Kokomo union leaders say they will take to Michigan in April.

Representatives from United Auto Workers will meet April 10 in Bay City, Mich., to discuss proposals for their contract negotiations with Detroit’s Big Three this summer.

The meeting will follow a convention held last week in Detroit. Union delegates spent three days discussing their collective bargaining strategies for their meetings with management from Chrysler Group LLC, General Motors Co. and Ford Motor Co.

Wages could take a lower priority to other issues during the upcoming negotiations.

UAW Vice President Joe Ashton told news media Tuesday in Michigan that he would agree to more jobs at second-tier wages if it meant the companies created more total positions.

Union leaders in Kokomo say wages will remain a “big issue” during negotiations, but the representatives have other top objectives beyond higher pay.

GMCH Kokomo workers have already demonstrated some willingness to sacrifice wages in order to bring in more jobs. UAW Local 292 members earlier this month ratified a new tentative Competitive Operations Agreement.

Skilled trade workers earning full-scale wages, under the agreement, would take slight pay cuts — most employees’ pay would not change. GMCH, in return, would create 100 jobs. The agreement is conditional on whether GMCH wins a contract with a potential buyer in California.

What 685 Wants

Leadership from Chrysler worker representative UAW Local 685 has stressed a desire to restore dental and vision insurance benefits for retirees.

That’s because it’s the right thing to do, according to Rich Boruff, the union’s president.

The union conceded retirees’ benefits in order to reduce Chrysler’s legacy costs and keep the company afloat through Chapter 11.

“Why do we want to make it right? Because [the retirees] laid the ground level for it,” Boruff said. “... They’re on fixed incomes. They’re paying the dues for us.”

Approaching negotiations with Chrysler will be radically different than four years ago, he said. Chrysler is indebted to the federal government, the company has a new CEO and UAW has a new national president, among other changes.

Better company performance means UAW could have more leeway with what it seeks, Boruff said. Chrysler’s discussed a return to the stock markets later this year or next year, and the company projects a 2011 profit between $200 million and $500 million.

Signs of improvement have shown in the past year in Kokomo, where Chrysler employs more than 4,500 people at its plants.

The city pulled in almost $1.3 billion in investments announced in 2010. Government, business and union leaders celebrated Chrysler’s announcements, saying they would preserve Kokomo jobs and potentially lead to more.

What 292 Wants

After a 2010 in which concerns arose about the plant’s future after 2012, there have been a few reassurances with the facility and GM overall that could position UAW Local 292 better than originally expected.

About 700 hourly employees work at the GM-owned Kokomo plant, which was part of Delphi Electronics & Safety until 2009 when it finished restructuring under Chapter 11. The operations, which once accounted for all of Delphi’s production lines in Kokomo, went to Delphi’s former parent, GM. GM then created GMCH as a subsidiary.

As part of contract negotiations, Danny Hiatt, shop chairman for UAW Local 292, wants to propose giving all Kokomo GMCH workers the right to transfer from GMCH to other GM operations. Under the current agreement, employees of the GM subsidiary hired since 2006 cannot move to other GM plants.

Automotive analysts say GM, like Chrysler, has a long way to go before it has fully recovered from bankruptcy. But with its first post-recession profits this year, the company is in a better position than it was during the last contract negotiation. That gives UAW better poise for contract negotiations, Hiatt said.

“Look at as [recent] as a year ago, when everybody was predicted to lose money,” he said. “Our market share has had some gain, but obviously we still have work to do. We have debt to pay back. We have the [Voluntary Employee Beneficiary Association] to pay back. We can’t rest on our laurels, so to speak.”

• Daniel Human is the Kokomo Tribune business reporter. He can be reached at 765-454-8570 or at daniel.human@kokomotribune.com.

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