As the Tuesday deadline for voting approaches, autoworkers appear to be headed toward approving a new contract with Ford. As of Monday morning, the UAW Ford Department Facebook is reporting that 62 percent of Ford workers have voted yes on the tentative agreement while 38 percent have voted no.
Approval didn’t seem like a sure thing when voting began last week. On Thursday after 20 percent of the ballots had been counted, 55 percent had voted no. Workers at two big plants, one in Wayne, Michigan, the other in Chicago, rejected the pact by a vote of 63 percent to 37 percent.
The large no vote was surprising given the fact that the Ford pact was somewhat better than the GM contract that was approved last month, but opponents of the tentative agreement argued that the new contract did little to win back concessions given to Ford in 2009 when the auto industry was slumping badly even though profits have rebounded strongly since then.
“First-tier autoworkers (those hired prior to 2007) lost up to $30,000 in concessions over the last few years,” said Gary Walkowicz, a bargaining committeeman at the Dearborn Truck Plant, on the Soldiers of Solidarity website. “Now Ford wants to continue these concessions for another four years. At what cost to us? Lose another $30,000? All for $12,000 in bonuses? No raises for four more years, after we have already waited six years?”
There was also concern that the tentative agreement did not go far enough in closing the wage gap between veteran autoworkers and those newly hired since 2007.
Back in 2007 when the UAW negotiated its last contracts with the Big Three US auto makers, the union agreed to a two-tier wage system that allowed the companies to pay newly hired autoworkers about $14 per hour, much less than workers already employed by the companies.
Before negotiations with the Big Three began, union president Bob King said that narrowing the gap between tier-2 and tier-1 wages was a priority for the union because tier-2 wages were well below the middle-class standard that UAW and its members had achieved over decades of struggle with the auto companies.
But tier-2 wages in the tentative agreement with Ford remain well below tier-1 wages. Starting tier-2 pay increases to just under $16 an hour and rises to about $19 per hour over the four-year life of the contract.
“The biggest concession is that two-tier will continue,” Walkowicz said. “This contract does not bring up the second-tier workers up to first-tier. This contract keeps them permanent second-tier, with no path to move up to first-tier wages and benefits. The pay increase, spread over four years, barely makes up for what second-tier workers lost in the 2009 concessions.”
Nevertheless, the Ford tentative agreement does contain extras not in the GM contract, which combined with conditions in the auto industry and economy in general, led many Ford workers to conclude that the tentative agreement is the best deal they could get.
The Ford signing bonus is $6,000; the GM signing bonus is $5,000. Ford workers will get another $9,700 over the course of the four-year contract in lump-sum payments, inflation protection, and profit sharing; GM workers will receive $6,500.
The Ford contract highlights some of the challenges that autoworkers will be facing in the future. There will be no raises to base pay for tier-1 workers over he next four years, and new workers working at a lower rate will make up a larger portion of the auto workforce, conditions that corporate management say are necessary to lower labor costs and keep US auto companies competitive.
But “keeping competitive” as Ford uses the term is just an means for transferring more of the wealth created by autoworkers into the pockets of auto company owners, managers, and investors. While Ford has been lowering its labor costs through contracts negotiated in 2007, 2009, and 2011, it has been giving its top executives top dollar. Executive Chairman William Clay Ford, Jr. and Chief Executive Officer Alan R. Mulally each received $26 million in compensation last year.