GM Will Pay $1.3 Million for Contract Violations : Strike Win Boosts UAW Leaders Facing Talks
The United Auto Workers union won more than a local battle when General Motors Corp. ended a four-day, 9,000-worker strike by promising to pay at least $1.3 million for contract violations, analysts said Monday.
The strike, and its apparent success, will give UAW leaders added confidence when they face GM and Ford Motor Co. negotiators in national contract talks beginning July 15. Both contracts expire Sept. 14.
“We got everything corrected that we wanted to,” said Don Douglas, president of Local 594, which represents the workers who on Thursday walked off their jobs at three GM truck plants in Pontiac. The strike ended Sunday with ratification of the settlement.
“I think what we’ve done here will enhance our union’s solidarity around the country. We’ve shown that if General Motors signs a contract with this union, they’ll have to live up to it,” Douglas said.
Douglas said the strike was timed to give the union “maximum pressure” against GM and “that’s why it was short and sweet.”
The three plants make GM’s new full-sized pickup truck, which is being launched across the country, and its popular and profitable Blazer and Jimmy sport-utility vehicles as well as commercial trucks and buses.
While GM’s car sales have been poor since November, truck sales have been strong, making GM far more vulnerable to a strike at a truck plant, where output is needed, than at a car plant, where a strike could help reduce inventory.
“It was a nice signal for the people on the street to send that GM workers are fairly militant even though they’re not in a strong position,” said Sean McAlinden, a labor policy researcher at the Industrial Technology Institute in Ann Arbor.
Local 594, which rejected a concessionary contract offered by GM as a way to increase chances Pontiac would get to keep medium-duty truck production from moving to another state, has been told GM has no plans to give it any work after 1989.
GM workers are “already pretty riled up” in the wake of a year in which they received no profit-sharing while Ford workers got record check and while GM paid $750 million to get rid of H. Ross Perot and authorized $169 million in executive bonuses, said Michael Luckey, analyst with Shearson Lehman Bros. in New York.
“If this is widely viewed as a union victory, then obviously it will make the union more confident in contract negotiations this summer,” Luckey said.
He also said the outcome of this year’s talks could be two separate contracts because of the very different issues at GM and Ford, a prediction that is gaining popularity as the talks approach.
The issues involved in Local 594’s walkout included some that are expected to highlight this year’s contract talks: subcontracting of union jobs to non-union workers; outsourcing, or buying parts and sometimes whole cars from outside the company, and the corporation’s push toward Japanese-style management.
In the settlement, GM agreed to compensate and rehire at least 20 workers who lost their jobs because the auto maker hired outsiders to do them, union officials said.
