Ford workers to decide on UAW deal with battery-plant pathway
Taylor — Some 56,000 rank-and-file United Auto Workers members employed by Ford Motor Co. now have the decision of whether to ratify an agreement that would provide a pathway for battery-plant workers to join the union, bring back popular provisions lost during past economic down years and eliminate certain wage tiers.
The UAW National Ford Council made up of local leaders voted Sunday to send the agreement with record gains to members to vote on over the next couple of weeks. The deal that came after a 41-day strike would expire on April 30, 2028, and includes $8.1 billion in investments, 26% compounded base wage increases in addition to cost-of-living adjustments, improved conditions for temporary workers and contributions to all forms of retirement plans.
UAW President Shawn Fain laid out the key provisions of the proposed contract during a Facebook Live presentation Sunday evening.
“The six weeks was worth it,” said Lumengo McGhee, 51, of Macomb, a worker at Ford’s Bronco and Ranger Michigan Assembly Plant that went on strike when the union’s previous contract expired on Sept. 14. “If Shawn didn’t do what he was out here doing, we never would have gotten anywhere. I’m glad he stepped up. It was a now-or-never situation, and look what we got.
“I’m ready to see it on my check,” she added. “When I do my 10 hours, I want to see I’m making some money.”
Ford says the agreement would increase its labor costs per vehicle by hundreds of dollars, and the full impact likely would show itself in the coming months. But its passage would mark a major victory for the union steered by Fain and the Unite All Workers for Democracy Caucus that endorsed him.
"I no longer see a union on defense, in decline or under threat," Fain said during the Facebook Live update. "I see power. I see the future of the working class."
The unprecedented simultaneous “stand-up” strike against the Detroit Three represented a different way in how the union negotiated and viewed its relationship with the automakers — especially a traditionally collaborative partnership with the Blue Oval.
“It’s a home run for Shawn Fain for using the stand-up strike effectively and putting pressure on when the union needed it,” said Art Wheaton, an automotive industry specialist at Cornell University's Industrial and Labor Relations School who has performed training for the UAW, GM and Ford. “Realistically, I don’t know if anyone thought he could get what he got. The members may have wanted more, and he may have said he was trying to get more, but I think they got everything they could get.
“It’s easier to organize if you are coming out of a background of strength,” Wheaton continued. “I really, really liked the response to saying that workers at Toyota and Honda are not the enemy, but those are our future members. Shawn Fain knows he needs to increase the market share of UAW-made vehicles, or it will be increasingly difficult to make gains at GM, Ford and Stellantis.”
The UAW on Saturday secured a tentative agreement with Stellantis NV that follows the economics of Ford’s deal. Its national council will meet on Thursday. Negotiations continued at General Motors Co. on Sunday as issues around pensions and temps held up a deal. The union’s strike against GM marked its 45th day on Sunday.
EVs and investments
Significant for the union and its future is an agreement in the Ford deal that would create a pathway to allow workers at future battery plants as well as a new electric vehicle complex in Tennessee to join the union and be included in the master agreement "at master agreement wages," Fain said.
“They want to organize as much of the nonunion parts of the industry as possible,” said Marick Masters, a management professor at Wayne State University. “They would move the needle forward on that. They could use that as a benchmark to say, ‘Look what we’ve done in a relatively short period of time, and we can do more if you recognize us.’”
The union earlier this month announced GM had agreed to include its battery-plant workers in the master agreement after Ford CEO Jim Farley had accused the union of holding a deal “hostage” over the issue. GM, though, has an Ultium Cells LLC battery plant with LG Energy Solution that is operating and has been unionized. Ford doesn’t have any plants operating, but has announced four, including a solely owned project in west Michigan’s Marshall; it paused construction there last month over whether it could operate the facility profitability, citing a “number of considerations.”
At the Marshall plant, the union would be able to use a card-check system and include workers there in the master agreement once unionized, and surplus Ford workers would have the ability to transfer there, Fain said. The Tennessee Electric Vehicle Center in Memphis also will have transfer rights for surplus UAW members and fall under the master agreement when a majority of its workforce is made of UAW members or after a card-check process.
"The punchline," Fain said, "is in the near future, we will likely have thousands of additional UAW members at the Marshall battery plant and the TEVC assembly plant under our master agreement."
The agreement includes some $8.1 billion in product commitments and other plant investments over the length of the contract, according to the UAW, including several new products. The assembly plant commitments include:
• Chicago Assembly, $400 million: Current Ford Explorer production will continue, including hybrid and police versions; Lincoln Aviator production will continue through its product lifecycle.
• Dearborn Truck and Rouge Electric Vehicle Center, $900 million: Ford F-150 will continue, including hybrid and Raptor models; F-150 Lightning production to continue through its product lifecycle; new EV truck will be added.
• Flat Rock Assembly, $50 million: Ford Mustang will continue; new product will be added, pending program approval.
• Kansas City Assembly, $1 billion: F-150 will continue, including hybrid and police versions; Ford Transit will continue; Transit EV will continue through its product lifecycle.
• Kentucky Truck, $750 million: Ford Super Duty will continue; Ford Expedition and Lincoln Navigator, including hybrids, will continue.
• Louisville Assembly, $1.2 billion: Ford Escape and Lincoln Corsair will continue through their planned product lifecycles; new EV product will be added.
• Michigan Assembly, $250 million: Current Ford Bronco will continue, including Raptor; Current Ford Ranger will continue, including Raptor; 3rd production crew to be added; stamping for Mustang, Bronco including Raptor, Ranger including Raptor, F-150, Expedition, Navigator, and Super Duty will continue; stamping for Escape and Corsair will continue through their planned lifecycle.
• Ohio Assembly, $2.1 billion: New EV van to be added; medium truck will continue; Super Duty will continue; E-Series Cutaway and Stripped Chassis will continue.
Additionally, Ford has committed to an outsourcing moratorium, product investment and EV work. There also is an increased moving allowance. Ford previously said it was making product commitments to every UAW-represented plants and that there wouldn't be job losses over the course of the contract because of EV battery plants.
Wages, COLA and more
Compounded, wage increases in the deal total more than 26% and would bring the top pay to $40.82 in October 2027. With COLA, that could be $42.60 per hour. The union estimates economic gains of $68,200 over the life of the contract for top-paid production workers.
Upon ratification, the top production wage would increase to $35.58 per hour. That's an 11% increase from the most common $32.05 per hour top wage at Ford. Starting full-time wages would rise to $24.91, up from $18.04. Workers then would receive 3% wage increases in October 2024, '25 and '26, and a 5% raise in October 2027.
The union estimates the COLA formula will increase wages by $1.78 per hour over the term of the agreement, based on a 2.4% average annual inflation increase, for a total estimated value of $8,800.
In addition, the time for workers to reach the top pay scale is reduced from eight years to three.
Chris Budnick, 38, of La Grange, Kentucky, a stamping quality inspector at Ford’s Kentucky Truck Plant, said he is content with the total wage increase, though would have preferred to have seen more upfront.
“A lot of folks feel that not having COLA for the past 14 years means we should be at least at $8 an hour,” he said. “Eleven percent doesn’t touch that. … It’s because of how crazy inflation is.”
But Budnick, a member of the United All Workers for Democracy Caucus’ steering committee, said he’s proud to see the result of the actions taken by the new UAW leadership and the members’ engaged response.
“We never thought in a million years it would happen this fast,” he said about the gains and changes in how the union conducted the talks. “The fact that it did, and it really worked out for the UAW membership. … (The wage increases are) more than what we got the past 22 years.”
The union and the company also agreed to a new profit-sharing formula after the Dearborn automaker stopped disclosing its North American financial results. The new one is based on total company profits and would have resulted in a $1,200 larger check for 2022 if it had been implemented that year.
Employees who have been temporary workers for three months or more will be converted to full-time in-progression immediately upon ratification. Newly hired temps would start at $21 per hour and become full-time after nine months, down from two years in the 2019 contract. The union estimates up to $193,300 in economic gains over the life of the contract for temps.
Temps will be eligible for profit sharing as well as the ratification bonus of $5,000. Temps also will be able to receive bereavement and jury-duty pay and tuition assistance. They also could receive supplemental unemployment benefits after three months of continuous service.
Workers at Rawsonville Components Plant in Ypsilanti Township and Sterling Axle Plant would be brought up to production worker wages.
After workers expressed they couldn't afford the vehicles they were building, Ford has agreed to a $1,500 voucher toward a vehicle purchase.
Tuition assistance would increase to $8,000. The agreement adds paid parental leave, maintains two family days, removes "tiered" vacation time, adds Juneteenth as a holiday and adds a step to the attendance discipline progression. Ford only could force workers to use one week of vacation time for plant shutdowns.
For skilled trades, COLA would bring their pay up to $50.50 per hour by the end of the agreement, according to union estimates. Ford agreed to a $1.50 per hour tool allowance, shy of the union's $2 request. Journeypersons would be protected from being forced to take production jobs. The union estimates $91,700 in economic gains for skilled-trades workers at the top rate.
The deal includes improved contributions for current retirees, workers with pensions and those who have 401(k)s. Active members with pensions will see their first multiplier increase since 2003 and an immediate increase in the life income benefit of $5 per year of credited service.
Additionally, Ford's employer contribution to 401(k)s would increase to 10%. For workers at top rate, that will bring the automaker's annual contribution to $11,000, up from $6,300.
A special retirement incentive package also would open for workers looking to retire during the 2024 calendar year. It includes $50,000 for an unlimited number of eligible production and skilled trade members.
Retirees and surviving spouses effective Oct. 1 will receive yearly payments of $500 with the first coming no later than the first quarter of 2024 and subsequent payments being made in December through 2027. The interim supplement for workers who retired before age 62 with less than 30 years will see an increase to $53.37 per month per credited year, up from $48.85.
The Dearborn automaker said Thursday it expects the agreement will add $850 to $900 to its labor costs per vehicle. It expects an impact of up to 0.7% on its margins, so the company would remain profitable, but it must find a way to boost productivity, John Lawler, Ford’s chief financial officer, said last week.
The union’s strike at Ford had cost it $1.3 billion through Wednesday, when the UAW sent its members on picket lines back to work after the tentative was reached. Restarting production to normal output is a process that will take weeks. Workers at its most profitable plant, Kentucky Truck, were working voluntarily following the tentative deal, but mandatory shifts were resuming on Monday.
"We became a force to be reckoned with," Chuck Browning, UAW vice president and head of the Ford Department, said during the Facebook Live update. "The companies didn't see it coming. We fought like h---, and we won like never before."
Other negotiations
Meanwhile, the union expanded its "stand-up" strike against the remaining holdout, GM. Hourly workers at its Spring Hill Manufacturing complex in Tennessee that makes the Cadillac XT5, XT6 and all-electric Lyriq as well as the GMC Acadia joined nearly 15,000 other GM workers on the picket line.
Still on strike at GM are employees at its Wentzville midsize truck and commercial van plant outside St. Louis in Missouri, Chevrolet Traverse and Buick Enclave plant in Delta Township outside Lansing, and the full-size SUV plant in Arlington, Texas, as well as at its parts distribution centers across the country.
Read the UAW-Ford agreement highlighterhttps://uaw.org/wp-content/uploads/2023/10/HourlyHighlighter-Ford_FINAL.pdf
And across the northern border, Canadian autoworkers union Unifor continued to meet with negotiators at Stellantis in efforts to reach a tentative agreement for 8,200 employees before its self-imposed deadline of 11:59 p.m. Sunday.
In an update on Friday, Unifor President Lana Payne said progress was slow after the company proposed "concessions" compared to the pattern adopted by Ford and GM, thought talks had picked up that day.
Sticking points mentioned included increased pension contributions, protections for salaried bargaining-unit workers, anti-outsourcing measures for parts distribution workers and the extension of bargaining rights to workers at the automakers' NextStar Energy joint-venture battery manufacturing plant with LG Energy Solution that is expected to launch production in the first quarter of 2024.
More:Stellantis, Canadian autoworkers union continue talks ahead of strike deadline tonight
At Ford and GM, Unifor secured three-year deals with wage increases of 10% in year one, 2% in year two and 3% in year three; COLA; a halved timeline of four years to the top wage; increase contributions to pensions and a new quarterly Universal Health Care Allowance for retirees.
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