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GM and UAW union making progress in talks for new labor deal: sources

Stock MarketsSep 25, 2019 06:03PM ET
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© Reuters. FILE PHOTO: New trucks crowd a parking lot at the GM assembly plant in Oshawa

DETROIT (Reuters) - General Motors Co (NYSE:GM) and the union that represents its 48,000 striking hourly workers in the United States have made progress in talks toward a new labor deal but are grappling with issues over the pay and job security of newer and temporary workers, two people familiar with the talks said on Wednesday.

United Auto Workers (UAW) Vice President Terry Dittes told union members in a statement issued late in the day that "all unsettled proposals are now at the Main Table and have been presented to General Motors.

"We are awaiting their response," Dittes said, adding: "This back and forth will continue until negotiations are complete."

There are still significant issues that need to be addressed, a person briefed on the matter said. More meetings were set for the evening, but the source said no deal was expected Wednesday.

UAW members went on strike at GM on Sept. 16 seeking higher pay, greater job security, a bigger share of the leading U.S. automaker's profit and protection of their healthcare benefits.

The strike has cost GM about $100 million a day, analysts said.

IHS analyst Joe Langley said at a conference on Wednesday the company could lose about 70,000 vehicles of production from a two-week strike and be challenged to make up the loss over the short term.

The walkout - the longest autoworker strike in nearly 30 years - has become a political event, attracting the attention of Democratic politicians, who have been visiting the striking workers and voicing their support.

The Democratic presidential candidates have echoed the striking workers in saying GM employees deserve fair treatment from the Detroit automaker they helped through bankruptcy.

President Donald Trump, a Republican, convinced numerous UAW members to vote for him in 2016, helping him win Michigan, Ohio and other states. He has repeatedly demanded GM find a new vehicle for its now-shuttered assembly plant in Lordstown, Ohio, a key state for him in the 2020 presidential election.

GM officials have tried to counter charges that they are abandoning U.S. workers, releasing details of an offer to the UAW that included the promise of investing $7 billion in U.S. plants, annual raises in a new four-year deal, increased profit sharing and retention of existing healthcare insurance.

However, the sources familiar with the negotiations said some of the bigger remaining issues relate to how fast newer hires progress to the top UAW pay scale of about $31 an hour. Currently, it takes eight years to reach that level for newer hires and the union wants a faster ramp to the top.

Another big issue is the use of temporary workers, who have no pathway to full-time job status and few rights related to sick time or vacation days, said the sources, who asked not to be identified because the talks are ongoing.

GM has said it can reduce its cost disadvantage with the international automakers in the U.S. market and safeguard union jobs by using temporary workers. The use of temps also allows Detroit automakers to cover for high rates of absenteeism among UAW workers.

GM and UAW union making progress in talks for new labor deal: sources

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Hank Williams
Hank Williams Sep 25, 2019 12:28PM ET
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