DETROIT -- UAW President Dennis Williams said the union's tentative contract with Fiat Chrysler makes progress in closing the gap between Tier 1 and entry-level workers while allowing veteran workers to share in the financial success of the company.
Williams and FCA CEO Sergio Marchionne also agreed that the UAW's idea of creating a health care co-op for active workers has the potential to control costs.
Marchionne and Williams, who took the unusual step of appearing together at a hastily called press conference late Tuesday, declined to provide details until the UAW executive board has had a chance to vet the agreement.
Williams said the agreement would likely go to FCA's 37,000 hourly workers next week for a ratification vote.
Williams said the union's goal was to provide a path out of Tier 2 for hourly workers in this round of bargaining. The union likewise wanted a contract that allows employees to share in the success of FCA, while beginning to address health care costs.
"We believe that we have met those goals," Williams said.
The agreement came after bargainers extended a 2011 contract on an hour-by-hour basis after it expired at midnight Monday.
The union will schedule informational meetings with local leaders to go over terms of the proposed contract before a membership ratification vote in the coming days.
“Ultimately, our membership will make the final decision,” Williams said at the press conference. "We will continue ... to make the best damn vehicles in the world."
Maturing relationship
Marchionne said there’s been a maturing in the relationship between the union and the industry in the three UAW negotiations he’s been involved with as CEO.
“It’s a reflection of the alignment of the interests,” he said.
The joint press conference was considered highly unusual in UAW-Detroit 3 history. Typically the union has held its own press briefings to discuss tentative contracts. The companies often brief Wall Street analysts on financial impacts of such contracts.
A tentative agreement does not always mean that the bargaining process is over. Once the details of the proposed agreement are passed on, first to leadership and then to members, it is not uncommon for one or both to reject the deal and send bargainers back to the table for sweeteners or clarification.
UAW Vice President Norwood Jewell, head of the union's Chrysler department, said in a tweet Tuesday evening: "Now it's our job to go out and explain it to people so they understand what a great job I believe we did."
The UAW selected FCA US as its initial target for pattern bargaining with the Detroit 3. The union's 2011 contracts with Ford Motor Co. and General Motors were extended hours before the Sept. 14 deadline, and bargainers at those companies were sent home while talks proceeded with FCA.
Expectations
"Expectations are very high for raises for everyone," Kristin Dziczek, labor analyst with the Center for Automotive Research, said Tuesday before the agreement was announced.
Veteran UAW workers, who make about $28 per hour, have not had a wage hike in a decade. More recently hired factory workers earn so-called second-tier wages that topped out at $19.28 in the old contract. Those workers have pushed UAW leaders to narrow that gap or set a clear path to eliminating it.
At FCA, about 45 percent of the hourly UAW workers earn lower-tier wages.
