Ford-UAW contract bolsters job security - includes other labor contract information - Developments in Industrial Relations - column

Monthly Labor Review, Nov, 1987 by George Ruben

The employees will be eligible for possible automatic quarterly cost-of-living pay adjustments calculated at 1 cent an hour for each 0.26-point movement in the BLS Consumer Price Index for Urban Wage Earners and Clerical Workers (1967 = 100). This is the same as in the 1984 agreement, except that there is no longer a provision for permanently removing 1 cent or 2 cents from each adjustment to help moderate the settlement cost. The union calculated that adjustments would total $1.73 an hour under the new contract, based on its projection of an average 4.7-percent annual rise in the CPI. Actual adjustments under the 1984 contract totaled 81 cents.

In October of 1988 and 1989, the employees will receive lump-sum performance bonus payments calculated at 3 percent of their earnings during the previous 12 months, including overtime, weekend earnings, holiday work premium pay, and incentive earnings. Under the previous contract, the workers received performance bonuses in October of 1985 and 1986, calculated at 2.25 percent of pay for compensated hours during 12-month periods, including overtime hours (but not overtime premium pay), vacation and holiday pay, shift premiums, and incentive earnings.

The profit-sharing plan, which had yielded payouts averaging $1,200 in 1985 and $2,100 in 1986, was liberalized by raising the employees' share to 7.5 percent of profits in excess of 1.8 percent but less than 2.3 percent of sales (a new bracket in the formula), plus 10 percent of profits between 2.3 percent and 4.6 percent of sales, plus 13.5 percent (formerly 12.5 percent) of profits between 4.6 percent and 6.9 percent, plus 16 percent (formerly 15 percent) of profits above 6.9 percent.

Limitations on overtime work during periods when workers are on layoff, which were addressed by the job security requirement that Ford must recall laid-off workers in proportion to any resumption in production, were also addressed by an increase in the overtime penalty. Now the company must pay $1.25 into the employee training and development fund for each hour of overtime work in excess of 5 percent of all straight-time hours worked. Previously, the penalty was 50 cents for each such hour.

Other terms included increases in health insurance benefits, such as dental care and expansion of hospice care, and increases in levels of life, sickness and accident, and extended disability insurance benefits resulting from increases in the base wage rates to which they are linked; an increase in Ford's funding of the legal services plan to 7.2 cents per hour worked, from 4 cents; an increase in tuition assistance under the development and training program, and adoption of a plan to aid employees in personal financial planning; addition of a paid holiday, the birthday of Dr. Martin Luther King, Jr.; and an increase (in three steps) in the pension rate totaling $4.20 a month for each year of credited service, bringing the range to $26.05 to $27 effective October 1, 1989, for employees retiring on October 1, 1987, or later.