Labor-management bargaining in 1992

Monthly Labor Review, Jan, 1993 by Michael H. Cimini, Susan L. Behrmann, Eric M. Johnson

At its peak, the stoppage led to layoffs of an additional 38,000 workers at nine GM assembly plants, and demonstrated the company's vulnerability to strategic work stoppages because of its "just-in-time" production process, where assembly plants receive parts only as they are needed in the production process.

In the second dispute, the union struck a GM body assembly plant in Lansing, Michigan, when management and union representatives were unable to resolve differences over scheduling rest periods. The 4-day dispute resulted in the walkout of 4,200 Auto Workers at the plant and the layoff of an additional 3,000 workers at another plant in Lansing. (See Monthly Labor Review, November 1992, p. 51, and December 1992, p. 53, for additional details.)

The third dispute involved about 3,400 GM workers at a key parts manufacturing plant in Anderson, Indiana, who threatened to strike over a company decision to subcontract some work, eliminating about 250 jobs. A peaceful settlement was reached when GM agreed to bring the work back into the plant and add about 240 jobs over the next 2 years in exchange for the union's pledge to cooperate in cutting costs.

In an apparent strategy to downsize without confrontation, in mid-October, GM was considering special incentives to lure thousands of older production workers into early retirement. The proposals reportedly would include incentives to workers who are at least 50 years of age and have 10 or more years of service, and would waive the rule that calls for reduced pension benefits for retirees who take post-retirement jobs. Reportedly, the buyout would be aimed at trimming the company's ranks of so-called "Jobs Bank" workers who can collect up to 100 percent of their take-home pay while on layoff status. (See Monthly Labor Review, January 1991, pp. 20-21 .)

Earlier in the year, GM's outside directors ousted Robert Stempel as head of the corporate board's executive committee and demoted Stempel's handpicked president, Lloyd E. Reuss, and replaced him with John F. Smith, Jr. (Smith previously had directed GM's profitable European operations). Later, Stempie resigned under pressure from GM directors, who were impatient with the slow pace of downsizing and cost-cutting. GM then announced a major reorganization of its North American operations, consolidating its six separate carmaking divisions into four, and making the company smaller and less vertically integrated.

UAW's top negotiator at GM chastised GM's outside directors for urging top GM managers to demand greater cooperation from the unions in implementing cutbacks, saying the the union "recognizes that GM has real problems that require real solutions .... we are prepared to be a part of the solution ."

Apparently, the lines are already drawn for 1993 negotiations. GM is expected to seek contract changes that will allow it to aggressively cut labor costs by permanently closing plants and slashing jobs without draining the company's financial reserves, reduce the company's medical insurance costs, and institute lower wages for workers at parts plants. The union is expected to fight these efforts.