GM union workers ratify labor contract

Journal Record, The (Oklahoma City), Nov 19, 1996

DETROIT (AP) -- General Motors Corp. workers have ratified a new labor contract by a wide margin, bringing the latest triennial round of Big Three bargaining to an end.

The United Auto Workers union said Monday that 85 percent of those voting among GM's hourly and skilled-trades workers nationwide endorsed the contract in voting last week. No vote total was released.

Like the contracts approved earlier by UAW workers at Ford Motor Co. and Chrysler Corp., the GM pact guarantees that at least 95 percent of UAW-represented jobs will be maintained during the next three years. GM, which initially refused such a guarantee, has assured Wall Street the contract allows it to reduce its work force through attrition and productivity improvements. But it remained unclear exactly what GM got out of the agreement that differed significantly from the Ford and Chrysler deals. "To be perfectly honest, we don't know yet," said analyst Joseph Phillippi of Lehman Brothers. Analysts expect to be briefed this week by GM executives. The GM agreement, like those at Ford and Chrysler, also provides a $2,000 lump sum bonus for the first year, followed by 3 percent wage increases in the second and third years. In addition, the contract gives the UAW a larger role in GM's decisions to farm out parts work to independent suppliers, a practice called "outsourcing." GM retirees also gained increased benefits. GM spokesman Chuck Licari said the contract gives GM the flexibility it needs to be more competitive, but he declined to discuss specifics of how the deal differs from the other Big Three pacts. Licari said the contract will allow GM to sell its Delphi parts plants in Flint and Livonia, Mich., and "exit noncompetitive businesses." The UAW has opposed the sale but apparently will not take any further moves to halt it. GM has no estimate of how many jobs may be cut over the next three years, Licari said. "We have never said we are focusing on reducing our employment level by a specific amount."