Labor Law Guy

What’s Up with the UAW and Ford?

Posted in Federal Labor Law, State Labor Law by laborlawguy on March 11, 2009

Ford, which is in the best shape of all three American automakers and has not gotten (nor will it seek) government bailout funds, has wrung a deal out of the United Automobile Workers (UAW) to cut costs in health care and in overtime and unemployment pay.

Or is the shoe actually on the other foot?

The UAW has typically struck a deal with one automaker that it then sets up as the gold standard for the other two. By cutting a deal with Ford that leaves pay scales and health care for existing workers intact, the union may be drawing a line in the sand for GM and Chrysler, both of whom are on a federal umbilical court and under orders to cut costs or die.

It’s unlikely that the union, outside of government or courtroom pressure, will go any further in making concessions, even to two firms that may expire of their own decrepitude and obesity. It’s also highly unlikely that the Obama administration will try to force the UAW into further concessions, so it looks like this is a union gambit that could play out for them.

Of course, if GM or Chrysler or both disappear, then all the gambits in the world won’t help.

It should be an interesting side show as the Great American Recession continues.

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2 Responses

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  1. Charmaine Rausch said, on March 11, 2009 at 9:55 am

    Wasn’t their talk of bankruptcy and if that happened then all the union contracts would be thrown out. I understand Obama not wanting hurt the unions though he can’t do anything about what is law. Let me guess the magic wand theory. I think the unions would be wise to negotiate. If GM and Chrysler go out then they are out 60% of their jobs. Am I missing something? Is my math wrong?

  2. laborlawguy said, on March 11, 2009 at 11:06 am

    I used to work for a union, and it’s all or nothing with those people. The leaders don’t care if their union members get screwed. They’ve already feathered their nests a-plenty and worry only about ego and power. The members might be standing in the unemployment line, but they’ll be on the beach somewhere sipping Pina Coladas.


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