Fiat Chrysler U.S. labor deal meets opposition in early voting

Reuters News
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Posted: Sep 26, 2015 2:32 PM

By Bernie Woodall

DETROIT (Reuters) - A proposed four-year labor agreement between Fiat Chrysler Automobiles NV and the United Auto Workers union encountered strong opposition from rank-and-file union members in early ratification voting.

Final results of voting at 37 U.S. UAW local union halls aren't expected until the middle of next week, and the contract could still win enough support from Fiat Chrysler's 40,000 UAW-represented workers to go into effect. But the pact, which would narrow but not close a pay gap between veteran workers and new hires, has run into trouble at some large Fiat Chrysler plants.

Some 77 percent of production workers voted "no" at a large UAW local in Kokomo, Indiana that has more than 5,000 workers, the Detroit Free Press reported on Saturday. Representatives of the union local could not be reached for comment.

On Thursday, a 2,000-member UAW local for a stamping plant in Sterling Heights, Michigan rejected the contract, according to postings on Facebook, and 80 percent of production workers at a 1,300-member union local for a Trenton, Michigan engine plant rejected the proposed deal, the local's website said.

Kristin Dziczek, labor analyst at the Center for Automotive Research, said the UAW would have several options if the contract is rejected, including going back to the negotiating table with Fiat Chrysler, or moving on to try to get a deal with Ford Motor Co or General Motors Co. A strike of some or all Fiat Chrysler UAW members is also possible, she said.

Brian Rothenberg, a spokesman for the UAW, said the union would make no comment on the ratification until voting is complete at all plants. A Fiat Chrysler spokeswoman declined to comment.

The UAW on Sept. 14 extended existing contracts with the Detroit Three automakers, including Ford and GM when the four-year deals reached in 2011 expired.

The UAW and Fiat Chrysler agreed to a tentative contract on Sept. 15. Under the proposed contract, the gap between the highest-paid Fiat Chrysler first-tier plant worker and the lowest-paid second-tier would close to $8 per hour from the current $12 per hour.

Fiat Chrysler has the lowest per-hour labor costs among the Detroit Three, because it has the highest share of the lower paid, second-tier workers, 45 percent compared to about 28 percent at Ford and about 20 percent at GM.

(Reporting by Bernie Woodall; Editing by Meredith Mazzilli)