Home » US Employment News » UAW pushes for 40 percent pay hike in talks with Detroit automakers

UAW pushes for 40 percent pay hike in talks with Detroit automakers

By Nithya Bose in US Employment News, posted August 4, 2023

The United Auto Workers union has boldly requested a 40 percent pay raise in the upcoming labor contract negotiations with Detroit car companies.

This demand, if met, would mark the largest pay hike in recent memory for the factory workers represented by the union.

Unionized factory workers at General Motors, Ford, and Stellantis start at around $18 an hour, with the highest wage reaching about $32 an hour over time.

The proposed 40 percent increase would be implemented for the next four-year contract, comprising a 20 percent raise upon contract ratification and four additional five percent increases distributed annually.

The UAW's president, Shawn Fain, has taken an aggressive approach in negotiations, vowing to secure double-digit pay raises for union members, without specifying an exact percentage.

Fain also outlined a list of ten demands, including the right to strike over plant closures, the restoration of certain retiree benefits, and a defined pension plan for all workers.

Wages have taken on heightened importance during this round of bargaining, coinciding with a period of elevated inflation.

The UAW is also seeking the reinstatement of cost-of-living adjustments and other benefits that were sacrificed in previous negotiations to support the financial stability of the car companies.

The demand for a 40 percent pay raise represents a significant departure from previous contracts, where the union secured two sets of three percent hikes along with lump-sum payments in the last round of negotiations in late 2019.

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GM said it plans to increase wages for workers but cautions that the current demands could affect the company's ability to support its hourly workers in the long run.

Ford has expressed readiness to collaborate with the UAW, while Stellantis reviews the union's demands after a productive meeting with the UAW leader.

UAW also advocates for greater job security, particularly as the auto industry focuses on producing electric vehicles.

The transition to EVs poses potential challenges to traditional engine and transmission plant jobs, as these vehicles require fewer workers for assembly.

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