Ford-UAW Deal Pays Hourly Workers $10,000 in 2011
By Keith Naughton, Craig Trudell and David
Ford Motor Co. will pay most of its United Auto
Workers-represented employees a $6,000 signing bonus,
$3,752 in profit sharing and a $250 "competitive bonus"
this year under a new four-year tentative agreement,
the union said in summaries today.
Workers with a year or less of service will get a
$5,000 signing bonus, the union said in highlights of
the agreement. Ford will also make annual $1,500
payments to its UAW workers, which replace
cost-of-living adjustments. If Ford earned $5 billion
annually, workers could receive $20,000 in profit
sharing payments during the term of the contract, the
Ford committed to adding 12,000 hourly jobs in its U.S.
manufacturing plants by 2015 as part of the agreement,
the Dearborn, Michigan-based company said today in a
statement. The figure includes 5,750 more than the
6,250 hourly positions previously announced to be added
by the end of 2012, Executive Vice President John
Fleming said at a news conference.
"What they did at Ford is pattern plus," said Kristin
Dziczek, a labor analyst with the Center for Automotive
Research. "A lot of the core economic structure of the
agreement is the same" as the union's accord with
General Motors Co., including the forgoing of raises
for senior workers, higher-pay for entry-level
employees and annual checks in lieu of cost-of-living
Ford will offer buyouts of $100,000 for skilled-trades
employees and $50,000 for production workers, the union
said. GM offered as much as $75,000 for skilled-trades
workers and $10,000 to production employees. GM is
giving a $5,000 signing bonus and it isn't pulling
ahead the first-half profit sharing payment as Ford is.
"When you don't lead, you're able to pick up some icing
on the cake in the contract," UAW President Bob King
told reporters today of Ford following GM's lead in
negotiations. "There's a significant amount of icing"
in the Ford agreement.
The tentative deal is subject to a ratification vote by
Ford's 41,000 U.S. hourly workers, which the union said
it plans to complete by Oct. 16. The UAW said the
national council's vote in favor of recommending the
accord to locals wasn't unanimous.
"I strongly believe we negotiated a contract the
members will be happy with," King said. "Would they
like fixed rate increases? Sure they would. I'd like to
give it to them, but they know the competitive
structure as well as I do."
The automaker plans to invest $555 million to assemble
the Fusion midsize sedan at a plant in Flat Rock,
Michigan, according to the UAW. The factory will add a
shift of workers and make 175,000 to 200,000 Fusions
each year, Jimmy Settles, the UAW vice president who
oversees the union's Ford department, said at the
union's news conference. The car will continue to be
made in Mexico, too, the UAW said.
The UAW is negotiating contracts for 113,000 workers at
U.S. automakers for the first time since GM and
Chrysler Group LLC went bankrupt in 2009. Workers at
Ford, which avoided Chapter 11, have said they are
seeking more from the automaker they helped save. Only
Ford workers can go on strike in these negotiations
because GM and Chrysler UAW-represented employees
agreed not to walk out as part of their U.S.-backed
"This agreement recognizes that Ford would not have
turned the corner had it not been for the commitment
and dedication of its workers," Settles said today in
an e-mailed statement.
The majority of the 12,000 jobs Ford is adding will be
workers making entry-level wages, Marcey Evans, a Ford
spokeswoman, said today. Wages for those so-called
Tier-2 workers have started at about $14 an hour, half
of what senior workers make. Ford has said it has fewer
than 100 UAW- represented workers receiving the lower
(For the entire article, go to http://www.businessweek.com/news/2011-10-04/ford-uaw-deal-pays-hourly-workers-10-000-in-2011-bonuses.html)
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