The United Auto Workers union reached a tentative agreement yesterday on a new contract with General Motors, one that includes things like a decent ratification bonus, a path for temporary employees to become permanent, raises, and no more cap on how much members earn in profit sharing. Maybe the biggest win, however, isn’t a change at all.
For the full details of what’s in the agreement, you can check out the UAW’s summary of the contract here.
This agreement still has to be ratified by members, a process that could take weeks and is far from a guarantee. But should this deal go through as currently constituted, it would also include something the UAW asked for from the get-go, one they ultimately got: no change to its current health benefits, which are among the best in the country for private employees.
UAW members currently pay just three percent of their healthcare costs, far lower than the national average of 28 percent. GM initially wanted workers to pay 15 percent.
We knew this was probably going to happen early on, after, on Sept. 16—just as the strike began—when Automotive News reported that GM had pretty quickly backed off the 15 percent demand. But it’s still striking (sorry) to see that, in the end, this provision did not change. (This is not, in my experience, usually how things go, having been at the bargaining table myself. Almost always, there is compromise from both sides, perhaps to help achieve a goal elsewhere in the deal.)
It’s possible that’s what happened here, too, with GM opting to not mess with healthcare in favor of pursuing another goal. That would be surprising if only because healthcare is the kind of cost businesses fear most, one that rises rapidly and unpredictably. Then again, it’s also possible after the kerfuffle over striking workers’ health benefits that GM realized messing with its workers healthcare was a bad look, period.
Either way, with GM agreeing to the three percent, you can expect Ford and Fiat Chrysler to fall in line as well in their own upcoming contract negotiations with the UAW, as they do already. Ford, for one, has said that its healthcare costs will top $1 billion next year, and should they agree to keep health benefits the same, a source told Auto News that would be the equivalent to a $3/hour pay increase over the next four years.