The United Auto Workers union is about to enter a new round of negotiations with the Detroit Three automakers, and this time, the focus is on the end of the two-tier wage system.
Two Tier Wages
Chrysler CEO Sergio Marchionne has said that he hopes to end the automaker's two-tier wage structure in the company's next round of labor talks with the United Auto Workers. According to Automotive News, Marchionne said that the current system creates two classes of workers and that it isn't viable in the long term.
Back in 2007-08, U.S. automakers and the United Auto Workers union signed landmark labor contracts that included many concessions on behalf of workers to keep the companies they work for competitive. Among them was an agreement to a two-tier wage structure that allowed automakers to start hiring replacements for retirees at a lower starting wage of $14-16/hour.
Just hours after threatening to strike at one or more GM plants, the UAW and the General have agreed on two-tier wages for certain job types. The move to clarify which jobs were "non-core" at the national level came as local UAWs were threatening to strike because they felt GM was asking for too many lower-paid positions at their plants. The more regimented deal identifies 16,000 positions that will soon be paid $14 per hour, which will save GM up to a half-billion dollars per year. It will take