UAW, Ford talks break up at 8 p.m.; back at it today

First Posted: 10/2/2011

UAW and Ford bargaining leaders met for a sixth straight day Saturday at the automaker's headquarters in Dearborn, but they broke up about 8 p.m. without a deal. Talks are expected to continue today.

UAW President Bob King, UAW Vice President Jimmy Settles and Ford executives John Fleming and Marty Mulloy are trying to hammer out the final details of a tentative deal to replace the 2007 labor contract.

The UAW has not updated members on the bargaining since Thursday night.

King and Settles are trying to negotiate better terms on certain issues at Ford than they achieved at General Motors. Fleming and Mulloy want an agreement that brings Ford's labor costs -- currently about $58 an hour, including benefits -- in line with GM ($56 an hour) and Chrysler ($49 an hour), as well as Japanese and Korean automakers with U.S. factories.

"I think they are balancing the two different sides with what they think they will be able to ratify," said Kristin Dziczek, a labor analyst for the Center for Automotive Research.

Ford executives have said they cannot afford to come out of contract talks at a disadvantage to their competitors.

GM workers ratified a new four-year labor contract Wednesday that included a $5,000 signing bonus, three $1,000 payments over the life of the contract and up to a $3.50-an-hour wage increase for entry-level workers. It also enhanced profit-sharing. GM told Wall Street analysts on Wednesday that its new UAW contract will boost hourly labor costs by only 1% in each of the next four years.

Talks have slowed at Chrysler, where the current contract has been extended until Oct. 19.

In the past, the agreement reached at the first of the Detroit Three automakers has been used as a template for the other two.

But Ford UAW workers argue that they deserve a higher signing bonus than workers at GM or Chrysler because Ford didn't need taxpayer assistance to survive the financial crisis of 2008. They also argue that they deserve compensation for sacrifices -- mainly forgoing wage increases -- when Ford lost $30 billion between 2006 and 2008.

When talks began in July, an unresolved grievance, signed by 35,00 of the automaker's 40,600 UAW workers, alleged that Ford had violated an "equity of sacrifice" promise by restoring merit pay and matching 401(k) contributions to white-collar workers, but not to hourly workers.

Ford has made $14.2 billion in profits since the end of 2008. Ford CEO Alan Mulally and Executive Chairman Bill Ford each received $26.5 million in total 2010 compensation, and stock awards initially worth even more than that. Many hourly workers find that compensation excessive because Ford production workers hired before 2007 have gone as long as eight years without a base wage increase.

This past spring, Ford boosted the average UAW worker's profit-sharing from an initial $3,500 to $5,000. Both the company and union have expressed interest in changing the method of calculating profit-sharing.

Ford’s success stirs UAW resentment in labor talks

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