loader image

The International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) has reached a historic agreement with General Motors (GM). Photo: UAW

USA: Notable Union Achievements in the Automotive Sector

03 November, 2023 | Ricardo Changala

On the morning of Monday, October 30th, the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW), reached a historic agreement with General Motors (GM), one of the Big Three companies in the automotive sector. This agreement came after a historic strike, paving the way for a global agreement that includes record economic gains for auto workers.

Shawn Fain, president of the union, stated, “We have reached unprecedented agreements with Ford, Stellantis, and now General Motors. We have united our members like never before, demonstrating to companies, American society, and the world that the working class continues its fight. In fact, we’ve only just begun.”

Similar to the agreements with Ford and Stellantis, the deal with GM has achieved record salary increases, surpassing what was accomplished in the 2019 union agreement. During this strike, more base salary increases have been secured at GM than in the past 22 years.

The agreement entails 25% increases in base salary until April 2028, cumulatively increasing the maximum salary by 33%. This includes estimated cost-of-living increase (COLA) coverage to more than $42 per hour. The starting salary will rise by 70%, coupled with the estimated COLA, to more than $30 per hour.

Furthermore, the agreement encompasses benefits for two key groups, Ultium Cells and GM Subsystems LLC, which were previously excluded but are now included.

The agreement reinstates crucial benefits lost during past crises, introducing a three-year salary progression and eliminating divisions in salary levels, fulfilling a historical union demand. It improves the retirement conditions for current retirees and workers with pensions. Like the agreements with Ford and Stellantis, the GM agreement includes collective rights such as the right to strike over plant closures.

The tentative agreement with Ford provides historic economic benefits to workers, combining annual general wage increases, the reinstatement of the cost-of-living increase allowance (COLA), and an initial lump-sum ratification bonus of US$5,000.

This marks the first time in over 20 years that annual increases in the base salary have been agreed upon, while the reinstatement of the COLA will provide greater security against inflation’s impact on the Consumer Price Index (CPI).

These three agreements remain tentative pending ratification by the rank and file of the organizations, a process currently underway.

The success achieved by the UAW union can largely be attributed to the strike strategy promoted by union president Shawn Fain. Instead of halting all operations at once, different sections of the union joined the strike progressively, exerting pressure in the absence of negotiation progress.

Fain represents a new cohort of union leaders who opted to reverse the losses suffered in previous periods when the union made concessions to sustain automotive companies.

President Fain expressed, “We entered these negotiations with the aim of addressing decades of concessions, and now we know that our stand-up strike will go down in history. For months, we’ve insisted that record business profits must result in record contractual terms. These agreements not only impact lives presently but also lay the foundation for greater achievements in the future.”

Recent conflicts in the USA, like these, underscore how union organization and struggle alter the dynamics in labor relations, enabling remarkable achievements that were previously unthinkable.

On October 31, the United Nations reported that the Special Rapporteur on extreme poverty and human rights urged the CEOs of Amazon, DoorDash, and Walmart to address allegations that wages at U.S.-based companies are pushing workers into poverty, necessitating their reliance on U.S. government benefits for survival.

“Multi-billion dollar companies should set the standard for working conditions and wages, rather than violate the human rights of their workers by offering insufficient wages,” stated expert Olivier De Schutter.

De Schutter highlighted that the ability of Amazon and Walmart workers to negotiate higher wages is severely hindered by their employers’ aggressive anti-union activities, involving spending millions of dollars to counter workers’ unionization efforts.

In separate letters to Amazon CEO Andy Jassy, DoorDash CEO Tony Xu, and Walmart CEO Doug McMillon, the expert requested a response to reports about inadequate wages and the misclassification of workers as “independent contractors,” denying them traditional labor benefits such as minimum wage guarantees.