Monday, March 27, 2006

Delphi Strike Inevitable?

Last week we discussed how the UAW, Delphi and GM may have worked out an agreement to avert a strike by having GM buy out UAW contracts and not laying off workers.

If you need to review that article, click here .

Yesterday, The Detroit Free-Press reported Delphi will announce amended pay cuts to those Delphi employees that remain.

If the workers don't accept that, Delphi will appeal to be let out of the UAW agreement, to which the UAW has stated that they will go on strike. This will send GM to bankruptcy.

Based on the two-tier wage structure that the UAW negotiated in 2003, it has been speculated that the wage cuts may be 37%, down from 63% that Delphi had announced before the negotiations began.

They are trying to reach a deal by this Friday.

It's kind of an interesting situation.

It might seem like the union has the upper hand, they aren't only threatening one company, but two companies.

But, on the other hand, if GM claims bankruptcy because of Delphi's union strike, then GM will likely file to be let out of their contract with the UAW at GM.

The days of the powerful union threats are over.

Even though of days of prosperous times in Detroit are long gone, hard habits are hard to break.

When GM had announced that GM retired employees were going to have to pay more of their retirement insurance than they currently did, the UAW demanded an independent analysis of GM's condition.

Nobody outside of GM or the higher ups at the UAW have seen that report, but it has been speculated that the info reported back to the UAW was indeed grim.

Today the Free Press announced that just under 500 white collar employees were laid off at about 30 locations across the US, most coming from the Warren Tech Center.

White collar workers generally refer to office workers, blue collar usually refers to the workers on the assembly line.

White collar workers are non unionized.

GM states that more layoffs are planned, but are trying to rely on normal attrition to attain that goal.

The Free Press also states that the specifics of the pay cuts will be announced to the UAW today.

Stay tuned.


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