Delphi wage cut scheme, GM layoff plan
DETROIT (PAI) — United Auto Workers members were hit with a one-two punch in late November, as bankrupt Delphi Auto Parts disclosed its latest wage proposals — which would put its lowest-paid workers’ wages slightly above Wal-Mart’s average — while GM proposed shutting plants and cutting 30,000 jobs by 2007-2008.
The more drastic plan came at Delphi, which filed for bankruptcy protection on Oct. 8. It wants to fire 18,000 of its 28,000 U.S. workers and cut wages of the rest to between $10.50 and $12.50, less than half of a Delphi worker’s present average pay.
UAW called that offer “insulting and ridiculous.” Union Vice President Richard Shoemaker told a press conference in Detroit that he wouldn’t even send it out for a vote among the Delphi workers and that “it doesn’t merit a serious response.”
United Food and Commercial Workers data shows an average worker at virulently anti-union Wal-Mart makes $9.68 an hour. Wal-Mart is now the nation’s single largest private employer — a spot GM once held, before auto firms slumped and before it spun off Delphi.
On Nov. 21, GM said it wants to lay off 30,000 workers, close six assembly line plants and cut back work at six parts plants, all by 2008. UAW spokesman Paul Krell said total layoffs would be 5,000, with the other 25,000 let go through retirement and attrition.
UAW responded by pointing out — again — “GM cannot shrink itself into prosperity,” and promised to protect its members. UAW put the onus on GM execs to design and retool vehicles quickly to meet changing market conditions, which it has not.
The Delphi case gives UAW its first chance to respond in court. Krell explained Delphi must ask a federal bankruptcy judge in New York City to approve another part of its plan: $87 million in bonuses and 10 percent of its stock, all to be distributed to top “key executives” to convince them to stay on. The hearing on that scheme, which UAW opposes, will be on Nov. 29.
“We intend to do various protest activities in Delphi communities” the day of the court hearing, Krell said. All six Delphi unions — UAW, IUE-CWA, the Steel Workers, the Electrical Workers, the Machinists and the Operating Engineers — are in a coalition battling the firm in court, negotiating and planning the protests.
The next milestone in the Delphi case will come Dec. 16. If UAW and Delphi don’t agree by then, it could that day seek a Jan. 24 hearing on voiding its contract with UAW. That hearing could take a week or two and the judge then can take up to a month to rule. “Negotiations for a new contract could continue right up until he issues a decision” in January, Krell said. “He could come into court and say ‘I have a decision here’ and we could say ‘Wait a minute. We reached an agreement.’ We’d rather reach a negotiated settlement.”
If the UAW and Delphi can’t settle, the bankruptcy judge “can only say ‘yes’ or ‘no’” to the parts maker’s demand to void its contracts, he added. A “yes” would also let Delphi “do whatever it wants, including imposing wages even below the levels of its latest offer,” Krell explained.
Over at GM, “at the end of the day, you’re looking at 30,000 fewer folks” out of a workforce of 118,000, Krell said. “That hurts individual families and communities.”
GM’s “wish list of shutdowns,” as Krell put it, includes one of its oldest plants, in Doraville, Ga., and one of its newest: Saturn Plant/Line No. 1, in Spring Hill, Tenn. Other closures would be in Oklahoma City, the Lansing (Mich.) Craft Center, which has 400 workers, and the Lansing Metal Fabrication Plant, which has several thousand and the IUE-represented third shift at its plant in Lorain, Ohio.