A MASS strike at General Motors plants across the United States began on Monday morning as 80,000 car workers walked out at 11 am local time after contract talks over health care costs and job security broke down.
Tens of thousands of United Auto Workers members streamed out of dozens of plants 10 days after their contract expired, furious at the company’s plans to slash their wages, pensions, conditions and job security.
Many of the angry workers were holding up signs reading ‘UAW on Strike’.
It is the first strike at GM since 1998, when plants across North America were shuttered for 53 days, costing the automaker two billion dollars.
The closure of GM’s US plants could also see as many as 100,000 Canadian auto workers laid off as demand dries up, said Canadian Auto Workers (CAW) President Buzz Hargrove.
And the Teamsters union announced on Monday that its members would not cross UAW picket lines or deliver GM cars.
‘It is time to put a stop to corporate America’s attack on the security of hard-working men and women in the United States,’ said Teamsters General President James P. Hoffa.
GM said it was ‘disappointed at the UAW’s decision to call a national strike’ and claimed it would ‘continue focusing our efforts on reaching an agreement as soon as possible’.
But union president Ron Gettelfinger condemned GM for engaging in ‘a one-way set of negotiations’.
This was despite the many concessions the union has already made in recent years to ‘help the automaker recover from staggering financial losses’, said Gettelfinger.
‘It was going to be General Motors’ way at the expense of the workers,’ Gettelfinger told a news conference.
‘The company walked right up to the deadline like they really didn’t care.
‘And as a result we called a strike.’
In his statement Gettelfinger said the union had already made ‘extraordinary efforts’ to help GM in introducing its restructuring plan.
These have already included billions of dollars in health care concessions, acceptance of the loss of some 30,000 jobs, and a halving of the wages of workers at GM’s bankrupt former parts subsidiary Delphi Corp.
But GM issued a statement issued before Gettelfinger’s press conference, making it clear that the ‘extraordinary’ concessions it has received from the union so far have done nothing to sate its appetite.
Quite the reverse, they have only made it hungrier still for even more.
Sources close to the negotiations say that GM now requires that the UAW help it introduce two-tier wages and other changes which would make it easier to lay off workers, and the UAW leadership is more than happy to talk on these issues.
However, the chief stumbling block to a deal between the company and the union officers is the workers’ intense hostility to the introduction of a proposed ‘Voluntary Employee Benefit Association’ (VEBA).
The VEBA would assume responsibility for health-care benefits of more than 460,000 GM retirees, limiting the costs to GM.
The company proposes that the VEBA would be funded by blocks of company stock.
But this would leave the health care of the GM retirees completely vuln erable to the continuing collapse in the price of GM stock.
‘The bargaining involves complex, difficult issues that affect the job security of our US work force and the long-term viability of the company,’ GM said.
However, David Cole, director of the Center for Automotive Research, said: ‘We sat down with them (GM executives) several months ago and they told us the top issues were health care, health care and health care. Nothing else came close.’
Harley Shaiken, a labour expert from the University of California at Berkeley, admitted that the union leadership has already accepted the idea of a health-care trust to take over responsibility for the health-care of GM retirees, but he claimed that the details of its operation are critical.
‘These are not minor details,’ said Shaiken. ‘It’s like buying a house: If you can’t agree on all the other terms like . . . who pays for the new roof, you don’t have a deal.’
‘The idea of building the trust company stock in the post-Enron world just isn’t workable from the union point of view,’ Shaiken said.
At a press conference on Monday, UAW President Gettelfinger denied VEBA was the one of the sticking points in the negotiations.
‘UAW workers went on strike against General Motors over job security, economic issues, benefits for active workers and winning investment in future products’ he said
And, flanked by the GM UAW National Negotiating Committee, he added: ‘We stand ready 24 hours a day, seven days a week to go back to the bargaining table.’
Pickets will remain outside plants until a contract is reached, he said before heading back to the bargaining table with UAW Vice President Cal Rapson, who directs the union’s GM Department, and the National Committee.
Gettelfinger said it was ‘significant that our union gave GM a nine-day contract extension, the longest in UAW history, to avoid a strike’, a drastic step no one on the union side wanted.
‘We were pushed into a strike and that’s where we are at,’ he added.
In recent years, UAW members have done their part by working with the company on issues such as the corporate restructuring, the attrition plan, the Delphi bankruptcy, the 2005 health care agreement and numerous quality, productivity and health and safety issues.
Workers gave up a three per cent general wage increase in 2006 and cost of living allowances.
‘We’ve met and solved all of GM’s problems since 2003’ he added. We’ve worked with General Motors on every issue that came before them.
‘We’ve done a lot of things to help that company,’ Gettelfinger said. ‘There comes a point in time when you have to draw the line in the sand.’
The UAW leader added that the strike had nothing to do with the much-discussed Voluntary Employee Benefit Association (VEBA) for retirees, which is a permissible but not mandatory subject of bargaining.
Job security, economics and benefits for active members remain critical issues for UAW members at GM.
‘It’s become apparent to us that as much as workers give, they cannot give enough,’ Gettelfinger said. ‘As much as executives get, they cannot get enough.’
Contracts at the Big Three automakers have traditionally always been linked to produce near-identical agreements.
However, negotiations at Ford Motor Co and Chrysler LLC have been put on hold this year while the union focuses on reaching an agreement with General Motors.
The union chose GM as its main target this year and says it plans to pressurise Ford and Chrysler to accept the same contract it wins from GM.