The three biggest American automakers are banking on health care benefits for the partners of gay employees as a low-cost way to lure new workers in a tight labor market.
The announcement Thursday from General Motors Corp., Ford Motor Co. and the Chrysler division of DaimlerChrysler AG could signal that such benefits will become standard in corporate America.
"This is really a landmark," said Kim Mills, education director with the Human Rights Campaign, a gay rights group in Washington that tracks company benefit programs. "We've never really seen an industry get together as a group and say, 'We're going to institute these benefits."'
The automakers have 465,000 hourly and salaried workers in the United States.
The companies said they decided to extend health benefits to employees' same-sex domestic partners after agreeing to study the issue as part of new contracts reached last fall with the United Auto Workers.
Starting Aug. 1, employees can apply for medical, dental and prescription benefits for their same-sex partners. The programs do not cover current retirees, but workers and their partners who receive the benefits will keep them after the workers retire.
David Murphy, Ford vice president of human resources, said the No. 2 automaker expects only about 1 percent of its 159,000 blue- and white-collar U.S. employees to take advantage of the benefits, adding less than $5 million to Ford's annual $2.4 billion employee health care bill.
"The benefit is saying to employees and future employees, 'Look, we are a diverse company and we do recognize not only race and gender but sexual orientation,"' Murphy said. "When we're in the labor market recruiting, we're sending a signal about how inclusive the Ford Motor Co. is."
Mills said about 3,400 companies, including 93 Fortune 500 companies, now offer benefits to same-sex domestic partners. She said the number of companies offering such benefits had grown sharply since the early 1990s.
"One factor is certainly the tight labor market," Mills said. "There's also the rise of openly gay employees within society generally and in the workplace, sitting down with managers and saying this isn't fair and managers recognizing it's an inequitable system."
A San Francisco city ordinance requiring that companies doing business with the city offer such benefits has led about 2,000 companies to adopt them, Mills said.
At GM, the benefits will be offered to 152,000 hourly employees and 54,000 salaried employees. Chrysler will offer the benefits to 71,200 hourly workers and 29,000 salaried workers; other corporate divisions of DaimlerChrysler with U.S. employees, such as Mercedes-Benz and Freightliner, will not offer the benefits.
Workers at Visteon Corp., the parts division that's being spun off of Ford, will be eligible for the domestic-partner benefits. GM's former parts division, Delphi Automotive Systems, said it was still studying whether to offer the benefits.
Murphy said Ford considered whether the move would create a backlash from employees or customers. The Southern Baptist Convention urged its members in June 1997 to boycott Walt Disney theme parks in part because the company offered same-sex domestic partner benefits.
"We decided the business case for moving ahead was a strong one," Murphy said.