By Jewel Gopwani, Business Writer Detroit Free Press June 30, 2007
Delphi worker Ken Blackmer was stocking parts on the assembly line at Flint East on Friday when he heard that UAW members at the auto-parts maker had approved a contract proposal that would save his plant.
"I just got this big smile on my face," said the bearded 54-year-old. "I wanted to holler, 'Yahoo!' "
Blackmer, one of hundreds of relieved workers in Flint, got one of the better ends of the deal. He expects to keep his job and his wage of about $15 an hour. Just a few weeks ago, Blackmer thought he'd have to start looking for a job, expecting the plant to be shut down.
But his union brothers and sisters at 10 UAW plants face just that fate in this contract, approved by 68% of voting members.
It's part of Delphi's plan to shrink its business and cut costs through wage and job cuts as it reorganizes in Chapter 11 bankruptcy.
The contract includes:
. The closure of 10 UAW plants, including the one in Coopersville.
. Promises of contracts to supply GM for most of the 11 plants that will stay open, including four that Delphi will keep. Seven will be sold.
. Wage cuts of about $10 an hour for 4,000 workers at Delphi's highest UAW production wage level. Those workers will be offered $105,000 over three years in exchange for taking lower wages, as first reported in the Free Press.
Those workers also will have the right to flow back to GM as positions open up, and they will be offered buyouts.
"It's a remarkable moment in labor relations that employees ratify deep pay cuts and a whole new paradigm in their work relationship," said Mike Whitty, a labor-relations professor at the University of Detroit Mercy.
The UAW deal is an important step for Delphi as it negotiates financing deals that help it emerge from bankruptcy protection.
>From here, UAW locals will start negotiating local agreements, in which
Delphi and GM have started to ask for flexibility on issues including work
rules, job classifications and outsourcing. Flexibility on those issues
often leads to layoffs and workers taking on more responsibilities, Whitty
said.
"We're not resistant to the idea of looking at flexibility, but fairness continues to be critical," said Mike Hanley, president of UAW Local 699, which represents about 2,300 workers at Delphi's Saginaw Steering plant.
Delphi also is in contract talks with its five smaller unions that represent 3,000 workers.
Workers in Lockport, N.Y., a plant Delphi plans to keep operating, voted against the deal. About 1,200 of the 2,200 UAW workers eligible to vote in Lockport were longtime Delphi employees, who will see their wages cut under the deal.
These higher-paid workers have the option of taking a buyout, a cash payment to make up for the lower wages or moving to open positions at GM. But with only two GM plants in New York, employing 2,000 people, the chances would be slim for workers to make such a move.
GM, which spun off Delphi in 1999, is paying $7 billion to ease the transition for workers who will see wage cuts.
During talks, the UAW criticized Delphi management, saying they demanded too much. UAW President Ron Gettelfinger credited GM for bringing negotiations to a conclusion. For the second time in a week, the union declined to use Delphi's name, instead calling it "GM's former parts operation."
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