GM - UAW Deal: Non-Core Workers To Get Half Pay!

As many insiders predicted when General Motors and the United Auto Workers (UAW) shook hands earlier this week, the shift of $50 billion in health-care obligations to the union fund was just half the story.

Citing people with knowledge of the plan, Bloomberg is reporting today that GM and UAW have agreed to create a new class of jobs that’d pay about half the current rate thus breaking UAW's tradition of equal earnings for union members. Under the agreement, the so-called non-core employees like janitors and maintenance workers would get receive about $28 an hour in pay and benefits, compared with $51 for present employees. -Continued after the jump

While current “non-core” workers wouldn’t be affected by the accord, GM will try to by them out with the new pay structure applying to their replacements. But will this truly help GM? We can’t say for sure since it isn’t clear yet how many of GM's 73,000 current UAW- represented positions will be considered as non-core jobs. Analysts believe however that in order for this to have an substantial impact on GM, it would have to concern more than 5,000 workers.

Commenting on the report, Richard Block, a labor professor at Michigan State University in East Lansing told Bloomberg, “The company likes it because it cuts compensation costs and the union can swallow it because the people affected aren't going to vote because they don't exist yet,''. How true Mr. Block; what the eye doesn't see the heart doesn't grieve...

Via: bloomberg