GM reportedly to demand 2-tier wages in '93 talks DTC

April 15, 1992|By Bloomberg Business News

DETROIT -- General Motors Corp.'s labor negotiators will insist on a two-tier wage formula as part of its next national contract with the United Auto Workers union, according to an industry newsletter.

GM wants to pattern a two-tier wage agreement after the one it signed in February with the International Union of Electrical Workers at the automaker's Moraine, Ohio, truck plant, Ward's Automotive Reports said this week.

That agreement, which pays component-parts workers and new hires less than vehicle assembly workers, was adopted to keep GM from closing the Moraine plant.

The company's three-year contract with the UAW expires in September 1993. Negotiations are unlikely to start until July 1993.

GM has about 3,500 employees at its Baltimore plant on Broening Highway.

The UAW has long opposed a two-tier pay structure, although GM may insist it is needed to cope with losses. GM's North American vehicle operations have lost almost $12 billion in the past two years.

GM has announced a restructuring expected to cut 74,000 jobs by 1995. The nation's No. 1 automaker reported a loss of $4.5 billion last year.

Workers in GM's parts operations make about $17 an hour, while total labor costs exceed $34 an hour including benefits, Ward's said. Workers at competing suppliers outside GM earn half or a third as much.

GM may be looking for a lower wage rate for its parts workers because it plans to hire more employees at its component operations to meet demand for items such as air bags and anti-lock brakes, Ward's said. That hiring could start in 1996 or 1997.

GM spokesman John Maciarz declined to comment on the report.

The UAW also must choose one of Detroit's Big Three automakers to negotiate with. That agreement will be a pattern for contracts at the other two.

"We always hope it will be us," Mr. Maciarz said.

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