UAW, GM work overtime to finalize new contract

9/23/2007

DETROIT - Negotiators for General Motors Corp. and the United Auto Workers met for the 20th straight day Sunday to finalize the details of a new contract agreement, according to a local union official who is being briefed on the talks.

Negotiators have wrapped up work on most issues and were down to determining how much money GM must put into a trust fund for retiree health care that will be managed by the UAW, said the official, who spoke on the condition of anonymity because the talks are private. The official expected a final deal could be reached as early as Sunday evening, although others said it could take longer.

"My sense is they are close. I think this is the end game," said Harley Shaiken, a professor at the University of California at Berkeley who specializes in labor issues and has been closely following the talks. "They may be approaching a resolution, but if that's in the next two hours or the next two days, it's hard to say. There are a lot of complex issues yet to be resolved."

The health care fund known as a Voluntary Employees Beneficiary Association, or VEBA would be a groundbreaking change for the auto industry and has been the major issue in this year's negotiations. GM has around $51 billion in unfunded retiree health care costs but the company isn't required to put the full amount into the VEBA. The UAW and GM have been wrangling over how much GM should put in and how much can be paid in cash or in stock

Talks resumed Sunday morning after negotiators recessed Saturday evening, GM spokesman Tom Wickham said. Sunday marked the ninth day since GM's contract with the UAW was scheduled to expire. The contract has been renewed on an hour-by-hour basis. A message seeking comment was left for UAW spokesman Roger Kerson.

Several local union officials said they had heard little about the negotiations as of Sunday afternoon and hadn't been told when the UAW will tell them about the deal. Once a tentative agreement is reached, local union leaders will meet for a briefing and then will present it to their members. Any agreement will have to be ratified by a majority of GM's 73,000 UAW members.

The UAW has picked GM as the lead company and potential strike target, so Ford Motor Co. and Chrysler LLC would likely match many of the terms of GM's agreement.

GM, which has about 339,000 UAW retirees and spouses, badly wants to pay the union to form the VEBA to get the health care liabilities off its books. The UAW is seeking guarantees of new vehicles to be built in U.S. plants in exchange.

Shaiken said workers will want to see job security promises if they're being asked to accept a VEBA.

"There's a tendency in negotiations for observers to focus on one or two contentious issues, but ultimately it's a package that's being voted on," he said.

Read more in later editions of The Blade and toledoblade.com