During the government’s bailout of General Motors, the UAW agreed to a number of concessions, including management’s ability to use “Innovative Labor Practices” in order to build a fuel-efficient subcompact car in the US. As a result, the 1,600 workers at the firm’s Lake Orion plant had a choice: the 800 most senior workers would return at the $28 “tier one” wage, while another 500 workers would be able to return only if they accepted a 50% pay cut, pushing them into the union’s “second tier” of wages. Workers forced into the tier two, which typically applies only to new hires, were not allowed to transfer to other Michigan plants, and could neither vote on the agreement, nor strike because of it. After all, the bailout’s green-tinged sales pitch meant that building a subcompact in the US was a politically necessary move, even if it went against every UAW principle… which is why it’s awfully ironic that the safety valve for this deteriorating situation is a factory building trucks.
Lake Orion worker have been protesting their union for months, becoming a lightning rod for criticism of the UAW’s two-tier wage system and union leadership’s willingness to sell out the rank-and-file. And now, GM and the popularity of its full-sized pickup trucks are coming to the rescue.
According to the Detroit Free Press, GM sent out a letter to the UAW’s Lake Orion workers, allowing Tier 1 employees to transfer to its Flint Assembly plant in order to keep from being bumped into the second tier. Of course, workers who accept this deal will no longer be enjoying the “green jobs” that are said to be the future of the business, as Flint builds Heavy-Duty versions of the Chevrolet Silverado and GMC Sierra… and if Flint ever shuts down, Tier 1 workers won’t be able to return to Lake Orion as the goal is to make that plant 100% Tier 2. For now though, Tier 1 Orion workers’ options are
1. Choose to work in Flint. That may be an attractive option for the more than 600 workers who were already driving through the Flint area to work in Orion.
2. Apply for a spot working in Orion at the full wage. GM will fill those spots by seniority, so the workers choosing this option will be able to transfer to Flint if they don’t make the cut.
3. Stay in Orion, no matter what. If the worker’s seniority does not make him or her one of the about 800 making the full wage, this option indicates the worker will willingly take the 50% pay cut.
Many Orion workers had already transferred to plants such as Lordstown. If they accepted only a $4,800 relocation bonus, they retained rights to come back to Orion after six months. That would qualify them to choose one of the options in the letter.
By working to mop-up the bad feelings at Lake Orion, GM is signaling that it’s taking UAW resentment of the “Innovative Labor Practices” seriously. Unfortunately, that resentment is increasingly with the two-tier system itself, and this decision only keeps Tier 1 workers from falling into Tier 2… the system that breeds shop-floor resentment remains. Moreover, the Tier 1 workers who are transferring to Flint may have kept their higher wage level, but they’ve traded any job security that comes with working at a fuel-efficient car plant. If gas prices spike, HD pickup production will be the first to get cut, and the UAW’s Tier 1 Gypsies will be on the move again.