UAW Entry-Level "Tier Two" Workers Get Pay Bump

by Edward Niedermeyer

Updated: January 31st, 2023 Published: September 18th, 2011

In yesterday’s coverage of the new UAW-GM contract, I wrote

What’s not yet clear is whether entry-level “Tier Two” workers, who make half what their “Tier One” brothers make, got a raise. Though it’s clear that GM and the UAW worked to avoid major increases to fixed costs by concentrating on jobs and profit-sharing bonus checks, the NYT confirms that the union was asking for some kind of entry-level raise. Given that no outlet is confirming any such Tier Two raise, though, it seems as though the UAW’s culture of seniority-over-solidarity has won out.

I was wrong. The Detroit News‘s Christina Rogers reports that GM will

give entry-level workers a $2-$3 an hour increase. Those so-called tier two employees, who are paid $14-$16 an hour, will be boosted to $16-$19 an hour.

Good for you, UAW. Thank you for proving me wrong. But the sooner the union shares the burden of the “new normal” equally across its entire membership, the better. This is a step in the right direction, but as long as some brothers are more equal than others, it’s going to be tough to talk transplant workers into what still amounts to a seniority pyramid scheme.

Edward Niedermeyer

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15 of 31 comments

NormSV650 on Sep 18, 2011

Tier ll is still below the transplant(foreign plants) and guarantees a union due. Win-win for UAW.

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- TrailerTrash on Sep 18, 2011
  
  um...but this is my original point about the con with such statistics. Isn't tier 1 way above the imports/implants? So...IF you go about trying to use play with numbers...this is what you do...you kind of not mention the whole picture. My point is you can't start a game with agreed rules, even get taxpayers to put money into the pot...then start frigging with the rules. It is a con...plain and simple. Look...I love a good con...but get kind of pissed when those playing it are caught and act sanctimonious or point and accuse me of wrong doing.
  
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PintoFan on Sep 18, 2011

The two-tier system isn't ideal, but I don't think that it's permanent. Give it 5 years, and we will probably see a reversal to a single-tier system- albeit with pay cuts for the upper level. A lot of it depends on the UAW's ability to unionize transplant factories. When Spring Hill is reinstated, I doubt that Volkswagen will be able to hold out for long. A good deal for the UAW will only strengthen their position against the transplants.

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- Geeber on Sep 18, 2011
  
  I'm sure that the VW plant will only hold out as long as the Toyota plants, Honda plants, Hyundai plants and Nissan plants. In other words, I'm not holding my breath waiting for it to become a unionized plant. The bitter truth is that the UAW has little, if anything, to offer transplant workers, except for the possibility of paying union dues.
  
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- Pch101 on Sep 18, 2011
  @geeber The bitter truth is that the UAW has little, if anything, to offer transplant workers, except for the possibility of paying union dues. That's right. The product that the UAW has to sell doesn't offer a compelling value proposition to those who don't work for one of the Detroit 3. If the UAW can't improve workplace conditions, wages and benefits, then its serves no purpose. And because its labor contracts are public information, it isn't tough for the other automakers to keep them at bay.
  
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- Geeber on Sep 19, 2011
  
  @geeber The UAW's problem is that it was born battling the icy, aloof Alfred P. Sloan of GM and the vicious Harry Bennet of Ford. They truly viewed the worker as little more than machines that could be easily replaced. The management teams of Honda, Hyundai, Nissan and Toyota aren't going to be that stupid.
  
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Mikey on Sep 18, 2011

@ PintoFan.. I agree with you to a point. However,getting the transplants on board,it all depends on how well the transplants treat thier workforce. As it stands today, there is no incentive for the transplant workforce to vote union. Though that can, and will change.

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- Golden2husky on Sep 18, 2011
  
  mikey, the transplant workers are getting the benefit of union representation without the baggage of actually being a member. Those transplants keep wage packages good enough to keep their workforce satisfied. That keeps the union out. Should the union fail to be viable, the wages at the transplants will at best stagnate.
  
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- Mikey on Sep 18, 2011
  
  @golden2husky....Your right,and up to this point the tranplants have done that job well.
  
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- TrailerTrash on Sep 19, 2011
  
  @golden2husky This, my friend, is pure nonsense. There is nothing that can be proven in what you say. This is similar to they spin today with the initial forced "investment" into the economy by Obama. We were promised there would NOT be a further increase in unemployment. However, if we did NOT do the spend, unemployment would reach above 8 percent. Really???? Ooops! But we cannot prove they are wrong. This just a "faith" statement. We are stuck, reduced to muttering to ourselves about never being conned again. But here it does come again, right? Today, with unemployment reaching numbers much higher than before the theft, all they say now is how much worse it would have been without the deal. Wait...what? Statements and positions such as this cannot be directly agued with because they are speculation. They cannot be proven or disproven. Ditto with the union/non-union relationship. You can also say that without the unions, the auto industry would be far more successful and competitive today. Many businesses are non union, never have been, yet are successful. This is another statement that cannot be proven, but equally as far out of reach of examination as yours.
  
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- Geeber on Sep 19, 2011
  @golden2husky golden2husky: mikey, the transplant workers are getting the benefit of union representation without the baggage of actually being a member. Those transplants keep wage packages good enough to keep their workforce satisfied. The transplant operations keep the union away by operating under a different set of assumptions. The union was born during a time when the American automobile industry followed the rules set down by Henry Ford I - the supervisor was the aboslute boss; management ran the company as it saw fit (at Ford, management was Henry Ford I; at GM, it was the executive team); the worker was not paid to think; workers would slack off unless management's boot heel was kept on their colletive necks, hence the need for strict supervision; and the goal was always more production, which meant that the line moved as fast as possible. Under those circumstances, it's no wonder that the union came into being, and that the us-versus-them mentality became a standard part of "Detroit" culture. The problem for the UAW is that transplants operate differently. The worker is treated as an adult, but at the same time, expected to use initiative and find ways to improve quality and productivity. The job classification system initially developed by Henry Ford I and now zealously defended by the union has been largely discared. Ironically, for all of the wailing about UAW members being overpaid, I doubt that the transplants would set pay at different rates. Which suggests that the UAW members are NOT overpaid, but also suggests that it's not just comparable wage rates keeping the union at bay. The challenge is more subtle - namely, the worker is expected to take initiative and find ways to improve the processes, which will ultimately improve the product. Workers are given both more freedom and more responsibility. The UAW has never truly faced this. But then, neither have the domestics.
  
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- Pch101 on Sep 19, 2011
  @golden2husky The union was born during a time when the American automobile industry followed the rules set down by Henry Ford I – the supervisor was the aboslute boss; management ran the company as it saw fit (at Ford, management was Henry Ford I; at GM, it was the executive team); the worker was not paid to think; workers would slack off unless management’s boot heel was kept on their colletive necks, hence the need for strict supervision; and the goal was always more production, which meant that the line moved as fast as possible. Very good post, Geeber. This provides a good summary of the background. The labor-management schism was created by management...but then labor incorporated that combativeness and disdain into a part of its own business model. Both sides were too concerned about pointing fingers at each other to put the priority where it belongs -- on the customer. The problem for the UAW is that transplants operate differently. The worker is treated as an adult, but at the same time, expected to use initiative and find ways to improve quality and productivity. This is the difference between the lean production methods pioneered by Toyota and the mass production system that was invented by Ford and imitated by the rest of Detroit (and, for that matter, by just about everyone else.) Contrary to the beliefs of the Detroit boosters, the transplants haven't built cars in the same way, and the results were different because of it. Toyota has built better cars because they used an entirely different process for building them. But as others finally adapt to the lean production model, it gets harder for TMC to use this as a competitive advantage.
  
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- Geeber on Sep 19, 2011
  
  @golden2husky Thank you, Pch101. I remember reading that Toyota wasn't worried about the competition adopting its techniques, because competitors viewed it mainly as a method to cut costs, not as way of organizing the company from the factory floor to the executive suite. Of the Detroit Three, I believe that Ford is the one that most "gets it," and even Ford isn't quite there yet.
  
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- Pch101 on Sep 19, 2011
  @golden2husky Toyota wasn’t worried about the competition adopting its techniques, because competitors viewed it mainly as a method to cut costs, not as way of organizing the company from the factory floor to the executive suite. I'm not sure whether TMC was concerned, but yes, Detroit didn't understand that lean production doesn't just involve scrapping job classifications for labor. It also involves creating a leaner management system, with less top-down authority. That is the sort of power that Detroit white-collar managers never wanted to give up, particularly GM with its engrained non-invented-here mentality. Of the Detroit Three, I believe that Ford is the one that most “gets it,” and even Ford isn’t quite there yet. Ford began to adapt aspects of lean production during the 80s, but then only partially. It has taken them more than two decades to get this far with it.
  
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Ihatetrees on Sep 18, 2011

I'm sure the work environment in plants with both tiers is Kumbaya kosher. It's gotta be a joy to manage the plant floor, too. For comparison purposes, does anyone know the approximate breakdown of the wage structure in transplant factories? From what I understand, there's about 6 job descriptions from general line workers (in the low $20/hour range) to skilled trades (at over $40/hour - better than their UAW counterparts).

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