FCA, UAW Pact Could Eventually End Tiered Pay System

Aaron Cole
by Aaron Cole

The tentative pact between the United Auto Workers and Fiat Chrysler Automobiles reached Tuesday evening may eventually end the two-tiered pay system for thousands of workers at the automaker, Reuters reported.

FCA chief executive Sergio Marchionne said the agreement would do away with the separate system “over time.” Roughly 45 percent of FCA’s workforce was hired at the lower, Tier 2 pay, which is roughly $9 less per hour than older, Tier 1 workers.

According to the report, raises for both classifications of workers would be likely, although details weren’t discussed.

Reuters also reported that the UAW’s health care agreement may broadly follow the “pooling” idea floated by Ford, General Motors and FCA last week. UAW retirees and their families are in a pooled, managed health care program established by the automakers to curb costs during the recession. It was expected that workers could eventually be folded into a health care co-op that could mimic the retiree plan, but it’s unclear if that was part of the UAW’s agreement with FCA.

The union’s pact with FCA could serve as a road map for further negotiations with GM and Ford.

Aaron Cole
Aaron Cole

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  • Rday Rday on Sep 16, 2015

    Sergio seems to have learned little about unions. The last thing we need in this country is more UAW built vehicles as if the lessons of the past are completely forgotten. Bought my last detroit vehicle and was that a mistake. Never more...just Toyotas and Hondas for me.

  • Thelaine Thelaine on Sep 16, 2015

    I wish Sergio would pass out on stage.

  • Xeranar Xeranar on Sep 16, 2015

    Is this really a surprise? This is EXACTLY what Marchionne was talking about and was likely going to work with the UAW to do. He's both a moderate on unions (really borderline pro-union) and he wants to consolidate support if he makes a play for GM. It's really more the former than the latter but both had a serious impact and it was obvious they were going to do this. But keep balking...Maybe you should move to another first world country with fewer unions than us....Oh wait, we're the lowest one. Guess you'll have to move to Southeast Asia to feel good about your chosen form of Capitalism.