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UAW Boss Avoids Question on Health Concessions

December 4, 2008
Related Topics: Retirement/Pensions, Labor Relations, Strategic Planning, Latest News
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United Auto Workers president Ron Gettelfinger declined Thursday, December 4, to say the UAW would accept additional concessions on retiree health care.

Responding to questions from Sen. Bob Corker, R-Tennessee, Gettelfinger said the union would have to study whether it could cut the Detroit Big Three automakers’ future commitment to the voluntary employee beneficiary associations, or VEBAs.

Corker asked Gettelfinger at a Senate Banking Committee hearing on a proposed auto industry bailout whether the union would accept equity instead of cash for half of the Detroit companies’ $21 billion VEBA obligations.

The bulk of that money would have been due in January 2010, but the United Auto Workers agreed Wednesday to delay indefinitely the next installment of VEBA payments by General Motors, Ford Motor Co. and Chrysler.

Corker also said the UAW needs to give up supplemental pay for laid-off workers that, when combined with state unemployment, brings the laid-off workers to nearly full wages.

Under last year’s contract with the UAW, the Detroit automakers transferred retiree health care obligations to a union-run fund. GM, for example, agreed to shed a $51 billion liability by contributing $35.3 billion to the trust.

Gettelfinger said Wednesday’s announcement also included a big concession: suspension of the Jobs Bank. That contractual provision requires the automakers to pay up to 95 percent of wages and benefits to laid-off autoworkers.

Filed by David Barkholz of Automotive News, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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