Most of the workers leaving Martin Luther King Jr. High School on Sunday were unhappy with the tentative agreement the United Auto Workers reached with parts maker American Axle and Manufacturing Holdings Inc.
Yet as they streamed out of the school after hearing details from UAW President Ron Gettelfinger and other union officials, many said they’ll vote for it anyway because it’s the best the UAW could do with the U.S. economy faltering and the company threatening to move jobs to other countries.
“It’s just a nasty situation,” said Curtis McCall, 45, of Detroit, an American Axle worker for 14 years. “You almost have no choice. If you vote no, then really you’re out in the cold.”
Other workers said they want to keep their nearly 12-week-old strike going to hold out for a better deal. Several said there was a lot of screaming inside the meeting as more than 1,000 Detroit-area workers expressed frustration at facing a 34 percent pay cut if the contract is approved.
“I’m voting no. It’s totally unacceptable,” said Gary Reed, 52, of Warren, who criticized American Axle Chairman and CEO Richard Dauch for making millions while asking production workers to take a pay cut from $28 per hour to $18.50.
“It’s a slap in our face,” Reed said. “We’ve been watching this guy making millions and millions of dollars even while we’ve been on strike, and were going to accept a stab in the back and just walk away with a smile on our face?”
About 3,600 workers at five factories in Michigan and New York will vote on the contract starting Monday. A large Detroit local won’t vote until Thursday.
If approved, the deal could end the nearly three-month strike that crippled General Motors Corp.’s production of pickup trucks and sport utility vehicles, causing thousands of layoffs in the U.S., Canada and Mexico.
Workers at two key GM assembly plants went on strike over local contract issues during the American Axle strike, and industry analysts said the UAW struck to pressure GM to get involved in the American Axle deal. Union officials denied any connection.
The four-year agreement also closes American Axle’s Detroit and Tonawanda, N.Y., forge operations.
The deal does give workers a $5,000 signing bonus, lump-sum cost of living adjustments and a variety of options to take money and leave the company.
After the meeting, Adrian King, outgoing president of UAW Local 235 in Detroit, said the session didn’t go well. Workers were angry about the deal, and their frustration was compounded by a malfunctioning public address system that hampered questions from the crowd.
“We had a lot of angry brothers and sisters,” he said. “It’s definitely a hard-looking contract, very tough pill to swallow for the membership.”
King wouldn’t say if he favored the pact, but said it was the best deal that UAW bargainers could get from a company that could move jobs elsewhere.
King also said an additional $18 million contribution from GM was the key to reaching the deal late Friday. The automaker already had agreed to kick in $200 million to help end the walkout and threw in the extra $18 million to cover supplemental unemployment benefits that American Axle was unwilling to pay, King said.
American Axle makes axles, drive shafts and stabilizer bars mainly for GM’s pickup trucks and large sport utility vehicles, and GM said it lost $800 million in the first quarter due to the strike.
A summary of the contract distributed by the union included base pay of $18.50 per hour for Detroit workers, up from the $17 per hour that American Axle had been offering.
The summary also said there will be buyouts of $85,000 for someone with less than 10 years with the company and $140,000 for a worker with more.
An offer of a $55,000 early retirement bonus also was included in the proposed contract.
Workers also would get a wage “buydown” of up to $105,000 paid over three years to help ease the transition to lower hourly pay. The size of the buydown would vary with the size of a worker’s pay reduction.
The deal features different pay rates at each of the company’s U.S. locations. Production workers in Detroit, for example, would make a maximum of $18.50 per hour, but workers doing some of the same jobs in Three Rivers, Mich., would make $14.50. Factory support workers in Detroit would make $14.35, while the same job would pay $10 per hour at the Three Rivers axle plant.
The summary sheet says American Axle agreed to invest $170 million to $200 million in UAW-represented factories, and the company agreed to place some new business in the plants. In addition, notices of outsourcing work from Detroit and Cheektowaga, N.Y., will be rescinded, the summary says.
And the union said it was able to hold off a company plan for up to a $4,000 health insurance deductible for a family. The new deductible is $300, the summary says.
Most workers leaving the meeting Sunday predicted the vote will be close. One worker tossed pages of the summary into the air as he walked out.
“There will be a lot of unhappy people,” Reed said as he carried a picket sign outside the school. “But I think it’s going to be accepted.”