DETROIT — United Automobile Workers leaders approved a new tentative agreement with Chrysler LLC today, clearing the way for a vote by about 45,000 Chrysler workers. But the leaders of several union locals voted against the contract, which could spell difficulties for its ratification.þþSeveral union leaders said they were concerned that the contract did not include specific promises by Chrysler for future work at their plants, beyond the vehicles they build now.þþThe meeting of the U.A.W.’s Chrysler Council was held at Cobo Center in Detroit. The U.A.W. reached a tentative agreement with Chrysler last Wednesday after a six-hour strike.þþThe contract is similar to a new agreement between the U.A.W. and General Motors.þþLocal leaders leaving today’s meeting said that the contract had been approved by the council, but that the vote had not been unanimous, unlike a similar vote by leaders of G.M.’s local unions.þþTom Littlejohn, president of Local 1268 in Belvidere, Ill., said he opposed the contract. “I’m not going to recommend ratification,” Mr. Littlejohn said.þþThe chairman of the U.A.W.’s bargaining committee, Bill Parker, president of Local 1700 in suburban Detroit, said he too would recommend that workers vote against the contract. It is rare for U.A.W. members to reject a tentative agreement, and union leaders are careful not to send out any deal that might stand a chance of defeat.þþIn 1982, workers at Chrysler defeated a contract that would have given them profit-sharing payments instead of immediate wage cuts, but voted to stay on the job until the differences could be ironed out. The defeat came three years after Chrysler workers granted concessions to the carmaker to help it avoid bankruptcy.þþBut even as some dissent emerged today, the union’s president, Ron Gettelfinger, said the contract was “overwhelmingly supported” by the council. “We give people an opportunity to express themselves,” he said of those who opposed it. “We’re a very democratic union.”þþHe went on: “We did the very best that we could in this set of negotiations. I’m very pleased with the outcome, and we’re prepared to go out into the field” to urge workers to vote for the contract. He said the union hoped to complete voting by the last week of the month.þþMr. Gettelfinger maintained that there was “as strong of language in this agreement as we’ve ever had” on job security, but he did not discuss the company’s investments.þþHe said he had met Friday with officials at Ford Motor, the final Detroit company with which the union must reach agreement, but would not say when talks there would begin. He said he hoped talks there would be settled “without any altercation.”þþThe developments on the Chrysler contract came as G.M. released details showing that the health care trust created in G.M.’s new contract stands to become the company’s biggest shareholder.þþThe trust would hold roughly 16 percent of G.M. stock, because of a convertible note that G.M. is investing in order to establish the trust. That level would make it G.M.’s biggest institutional shareholder, surpassing the State Street Corporation, which has about 13 percent of G.M. stock.þþG.M. and the U.A.W. reached agreement on their contract on Sept. 26, after a two-day strike. Workers approved the contract last week.þþIt established the trust, called a voluntary employee benefit association, which would assume G.M.’s liability for health care benefits for G.M. workers, retirees and their families over their lifetimes. þþToday, G.M. said the liability for its U.A.W. members was about $46.7 billion.þþG.M. agreed to spend $29.9 billion to finance the trust, which are generally created at a discount to their total liability. The G.M. investment includes cash as well as a five-year, $4.37 billion convertible note, which will be invested in the trust on Jan. 1.þþThe note is equal to 109 million newly issued G.M. shares at $40 a share. G.M. can convert the note after three years, meaning in 2011, the same year that the U.A.W. contract expires. It can also convert it if G.M.’s share price reaches $48.þþG.M. stock was down $1.34, to $41.30 in late morning trading.þþThe trust would be run by an independent board that is expect to include union and company advisers, although G.M. said it might not take part if that affects the accounting for its liability. The new contract with Chrysler calls for the creation of a similar trust, and it is expected to be a feature of any agreement with Ford Motor, as well.þþG.M.’s chief financial officer, Frederick Henderson, said the VEBA “will be a very large shareholder of General Motors.” He said he would expect its trustees to “vote the stock in the same proportion as all shareholders.”þþSpeaking on another aspect of the contract, Mr. Henderson said G.M. would no longer pay retirement health care benefits for newly hired workers, even when they reach full status at the company. þþThe contract creates a new two-tier wage and benefit system that pays sharply lower wages and less-generous benefits to workers in the lower tier of wages. þþBut instead of post-retirement medical benefits, those workers would receive 401(k) funds that presumably would pay for their medical coverage after retirement.þþG.M. said it expected to promote workers from the second tier to the higher-paying first tier, as veteran workers retire or leave the company. It said about 75 percent of its workers would be eligible to retire, or take early retirement benefits, by 2011.þþBut even when the newly hired workers advance, they would not be eligible for traditional retiree health care benefits, G.M. said.þþU.A.W. leaders had no immediate comment on the G.M. disclosures. þþ
Source: NY Times
