UAW, DaimlerChrysler Subsidiary Reach Unique, Multi-Plant Labor Agreement

DETROIT October 11, 2004; John Porretto writing for the AP reported that the United Auto Workers and an automotive supplier have reached an agreement that covers current hourly workers and possibly those at yet-to-open factories, the first multi-plant pact negotiated by the UAW in 20 years.

The UAW and Axle Alliance Co. announced the deal Monday. The two sides negotiated a four-year pact in February covering workers at Axle Alliance's plant in Redford, a Detroit suburb, and struck the national agreement two weeks ago.

For now, Axle Alliance runs only the plant in Redford with about 70 hourly employees and is beginning work at another in Kings Mountain, N.C., but expansions are under way. The new agreement would cover hourly workers at any additional facilities if a majority of them choose UAW representation.

Axle Alliance said it plans to spend $25 million to $30 million to expand its facility in Redford, doubling the number of hourly workers to about 150 next year. The company also is investing $5 million to $10 million at its new assembly plant in North Carolina. The company said it will employ 50 to 60 hourly workers at Kings Mountain by year's end.

Altogether, Axle Alliance plans to increase its work force from 200 to roughly 500 in the next two years.

Production workers will be paid about $14 an hour to start and be eligible for extra compensation from continuing education and performance incentives.

UAW officials said the new agreement is novel in that it will eliminate negotiations on specific work-related matters at individual plants. For example, when the UAW and Detroit's Big Three automakers, General Motors Corp., Ford Motor Co. and DaimlerChrysler AG, reached national agreements in 2003 on wages, benefits and other issues, local UAW outfits negotiated contracts with the companies on matters specific to their plants.

"You take some corporations (where) we have numerous work sites and it's like we're in constant negotiations," said UAW president Ron Gettelfinger. "Under this concept, we can sit down, work out an agreement that's fair, get it ratified ... and move forward.

Gettelfinger said he hopes the Axle Alliance agreement becomes a model for others, but he acknowledged that each set of talks is different.

Labor experts said the larger the company, the more difficult it would be to come to terms on a deal that covers all factories.

"This seems like a situation where Axle Alliance and the UAW are really planning to work together and be partners rather than have a contentious labor-management relationship," said Ed Hertenstein, a professor of labor relations at the University of Illinois at Urbana-Champaign.

Axle Alliance chief Christof Traidl said UAW officials have played a key role in discussing the company's future.

"We talked pretty much strategically up front," he said.

Founded in 2001, Axle Alliance is a wholly owned affiliate of DaimlerChrysler that builds axles for the vehicle-maker's North American plants. The axles are used in Freightliner vehicles and Thomas Built buses.