Detroit Free Press: Marick Masters on how health care costs can impact the UAW strike
General Motors, in its negotiations with the UAW, has cost Ford a lot of money. Why? Ford employs the most hourly workers in the U.S and as a result pays more for health care. So any costs that GM negotiates in what is seen as a master contract with the Detroit Three directly impacts Ford disproportionately, labor analysts say. One upside of being the target chosen by the labor union to go first during collective bargaining means GM sets the pattern for key issues such as wages, health care and temporary workers in the four-year contract. Initially, GM proposed raising the share of their health care costs that hourly workers pay from 3% to 15%, but the UAW screamed no way. The union argued that, for years, workers have conceded pay raises and other benefits to protect health care costs for workers in physically demanding jobs. GM has said that it has agreed to leave health costs as they are, a big win for the union. The autoworker insurance deal is among the best remaining in the country. The average worker today pays 28% of health care costs, the Center for Automotive Research says. “Health care is a major issue,” said Marick Masters, a business professor at Wayne State University who specializes in labor management. “That is sacrosanct as far as the UAW is concerned. Any company that tries to make a significant change in health care to shift the cost to employees is inviting a strike.” Most foreign-based automakers have considered Detroit 3 wages and benefits the UAW sets nationally, but in recent years some nonunion automakers have shifted to setting wages based on regional market rates, analysts noted. They cite a leaked 2006 Toyota memo that discussed needed wage reductions and suggested hiring more temporary workers to replace $25 an hour workers at Toyota plants in North America. Protecting health care costs can be used to effectively organize foreign-based company autoworkers in the future, Masters predicted. So this is a key strategy for the UAW if it's going to grow its manufacturing membership.