The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Profit-Sharing:
A Net Loss for Workers

Feb 4, 2013

Auto companies reported enormous profits for 2012. This meant larger profit sharing checks for workers. Full-time Ford workers will get $8300, before taxes. (That amount is prorated down if a worker worked less than 1850 hours in 2012.) Full-time Chrysler workers will get $2250 before taxes. GM had not announced as of February 2.

The companies trumpet these large numbers to show how fair they are to employees. Well, not quite!

Profit sharing was set up from the first to attack workers’ pay, not improve it. Because profit-sharing replaced the annual 3 per cent yearly pay increase, the companies have scammed the workers big time.

Taking Chrysler as one example, look at the past 13 years of profit sharing as reported in the Detroit Free Press. Chrysler workers received a sum total of $7,485 profit sharing in those 13 years. But if those workers had had 3 per cent yearly pay increases, their additional income in those 13 years would have been above $24,000 – and their hourly wage today would be closer to $42 than to $28!

The profit-sharing scam not only keeps hourly wages down for the workers still employed by the Big Three; the scam multiplies its benefits for the companies by further holding down the wages of the spun-off, outsourced and subcontracted workers of the lower-tier suppliers.

Nor do these spun-off, outsourced workers, in their hundreds of thousands, receive any profit sharing whatsoever – regardless of the fact that their labor was just as essential to vehicle production as anyone’s.

Profit-sharing instead of pay raises began in the 1983 auto contracts. Thirty years later, profit-sharing continues to be part of the large-scale war on the workers waged by the billionaire class.