“Abolish Two-Tier”

Mar 30, 2015

When the UAW Bargaining Convention 2015 opened in Detroit, Michigan on March 24^th, the issue of two-tier wages was a major concern for delegates. The fact that the union administration felt the need to address it was proof that pressure against the current wage structure has been building in the union. In speeches and resolutions, the administration took care to appear resolute in their determination to “bridge the gap” in wages.

The tiering of wages is a strategy of the automakers to bring down the wage levels paid for production of autos. The GM annual report in 2010 said, “Our current U.S. and Canadian hourly labor agreements provide the flexibility to utilize a lower tiered wage and benefit structure for new hires, part-time employees and temporary employees.”

The UAW leadership also supports tiering policies: They argue that wages must be lowered to levels paid by the Asian and European transplants here in the U.S. in order to allow the Big Three to compete.

Parts plant workers are perhaps the hardest hit by tiering. Once part of the auto worker family, parts work was spun off to other mostly American plants at lower wages. This created third and fourth tiers. Today, American Axle for example starts workers out at $10 per hour.

Still, today, the UAW administrators claim that it is their negotiation of tiers that resulted in “more jobs”, i.e., the recent hiring into the plants of some 40,000 Tier 2 workers.

In fact, it is not true that the UAW leaders have created more jobs by accepting lower tiers of pay. If companies have been hiring in the current period, it is due to the increased production of vehicles and increased sales that followed the recession of 2008 and the replacement of some retired workers.

In any event, today, auto workers are producing as many vehicles as they did 30 years ago with around half as many workers. That’s not more jobs.

The administration of the union no doubt feels the pressure from its membership for wage increases due to the record profits of the auto companies. Their strategy is clearly to patch their way through rough waters by convincing the bosses to throw some of their super profits toward small wage increases, even for the 1^st tier of workers.

But behind the scenes, these same union leaders and the corporate bosses speak happily about the upcoming end of two tier in perhaps two rounds of contracts.

They know that in a period of about 8 years, or two contracts, the current Tier 1 workers, who average 49 to 51 years of age, will be retired out, eliminating the problem of Tier 1 & 2 disparity. They know that then the lower Tier 2 will be the norm.

This may be a great solution for the auto bosses and for their junior partners in the union. But it is not good at all for the working class.

Many delegates to the convention are wise to the administration’s strategies, which are, in fact, corporate strategies. In the words of Gary Walkowicz, bargaining committeeman at the Dearborn Truck Plant at Ford Rouge, and long term fighter against two-tier, “It’s not about ‘bridging the gap.’ It’s not about moving a few people into first tier pay. It’s not about giving people first tier pay, but no pension. It’s about getting rid of two-tier now.”

He pointed out in interviews that the company he works for, Ford Motor Company, could convert its 14,685 Tier 2 workers to a full $28-an-hour Tier 1 wage for about 335 million dollars a year; that is, a fraction of the $6.9 billion the company earned in North American profits just last year.

Delegates, including Walkowicz, wore T-Shirts that read “ No More Tiers” and spoke up for a fighting policy on the convention floor.

It is certainly possible that during contract negotiations the auto bosses will grant some small concession in wage increases to auto workers, even to Tier 1 workers.

But if there is any concession from auto companies, auto workers can be sure that it will be a bone thrown out to keep workers from organizing and fighting until the company can eliminate Tier 1 in some few years time.

If the Union Administration had any intention of halting the downward spiral of wages, health and retirement benefits and working conditions, they would have used this convention to begin organizing for a real fight, which appears to be the last thing on their minds.

Clearly, to roll back the attacks, to start the working class on the road to recovery, will take a real fight led by different leaders; workers who are loyal to their class and their class interests.