{"id":9336,"date":"2023-09-09T13:50:02","date_gmt":"2023-09-09T13:50:02","guid":{"rendered":"https:\/\/prosfunds.com\/finance\/i-have-a-pension-they-dont-why-united-auto-workers-are-fighting-to-end-a-two-tier-system-for-wages-and-benefits\/"},"modified":"2023-09-09T13:50:04","modified_gmt":"2023-09-09T13:50:04","slug":"i-have-a-pension-they-dont-why-united-auto-workers-are-fighting-to-end-a-two-tier-system-for-wages-and-benefits","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=9336","title":{"rendered":"\u2018I have a pension; they don\u2019t\u2019: Why United Auto Workers are fighting to end a two-tier system for wages and benefits"},"content":{"rendered":"<p>Joe Genovese was hired by Ford Motor at the tier-two level, as workers refer to it, 11 years ago. In a year, he\u2019ll finally make top pay, he told a United Auto Workers rally earlier this month.<\/p>\n<p>Tier-two workers in the automobile industry can receive less than half as much in hourly wages as top-tier workers, depending on the automaker and the contract. Their benefits are also less generous \u2014 and, like in Genovese\u2019s case, it takes them many more years to reach the top hourly wages than those hired before 2007, when the Big Three automakers introduced the current tiering system after their financial troubles.<\/p>\n<div>\n<p>Because of this, Genovese said, he has seen many friends and family members who were also tier-two employees transfer to other plants during his time at the company, as they sought to increase their pay however they could. <\/p>\n<p>\u201cWith tiers, there is no union,\u201d he told the crowd of hundreds of union workers near Detroit during the Aug. 20 rally, which was livestreamed. \u201cWith tiers, there\u2019s a division. It\u2019s time to close that division.\u201d<\/p>\n<p>The union has been dissatisfied with its negotiations with the Big Three automakers, and announced Friday that 97% of members had voted to authorize a strike if no agreement is reached. Contracts are set to expire Sept. 14.<\/p>\n<p>One of the union\u2019s priorities is ending the automakers\u2019 tiered workforce. Shawn Fain, the UAW\u2019s president, wore an \u201cEnd Tiers\u201d T-shirt at the recent rally. <\/p>\n<h2>\u2018A sore point from Day 1\u2019<\/h2>\n<p>Tiering, an increasingly common practice that labor experts say started in the U.S. in the 1980s as employers pushed for concessions from their employees, is when companies bring in new employees for lower pay and fewer or worse benefits \u2014 sometimes on a supposedly temporary basis that can stretch on for years \u2014 than workers hired earlier who are doing the same work.<\/p>\n<p>In the U.S. automobile industry, workers hired in 2007 and onward don\u2019t have pensions or healthcare when they retire. In addition, as automakers make the transition to electric vehicles, so-called new types of work are being performed that may not be covered by UAW contracts, such as by workers at some battery plants that have not been unionized. That worries unions and labor observers alike.<\/p>\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetPullQuote\n            inline\n    scope-web|mobileapps\n  article__inset\n          article__inset--type-InsetPullQuote\n            article__inset--inline\n  \"><\/p>\n<p>          <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<div class=\"wsj-article-pullquote article__inset__pullquote \">\n<p class=\"pullquote-content article__inset__pullquote__quote\">\n        <span class=\"l-qt article__inset__pullquote__mark--left\">\u201c<\/span>\u2018Across the board, the rank-and-file hated [tiering]. \u2026 They viewed it as discriminatory that people were doing same job and getting paid substantially less, and that [some workers were] treated as second-class citizens.\u2019<span class=\"r-qt article__inset__pullquote__mark--right\">\u201d<\/span>\n      <\/p>\n<p>        <small><br \/>\n          <span class=\"inset-author article__inset__pullquote__author\">\u2014 Marick Masters, business professor at Wayne State University<\/span><br \/>\n        <\/small><\/p><\/div>\n<\/p><\/div>\n<p>Nelson Lichtenstein, a professor at the University of California, Santa Barbara who has written books about the history of labor, said that in the \u201980s, tiered workforces could be found not just in the automobile industry but in airlines and trucking, too. Now, many \u201cemployers are constantly creating new tiers. It fits in with the fissuring of the workplace,\u201d he said in an interview before the results of the strike-authorization vote were released.<\/p>\n<p>U.S. automakers over the years have justified tiering as a way to stay competitive because of globalization, Lichtenstein said. \u201cWhether the automakers are doing well [financially] or not, they\u2019ll say the competition, like Toyota, will eat our cake.\u201d<\/p>\n<p>But \u201cacross the board, the rank-and-file hated [tiering],\u201d said Marick Masters, a business professor at Wayne State University in Detroit. \u201cIt was a sore point from Day 1. They viewed it as discriminatory that people were doing same job and getting paid substantially less, and that [some workers were] treated as second-class citizens.\u201d <\/p>\n<p>Other auto workers tell stories that are similar to Genovese\u2019s.<\/p>\n<p>Quortez Danforth, a UAW Local 1264 member in Sterling Heights, Mich., who has been a temporary part-time worker at Stellantis for five years, also spoke at the rally. He said he had \u201cmissed out on rolling over\u201d to a full-time job in 2020, when he had to have open-heart surgery. Since then, he said, he has lost out on three years of bonuses and profit sharing, to which full-time permanent workers are entitled.<\/p>\n<p>\u201cI\u2019m hoping this [union] fight will help,\u201d Danforth said.<\/p>\n<p>Tony Totty, the president of UAW Local 14 in Toledo, Ohio, and a General Motors employee, told MarketWatch ahead of the vote results that the union and workers have made concessions for years as U.S. automakers went through tough financial times, including bankruptcies and bailouts.<\/p>\n<p>\u201cIf we didn\u2019t make those concessions, these [companies], managers and CEOs wouldn\u2019t be making what they make,\u201d Totty said. \u201cNow they\u2019re so profitable, but we still have these provisions from the days of bankruptcy.\u201d<\/p>\n<p>GM<br \/>\n        GM,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/205226835\/composite\" class=\"positive\">+1.17%<\/bg-quote><br \/>\n       and Ford<br \/>\n        F,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/208911460\/composite\" class=\"positive\">+2.84%<\/bg-quote><br \/>\n       posted $2.6 billion and $1.9 billion in profit in the second quarter, while Stellantis<br \/>\n        STLA,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/204248628\/composite\" class=\"positive\">+0.77%<\/bg-quote><span>,<\/span><br \/>\n       the Dutch multinational automaker that is the parent company of the U.S. automaker formerly known as Chrysler, reported $12.1 billion profit in the first half of 2023.<\/p>\n<p>A GM spokesperson would not comment on tiering but issued the following statement: \u201cWe\u2019ve been working hard with the UAW every day to ensure we get this agreement right for all our stakeholders.\u201d A spokesperson for Stellantis referred MarketWatch to the company\u2019s website about the negotiations with the union. Ford did not respond to a request for comment.<\/p>\n<p>Totty, who was hired by GM in 1997, said it took him three years to reach top rate, or the highest wages possible. \u201cNow it\u2019s an eight-year progression. Now there\u2019s other things that will never get them to 100% in the contract,\u201d he said. \u201cI have a pension; they don\u2019t. That pension allows me to get retiree healthcare. They don\u2019t get that.\u201d<\/p>\n<p>As for the issue of automakers striking partnerships with other companies to make batteries for EVs and using nonunion labor, battery-plant workers are starting out at a lower hourly rate of $16 to $20 an hour, Totty said. He expressed concern about what will happen to other workers once the transition to EVs is complete.<\/p>\n<p>\u201cGM has had partnerships before, like with NUMMI [a joint venture between GM and Toyota that had an automobile plant in California], done with all UAW workers,\u201d Totty added.<\/p>\n<h2>A game of whack-a-mole<\/h2>\n<p>Jody Calemine, a senior fellow and director of labor and employment policy at the Century Foundation, a progressive think tank, likened tiering to a game of whack-a-mole. Tiering exists everywhere, he said, including at grocery stores, in healthcare and in the public sector. It exists in delivery, including at the U.S. Postal Service.<\/p>\n<p>Teamsters at UPS<br \/>\n        UPS,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/201245396\/composite\" class=\"negative\">-0.74%<\/bg-quote><br \/>\n       were able to eliminate one tier \u2014 a second tier of lower-paid drivers \u2014 in the contract the company\u2019s employees approved last week. But a part-time UPS warehouse worker, Noah Jorstad of Fargo, N.D., told MarketWatch that under the new contract, there remains a difference between what current part-timers will make by 2028 ($25 or $26 an hour) and what new hires\u2019 hourly wages will be by that time ($23 an hour).<\/p>\n<p>\u201cIt\u2019s going to be an issue for the next contract,\u201d he said. \u201cIt\u2019s like kicking the [can] down the road.\u201d<\/p>\n<p><strong>See:<\/strong> It\u2019s \u2018crunch time\u2019 for unionized auto workers, but this is not UPS<\/p>\n<p>Saving difficult issues for later has been a recurring theme in labor negotiations since companies introduced tiering in the \u201980s, Calemine said. For the companies, it was \u201ca very clever tactic,\u201d he said. \u201cIt ended up being the cheapest concession a union could make in the moment. Though unions resisted it, no current member was losing anything.\u201d<\/p>\n<div data-layout=\"inline\n                \" data-layout-mobile=\"\" class=\"\n          media-object\n          type-InsetPullQuote\n            inline\n    scope-web|mobileapps\n  article__inset\n          article__inset--type-InsetPullQuote\n            article__inset--inline\n  \"><\/p>\n<p>          <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<div class=\"wsj-article-pullquote article__inset__pullquote \">\n<p class=\"pullquote-content article__inset__pullquote__quote\">\n        <span class=\"l-qt article__inset__pullquote__mark--left\">\u201c<\/span>\u2018We need to be the working class again, instead of the working poor.\u2019<span class=\"r-qt article__inset__pullquote__mark--right\">\u201d<\/span>\n      <\/p>\n<p>        <small><br \/>\n          <span class=\"inset-author article__inset__pullquote__author\">\u2014 Sarah Schambers, a fourth-generation Ford worker in Michigan<\/span><br \/>\n        <\/small><\/p><\/div>\n<\/p><\/div>\n<p>Perhaps nowhere are the effects of tiering more obvious than within the same family.<\/p>\n<p>Sarah Schambers, a fourth-generation Ford worker in Michigan and single mother of two children, said in a video recently released by the UAW that it took her six years to go from a temp job to a permanent position that paid $16.66 an hour. And it took her a total of 15 years to reach the top wage of $32 an hour at the company, she said \u2014 after having to move plants four times, from Michigan to Kentucky and back. <\/p>\n<p>By contrast, it took her mother just three years to get to top pay, she added.<\/p>\n<p>Even when she was working 40 hours a week for Ford, Schambers said, she would make deliveries for the grocery-delivery app Instacart \u201cso I could make sure that my bills were paid and that my kids had everything they need.\u201d <\/p>\n<p>\u201cI don\u2019t think that\u2019s freedom,\u201d she said. \u201cWe need to be the working class again, instead of the working poor.\u201d<\/p>\n<p><strong>Related: <\/strong>Actors, writers, hotel housekeepers and grad-student workers are all striking for the same reason<\/p>\n<\/p><\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/story\/i-have-a-pension-they-dont-why-united-auto-workers-are-fighting-to-end-a-two-tier-system-for-wages-and-benefits-e11f1caa?mod=personal-finance\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Joe Genovese was hired by Ford Motor at the tier-two level, as workers refer to it, 11 years ago. In a year, he\u2019ll finally make top pay, he told a United Auto Workers rally earlier this month. Tier-two workers in the automobile industry can receive less than half as much in hourly wages as top-tier [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":9337,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[24],"tags":[],"class_list":{"0":"post-9336","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>\u2018I have a pension; they don\u2019t\u2019: Why United Auto Workers are fighting to end a two-tier system for wages and benefits | Prosfunds<\/title>\n<meta name=\"description\" content=\"Joe Genovese was hired by Ford Motor at the tier-two level, as workers refer to it, 11 years ago. 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