Specific details of the terms are being kept quiet until the proposal is ratified by the nearly 40,000 union workers employed by FCA, though both sides have previously expressed interest in moving away from two-tier wages and reforming healthcare provisions.
FCA chief executive Sergio Marchionne has hinted that the two-tier pay structure will be phased out “over time,” according to quotes from a joint press conference attended by The Detroit News. It is unlikely the system will be completely eliminated in the fresh contract, though the parties may have negotiated a raise program, expanded profit sharing or other compromise to narrow the wage disparity between top- and bottom-tier workers, which is said to cause friction among factory workers.
The company also agreed to partner with a UAW healthcare co-op program that would pool coverage for all employees. Marchionne has voiced enthusiasm for the idea, arguing that it could both lower costs and improve quality of care. The program may be modeled after the UAW’s Voluntary Employee Beneficiary Association (VEBA), which consolidates healthcare for retirees from the big three US automakers.
Additional details will likely emerge in the coming weeks as UAW leaders pitch the proposal to workers.
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