UAW Boss Seeks 46% Raise, 32-Hour Work Week in Carmaker ‘War’

Shawn Fain, president of the United Auto Workers union since March, has declared “war” on the Detroit Three automakers, with contract demands that even he calls “audacious,” including proposals for a 46% raise, a return to traditional pensions and a 32-hour work week.

Now the 54-year-old who began work as an electrician at a Chrysler casting plant in 1994, is threatening to take his 150,000 UAW members out on strike. If he doesn’t have contracts with General Motors Co., Ford Motor Co. and Stellantis NV, maker of Jeep and Chrysler models, by the Sept. 14 deadline, the UAW could strike all three simultaneously — something it has never done.

“The deadline is the deadline,” Fain said an interview earlier this month at the UAW’s Solidarity House headquarters along the Detroit River.

Shawn Fain speaks to UAW members and supporters in Warren, Michigan on August 20.

Source: AFP

Fain, whose demeanor leans more Sunday school teacher than fire-breathing union boss, has brought back a tough-talking style evoking the labor movement’s roots in America. He’s part of a new generation of leaders that includes International Brotherhood of Teamsters President Sean O’Brien, who earlier this month won a historic five-year contract with United Parcel Service Inc., and Lynne Fox, president of Workers United, which says it has unionized more than 350 Starbucks Corp. stores.

These aggressive labor leaders want to rewrite the social compact with everyday workers around a simple question: Why not us?

WATCH: The United Auto Workers union is demanding a 46% raise, a return to traditional pensions, and a 32-hour work week. David Welch and Kailey Leinz report.

Source: Bloomberg

The pandemic and technology allowed more salaried staffers than ever to work from home. Now service and factory workers who faced Covid’s dangers on the job want to improve their work-life balance, too. And with inflation eating into everyone’s pocketbooks, polls show there’s growing support for the labor movement.

Fain won a narrow victory of less than 1% by positioning himself as a reformer out to overhaul a union rocked by a corruption scandal. Thirteen UAW officials were convicted of illegally using union dues to finance lavish lifestyles and the union remains under the oversight of a federal monitor.

When the scandal first came to light, Fain said “it was a gut punch,” but he’d had suspicions because the union leadership delivered weak contracts in times of prosperity.

“We have a horrible history in this union of setting expectations low and settling lower,” Fain said. “Those days are over.”

Now it’s payback time, Fain contends, for union members swindled out of good deals as auto companies banked record profits while giving hourly workers two 3% raises over the past four years that failed to keep up with inflation.

“Mary Barra made $200 million in the last nine years,” Fain said, referring to GM’s chief executive officer; company filings confirm this. “Our wages went backwards. There’s something wrong there.”

Fain says automakers’ recent record profits were made possible by UAW concessions given during the government bailouts and bankruptcies of GM and Chrysler in the Great Recession of 2009. Now he wants to make up for those sacrifices — plus more.

Beyond big raises and a shorter work week, the UAW’s demands include restoring cost-of-living increases, an end to a tiered system that pays new workers less, restoring retiree health care and boosting pension payments.

Read More: What’s at Stake as US Autoworkers Threaten to Strike

The automakers counter that meeting those demands would threaten their existence, driving up labor costs by $80 billion and increasing total pay and benefit expenses to more than $150 an hour, from about $64 now, Bloomberg has reported. As the three automakers collectively spend more than $100 billion to make the shift to electric vehicles, they contend they can’t afford a generous contract with the UAW.

In fact, higher labor costs contributed to Chrysler, Ford and GM’s lack of price competitiveness against foreign brands in the 1990s and 2000s. But pressure is on Fain to deliver a good deal, since his margin of victory was so slim.

“The car companies cannot possibly agree to his demands and even if he succeeds, his members still lose because the car companies will go bankrupt,” Johan de Nysschen, a consultant and former GM and Volkswagen executive, said in an interview. Fain, he added, is “promising the sun, the moon, the Earth and the stars to people who are, frankly, easily impressed.”

Fain bristles at the notion that his blue-collar members are asking for too much. He sees the companies’ arguments about being competitive as code for “a race back to slave labor.” He points to Stellantis North American Chief Operating Officer Mark Stewart, who recently lectured workers on economic realism from his vacation home in Acapulco, Mexico. Stellantis declined to comment on Stewart’s whereabouts.

“When your CEOs are making 300 to 400 times more than the average worker, and they want to talk to you about economic realism, that’s pretty pathetic,” Fain said.

Kokomo Roots

Fain carried his grandmother’s bible for his swearing in as UAW president. It was given to her as a child during the Great Depression, when she and her siblings were dropped at an orphanage in Tennessee because their parents couldn’t afford to care for them. Years later, she and her husband migrated north for work at a Chrysler factory, forever changing the trajectory of the Fain family.

“I get a little emotional,” Fain said, his voice catching. “I was raised to never forget where you come from and it’s why what I do matters to me.”

He grew up in Kokomo, Indiana, where Shawn’s father joined the police force and rose to police chief, and his mother earned a nursing degree after staying home with their children while they were young. They could pursue those careers because their parents landed jobs in Chrysler and GM factories at a time when auto work was the “gold standard,” Fain said.

“My grandparents lived the American dream,” Fain said. “They were destitute in the hills of Tennessee and Kentucky, so they migrated north for good-paying union jobs and it changed their lives.”

Fain carries in his wallet his grandfather’s pay stub from when he worked at Chrysler in 1940.

Source: AFP

Fain’s father was deeply involved in Democratic politics and Shawn grew up “putting out yard signs, knocking on doors and going to chili suppers,” he said. “I hated it as a kid.”

But his attitude changed after he was laid off early in his career and had to rely on government assistance to buy diapers and formula for the first of his two daughters.

“It was a humbling experience,” Fain said. “But I wouldn’t trade it because being on unemployment and trying to survive on $80 a week really made me understand how the system works.”

Fain, who became a journeyman electrician three decades ago, says he’s living proof that you don’t have to go to college to earn a good living.

“I went to an apprenticeship program and it was life-changing,” Fain said. “My brother and sister both have master’s degrees and I’ve out-earned both of them.”

Before going to work at Chrysler, Fain was a member of the International Brotherhood of Electrical Workers Local 873 in Kokomo, where on top of his apprenticeship he put in 1,200 class hours to earn an associate degree in applied science. His former IBEW members don’t doubt his resolve.

“He doesn’t bend or waver,” Michael Young, business manager at Local 873, said in an interview. “He has lofty goals, there’s no doubt. But you have to shoot for the moon on this one.”

Fain is also trying to set the table for what he calls a “just transition” to the electric vehicle future.

Fain speaks to demonstrators before a United Auto Workers practice picket in Detroit, Michigan.

Photographer: Jeff Kowalsky/Bloomberg

The Detroit Three automakers are in the process of building nine battery plants, mostly with joint-venture partners from Asia. The fate of those thousands of battery workers — who are not yet hired or represented by the UAW – hangs over the bargaining table.

At GM’s battery factory in Lordstown, Ohio, workers initially started at $15.50 an hour, less than half the top wage at UAW-represented assembly plants. A recent deal will boost pay by as much as $4 an hour, which is still far less than what Fain wants. He fears those workers will also have fewer job and safety protections.

In May, Fain went to the local union hall in Lordstown where, according to multiple union members who were present, he declared that “this is an existential fight.” He asked workers to sign a card pledging they are “all in” to get battery workers a better contract.

Fain also enlisted the help of President Joe Biden, who, after meeting with the UAW leader at the White House last month, issued a statement calling for a “fair transition” to EVs with contracts that “retool, reboot, and rehire in the same factories and communities at comparable wages, while giving existing workers the first shot to fill those jobs.” Yet on Friday, Biden expressed concern about the impact of a possible UAW strike.

Fain wants battery plant jobs to go to UAW members displaced as factories building engines, transmissions and conventional cars close. The process is already underway: Stellantis recently idled a 58-year-old factory in Belvidere, Illinois, that most recently built Jeeps.

Fain displays particular contempt for the company he worked for and its CEO, Carlos Tavares, who’s been outspoken on the need to cut overhead and people. Their only meeting, Fain said, came before official bargaining began where the executive used the word “brutality” about 40 times to describe government mandates on the transition to EVs.

“I came back and said, our workers have had a brutality imposed upon them,” Fain said. “You close plants and they have to uproot their lives.”

As contract talks come down to the wire, Fain’s ambitions go well beyond the meat and potatoes issues. He is out to change the way people think about — and treat — factory labor.

“Workers are fed up,” Fain said. “If Covid taught anybody anything, it taught people what’s important in life. And it sure as hell isn’t living in your workplace seven days a week so you can scrape to get by and barely survive.”

To contact the reporters on this story:
Keith Naughton in Southfield, Michigan at knaughton3@bloomberg.net;
Gabrielle Coppola in Detroit at gcoppola@bloomberg.net;
David Welch in Southfield at dwelch12@bloomberg.net

To contact the editors responsible for this story:
Chester Dawson at cdawson54@bloomberg.net

Anne Cronin

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