UAW wins back Obama-era concessions from financial crisis, as strike nears end

The United Auto Workers (UAW) union has won back several concessions it made to three major automakers in the wake of the 2007-2008 financial crisis, after reaching tentative agreements with all three major U.S. automakers.

General Motors was the last of the three to reach a deal with the union Monday, agreeing to largely the same terms that Ford and Stellantis accepted Wednesday and Saturday.

The tentative agreements, which still must be ratified by UAW members, would provide a 25 percent general wage increase over the life of the 4.5 year contract, including an immediate 11 percent raise. 

Notably, the agreements would also walk back key concessions the union made during the financial crisis more than 10 years ago, reinstating cost-of-living adjustments and more rapid progressions to top wage rates and eliminating the two-tiered wage system.

The UAW agreed to create the two-tiered wage system in 2007, allowing the automakers to offer lower starting wages to new workers.  

As the companies teetered on the verge of bankruptcy in 2008, the union also agreed to suspend lump sum wage increases, cost-of-living adjustments and other programs included in the 2007 contract.

Cost-of-living adjustments remained suspended or were eliminated in subsequent contracts between the UAW and the automakers, while the tiered system created substantial differences in pay between workers performing the same job.

Strike puts into place new union gains

The new agreements reached over the past week would reinstate cost-of-living adjustments, cut the time it takes to reach the top wage rate from eight years to three years and end the tiered wage system by immediately bringing wages for lower tier workers in line with higher tier workers, the union said. 

Workers who have been with the automakers for at least three years would immediately see their wages jump to the top rate, which is set to reach more than $42 an hour by the end of the contract in 2028.

Some of the lowest paid workers at three major automakers would see substantial raises immediately. For instance, temporary workers at General Motors could see raises up to 115 percent at the time of ratification, UAW President Shawn Fain said Monday.

“These are huge steps forward in our goal of ending tiers, which have eroded our solidarity and our dignity while making these rich companies even richer,” Fain said in remarks posted to X, the platform formerly known as Twitter.

In the wake of the agreements, the UAW has officially suspended its strike. The union initially launched the strike at handful of plants in mid-September, after failing to reach an agreement with GM, Ford and Stellantis before its prior contract expired.

Throughout the six-week strike, the UAW ramped up the pressure on the automakers, targeting additional plants with surprise walkouts. Before reaching a deal with Ford on Wednesday, more than 45,000 workers total were on strike.

“Over the course of the last six days working around the clock, we have reached tentative agreements across each of the Big Three,” Fain said Monday. “When I think about where this fight began, one thing is abundantly clear. They underestimated us. They underestimated you. These corporations had no idea what was coming for them, and they have no idea what’s next.”