Rebecca Cook / Reuters

UAW deal with Fiat Chrysler stalls out

United Auto Workers union members nixed a proposed contract with Fiat Chrysler that did not end two-tier wage structure

United Auto Workers (UAW) members have rejected a proposed contract with Fiat Chrysler (FCA) in a rebuke of union leaders who had praised the deal.

Official totals weren't released, but workers at many large factories voted against the pact by large margins, making victory impossible.

Late Wednesday, members at the last plant to vote in Belvidere, Illinois, turned down the contract. The local union's website says 65 percent of the 2,980 workers who voted were against it. Members at large assembly plants in Toledo, Ohio, and Sterling Heights, Michigan, also rejected the pact in voting Tuesday. Only a handful of local unions voted in favor.

A UAW spokesman said final results would be released on Thursday.

UAW leaders summoned local presidents and bargainers to a meeting in Detroit on Thursday to decide the next move. FCA’s 40,000 union workers could go on strike, continue bargaining with the company or shift their focus to General Motors or Ford. Union workers at all three companies have stayed on the job under contract extensions since Sept. 14.

A Fiat Chrysler spokeswoman would not comment Wednesday night.

Separately, the UAW’s top negotiator at Ford on Tuesday said he has authorized a strike as early as Sunday by 7,500 workers at a factory near Kansas City, Missouri that builds the company’s best-selling F-150 pickup truck, a linchpin of Ford’s global profits.

Analysts said the move by UAW Vice President Jimmy Settles is in part a signal to rank and file members about his readiness to hit the company hard if management does not agree to UAW demands.

The UAW’s defeat at Fiat Chrysler and the threat of conflict at Ford, a company that has cultivated peaceful labor relations over the past 30 years, reflect growing discontent among American workers over stagnant pay. UAW leaders may have underestimated rank and file determination in industries from fast food to airlines to get significant raises now.

“Everything costs more and it’s going up, but not my pay,” said Gary Spangler, a 22-year veteran at FCA’s transmission plant in Kokomo, Indiana. He said he voted against the proposed contract.

The union reached a tentative agreement with the company two weeks ago that includes pay raises, the potential for increased profit sharing and a $3,000 signing bonus. But some members objected because the raises didn’t bring an end to a two-tier wage structure in which workers hired after 2007 are paid less than veteran employees. The contract also allowed the company to shift some car production to low-wage Mexico, replacing it with new trucks and SUVs that carry higher price tags to cover higher U.S. wages.

Workers said they voted "no" because the deal didn't give lower-tier workers a path to reaching the top wage of $28.50 per hour. They also said the contract didn't cap the number of second-tier workers. The UAW agreed to allow lower pay for entry-level workers in 2007 when Detroit automakers were struggling financially. About 45 percent of FCA's workers are paid the lower wage, while GM and Ford can't exceed 20 to 25 percent.

Under the rejected deal, pay for entry level-workers would have topped out at $25.35 per hour after three years, up from the current $19.28. Top-tier workers hired before 2007 would have gone from $28.50 per hour to $30 per hour during the four-year contract. They haven't had raises in more than a decade, although they have received profit-sharing checks.

Wire services

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