Automakers are scrapping tiered wages

The country’s largest automakers — Ford Motor Co., General Motors and Stellantis — are poised to become the latest U.S. corporations to do away with tiered wage arrangements, a system that splits the workforce into haves and have-nots by confining newer employers to lower wages.All three auto giants have agreed to sweeping improvements in employee pay, including the elimination of unequal pay scales that made it difficult for new hires to catch up with longtime employees.

The new deal also shortens the amount of time it takes for new employees to work their way up to the top pay rate from eight years to three.Ford and General Motors did not respond to emails seeking comment. A spokeswoman for Stellantis declined to comment.“In 2007, employers went all-in on a divide-and-conquer strategy for the American autoworker,” Chuck Browning, UAW vice president and chief negotiator with Ford, said in a news conference Sunday.

The water treatment company Culligan, Boeing, Harley-Davidson and Caterpillar have also recently done away with tiered wage structures at the urging of workers unions.There has also been a broader pushback against unequal wages, even when unions aren’t involved. In Nevada, residents last year voted to abolish the state’s two-tier minimum wage that allowed employers that offered health benefits to pay $1 less per hour. Beginning July 2024, all employers will have to pay at least $12 an hour.

Those concessions continued into the 1990s and early 2000s. For employers, tiered pay was a simple way to reduce long-term labor costs. But for workers and unions — who referred to the practice as “eating your young” — it became a growing source of resentment. Newer hires felt undervalued and demoralized, and long-term workers worried they could easily be replaced by cheaper newcomers.

. Chief executive pay has increased 40 percent in the past four years, compared with a 6 percent bump in workers’ pay, according to union officials.“The increase in tiers happened when companies were struggling and it was fairly credible for them to make threats like layoffs, factory closures and bankruptcy,” Givan said. “But there’s no way these employers in 2023 can credibly say they’re at risk of going under.”The U.S. economy has defied expectations this year.

Project to dismantle Navy nuclear fueling barge in Mobile is completeSpecialized teardown of vessel had been in progress since 2021. Read more ⮕

Chinese EVs Are A Big Threat To Western Automakers Because People Can Actually Afford ThemThe average Chinese EV costs less than half as much as the average American or European EV, which leads to a price gap that keeps widening Read more ⮕

EVs create profit potholes for major US automakers GM, FordThe electric vehicle push by Ford and General Motors cut into both companies’ profit margins which has the automakers revising some of their EV plans to rein in costs. Read more ⮕

Lakeside family cheers on son as he plays in the World SeriesCiara Encinas joined the ABC 10News team in December 2021 as a multimedia journalist. Read more ⮕

U.S. Tax Credits Could Benefit Global Automakers — But Europe Wants MoreThe European Union is still not completely satisfied with recent concessions from Washington on its historic set of green energy subsidies. Read more ⮕

GM reaches tentative deal with UAW, ending simultaneous strike against Detroit automakersGeneral Motors (GM.N) and the United Auto Workers (UAW) union have reached tentative contract agreement, two sources familiar with the matter told Reuters, effectively ending the first simultaneous strike against the Detroit Three automakers with record wage and benefit hikes. Read more ⮕