Latest FCA-UAW Pact Would Hike Pay and Bonuses, Drops Healthcare Co-op

The tentative labor contract between Fiat Chrysler Automobiles NV and the United Auto Workers union abandons the idea of forming an industrywide healthcare co-op, hikes the ratification bonus one-third to $4,000 and enables so-called second-tier hires to reach parity with senior workers in eight years.

Leaders from UAW's Chrysler locals are meeting in Detroit today to decide whether to present the new tentative agreement for ratification by Chrysler's 40,000 hourly workers.

Pay for first- and second-tier workers was capped at $28 and $19.28, respectively, under the contract that expired last month. The new proposal would cap hourly wages at nearly $30 for first-tier workers and $29 for second-tier hires over four years. Both groups would achieve parity in eight years.

Senior workers would receive an immediate $4,000 ratification bonus and 3% wage increase, then a 4% ($2,400) bonus in 2016, a 3% wage hike in 2017 and a 4% ($2,500) bonus in 2018.

Tier-two workers would receive a $3,000 ratification bonus. They also would receive hourly pay increases over four years totaling between $6.72 and at least $10.42 depending upon seniority.

The pact drops plans to form a healthcare co-op with General Motors Co. and Ford Motor Co., reflecting opposition from workers. The union says the co-op plan was intended to find ways to shrink per-hour healthcare costs of workers from $8 currently to a projected $13- $14 by 2019.