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UAW Approves Lear Contract Ending Two-Tier Pay
United Auto Workers union members at Lear Corp.'s seating factory in Hammond, Ind., have overwhelmingly approved a four-year contract that will phase out a two-tier wage system adopted there several years ago.
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United Auto Workers union members at Lear Corp.'s seating factory in Hammond, Ind., have overwhelmingly approved a four-year contract that will phase out a two-tier wage system adopted there several years ago.
The contract establishes a single starting hourly pay rate of $16.50 that will grow to $21.58 by the end of the agreement. Previously new hires started at a lower rate and could never earn more than $16 per hour, according to the union. The dual rates have created situations where recent hires earned less than veteran employees doing the same work.
The UAW agreed to two-tier wages in 2007 to help the U.S. auto industry cope with the global recession. But the union describes the arrangement as inherently unfair and says it should be eliminated now that the industry has recovered.
Abolishing two-tier pay rates will be a top priority for the UAW when it opens contract talks with General Motors, Ford and Chrysler Group next year.
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