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Thread: Labor is the Scapegoat

  1. #1
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    Labor is the Scapegoat

    The following is an editorial found on another automotive website. It represents my point of view on the issue of the bailout

    itor's Note: After seeing these wage comparisons. it looks like labor is being made the scapegoat once again, by not only inept auto company management and inept U.S. Senators, but also the by UAW leadership...if these numbers are fact then the UAW should have agreed out of hand to the Senates request for parity and eliminated the drama and negative feeling to working men and woman.

    DETROIT, Dec 12, 2008; Poornima Gupta writing for Reuters reported that the wages and benefits for the United Auto Workers union are at the center of a debate on a $14 billion package in emergency loans to U.S. automakers.

    Some Republican senators want Detroit autoworkers to have pay parity with foreign auto manufacturers.

    But the UAW has said the wages and benefits of its members are now competitive with workers employed by Japanese automakers following landmark labor agreements the union reached with General Motors Corp, Chrysler and Ford Motor Co in 2007.

    The agreement slashed wages for new hires and created a trust for retiree healthcare called a Voluntary Employee Beneficiary Association, or VEBA, to shift liabilities to a union-aligned trust to be established in 2010.

    Here are details of the average hourly labor cost of UAW workers employed at Ford and those employed by non-U.S. based automakers with plants in the United States. The figures are similar across the three Detroit automakers.

    WAGES: Base hourly wages and cost of living adjustments

    UAW: $29
    Transplants: $26
    WAGE RELATED: Paid vacation, overtime, holidays, night and weekend pay, break time

    UAW: $14
    Transplants: $9
    BENEFITS: Healthcare, training, etc

    UAW: $12
    Transplants: $11
    LEGACY COSTS (Without VEBA): Pension and healthcare benefits for retirees

    UAW: $16
    Transplants: $3
    LEGACY COSTS (With VEBA): Pension and healthcare benefits for retirees

    UAW: $3
    Transplants: $3
    TOTAL LABOR COST:

    UAW (without VEBA): $71
    UAW (with VEBA): $58
    Transplants: $49
    Source of data Ford Motor Company.

    The VEBA Plan is a tax-free health reimbursement arrangement (HRA) that enables your employer to make tax-free contributions into a special trust account on your behalf. These tax-free funds can then be used to pay or reimburse eligible out-of-pocket health care costs and premiums for yourself, your spouse, and your qualified IRS dependents.

    Note: Average wage assumes 20 percent entry-level employees.

    Editing for Reuters by Gary Hill

  2. #2
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    While it is also popular to jump on the GOP senators for blocking assistance to the automakers, and I agree with that, I also find it reprehensible that the Demoncats couldn't get it together enough to sell the assistance package to their colleagues and the public-at-large. Is it because that Ms. Pelosi and Mr. Reid have loaded up this thing with so many potential restrictions that even the supplicant car makers said "no thanks?"

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