New Rule Bars Strikes against GM

Sunday, January 11, 2009

In the recently released details of its $13.4 billion, 3-year loan to GM, the government included a condition permitting it to call in its loan and bankrupt GM, if “any labor union or collective bargaining unit shall engage in a strike or other work stoppage.” The United Auto Workers union (UAW) already has a no-strike clause in their current agreement expiring in September 2011, and it appears that the government insisted on the clause to ensure that UAW could reopen and modify its contract to meet the loan terms without renegotiating the no-strike clause. The deal also requires UAW to lower their wages to match foreign-owned manufacturing plants in the U.S. by February 17, even while GM CEO Rich Wagoner receives a bump in annual pay to $2.2 million, despite 3 years of consecutive losses. UAW president Ron Gettelfinger has announced that the union will not reopen their contract, and intends to press the incoming administration to readjust the loan’s terms.



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