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UAW rejects pay cuts; local GM plant could close

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Union employees at General Motors' Indianapolis metal-stamping plant have overwhelmingly rejected a proposed pay cut that would have kept the facility open.

United Auto Workers Local 23 voted 457 to 96 against a contract with Illinois-based JD Norman Industries, union observers said Monday.

The vote means General Motors won't be able to sell its Indianapolis metal-stamping plant to Norman Industries, and the automaker may proceed with its plan to close the plant by September 2011.

"We are satisfied that the members of UAW Local 23 were allowed the opportunity to vote on JD Norman’s contract proposal," said company CEO Justin D. Norman in a prepared statement released Monday evening. "Clearly, we are disappointed in the final outcome. While we are withdrawing from pursuing the plant any further, we continue to hold the employees at the facility in the highest regard and wish them the best in their respective futures."

The votes were counted Monday by the American Arbitration Association and observed by members of Local 23, said Gregg Shotwell, the author of a labor newsletter called "Live Bait and Ammo." Shotwell, a GM retiree who lives in Grand Rapids, Mich., said he learned about the count from local observers on Monday.

The vote, held by mail-in ballot, was arranged by higher-level UAW officials. Region 3 Director Maurice "Mo" Davison could not be reached for comment Monday afternoon.

The Norman Industries contract would have cut unskilled workers' wages by about 50 percent, to $15.50 per hour. UAW national officials promoted the contract as a way to keep the plant open and grow the membership in Indianapolis. Davison has said in the past that he hoped under Norman Industries' ownership, employment would grow from less than 650 to 2,000.

Shotwell, who is also co-founder of Soldiers of Solidarity, a UAW dissident group that lobbies against workers accepting concessions, said the local rank-and-file recognized that any additional work for the Indianapolis plant would come at the expense of other GM plants. UAW members from various locals converged on Indianapolis on Saturday for a rally at the Region 3 headquarters, said Shotwell, who attended the rally.

The "no" vote doesn't necessarily mean UAW members will be out of a job. Many of them already are eligible for retirement. Those who can't yet retire from GM have the right to transfer, once GM officially dsignates Indianapolis as a closed plant.

One group of workers who may have voted to work for Norman Industries are the 60 temps, who currently earn less than $15.50 per hour.

GM has been planning to close or sell the 2-million-square-foot plant west of downtown for three years.

The facility employs about 640 hourly workers.

As IBJ reported last week, closing the plant could cost GM $50 million or more due to the cost of removing and possibly relocating the massive presses and dies used there now.

Some observers have speculated that the automaker, which has emerged from bankruptcy and is preparing for a public stock offering, might need the production capacity from the Indianapolis plant after all.

“They didn't lose as much market share as they thought they would in bankruptcy,” said Tracy Handler, a market analyst at IHS Global Insight in Detroit.

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  • reading comprehension
    I know all you union bashers have you knee jerk reaction as soon as you see the word union so this needs to be repeated for you. Some observers have speculated that the automaker, which has emerged from bankruptcy and is preparing for a public stock offering, might need the production capacity from the Indianapolis plant after all.
    â??They didn't lose as much market share as they thought they would in bankruptcy,â?? said Tracy Handler, a market analyst at IHS Global Insight in Detroit. The article said the plant "could" close. It now looks like it may stay open.


  • And anotherone's gone
    IDIOTS! They just voted themselves out of a job... unless they're willing to pull up stakes and move. BTW - the pension fund of GM is now up to the UAW to fund; that was one outcome of the bankruptcy. So, no wonder the national was urging the local folks to accept - so they'd be able to pay more into the fund rather than be drawing on it! Meanwhile, the ones who don't want to move - or can't for some reason - are OUT OF A JOB! Period Dot End of discussion. And UI benefits won't begin to cover the lost paycheck; even if it was only 60%... That's about what the UI benefit is; only it ENDS in 16 weeks!
  • Great Idea!
    A very good point...they just voted to close the facility. I feel absolutely no obligation to pay their unemployment. Of course, the employer pays it anyway...
  • Union's fault
    All the UAW has done over the years is hurt the laborer's further downstream from them. Talk to a tier 2 or tier 3 supplier whose had to make a deal with the devil to get a supply contract. GM makes up for the extreme labor cost of UAW by sticking it to others on the supply chain. UAW is in it for themselves and for the moment. They voted no for future jobs here in Indy by voting against J Norman, not just theirs. Sure they might relocate, but I'm sure we'll hear them complain of the hardship involved with that too... Just like cattle in a slaughter house, guide them to one area until it's too late and they realize that area is the end of the line... There won't be a UAW for too much longer, but once labor realizes what's become of their livelihood, it will be too late. That's what both sides get for not meeting in the middle over the last few decades. UAW is lucky there was a Democrat in the White House to save their hides when things got bad last year.
  • My next car will be a Mazda
    Made in the USA. Of course, it could be a while. I have 220,000 miles, and am doing the maintenance to get it much higher. I wouldn't even try that with a GM car.

    Unions add several thousand dollars to the cost of every car that rolls off the assembly line. How do you stay competitive? 2 options.

    1) You ask people to pay more to support the unions, as a form of "patriotism".

    2) You cut costs through cheap parts--many made in other countries--and sell the car for the same amount, which means you decrease its actual value.

    Of course, neither option is really very good, and long term pursuit of this strategy could lead to business failure. Wait, it already did, didn't it?

    Screw the UAW. Those gangsters won't get a dime from me and sooner or later their sugar daddy, the Federal government when run by Democrats, will cut off their allowance, bringing them back to Earth with the rest of us, who earn market wages and aren't proud of striking simply because we can or sitting around collecting unearned wages.
  • Unions
    Maybe people should be wondering why they make so little compared to others who make more!
  • It will!
    Per union contract, the UAW probably WILL support the workers, just as it does when they strike! I used to know UAW workers who looked FORWARD to striking!
  • Union Benefits
    To the person who's spouse has good benefits thanks to the Union, and hopes they will be the same next year... Where will your spouse be working to get next year's benefits? The union workers just voted themselves out of their jobs unless, of course, you move to another location. At this point, I don't think very many people would consider that a "Brain Drain."
  • Unions
    I wish people would quit bashing the unions. If it were not for the unions my husband would not have the benefits he has (that the union fought for). I hope when they renew their contract next year everything stays the same, although I doubt that it will thanks to our so-called President.
  • Here's the Difference, Rick
    There are plenty of folks willing and ABLE to do your work at the plant for half the current wage.

    Say a heart surgeon makes $500k a year. Sure someone would take the job for half that wage, but obviously no hospital would hire them because they are not able to perform the duties required, which is why the surgeon can demand the higher wage.

    Believe me, if my employer thought they could get he quality of work for half the price, I would be out of work, and rightfully so. That's why I have to prove my worth everyday. I don't have a cushy contract that dictates what I'm worth.
  • Why On Earth ...
    Why would any reasonable person risk giving up a fair paycheck and risk his/her families well being? If your skills are worth $15.50/hr then that is what you should be paid. If you think you are worth more then go find the job that will pay that... the American way. The UAW is just as bad as the mortgage brokers by trying to artificially inflating their members' value without being able to substantiate it.

    I am not taking sides in this case. I am trying to understand if there is any reasonable logic put into play here.
  • Dinosaur
    My spouse's company GM vehicle just had its 2nd repair in as many months, and its still under warranty. Can't wait to see what happens when its not. Perhaps you all deserve a pay cut because youre just not that good at what you do. GM should have been allowed to die a quick and painless death.
  • Hey, Why Not
    Might as well not work then take a pay cut and continue to provide for your family. Great call.
  • note to your boss
    I'm going to go ahead and let your boss know that you're OK with a fifty percent pay cut. Only a fool and a loser wouldn't be, right?
  • Consequences?
    The workers voted. So when the plant closes, they should be ineligible for unemployment benefits. Let the union support them.
    • Wow
      It's great that everyone has a voice and is entitled to their opinion. The fact that even ignorant people get to voice that opinion is sad. It is easier for ignorant people to voice their opinion than to understand that everything Unions have has been fought for with blood, sweat, tears and mostly solidarity......but everyone is entitled to their opinion....!
    • So Mimi,
      What happens next fall when the plant closes? If your husband gets a transfer, won't you have to quit your job to move with him? Then you are back to a one income family. How long will it take you to find a new job? Will you have to take a pay cut? What happens in 2 - 3 years when that next GM plant closes because it's paying wages over market rate?
    • WAY TO GO!
      Why should we have to take a pay cut and not the big wigs. I am proud of my husband for standing up for his FAMILY! We are a two income family and we are just getting by so don't tell me we should have taken this pay cut. Don't settle for less or you'll be sorry.
    • Babbit
      What do they care about selling their homes? GM probably has to buy, and then will them dump at fire sale prices screwing the neighbors' property values.
    • Seriously HB?
      Heroes? C'mon, sounds like they put their union-inflated egoes ahead of the the 60 common man workers who now don't have the job security a new owner would have provided. But, hey, the union boys get to retire anyway. Yeah, heroes championing the cause of the common man.
    • Thanks for nothing!
      Well, thanks for considering the future of Indianapolis in your vote! Another plant closing. Yeah!!

      Journalistically, this section bugs me:

      The "no" vote doesn't necessarily mean UAW members will be out of a job. Many of them already are eligible for retirement. Those who can't yet retire from GM have the right to transfer, once GM officially dsignates Indianapolis as a closed plant."

      "Retirement" is not a job, by the way... And good luck to those wanting to transfer when they try to sell their home!! You have screwed yourself once again with your lack of education... how appropriate.
    • I Have A Clue
      There will soon be another closed, massive hulk of a GM plant blemishing the Midwest. Why? Here's your clue:

      What's the one thing they all had in common? Union "Labor".

      Doesn't take Sherlock Holmes to figure out that clue.

      On to Bedford for some of these employees (I won't call them "workers"). What's the over / under on the life expectancy of the Bedford plant? 2-3 years?
    • congratulations
      congratulations to the workers of local 23 for standing firm against whipsawing & the machinations of their international.

      the people calling these workers drunks & dopers don't have a clue. these are heroes, fighting even for dopes like the commenters, who cheer the bosses on as they rachet everyone down to poverty.
      • Poor John
        There is an joke that GM is an insurance/pension company that sells cars to try to cover its costs. The sad thing is, that's not really joke. The unions have brought what was once a wonderful US manufacturing institution to the point where it is ridiculed.

        So yes, I agree, I already thought unions were worthless. It boils down to what is the value of the work. Apparently the free market says it is $15/hr. You have a contract that calls for more than that. Good for you, but you and I both know there are folks out there that would, and more importantly COULD, do the same work for less right here in Indiana. So shut the plant down, and maybe you'll be one of the ones who lands a job at the next soon to be closed plant. Maybe you'll be even luckier and you'll be one of the ones who gets to sit on their fannies and collect 90% of your salary from GM while doing nothing. Meanwhile, I'll proudly work my job for the market rate, and pay my taxes to support you. I drive a GM vehocle right now, but you can bet it is my last.

        Eight hour days? I can only wish. I bust my rear to prove my worth to my employer, you vote to prove yours.
      • To Esta
        Esta, I think you are stereotyping people and you should be ashamed....Sounds like you aready thought we were a bunch of... We, Union people are not all dope heads and or drunks...We work to support or families and pay taxes just like you...unless you are so rich it doesn't matter...which I doubt or you wouldn't be bloging on this issue...please remember that unions and the working class helped build this country and we only ask for a fair days pay for a fair days worth of work...I'd like to see you hump in this place for 8 hrs a day...and then tell us if we were right or wrong on voting down this agreement....
      • Congrats
        Great job, boys! Just when I thought my opinion of unions couldn't get any lower, you've managed to prove me wrong. Now you can go drinking and doobing it up with the guys from the Chrysler plant. I have more respect for the bum on the corner than a union worker, because at least he puts in an honest day's work for his wages.
        • This is Crap
          You people would rather see the plant close because apparently you all ready have Quote Gave to much cuts all ready? Guess what u guys are screwed if u cannot transfer, let alone when ur subpay goese up ull be making equivlant to what he was wanting to start. You people are crazy. You think your going to get another offer. Your wrong that was final and now he is gone. Good Job Uaw employees of general motors. Soon before you all realize it ur subway will be up all 31+ senority employees will trasnfer or all u will sit at home make crap unmployment. It even says in your current contract your wages will go down lol.

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