Responding to a severe financial crisis at Mitsubishi Motors of North America (MMNA), members of UAW Local 2488 have voted to accept temporary wage and Cost of Living Allowance (COLA) deferrals in exchange for job and investment guarantees at Mitsubishi’s plant in Normal, Illinois.
Members voted by a 51 to 49 margin to re-open the current UAW-Mitsubishi labor agreement, and to accept certain changes in the agreement.
Voting took place on Thursday, August 31 and Friday, September 1 in Normal.
UAW Local 2488 represents approximately 1500 active and 1200 laid off members at Mitsubishi’s Illinois plant, which is its only U.S. manufacturing facility.
Mitsubishi has agreed that there will be no involuntary layoffs in Normal through the term of the new agreement, which expires in August of 2008.
The company also committed to keeping the plant open through August of 2008, and to take actions necessary to keep the plant a viable and operating auto assembly facility. Specifically, the company will allocate all necessary funding and approvals to substantially redesign the Galant sedan, beginning this year, so that production of the newly-designed Galant will begin in model year 2009.
“When it’s crunch time, UAW members will meet any challenge,” said UAW Vice President Jimmy Settles, who heads the union’s Transnationals and Joint Ventures Department.
“Members of UAW Local 2488 have won well-deserved productivity awards for operating the most flexible auto manufacturing plant in North America. Today, they’ve made a decision to accept painful sacrifices in order to preserve jobs and keep a manufacturing facility operating in central Illinois.”
“We know how important these jobs are, for our members and our families and for the Bloomington/Normal community,” said Dennis Williams, director of UAW Region 4, which includes Illinois.
“Local 2488 members are going to keep doing what they do best: building great cars and trucks, so that Mitsubishi has the quality products it needs to build a strong recovery.”
Temporary wage and COLA deferrals, which will be restored in full in April of 2008 include: $1.50 an hour for all associates; COLA payments of $2.53 per hour; suspension of 401(k) match, to be restored in April of 2008; and suspension of the Incentive/Performance Improvement Plan.
Other contractual changes include an increase in office visit co-pays for HMO and PPO participants; the PPO increase will be partially restored in April of 2008.
Prescription co-pays will be increased, and Medicare Part B coverage will be limited to retirees and surviving spouses who are age 62 or older with at least ten years of service. The current contract provides coverage at age 55 with five years of service.
A pay raise of 3%, scheduled for March of 2007 will not take place, nor will a scheduled COLA payment of 38 cents per hour which would have been due in September of this year.
In addition, up to 16 cents per hour of future quarterly COLA increases will be diverted through the length of the agreement.
The modified labor agreement also includes enhanced contract language for members of UAW Local 1488, including improvements in indoor air quality; enhanced payment of disability claims; improved language on staffing and temporary transfers; an improved procedure for resolving time study issues; and improved job placement opportunities for workers with medical restrictions.
The newly-modified agreement will expire on August 28, 2008.
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