The United Auto Workers is seeking a 20% upfront wage increase as part of its current contract negotiations due to the “severe impact of inflation," according to the Detroit News. This significant pay hike for UAW members, one of the largest in decades, would be followed by a 5% annual pay raise each September through 2027.
The labor agreement would cover roughly 150,000 hourly workers at General Motors, Ford and Stellantis. The top pay for UAW members is around $32 an hour. The new proposal would increase top hourly wages to roughly $47, a jump of nearly 46%.
The current UAW contract with the Big Three automakers expires on Sept. 14.
During the previous round of negotiations in 2019, UAW workers received two 3% pay increases over the life of the contract and lump-sum payments.
The contract negotiations, which began in July, come as GM, Ford and Stellantis invest billions to ramp up electric vehicle production and reduce costs to improve margins. During an earnings call last week, Ford said it estimates its Model e electric vehicle business will lose $4.5 billion this year, a 50% jump from previous projections. However, according to the Wall Street Journal, Ford said it looks forward to working with the UAW.
GM remains critical of the UAW’s latest contract proposal. The largest U.S. automaker said in a statement that the pay hike “would threaten our ability to do what's right for the long-term benefit of the team." According to the UAW, GM employs around 48,500 hourly union workers.
Other UAW demands include the right to go on strike over plant closures, which total 65 plants over the last 20 years for the Big Three automakers, according to the UAW.
“We have to have the right to defend our communities from the corporate greed that’s killing so many cities and towns,” the UAW said in its list of demands.
Additional demands include a working family protection program that requires companies to pay UAW members to do community-service work if they close factories, as well as more paid time off.