SPRING HILL, Tenn. — Auto workers overwhelmingly approved a new contract Sunday with General Motors' Saturn Corp. that would alter the risk-reward arrangement that helped make Saturn "a different kind of car company."
Union workers voted 2,220 to 271 for the four-year contract covering Saturn's 7,200 workers in Spring Hill and about 100 at the company's engineering center in Madison Heights, Mich. The contract is much closer to those negotiated by the union for other U.S. auto workers, according to UAW Local 1853.
"We're pleased. It was a big victory for organized labor," said union spokesman Thomas Hopp. "I don't think Saturn had any choice but to bargain with us. If we had to strike, we surely would have. . . . We were ready, and they didn't want to test that."
Hopp said the new contract would add 15% to base pay, retroactive to Sept. 20. It calls for 3% annual pay raises for four years, plus a $1,350 upfront bonus and other gains.
"Everyone involved in our negotiations process was searching for a win-win solution, and we achieved that goal together," said Brian McClelland, a Saturn vice president.
Under a "risk-and-reward" pay program, Saturn employees earn less in salary than GM's other workers but receive bonuses for reaching productivity and quality goals. For years, that arrangement produced a harmonious relationship between management and union rank and file at Saturn, which dubbed itself "a different kind of car company."
But as the demand for small cars waned in recent years, Saturn's sales fell, worker bonuses shriveled, and the agreement became a source of friction. Union leaders said Saturn wasn't giving workers enough input. Last year, they threatened a strike but backed off when the company agreed to build a sport-utility vehicle. Production is expected to begin in 2001.
The effect has been that Saturn workers now make 12%, or about $6,000, less in base pay than their GM colleagues, who average just over $50,000 per year before overtime, according to union figures.
That would change under the new contract, Local 1853 President Ron Hankins said.