UAW members to vote on contract with GM: Chrysler to be next

The proposed United Auto Workers' deal with General Motors Co. offers workers $12,500 in profit-sharing bonuses over the next four years, saves or creates 6,400 jobs at US factories, and awards $2- to $3-an-hour raises to entry-level workers. Workers would forgo some long-standing benefits such as cost- of-living increases. Higher paid workers would be induced to leave so that the company can replace them with lower-paid entry-level workers. This move could save GM billions. Local union leaders from across the US voted to recommend the contract's ratification by GM's 48,500 members next week.

The deal includes $2.5 billion in plant investments and brings some work now done in Mexico back to US plants. That investment figure is in addition to a $2 billion commitment made in May to create or retain 4,000 jobs at GM factories nationwide.

Under the new contract, GM's factory workers will get a $5,000 contract signing bonus after ratification, plus a profit-sharing payout of at least $3,500 for this year (paid in 2012) and a $250 quality bonus if certain targets are met. They'll also receive an annual $1,000 "inflation protection" bonus each year of the contract.

The agreement ensures that the company gets what it wanted: no pay increases, cost of living allowance, pension increases or jobs bank, whereby laid off workers continued to be paid: the UAW gets good money for their people and some jobs. It is the first deal between the UAW and a Detroit automaker since the government bailouts and bankruptcy crisis of 2009.