Fiat Chrysler Automobiles NV (NYSE:FCAU) will in the coming days pay UAW members $3,000 bonuses if a new contract is ratified. This is, however, lower than the previous contract in 2011 in which the workers received $3,500 ratification bonuses. This comes after weeks of negotiations between Fiat-Chrysler and the United Auto Workers. The UAW began negotiations with auto companies including Ford Motor Company (NYSE:F), General Motors Company (NYSE:GM) and Fiat Chrysler; who were of the view that instead of increasing hourly rate, the workers should agree on profit-sharing.
The new contract if ratified will see the hourly wage for employees increase by as much as a dollar. This is according to one of the people who sought anonymity because the details of the raise have not reached the members. The senior members of the union would get a raise amounting to about $30 an hour while the junior level would earn as much as $25 an hour.
Dennis Williams, the president of UAW, said that getting a raise for the assembly workers was one of his key goals in the negotiations. This was because veteran and senior workers at Fiat-Chrysler had not had a raise for close to nine years. Jodi Tinson, the spokesman for Fiat-Chrysler and Brian Rothenberg, the spokesman for UAW, however, declined to reveal the details of the contract. They said that it was a tentative agreement and would have to be approved by members through a voting process. Some of the UAW members are still in a fighting mood and, therefore, the voting process is critical. In a letter to the employees sent on Wednesday, the Fiat Chrysler Automobiles NV (NYSE:FCAU) Chief Executive Officer, Sergio Marchionne, said that profit sharing is a component of the new agreement. This agreement will give workers more substantial benefits if the company meets its goals.
The UAW president noted that there is still a lot of work to be done citing other auto companies whose rates are not negotiated yet.