Ford (F) Victorious in UAW 'Grievance' Arbitration; 2009 Deal Ruled Null
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Price: $14.81 -1.07%
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Dividend Yield: 3%
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Overall Analyst Rating:
NEUTRAL (
Down)Dividend Yield: 3%
Revenue Growth %: 0.0%
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Ford Motor Co. (NYSE: F) shares are indicated for a lower open Friday, amid late-session news Thursday that it was the victor in an arbitration battle with the United Auto Workers (UAW).
Arbitration was over the Equity of Sacrifice grievance, with the case ongoing for over a year.
In 2010, Ford instituted merit pay raises and 401(k) matches for salaried workers, but not hourly workers. This stuck a chord with the UAW, which argued that Ford violated modifications to its 2009 contract which stated that all of Ford's stakeholders make equal sacrifices to get the company back on track.
According to the Detroit Free Press, about 35,000 UAW members signed a mass grievance which was filed in February 2010. Ford argued that the bonuses, 401(k) matches, and merit raises had already been suspended at the time of negotiations.
In the arbitration ruling, Arbitrator David Grissom said Equity of Grievance sacrifices only applied to the 2009 agreement. He stated, "The Feb. 9-15, 2009 negotiations between the parties…clearly established that no written agreements resulted from negotiations or otherwise which precluded Ford from providing 2010 merit increases and a partial 401K match to its salaried workforce. The 2009 documents …only make reference to 2009 merit increases/401Ks." There is no Equity of Sacrifice agreement in the new UAW contracts.
It's not clear what will happen with the UAW at Ford moving forward. The latest contract calls for "$6,000 [in] signing bonus, enhanced profit-sharing that included an early payment that averaged $3,752 and other performance bonuses," according to the Freep.
Ford was the only one of the three large U.S. automakers not to take a bailout during the 2008 financial crisis and subsequent fallout. Those that did receive government assistance include General Motors (NYSE: GM) and Chrysler LLC.
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Arbitration was over the Equity of Sacrifice grievance, with the case ongoing for over a year.
In 2010, Ford instituted merit pay raises and 401(k) matches for salaried workers, but not hourly workers. This stuck a chord with the UAW, which argued that Ford violated modifications to its 2009 contract which stated that all of Ford's stakeholders make equal sacrifices to get the company back on track.
According to the Detroit Free Press, about 35,000 UAW members signed a mass grievance which was filed in February 2010. Ford argued that the bonuses, 401(k) matches, and merit raises had already been suspended at the time of negotiations.
In the arbitration ruling, Arbitrator David Grissom said Equity of Grievance sacrifices only applied to the 2009 agreement. He stated, "The Feb. 9-15, 2009 negotiations between the parties…clearly established that no written agreements resulted from negotiations or otherwise which precluded Ford from providing 2010 merit increases and a partial 401K match to its salaried workforce. The 2009 documents …only make reference to 2009 merit increases/401Ks." There is no Equity of Sacrifice agreement in the new UAW contracts.
It's not clear what will happen with the UAW at Ford moving forward. The latest contract calls for "$6,000 [in] signing bonus, enhanced profit-sharing that included an early payment that averaged $3,752 and other performance bonuses," according to the Freep.
Ford was the only one of the three large U.S. automakers not to take a bailout during the 2008 financial crisis and subsequent fallout. Those that did receive government assistance include General Motors (NYSE: GM) and Chrysler LLC.
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