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Union ratifies UAW-GM agreement to officially end 40-day strike

The new labor contract includes plenty of wins for union members, but deals blows to three manufacturing plants.

UAW-GM Strike
Jeff Kowalsky/Getty Images

After 40 days, UAW-GM union workers are heading back to work as members voted to ratify the tentative agreement put in place last Thursday.

The agreement puts an end to a costly strike for both UAW workers and General Motors, which has become one of the longest walkouts in GM history. The ratification process requires a simple majority for the labor contract to move past the tentative stage.

"We are all so incredibly proud of UAW-GM members who captured the hearts and minds of a nation," UAW Vice President and Director of the UAW-GM Department, Terry Dittes, said. "Their sacrifice and courageous stand addressed the two-tier wages structure and permanent temporary worker classification that has plagued working class Americans."

Although workers have survived on $275 per week strike pay, GM will pay out $11,000 ratification sums to each full-time worker for ratifying the agreement. Part-time workers will receive $4,500. In addition, the new labor contract provides a pathway to full-time employment for temporary workers -- a major victory for the union.

For the pay scale side of things, workers will receive 3% pay raises in each of the four years this contract covers, or 4% lump sum payments. The union also negotiated an end to the $12,000 profit-sharing bonus cap. Union workers will receive $1,000 per $1 billion GM makes in profit under the new labor agreement, which opens the door to higher union bonuses.

Healthcare remains untouched with no additional out-of-pocket expenses for workers. On GM's investment part, the automaker will sink $7.7 billion into US plants, which will create or retain 9,000 jobs.

The Lordstown plant will officially close.

General Motors

Despite the investments, GM successfully negotiated the closure of three US manufacturing plants. The biggest blow to the union is the closure of the Lordstown, Ohio, plant. It most recently built the Chevrolet Cruze and the automaker named it as one of two facilities to go "unallocated" in the US last November. Two additional facilities, the Baltimore and Warren Transmission plants, will also close. 

Both sides did negotiate to keep the Detroit-Hamtramck assembly plant open, which continues to build the Cadillac CT6 and Chevrolet Impala today. Production of both cars is scheduled to wrap up this coming January. GM floated electric pickup truck production for the plant, but it remains unclear what the news may mean for the CT6.

In addition, GM said it's moving forward with the opportunity to bring battery cell production to the Mahoning Valley in Ohio, near the Lordstown area. This investment would create 1,000 new manufacturing jobs, according to GM. The automaker will also pursue the sale of the Lordstown plant to Lordstown Motors, the company that oversees the startup known as Workhorse.

The union must still negotiate two additional labor contracts between Ford and Fiat Chrysler Automobiles. It's not yet clear which automaker the union will head to the bargaining table with next.

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