Elections Today
- Maryland
- Nebraska
- West Virginia
Recent Projections
| State | Candidate | Delegates |
|---|---|---|
 Joe Biden | ||
West Virginia |  Donald Trump |
Ford, UAW reach deal on health care trust
DETROIT -- At issue was how the automakers would fund a Voluntary Employee Beneficiary Association, or VEBA. Millions in cash payments were due next year, but the cash-strapped automakers were hoping to talk the union into taking equity in the companies in lieu of real green dollars.
Although the details will differ, the fact that the UAW agreed to take on stock as part of the health care trust at one automaker makes it likely the union will do the same for the other two. The UAW generally gives all three domestic automakers about the same level of concessions to ensure one company is not more financially competitive than the other two.
Under the agreement, which still has to be ratified by union members, Ford has the option of issuing up to 50% of the payment in stock rather than cash. "The agreements, if finalized, will allow Ford to become competitive with foreign automakers' U.S. manufacturing operations, and are critical to our efforts to operate through the current deep economic downturn without accessing government loans," says Joe Hinrichs, Ford's group vice president of labor affairs.
Just last week, union members were refusing to take company stock. That's because taking stock is a risk for the union, says Harley Shaiken, a professor of labor studies at the University of California-Berkeley.
"Stocks are inherently volatile, and they're especially volatile in the automobile industry," Shaiken says. "Health care for retirees is a pivotal issue for workers and the union, so the volatility of stocks made the union reluctant to sign on."
Trending Reader Picks
ABC News Live