Autoworker contract talks stall over pay

DETROIT – Contract talks between the United Auto Workers union and General Motors and Chrysler slowed Friday as the union seeks more money and the companies insist on cost cuts to offset pay increases, three people briefed on the negotiations said.

The slowdown over pay comes just five days before the union’s national agreements with General Motors Co., Chrysler Group LLC and Ford Motor Co. expire on Wednesday.

The contract talks will determine wages and benefits for 111,000 union workers at the companies, and they also set the bar for wages at auto parts companies, U.S. factories run by foreign automakers and other manufacturing companies, which employ hundreds of thousands more.

One key issue is pay raises for entry-level factory workers who now make $14 to $16 per hour, about half the rate of longtime union workers. The union agreed to the lower wages in 2007 to help the companies through tough financial times while at the same time preserving the roughly $29 per hour made by longtime UAW workers.

The union has proposed pay increases, but the companies, wary of increasing payrolls, have said costs must be cut in other areas to fund the raises, the three people said. They’re looking at wellness programs to cut health care costs, and other measures.