Fiat Chrysler and U.A.W. Reach Contract Accord to Avert Strike
DETROIT — The United Automobile Workers and Fiat Chrysler Automobiles announced early Thursday that they had reached a tentative agreement on a new contract shortly after a midnight strike deadline set by the union.
The deal, subject to approval by a vote of 36,000 hourly workers and 4,000 salaried union members, averted a potential strike against the automaker.
The union’s president, Dennis Williams, said the agreement included unspecified changes from a previous one voted down last week by workers.
“We’ve reached a proposed tentative agreement that I believe addresses our members’ principal concerns about their jobs and their futures,” Mr. Williams said in a statement. “We have made real gains, and I look forward to a full discussion of the terms with our membership.”
Fiat Chrysler confirmed the agreement, but it provided no details because it is subject to ratification by workers.
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The U.A.W. president Dennis Williams, center, and Fiat Chrysler’s chief, Sergio Marchionne, right. The union set a strike deadline of 11:59 p.m. Wednesday.
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Mr. Williams said the tentative agreement would be presented to local union leaders on Friday, at which time details would be released and a vote would be scheduled.
The tentative contract came after marathon bargaining sessions on Wednesday, as workers prepared for a possible strike against Fiat Chrysler, the smallest of the three Detroit automakers.
People familiar with the talks said one of the big issues still on the table on Wednesday was whether Fiat Chrysler would accept a cap on the number of lower-paid factory workers.
More than 40 percent of Fiat Chrysler’s hourly workers are considered entry-level, and they are paid $9 to $12 an hour less than the $28 earned by veteran employees.
A tentative agreement reached last month between the company and union leadership called for raises for both entry-level and longtime workers.
But workers voted the deal down last week by a nearly 2-to-1 margin. Many of those opposed said it failed because there was no cap on the number of entry-level workers and no mechanism for them to move up to top-wage status.
Workers also expressed concern about changes in health care proposed in the initial agreement and the lack of production guarantees for individual factories across the country.
“It seems clear that workers did not believe the union had pressed hard enough to bridge the gap between the lower- and upper-tier workers,” said Harley Shaiken, a professor at the University of California, Berkeley, who has worked with the union in the past.
On Wednesday, the union published information for members about a possible strike.
The union staged brief strikes in 2007 against General Motors and what was then the Chrysler Corporation, before settling contracts at both companies. Those negotiations, however, were conducted during difficult financial times for G.M., Chrysler and Ford Motor.
Just two years after that, G.M. and Chrysler went bankrupt and needed government bailouts to survive, with Chrysler ultimately merging with the Italian automaker Fiat.
This year’s contract talks were expected to be smoother because of strong vehicle sales in the American market and healthy profits at each of the three Detroit carmakers.
But 65 percent of union workers at Fiat Chrysler voted against the initial agreement proposed jointly by the company and the union’s leadership.
The resounding defeat stung Mr. Williams and other members of the union bargaining team.
In a message to workers posted on Monday on the union’s website, Mr. Williams pledged to keep workers better informed on the latest negotiations.