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05:24 p.m. EDT, October 11, 2007
At the end of a national strike that lasted only six hours, the United Auto Workers Union made concessions similar to those in the General Motors contract, but with fewer compensations in return.
The tentative contract, good for four years, now faces ratification by approximately 45,000 Chrysler workers who are UAW members.
Under the terms of the proposed agreement retiree health care benefits will be channeled through a union administered trust, freeing Chrysler of $18 billion in obligations for a one-time contribution of $11 billion.
While neither Chrysler nor the union has commented on the specifics of the contract, the bulk of the agreement is patterned, as expected, on the contract forged last month with General Motors.
The UAW agreed to a benefit package for new hires with incentives for existing veteran workers to take a buyout on their contracts. Additionally workers will be given small bonuses on an annual basis for the duration of the contract rather than wage increases.
If the figures are similar to those in the GM deal, workers will receive a signing bonus of approximately $3,000 with lump sums of 3 percent, 4 percent, and 3 percent while the contract is in effect.
Both the deals with GM and Chrysler will help to shrink the labor cost gap of $20 to $30 American manufacturers face against their Japanese competitors. In the coming days the UAW will begin its negotiation process with Ford Motor Co.
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