Weekend UAW contract deadline looms under cloud of corruption scandals

Weekend contract deadline looms under cloud of corruption scandals

DETROIT – The clock is ticking down on the United Auto Workers union's national contract.

The union's national agreements with General Motors, Ford and Fiat Chrysler Automobiles are set to end at 11:59 p.m. Saturday. The union has picked GM as its target company. That means GM is the focus of bargaining. If there are any strikes, GM would be the first to have workers do so.

Related: UAW extends contracts with Ford, FCA; GM talks continue

A recent union scandal could impact the negotiations.  

Related: UAW official Vance Pearson, others, accused of embezzling thousands

The 40-page complaint focuses on union corruption. Federal investigators claim the complaint is true and have arrested a UAW board member and four other current and former UAW leaders they say are involved.

"I'm deeply saddened and irritated that some members of this union and some leaders in the auto companies exploited their positions to benefit themselves," said UAW President Gary Jones. "It frustrates me, and I know it frustrates you."

One of Jones' closest allies and his successor in UAW Region 5, Vance Pearson, was arrested and charged with embezzlement, wire fraud and money laundering, among others. 

Jones' home in Canton was raided in August, the same day Pearson's office and home was raided. People are wondering if Jones is one of the unnamed co-conspirators under investigation.

Center for Automotive Research analyst Kristin Dziczek thinks the two issues will get separated.

"The companies really don't want a weakened union now," Dziczek said. "They want a union they can get a tentative agreement with and get a contract."

The union's leverage is lessened by these allegations of high living, but there is one overriding concern at the bargaining table: The membership approves the contract. If members don't see enough gains, they'll kick it back looking for more, which is what happened in the last round of negotiations.

The UAW could extend the negotiations, call for a strike or negotiate a lead contract with either FCA or Ford on Saturday.

About the Authors:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.

Dave Bartkowiak Jr. is the digital managing editor for ClickOnDetroit.