Jobs bank, the two-decades-old program, is costing the Detroit's Big Three billions of dollars at a time when they are losing billions. This is why Detroit's Big Three is planning to close them. The Big Three hopes to drastically overhaul during contract talks this summer with the United Auto Workers (UAW).
But at the UAW Local 599 in Flint, General Motors Corp. workers steadfastly defend the jobs bank. While outsiders criticized them for refusing to acknowledge that such guarantees are unsustainable in today's time, they consider protecting the jobs bank a mission. "We want to save the American auto industry," said Terry Everman, a Local 599 official who helps oversee the jobs bank. "We know what kind of trouble we face, but to give up the jobs bank is to give up everything the union fought decades to win." Jobs bank functions like a reliable that serves as proper anchorage to the workers.
Everman added, "None of these workers wanted to stay in the bank for this long. But they stayed because GM made them a promise that if we cooperated, which we have all along, if we worked hard and produced quality, which we have, then we would keep our jobs. How do you save the American auto industry by sacrificing the rights and protection of workers?"
The jobs bank was instituted more than two decades ago in lieu of the UAW's help in making plants automated and more flexible. The union wanted to safeguard the jobs that were left. Earlier, the union has shown readiness to compromise.
"This is about GM and the UAW continually looking for ways to improve competitiveness," GM spokesman Dan Flores said. Detroit's Big Three declined to divulge how much they currently spend on their jobs banks. However, the four-year labor contracts they signed with the UAW in 2003 instituted contribution caps that reflect the idea of the expense. GM agreed to contribute up to $2.1 billion over four years. Chrysler allotted $451 million for its program, along with another $50 million for salaried union employees. Meanwhile, Ford agreed to contribute $944 million.
"The domestic auto companies are playing by rules that no longer apply to the 21st century global economy," said Dana Johnson, the chief economist for Comerica Inc.
Job bankers like Dean Braid, 28-year GM veteran, in Flint said that the program should remain until Detroit automakers start investing more in America rather than shifting production to lower-cost countries. "We made one of the best products in the world and yet, here we are," said Braid as he sat in the conference room at Local 599 with several others.
He believes that the UAW granted too many concessions in recent years and agreed to close too many plants. "Do we want the Wal-Mart standard for all workers?" he asked. "Who's going to able to afford to buy a car or truck if we all get paid that way?"
Workers at the Local 599 said that the cost of abandoning the jobs bank is too high for union members in Flint and elsewhere, today and in the future. "It's about the social contract being broken," said Everman, the UAW Local 599 official. "It's about not letting the companies ship all those jobs to Mexico and China. It's about not walking away from the American worker. It's about not letting what happened to the American steel industry happen to the American auto industry."
"The UAW has set the standard for the common men and women in so many ways, and for so long," said Local 599 President Bill Jordan. "We fought for every right we have."
