UAW to renegotiate labor terms, suspend jobs bank
By KIMBERLY S. JOHNSON, AP Auto Writer

DETROIT - The United Auto Workers said Wednesday it is willing to
change its contracts with U.S. automakers and accept delayed payments
of billions of dollars to a union-run health care trust to do its
part to help the struggling companies secure $34 billion in
government loans.

United Auto Workers President Ron Gettelfinger said the union will
suspend the jobs bank, in which laid-off workers are paid up to 95
percent of their salaries while not working, but he did not give
specifics or a timetable of when the program will end.

"We're going to sit down and work out the mechanics," Gettelfinger
said at a news conference after meeting with local union
officials. "We're a little unclear on some of the issues."

Members of Congress criticized the automakers last month for paying
workers who are not on the job. About 3,500 auto workers across the
three companies are currently in jobs bank programs.

One local union member who was in the meeting said the changes to the
jobs bank would nearly eliminate the program. The member asked not to
be identified because the details had not been made public.

Gettelfinger stopped short of saying the union would reopen contract
talks with General Motors Corp., Chrysler LLC and Ford Motor Co. but
said it would be willing to return to the bargaining table to change
some terms.

Talks with GM will begin immediately, but additional bargaining
officials must be elected for Ford and Chrysler, Gettelfinger said,
and any modifications would still have to be ratified by local union
members.

He also said the union will run a television ad in Maine, Kentucky,
Indiana and Minnesota to put the faces of union workers on the
controversy over the loans, and explain how the auto industry differs
from the banking industry. The ads presumably are designed to
pressure Congressional opponents of the loans.

"There's a perception problem," Gettelfinger said, stressing that the
automakers' woes have painted a negative view of the union. "Yes, we
have lost some clout."

Delaying the health care trust payments will help the companies
survive their cash shortages, which they say were brought on by the
severe economic downturn and the worst U.S. sales climate in more
than a quarter century.

GM had been scheduled to pay more than $7.5 billion early next year
to the union-administered fund which will take over retiree health
care payments on Jan. 1, 2010. Ford owes $6.3 billion to its trust
fund at the end of this year. Chrysler figures were unavailable.

The delay will have to be approved by federal courts, which already
have blessed the trusts' formation.

All three companies agreed to fund the trusts, called voluntary
employee beneficiary associations or VEBAs, as part of the landmark
2007 contract reached with the UAW. By doing so they move billions in
liabilities off their books.

When they go into effect, the trusts will pay health care bills for
about 800,000 UAW retirees, spouses and dependents at the three
companies. GM expects to save about $3 billion a year when the
expenses are moved, while Ford says it will save $1 billion.

The CEOs of all three automakers are heading to Washington for more
hearings Thursday and Friday on their loan requests after an abysmal
showing before lawmakers last month. Gettelfinger will also attend.

Congressional leaders demanded business plans from all three that
include a reduction in labor costs so Detroit is more competitive
with foreign automakers with U.S. factories. The companies submitted
their plans to Congress on Tuesday.

"I don't think Congress is out for blood," Gettelfinger said of the
criticism the union received during his previous testimony last
month. "There will be more pressure on us to do this. We're going to
step up and do it."

That sentiment was echoed by several union representatives at the
news conference.

"Everybody has to give a little bit," said Rich Bennett, an official
for Local 122 in Twinsburg, Ohio, representing Chrysler
workers. "We've made concessions. We really feel we're doing our
part."

But a retired GM worker said the union might be acting hastily out of
fear that one of the automakers could shut down.

"Fear is a bad basis on which to make decisions," said Frank Hammer,
of Local 909 in Warren, Mich. "I think they're making another
mistake."

Members at Local 122 are fearful of losing their jobs, said Bennett's
associate, Ken Walters. They're seeing nearby plants shut down on
regular basis.

General Holliefield, the UAW vice president representing Chrysler
workers, said union members "historically do the right thing" in
terms of making concessions during tough times, although the moves
outlined Wednesday came to fruition following last month's
congressional thrashing.

"Washington didn't ask us for concessions," he said. "It wasn't
anything we were thinking about."

The president of Chrysler said the UAW's willingness to change the
union's contract is a good step.

Chrysler LLC President Tom LaSorda said during a Toledo rally for the
industry on Wednesday that both sides need to go back and review the
entire framework of the contract. He said if the union would
surrender job security protections it would help the Detroit Three in
the long run.

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AP Auto Writer Tom Krisher contributed to this report.