General Motors and the United Auto Workers union are still hammering together a contract after the UAW went on strike over the weekend. Now, the automaker is shifting health insurance costs to the union as the GM strike continues into the week.
While the UAW sought to have GM pay for health insurance costs through the end of the month, the automaker has said it is now halting those payments as a result of the GM strike. The move places additional pressure on the UAW with a further drain on the union’s strike fund.
GM spokesman Jim Cain addressed the move, saying in an email, “We understand strikes are difficult and disruptive to families. While on strike some benefits shift to being funded by the union’s strike fund, and in this case hourly employees are eligible for union-paid COBRA so their health care benefits can continue.”
In a letter to union leaders, the vice president responsible for the UAW’s GM department, Terry Dittes, indicated that the union would review its legal options with regard to the automaker’s decision.
Health care costs can be substantial, with GM indicating previously that it allocates roughly $1 billion annually on healthcare coverage for hourly workers.
During the GM strike, UAW members are expected to receive $250 a week from the union fund. However, some employees of GM supplier companies are ineligible for the payments and have already been laid off.
This is the first company-wide strike seen in some 12 years. With the latest GM strike now stretching into a third day, the walkout has surpassed the two-day strike seen in 2007.
So far, little progress has been seen in hammering together a workable deal between the UAW and GM. For now, the GM strike will continue, with some financial experts predicting costs up to $100 million per day for the automaker.