(Adds quotes from UAW president, details of agreement)
By Bernie Woodall
DETROIT, Oct 9 (Reuters) - U.S. union United Auto Workers'
leaders on Friday approved a tentative four-year contract with
Fiat Chrysler Automobiles (NYSE:FCAU) NV FCHA.MI FCAU.N , sending the
proposed agreement to 40,000 workers for a ratification vote.
The new deal, if ratified, would reshape the way in which
UAW workers at Fiat Chrysler are paid, gradually eliminating a
contentious two-tier pay structure.
UAW President Dennis Williams admitted he made some false
steps that helped lead to the landslide loss for a previous
proposed contract in a worker vote. The rejection almost led to
a strike at Fiat Chrysler's U.S. operations that was called off
minutes before a strike deadline late Wednesday night.
Williams said he misread the intensity for which lower-paid
second-tier workers wanted a clear path toward top pay rather
than a bridge closer to it, and he should have allowed more time
before holding the previous ratification vote.
Friday, in his first hours as marketer-in-chief for the new
deal, Williams told reporters in a telephone press conference,
"It's one of the biggest contracts we've ever negotiated" with
the company.
Several hundred of the UAW's local leaders from its
branches, mainly in the U.S. Midwest, met in Detroit on Friday.
They gave the new contract and its negotiators several
spontaneous standing ovations, Williams said.
It will take eight years from being hired to reach top pay
rather than a shorter period for UAW workers prior to the 2007
creation of the two-tier structure.
A health care co-op to pool workers ID:nL1N0Z42M3 at the
Detroit automakers, cited as a reason for rejection of the
previous proposal, is not included in the new deal, Williams
said.
The deal is now richer in that it raises the top pay for
newer second-tier workers to about $29 from about $19 currently,
and from the top pay of $25 proposed in the rejected contract.
Fiat Chrysler is financially the weakest of the Detroit
Three which also includes General Motors Co (NYSE:GM) GM.N and Ford
Motor Co F.N . Its labor costs are lower than GM's or Ford's in
large part because it has a higher percentage of second-tier
workers.
Arthur Schwartz, a labor consultant and former GM
negotiator, said this proposal is richer and that he will be
"stunned" if it is not ratified.
"If (UAW members) don't vote for this, then their
expectations are too unrealistic and I don't know if they can
get a contract at Chrysler," Schwartz said after the highlights
of the new deal were released.
When UAW leaders sent the previous proposal to worker vote
last month, Schwartz said it would have a difficult time
passing.
If ratified, fist-tier workers would get their first raises
in about a decade. They would get an immediate 3 percent raise
from their current pay of about $28, and another 3 percent in
the third year, along with lump sum bonuses of about $2,500 in
years two and four.
The UAW said it agreed with the company to offer "retirement
incentive packages" at some plants, without mentioning which
ones.