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Money News

GM: What Are Strikes All About?

September 24, 2019

2 min read

A strike at General Motors (GM) is having a big impact on the nation’s largest auto manufacturer.

This week, nearly 50,000 employees stayed off factory assembly lines in Detroit and dozens of other factories around the country, demanding equal wages for workers. And as the strike has entered its second week, it’s estimated to have cost GM between $25 and $50 million.

GM has been in the process of restructuring its operations, aiming to aggressively enter the electric vehicle market. In 2018, it announced plans to cut 15,000 workers and shutter up to five plants.

What do strikers want?

GM workers reportedly want equal pay and an end to a system that pays workers who have longer tenures about 40% more than people hired more recently. They also reportedly want a path to regular employment for temporary employees, many of whom have remained contractors for close to a decade. Additionally, workers want to keep their health care affordable, according to reports.

The strikers are represented by the United Auto Workers Union, which last organized a strike against GM in 2007. The UAW is one of the largest unions in the country, representing nearly 1 million current and former automobile workers.

What happens when workers go on strike?

A strike is a collective group action by employees to attempt to change working conditions, such as wages, benefits, or safety conditions, by withholding their labor. Under something called the National Labor Relations Act, employees are entitled to lawfully engage in a strike.

Unions, such as the UAW, typically represent workers in negotiations with an employer, to come up with new working agreements and contracts. Workers pay dues to belong to a union, and in exchange, they receive a number of benefits, such as representation in these contract negotiations, and pay for each week they remain on strike. Union members who cross a picket line to return to work before a strike concludes could jeopardize their pay and membership in the union.

As union membership has declined over the past few decades, the number of strikes has also decreased dramatically.

More about GM

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By Jeremy Quittner
Jeremy Quittner is the senior writer for Stash.

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