UAW-backed contract includes new attacks on Volvo Truck retirees

Volvo workers: contact the Volvo workers’ grassroots committee by e-mail at or by SMS to (540) 307-0509.

Nearly 3,000 workers at Volvo Truck’s New River Valley plant in Dublin, Virginia, will vote this Sunday on a six-year labor agreement backed by the United Auto Workers union. Grassroots workers actively oppose the deal, which is just a slightly modified version of a previous UAW-backed deal that was decisively rejected last month.

Many elements of the proposed agreement angered workers. In the last three contracts, the Swedish multinational and the UAW have cited supposed economic hardships to justify demands for concessions, including the introduction of a tiered wage and benefit system that condemns young workers lower wages and denies them fully paid retirement benefits.

Volvo workers strike (Source: UAW L. 2069 Facebook page)

With the company enjoying years of profits and increasing market share, workers are determined to recoup their losses and achieve substantial improvements for current and retired workers.

In statement calling for a ‘no’ vote on Sunday, newly formed Volvo workers’ grassroots committee informs UAW President Rory Gamble, Secretary-Treasurer Ray Curry and UAW Local 2069 president , Matt Blondino, what would be the minimum basis for a deal. that workers will accept.

This includes:

  • A generalized 25% wage increase to restore lost income during the last three contracts
  • Maintain current health insurance rates and coverage
  • Fully paid health care benefits for retirees with no co-pay or premiums
  • End the multilevel pay system and transfer all workers to the highest pay and benefits
  • Eliminate the alternative work schedule and keep the current overtime rules
  • Put in place a COLA clause to deal with soaring consumer goods prices
  • Five personal days for all workers, not just salaried workers, and no reduction in vacation days
  • A contract ratification bonus of $ 4,000

Defending the livelihoods and health of thousands of retirees and surviving spouses is a matter of principle for the VWRFC. The committee fought for the unity of all workers, young and old, of the “central group” and “competitive workers”, active and retired, and fought against all the efforts of the company and UAW to divide and weaken workers.

Among the retirees are the first workers at the New River Valley plant, which was built in 1979 and originally owned by White Motor Corp. of Cleveland. Volvo purchased the plant and other assets as part of its near-bankrupt White Motor takeover in 1981 and entry into the North American truck market, which included a controlling stake in the General group. Motors Truck and Bus of Pontiac, Michigan.

Beginning in the 1980s, the UAW handed out concession after concession to auto and truck manufacturing companies as part of its corporate agenda of worker-management collaboration and prompted global corporations to invest. in the United States by ending strikes and systematically reducing labor costs. This included the abandonment of millions of retirees who had spent their working lives producing corporate profits.

This took a qualitative turn in mid-2005 when the UAW agreed to grant historic concessions to GM, including the company’s demand to cut billions of dollars in health care benefits to its 500,000. retirees and their dependents. In 2007, the UAW abandoned the principle of fully paid health benefits for retirees, won by autoworkers in 1964 after nearly two decades of bitter struggles, and allowed automakers in Detroit to get rid of of their obligations.

This took the form of the creation of a so-called Association of Beneficiaries of Voluntary Employees, or VEBA, which was initially funded (in fact considerably underfunded) by companies. The UAW, which has been handed billions of dollars in company stock, has been tasked with rationing medical benefits to retirees and their survivors.

To push the VEBA through, the UAW went so far as to join General Motors in a lawsuit against retirees who had filed a class action lawsuit to end the first-ever cuts to health care benefits. the Detroit Free Press noted at the time that legal experts said the UAW had taken “an unusual step to prevent disgruntled retirees from challenging the union’s right to negotiate such concessions and tie the deal to years of litigation.” .

Between 1984 and 2005, collective agreements between the UAW and Volvo provided that health benefits for employees eligible for retirement “shall be maintained until retirement with [Volvo] make the full contribution. In 2005, however, the UAW agreed to set up a VEBA with Volvo, as well as a mechanism to shift higher costs onto retirees if there was not enough money in the trust. VEBA.

According to court documents from the 2011 case Quesenberry v. Volvo Trucks retiree healthcare argued in the US Fourth Circuit District Court, the 2005 agreement also set out the limits of Volvo’s financial obligations: “Volvo’s liability for retiree health insurance expenses was limited to an average cost of $ 13,606 per year for each retiree not for each retiree eligible for Medicare. To address issues with potential costs exceeding these caps, Volvo agreed to set up a Volunteer Employees Association (VEBA) trust, to which it was to pay a total of $ 3.943 million, of which $ 1.585 million was last day of the 2005 CBA term in 2008. Of this amount, Volvo predicted in 2005 that only $ 400,000 would be needed for cumulative costs above the cap until the agreement expired on January 31, 2008. VEBA’s assets were to be held “for the sole purpose of paying any costs incurred by retired participants under the Volvo Plan that exceed the limits set out above.” “

The documents further state: “In the event that the VEBA trust was to run out within a calendar year, Volvo and the UAW were to meet to discuss how to reduce healthcare costs. If these negotiations prove unsuccessful, Volvo could charge each retiree for all costs in excess of the limits according to a formula set out in the paragraph on costs. “

In a 2011 ruling that is surprisingly similar to the one handed down by the courts in the bogus UAW case against GM in 2005, the U.S. District Court ruled that Volvo cannot unilaterally cut pension benefits unless that “the VEBA is not used up within one year. year and Volvo and the union are unable to agree on benefit cuts to reduce the premiums that Volvo pays for employees.

It is likely that the UAW and Volvo have deliberately underfunded VEBA in recent contracts, setting in motion a series of new cuts. In a disturbing threat to retiree benefits, the tentative agreement the UAW is now pushing states that “the company and the union agree to continue to meet to discuss potential changes to the Volvo plan as it applies. to each group ”. This includes Volvo’s hiring of a third-party contractor to help analyze potential cost reduction changes.

In a letter to Volvo’s workers’ grassroots committee, a worker who retired after 31 years wrote: “I am so proud of all of you who stand up for retirees. We have had the well for several years and if you let this new contract be approved without a Veba trust fund, then the current retirees and employees are screwed.

“After the 2016 contract was approved, I attended a retirees meeting and heard our local president say that they had ignored the Veba trust fund, but don’t worry because he would take care of us. 2021. I got chills back because I knew that if they didn’t take care of us in 2016, they sure wouldn’t take care of us in 2021.

“The only thing the company wants for us is to die and get rid of its responsibility !!! Our retirement income benefit has declined and the future is not looking bright for us who have income or insurance. I’m sure the company told Anthem to put co-payments and funds on our last insurance card because they also intend to ram them down our throats. I would love to vote on this contract !!

The letter ends by thanking the committee “for what you are trying to do for us and all current employees”.

Volvo workers: contact the Volvo workers’ grassroots committee by e-mail at or by SMS to (540) 307-0509.

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