It's been almost a month since the United Auto Workers (UAW) went on strike against American Axle (AA). The news that American Axle CEO Dick Dauch's pay package totaled over $7 million last year (not including estimated value of stock option grants or projected pension values) won't help management's negotiating position one whit. The Detroit Free Press reports that Dauch's '07 compensation included $5.6m in stock awards (more than double what he received in 2006) plus a $1.47m base salary, up 9.6 percent from 2006. "How can you expect us to keep giving when they just keep getting more?" UAW member Harry Jemkort asked. "It's just throwing another log on the fire for us to say we'll stay out here, we're going to fight." Yes, well, keep in mind that Dauch's $7m package represents a 9.2 percent cut from his '06 compensation (which included a $3.9m cash bonus). Unless you figure in what he might get from stock options, assuming the UAW workers settle or AA goes south of the border.
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If he only takes a 9.2% cut, why is he asking his workes to take a 50% cut?
What difference does it make?
Why do negotiations with the UAW seem to go “You make a billion dollars so I’m entitled to $28/hr plus killer bennies…AND you can’t fire me.”
Shouldn’t negotiations go something like “The robot lifts the part for you, the crane moves it over…all you do is push the wheel onto the car. Your labor is worth $8/hour.”
Oh yes, because manufacturing is now within the realm of the unskilled, or so we’d like to assume because a college degree isn’t a requirement, so we can just give them a wage that’s so very far below the poverty line and threaten to move their jobs overseas if they don’t like it.
MBAs are jerks. So are union bosses. They deserve each other.
Now people have to lose jobs to stroke egos.
I’m with Brendan.
Both sides in these deals are a bunch of losers.
If it were not for the union, the wage would likely find the right level in no time.
NICKNICK
What do you pay the programmers and maintainers of the robots and cranes? Plus have you ever operated and set up a machine that cuts and grinds gears and shafts? It isn’t as simple as you portray.
Why do the unions never try to negotiate a pay plan that says whatever percentage the boss gets, we get?? If he gets a raise, so do we. If he gets a bonus, so do we. Same percentage! He can’t get fired, neither can we. He gets a golden parachute, so do we. It will make everyone’s tide lift or sink based on the profitability of the business and have everyone invested in the whole thing.
Makes the union actually work for the good of the company and makes the executives do the same.
While I’m no fan of the union, and in no way defending them, the amount of money that these auto industry execs make isn’t in the ballpark of their performances, or that of their companies. I think that we’re seeing an auto industry labor bubble (top to bottom), and we’re almost at the breaking point. NO ONE deserves to make the amount of money that the line workers make for what they do, but that also goes for the top-level executives who have overseen yearly (that is 4 consecutive quarters for the MBAs in the audience) losses for…years.
Considering if he took a 50% paycut, that could cover roughly 60 employees at their CURRENT rate with that cut, the phrase “lead by example” comes to mind. Honor? Dignity? Being a good leader? Who cares as long as you’re making money…for yourself. If he took a 50% cut *HIMSELF* and said it’s going straight toward securing 120 jobs at 50% of THEIR rate, I don’t think the union’s bargaining position would exist. Slippery slope? Sure, but to most Americans, a 50% pay cut puts them in a more than tough spot. A 50% pay cut for this guy is a “market adjustment” (again, for the MBAs in the audience).
mykeliam wrote:
It will make everyone’s tide lift or sink based on the profitability of the business and have everyone invested in the whole thing.
Because the bosses have millions horded away. If business takes a nosedive and management has to take a 25-50% pay cut, no big deal, but based on your reasoning, if the hourly also have to, they’ll balk at that. I know too many unionized hourly workers who would rather do everything they can to put a business out of business if their pay and benenfits were threatened, than to do everything they could to make sure it is successful.
@jolo: I know too many unionized hourly workers who would rather do everything they can to put a business out of business if their pay and benenfits were threatened, than to do everything they could to make sure it is successful.
Top to bottom, sounds like they’re on the same page. Maybe if they realized this, they could have some common ground to start from.
mykeliam,
Come on now, you’re making too much sense!
@Juniper: Actually, NICKNICK does set up those machines.
You pay the programmers and maintainers of those machines a market wage that keeps them at your plant. The problem is that back when the factory work was required hard physical labor and lots of skill, the deserved the high wages, as not many people could do the job well. But now that robots do most of the work, why do we still pay it as skilled labor.
Miked
I won’t argue with someone in the plants everyday, but I saw a tendency in posts to lump everyone into the lowest category. I’ve spent a lot of time in engine and assembly plants (non automotive) There is a wide range of skills and effort required. When visiting automotive plants I saw the same diversity. Will they be able to develop job classifications that reflect the skill level or effort required and pay accordingly or will it all just go away, where it will just start all over again.
I do not think its out of line for the CEO to ask for anything. I do not think its out of line for employees to ask for anything either. The company is not an absolute place. No one is in control of another. No one can justify what another is doing because its unfair to them. No human law is absolute.
Good CEOs seem rare. Companies may feel they need to pay big money to get one that will help them move in a worthwhile direction. A 7 mil dollar CEO may mean an extra 1/3 billion in revenue, or not. A few line employees do not seem to carry the same ability. Pay may seem unfair, but comparison is meaningless.
People really shouldn’t shorten their names to ‘Dick’ any more.
That said, CEO compensation or overcompensation is at the root of much of our current economic woes right now. It’s good to see the issue brought up and discussed.
Good CEOs seem rare. Companies may feel they need to pay big money to get one that will help them move in a worthwhile direction. A 7 mil dollar CEO may mean an extra 1/3 billion in revenue, or not. A few line employees do not seem to carry the same ability. Pay may seem unfair, but comparison is meaningless.
Is he really that good if he’s trying to chop the salaries of his workforce? If he’s good, then he shouldn’t be worried about such drastic cuts. If he’s good, he wouldn’t try to have his cake and eat it too by keeping shaving payroll while keeping his employees.
Obviously, he’s not worth his $7M salary.
When Dauch bought American Axle they were very near bankruptcy. He was the man who made them the profitable company they became.
To the guys knocking union workers, have any of you actually worked on an automotive assembly line. Are you aware that the target efficency for assembly workers is that they be working at least 55 minutes out of every hour. You do the math on how much time that is between jobs if the rate is 72 jobs per hour. Oh by the way assemblers can’t go to the washroom or get a coffee or surf the net whenever they want. They are tied to the line and have to request relief to get off the line. Bottom line is they earn what they get. If you think it’s an easy big paycheck why not sign up.
To those knocking unions ask yourself if you would be making what you earn if it were not for unions negotiating good pay and benefits for their membership. Most of us owe our pay rate to the guys on the shop floor. The higher the workers get paid the more the supervisor is paid and it flows on up the ladder.
Potemkin,
No, I never worked on an auto line, but I have been on them, I know people who worked on them, and I grew up working with my dad on an extrusion plastics line. The first dozen or so years of my career, I had worse conditions at lower pay. Even the first half dozen years after getting my degree at a top university, I still made less than a UAW member.
I paid my dues by taking risk, putting up with BS, being cheated by employers, and learning. Now I can make much more than a UAW worker in much better conditions. I would bet dollars to donuts most of them would want their UAW job back after a few months at any job I ever had. Having been a salesman or consultant for the last dozen plus years I doubt many of them would ever put in the effort to get to this level. If I had gone on strike when I was cheated out of pay, I would never have made it to the second year of a sales job – EVER.
Get over it man. The biggest problem with most UAW jobs is the UAW and the whole union mindset. There are no guarantees. The hardest thing about making a good living is finding the good jobs at the good companies and doing what it takes to succeed and keep them. Working hard and doing a good job is only a small part of the equation, and the easiest part by far.
I have been in the forging industries for 15yrs+. These union morons forge net shape gears or rather should I say the ROBOT runs them. They make ring gears, spline yokes and near net gears, that is the bulk of it. Im not even talking about Cheektowaga but the forge. Those idiots got no idea what real work involves, heck my 1st paycheck didn’t even break 200.00 I started at 5.25. Some of them CRY BABIES were bringing home 100,000 + like die setters. As for skill please very easy to do. Its work but it isn’t rocket science people. I afford them no sympathy for the greed or stupidity. It was my choice if I wanted to work there or NOT. I didn’t deserve it nor do they. HA as for programming a robot it’s like playing a video game. I can ‘hot’ mod positions and add functions with the best of them. Robots nowadays are VERY easy to work with. Generally I can show someone how to do the above with average intelligence in 4 HOURS!!!
I wonder how many of them peons drive imports??
Imports are cancer which is slowly killing the auto industries and before any of you simple minded beings reply you had better do some research on the subject. Its easy to boot out the obvious which is inevitable but REALLY look at what’s happening.
I have a task for you wagging finger naysayer’s, you Americans that drive imports. Pick a day any day it matters less but while you’re out there driving and you pass a person of Asian descent you make a note of what there driving.
Were being rotted out from the inside out. Those Chinese, Japanese are more loyal to there homeland than we are right here in our very own HOUSE OF THE USA!!! SLAPPED!!!!!!