While there is no longer a official contract between the UAW and General Motors (GM), the parties agreed to keep negotiations going forward on an hourly basis, although there is not a formal agreement in place to extend the contract.
This is good in that the two sides are pressured to come up with solutions in a quick way. Even so, the UAW could still call a strike and stop the hourly agreement.
"An hour-to-hour arrangement generally means both sides think a deal's close," said Jim Walters, a labor attorney with Fisher & Phillips LLP in Atlanta.
The major issue in the negotiations is how a trust or employee benefit association - called VEBA - would be be set up. VEBA would take over responsibility for the health care benefits of over 460,000 retired GM workers.
Both sides are in agreement on having the health-care trust, it's the details of that trust that are being hammered out at this time.
Harley Shaiken, a labor expert from the University of California at Berkeley, said, "These are not minor details. It's like buying a house: If you can't agree on all the other terms like ... who pays for the new roof, you don't have a deal."
At issue is how much liability the UAW will be responsible for absorbing with the trust. GM wants to fund it at a much lower rate than the UAW wants.
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