DETROIT – General Motors’ Ultium Cells has agreed to increase worker pay at its battery plant in Ohio by an average of 25%, the company and United Auto Workers union said Thursday.
Ultium, a joint venture with LG Energy Solution, is key for the automaker to increase its supply of batteries for its growing fleet of electric vehicles. The deal is a major win for the union, as it’s the first major organized battery plant in the country.
The UAW and Ultium have been negotiating a deal for roughly 1,100 workers at the plant since a majority of employees agreed to organize with the union last year. The union previously argued the battery workers should make the same wages as their traditional counterparts assembling engines and cars.
Ultium workers currently make between roughly $20 and $25 an hour for production workers and $25 to $34.60 an hour for maintenance employees. The wage increases will be between $3 and $4 an hour, the union said. With the increases, they’ll still be paid less than the more than $32 an hour of traditional UAW assembly workers with the Detroit automakers.
The tentative deal, which must be ratified by workers, is not a complete agreement. It addresses worker pay and but does not include other dynamics and processes. If ratified, workers will be retroactively paid backed wages of between $3,000 and $7,000
“While an entire ‘first’ agreement is being negotiated, the committee is still hard at work in bargaining working conditions, health and safety, seniority rights, addressing other issues raised by the membership and future wage increases throughout the term of this agreement,” Josh Ayers, UAW Local 1112 chairman, said in a statement.
This is a separate agreement than the ongoing national negotiations occurring between the UAW and General Motors, Ford Motor and Stellantis covering roughly 150,000 workers.
The Ultium plant in Ohio, which started production in August, is the first of at least four U.S. battery facilities for joint ventures with GM. The plants are expected to employ thousands of workers in the coming years. Ford Motor, Stellantis and other automakers have announced similar plants, which would each have to be organized separately by the union in addition to the other Ultium plants.
“This agreement is a significant and meaningful step as we continue to negotiate collaboratively and in good faith with the UAW to reach a comprehensive contract,” Ultium Ohio Plant Director Kareem Maine said in a statement. “Our team members are at the core of our business, and we’re proud to be able to reach an interim agreement for wage increases that prioritizes our incredible workforce.”
The UAW’s membership ratification vote is expected to conclude by Aug. 27. If ratified, the interim wage increase will be retroactive, and active current hourly employees will receive back pay for every hour worked since Dec. 23. Any current employee who has worked since then can receive a one-time payment of $3,000 to $7,000, based on hours worked.