The president of the United Auto Workers union (UAW) has called General Motors’ (GM) proposed 16% pay increase “insulting.”
The 16% wage increase would apply to the top tier of earners at the Detroit automaker, with General Motors also offering newer employees a 56% pay raise.
However, UAW President Shawn Fain dismissed the offer, saying the proposal “insults our very worth.”
The pay raise offered by GM is slightly higher than what rival Ford Motor Co. (F) had offered the union but is still well short of the 46% across the board pay increase that the union has demanded.
General Motors latest offer to the union also includes a one-time $11,000 U.S. payment to help cover the cost of inflation, as well as a shortened period to reach top wages, and better pay for temporary staff.
The latest contract offers from the automakers come one week before the union’s contract officially expires and workers are in a position to strike.
The UAW also wants to reinstate guaranteed pensions, cost-of-living allowances, and retiree healthcare benefits.
The offers on the table from both GM and Ford do not include retiree benefits, which were taken away in 2007 for new hires. Workers hired after 2006 are now enrolled in a 401(k) plan that is similar to RRSPs in Canada.
The automakers have said that reinstating all the retiree benefits as the union wants could cost them $80 billion U.S. over four years.
General Motors’ stock has declined 20% over the last 12 months to trade at $32.57 U.S. per share.