UPDATE 6-After GM talks hit impasse, UAW workers to strike as of Sunday night

DETROIT (Reuters) – The United Auto Workers (UAW) said on Sunday that its roughly 48,000 hourly workers at General Motors Co facilities would go on strike as of midnight Sunday after labor contract talks reached an impasse over wide-ranging issues from wages to health care benefits and temporary workers.

A member of United Auto Workers, Aramark workers, carries a strike sign outside the General Motors Detroit-Hamtramck assembly plant in Detroit, Michigan, U.S. September 15, 2019. REUTERS/Rebecca Cook

“We do not take this lightly,” Terry Dittes, the UAW vice president in charge of the union’s relationship with GM, said at a press conference in downtown Detroit. “This is our last resort.”

Earlier on Sunday 850 maintenance workers at five GM facilities walked off the job on strike.

The union has been fighting to stop GM from closing auto assembly plants in Ohio and Michigan and arguing that workers deserve higher pay after years of record profits for GM in North America.

GM officials have said the plant shutdowns are necessary responses to market shifts, and that UAW wages and benefits are expensive compared with competing non-union auto plants in the southern United States.

Before the union’s previous four-year contract with the No. 1 U.S. automaker expired at midnight on Sunday, Dittes said that “significant differences” remained between the two sides over wages, health care benefits, temporary employees, job security and profit sharing.

“We are standing up for fair wages, we are standing up for affordable, quality health care,” Dittes said on Sunday. “We are standing up for our share of the profits.”

A broad strike by the union would be the first such action at GM in 12 years and would test both the union and GM Chief Executive Mary Barra at a time when the U.S. auto industry is facing a slowdown in sales, and rising costs for launching electric vehicles and curbing emissions.

GM starts off the strike with healthy levels of inventory of some its key, high-margin vehicles.

As of Sept. 1, the automaker had 96 days supply of its Chevrolet Silverado pickup truck, 59 days supply of its Chevrolet Equinox SUV and more than 100 days supply of the Cadillac Escalade.

If the strike is short, hourly workers should not suffer much. But strike pay provided by the UAW, which has been building up reserves in preparation for possible industrial action, is just $250 per week.

This is far below their normal wages and means that the longer the strike goes on, the harder it will be for GM’s workers to pay their bills.

Earlier on Sunday, the UAW said maintenance workers employed by GM contractor Aramark would strike at five GM plants in Michigan and Ohio.

The automaker has 12 vehicle assembly plants, 12 engine and power train facilities and a handful of stamping plants and other facilities around the United States.

The UAW said the Aramark workers have been in negotiations since March 2018, and the company and union are at odds over pay and benefits.

GM did immediately respond to a request for comment, but said last Saturday it was “prepared to negotiate around the clock.”

A UAW spokesman did not say whether talks have resumed.

On Friday, the UAW announced temporary contract extensions with Ford Motor Co and Fiat Chrysler Automobiles NV (FCA) while it focused its attention on GM. The union had targeted GM as the first automaker with which it wanted to conclude contract talks.

This year’s talks had been expected to be contentious but have been complicated by recent developments in a longstanding federal investigation into corruption at the union.

The probe has raised questions about UAW President Gary Jones, who was identified as an unnamed official mentioned in a searing federal complaint this week detailing alleged embezzlement by union leaders.

Jones has not been charged and denies any wrongdoing. He remained in office after a meeting of union leaders Friday.

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Jones did not attend the union’s press conference on Sunday morning.

The spreading probe raises questions about the union’s options and its leaders’ standing with rank-and-file members.

GM’s workers last went out on a brief two-day strike in 2007 during contract talks. A more painful strike occurred in Flint, Michigan, in 1998, lasting 54 days and costing the No. 1 U.S. automaker more than $2 billion.

Reporting by Nick Carey and Ben Klayman in Detroit; Editing by Daniel Wallis and Lisa Shumaker

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