WYPR: Local Auto Workers Worry About Benefits (2009-04-06)

The Obama Administration has given General Motors until the end of May to come up with a survival plan acceptable to the government, or face bankruptcy. A key part involves striking a deal with the United Auto Workers on benefit costs. Talks are under way in Detroit, and GM retirees in Baltimore are holding their breath. WYPR's Georgia Samios reports.

The UAW hall in Highlandtown is eerily empty this weekday morning. An oversized aerial photo of GM's sprawling plant on Broening Highway hangs on one wall. But the factory closed in 2005, and the place where thousands once worked is gone. Local GM retirees outnumber active members by more than 13 to one. Fred Swanner is the president of Local 239, and a current GM employee at its much smaller transmission plant in White Marsh:

"Active members in this local, we have close to two hundred and seventy-five. ..Retirees, we have close to thirty-six hundred retirees."

GM has long said it couldn't afford the rising health costs for its legion of retirees, many too young for Medicare. In 2007, it got the UAW to agree to a new trust fund to get that obligation of its books. That fund is supposed to kick in next year. But, with GM on the ropes, no one knows how that will play out. Retirees are concerned, and they don't get to vote on an amended contract, says Gene diNatale, chairman of Local 239's retirees chapter.

"They're worried about their pension and health care, something that, you know, they thought they would have to the day they died and they don't. Maybe they don't."

Butch Pinder, 63, is one of those. He spent 30 years on GM's payroll, much of that as a union rep. He knows just how valuable his drug coverage is:

"Last year alone, if I would have had to purchase the medication I take personally, it would have amounted to over 10 thousand dollars. Now, fortunately because of the plan that we have it was down into the hundreds that I had to pay out of pocket."

Dallas Salisbury, president of the Employee Benefit Research Institute in Washington, says GM retirees have good reason to fret about medical benefits. Union negotiators, especially in dire situations, typically focus more on active workers.

"Retiree medical benefits are not an advanced funded benefit, meaning there's not money in the bank, and so that is something that always in situations like this, whether it was the steel industry or companies like Polaroid , retiree health benefits have been lost."

If GM falls into bankruptcy, a judge and creditors will call the shots, Salisbury says. That possibility worries Peter Haussler, who retired from GM in 2006 after 41 years:

"I've been having trouble sleeping at night, thinking, you know, what could happen. if they do go bankrupt, because this way all the union contracts are void, and then they can just start over from scratch."

Like his fellow retirees, Haussler takes pride in the work done at Broening Highway, and gets upset when he hears accusations that UAW benefits are too generous. They're well deserved, he argues.

"It's hard to work on an assembly line, eight, 10 hours a day summertime it got up to a hundred and ten, hundred and fifteen degrees. Some places, like up in the paint shop, it was like a hundred and thirty. So, you know, it was no picnic."

Columbia resident Paul Pinkney, 69, spent 40 years at the plant. He started at a dollar-ten an hour, and was getting 25, 26 dollars when it closed. As the plant was being demolished, he could barely stand to drive by.

"I was so glad when they finally got it down because part of me was there, everything that I own, everything that I am, I got from General Motors, I got from that plant."

Salisbury, from the Washington think tank, says situations like GM can help propel changes in America's health care system this year. Those reforms could include ways to cover pre-Medicare retirees who lose benefits, as well as those who never had them in the first place.