What the United Auto Workers will gain in their historic contracts

President Joe Biden visited an Illinois auto plant on Thursday to celebrate the major victory won by the United Auto Workers last month, another watershed moment in a year of galvanizing labor activity across the United States.

After six weeks of strikes, the UAW clinched new deals from the three largest American auto companies, reinstating benefits previously lost and securing new gains, including wage increases across the board and reopening the Belvidere Assembly Plant for Jeep-maker Stellantis.

“Wall Street didn’t build America. The middle class built America, and unions built the middle class,” Biden said in Belvidere, Illinois, surrounded by auto workers and wearing a red UAW T-shirt.

Biden, who says he’s the “most pro-union president in American history,” also showed up on the picket line during the UAW strike last month and has lauded the agreements between workers and automakers.

READ MORE: 3 experts on the UAW strike and why we’re seeing an American labor ‘upsurge’

Workers at Ford who have already voted have overwhelmingly favored the agreements, and 146,000 more union members will vote on the tentative agreements in the next couple weeks.

Labor reporter Steven Greenhouse believes this latest victory is a turning point for UAW, which has had to contend with years of concessions and scandals, including past corruption from union leadership.

“Now the UAW can say to workers, ‘We’re a new union, we’re a militant union, we deliver big time,’ and that might improve their image,” he said.

The strikes were widely popular among Americans, with only 9 percent favoring the automakers over the workers, according to an AP-NORC poll.

“This contract is about more than just economic gains for autoworkers,” UAW President Shawn Fain said in a speech following the initial agreement with Ford. “It’s a turning point in the class war that has been raging in this country for the past 40 years. For too long it’s been one-sided and working class people have been losing.”

Here’s some of the biggest wins from the tentative contracts.

Wage gains across the board

Across the three automakers, workers gained a massive jump in wages.

Ford, Stellantis and GM employees gained a 25-percent wage increase.

A “25-percent raise is a lot of money, and it’s far beyond the 6 percent some of the companies were originally offering,” Greenhouse said. “It’s much better than many unions have done in recent years.”

The win also extends to temporary workers, typically the lowest-paid members in the union, whose immediate wage increases start around 50 percent at all three companies, and can rise to more than double of their current base pay.

EXPLAINER: Labor movements are seeing historic victories this year. Can unions keep up the momentum?

Kate Bronfenbrenner, a professor at the Cornell University School of Industrial and Labor Relations, pointed out that, back in 2007, the UAW accepted many concessions as the automakers worked to prevent bankruptcy during the Great Recession, which included a dip in wages and the establishment of a two-tier wage system where new employees would be paid far less than old employees.

With that context, she said much of these wage increases make up for what was lost more than 15 years ago.

Still, it’s a large overall jump in wages that is also paired with the addition of a new cost of living adjustment (COLA) to counteract rising inflation.

Tier wages scrapped

In a two-tier system, new workers who were hired after 2007 were paid about half as much as older workers for doing the same job, only shifting into the higher tier of pay after eight years.

Bronfenbrenner said this system often divides workers and makes it “very hard to have solidarity.”

The new deals shorten the amount of time it takes new employee pay to catch up to senior employee pay, from eight years to three years.

“Hopefully it’s going to make employers and unions think twice about doing two-tier,” she said.

Reopening a plant

One of the biggest wins for the UAW was the reopening of a Stellantis assembly plant in Belvidere, Illinois. It was shuttered in February amid faltering sales of the Jeep Cherokee and the company’s transition to electric vehicles.

Beyond the reopening, Stellantis also plans to open a brand new battery production plant in the area.

“I’m fighting for places like Belvidere because I came to the presidency determined to put an end to this trickle down economics in this country,” Biden said. “For too long, the wealthy and big corporations have done just fine, but the rest of us were cut out of that deal.”

The Belvidere Assembly Plant housed as many as 5,000 employees during its peak and 1,200 employees when it closed earlier this year, making it a major job creator for the local town.

What the union didn’t get

Despite the major wins, the three automakers didn’t meet all of UAW’s original demands.

The union’s starting demand for increased wages was 40 percent over four years, which eventually went down to 25 percent.

The strikes also failed to ensure defined-benefit pensions for full-time workers hired after 2007. Instead, they have been provided a 401(k) account with the company contributing 6.4 percent of the workers’ base wages. The new contracts maintain this separation. This policy generally aligns with U.S. economic trends where pensions have been slowly phased out in the private sector.

Lastly, the workers aimed to move the Big Three companies toward a four-day work week, an idea that’s grown in popularity over the last several years, but automakers didn’t budge.

What comes next

Emboldened by this huge win, Fain called on more unions to align their contract expiration dates to April 2028, positioning U.S. labor to strike at the same time on May Day, also called International Workers’ Day, and “begin to flex our collective muscles.”

“If we are going to truly take on the billionaire class and rebuild the economy so that it starts to work for the benefit of the many and not the few, then it’s important that we not only strike, but that we strike together,” he said in his remarks on Oct. 29.

Greenhouse anticipates other automakers will be looking at this shift and start to consider raising wages to avoid similar strikes or unionization.

“I imagine there’ll be ripple effects at non-union auto parts plants,” Greenhouse said.

“I think the non-union auto companies must be cursing Shawn Fain and the UAW right now because, of course, they have to either match these changes or beat them to try to prevent an organizing drive succeeding in their workplaces,” Bronfenbrenner said.

Last week, Toyota increased wages for non-union U.S. workers by 9 percent effective Jan. 1. Biden attributed this increase to the success of the strike against the Big Three.

“These deals are game changers. Not only for workers, but for all workers in America,” Biden said.