Four-year Deal with Delphi Wins 75 Percent Approval

If financing holds, company poised to emerge from bankruptcy in late December 2007

Dayton, Ohio

Members at eight IUE-CWA locals with members at Delphi Corp. voted to ratify a new four-year agreement by 75 to 25 percent.

The vote tally came nearly two weeks after a tentative agreement was reached with Delphi that would advance the auto parts manufacturer's emergence from Chapter 11 bankruptcy.

"The past two years have been a difficult period for our members and local unions," said IUE-CWA President Jim Clark. "This vote gives members options about their future on the job and allows the union to start the rebuilding process. Delphi is now more competitive than ever thanks to the sacrifices of our members. If the company succeeds, the workers deserve the credit and should share in future rewards."

Movement in talks started after IUE-CWA notified Delphi it was revoking its permission for the use of temporaries in the plant. The tentative agreement was reached the evening before Delphi would have had to hire the temps as permanent or reduce production.

Prior to the final IUE-CWA local voting, federal bankruptcy Judge Robert Drain approved the deal, so the contract went into effect immediately.

Plants in Warren, Ohio, and Clinton and Brookhaven, Miss., will remain as part of Delphi.

A plant in Gadsden, Ala., and one in Kettering, Ohio, will be sold. Trying to breathe life into the Kettering facility, which under Delphi's original plan was scheduled for shutdown, was a key goal of negotiators.

The plant in Moraine, Ohio, will close. Plants in Anaheim, Calif., and New Brunswick, N.J., already have closed but still had members eligible to vote on the Delphi payroll.

"These agreements strike a balance between allowing Delphi to win new business and our members to progress with their lives," said IUE-CWA Automotive Conference Board Chairman Willie Thorpe. "From temporary workers who have advancement prospects to senior members who can decide their future within the company, this contract delivers the best opportunities for our members under our current situation."

Members have an array of early retirement options, buyouts and buy downs to choose from based on their seniority, age and wage rates. Buy down payments range from $10,000 to $105,000 for most workers based on current wage rates.

The final hourly pay varies by location. The contract provides for two 3 percent wage increases and two 3 percent lump-sum payments over the four years.

In a crucial victory, negotiators were able to secure retiree health care benefits for a much wider group of retirees than originally proposed by General Motors.

The GM benefit guarantee, a critical protection for IUE-CWA members, was set to expire in October.

The agreement now covers all current Delphi retirees and all workers who left under the previous or current special attrition program. It also extends to not only traditional employees who were working as of May 28, 1999, but any who were employed by that date who have since reached parity.

Those still working will get an extra seven years of GM pension credit. If they are not eligible to retire within those seven years, a special VEBA was set up to provide supplemental retiree health care for those individuals.

GM committed to placing products in IUE-CWA plants and both GM and Delphi pledged to suspend all sourcing. The business commitments translate into sustainable employment levels, but could be impacted by volume-related variables.

The contract will allow many of the current temporary workers to become permanent hires and receive some benefits as well as be eligible for up to $40,000 in severance payments if they are permanently laid off prior to October 2011, when the contract expires.

Former GM workers also have special preferential hiring rights should positions become available at GM plants.

IUE-CWA will take ownership of the Joint Activities Center and have funding to run training, educational programs, counseling and other assistance for current and former members at Delphi.

Delphi has now completed revised labor agreements with all of its U.S. unions. The next big step is testing the financial markets for support for its rights offering. Appaloosa pledged to invest $2.55 million after Cerberus dropped out of the deal.

Delphi is anticipating emerging from bankruptcy in late 2007.