Allison Transmission Holdings Inc. (NYSE: ALSN) announced that members of theInternational Union, United Automobile, Aerospace andAgricultural Workers of America (UAW) Local 933 ratified a new five-year collective bargaining agreement (CBA) which becomes effectiveDecember 3, 2012 and will expire onNovember 14, 2017.
Some of the key economic provisions from the new CBA include a$5,000ratification bonus, maintenance of a multi-tier wage and benefit system, and an annual incentive compensation program. Tier one and skilled tier two union members will receive a lump sum payment equal to 3 percent of their base wage in 2013 and again each year until 2016. Production tier two union members will receive base wage increases ranging from 2 to 4 percent in 2013, 2015 and 2016 and a one-time 3 percent lump sum payment in 2014. Annual cost of living allowances based on a variable consumer price index were eliminated and replaced with a fixed annual lump sum payment of$1,000.
Pension rates under the CBA are unchanged and the company match for tier two employee contributions to the 401(k) plan increased from 5 to 6 percent. The parties also agreed to modify retiree healthcare, more closely aligning it with the benefits offered in theVoluntary Employee Beneficiary Association(VEBA) trust covering retired U.S. auto workers fromFord Motor Co.,Chrysler Groupand General Motors Co.
The new CBA covers approximately 1,550 hourly employees who primarily work in the Indianapolis area.
