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Tag: labor

  • Virgin Galactic to cut staff to focus on lower-cost Delta spacecraft

    Virgin Galactic to cut staff to focus on lower-cost Delta spacecraft

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    Commercial space-flight operator Virgin Galactic Holdings Inc. on Tuesday said it would cut staff in an effort to focus on developing its new class of Delta spacecraft that are expected to cost less and bring more profit.

    Management, in an email to employees, did not offer specific figures on the cuts, while citing a shaky investing environment as part of the reason for them. The message said the company would offer more details during its third-quarter earnings call on Wednesday.

    Virgin Galactic
    SPCE,
    +2.96%    ,
    when reached on Tuesday, declined to offer additional information. Executives over the summer said they expected commercial service for Delta ships to begin in 2026, after testing in 2025.

    Shares were little changed after hours on Tuesday. The stock has fallen 50.4% so far this year.

    The cuts follow a handful of space flights this year from Virgin Galactic, which was founded by billionaire Richard Branson. But Chief Executive Michael Colglazier, in the email, said that following successes from the spaceship Unity and its carrier mothership, Eve, the company needed to “reduce our reliance on unpredictable capital markets.”

    “To profitably scale our business, we must first invest upfront capital to create a fleet of ships based on a standardized production model — the Delta Class ships,” Colglazier said in the email.

    He added that “uncertainty has grown in the capital markets,” with higher interest rates pressuring borrowing and “geopolitical unrest” making for a more cautious environment. He said the Delta spacecraft played a key role in expanding flight service and profitability, and that it was crucial to focus on bringing them into service.

    “Interest rates remain high, which adds pressure to companies who are investing today for profits that will come in the future,” he said. “Geopolitical unrest continues to expand, and the combination of these factors makes near-term access to capital much less favorable.”

    “The Delta ships are powerful economic engines,” he continued. “To bring them into service, we need to extend our strong financial position and reduce our reliance on unpredictable capital markets. We will accomplish this, but it requires us to redirect our resources toward the Delta ships while streamlining and reducing our work outside of the Delta program.”

    He said employees would be notified of their job status between Tuesday and Thursday. Employees will be working from home for the rest of the week, Colglazier said, adding that on-site work locations would be unavailable through that time.

    “Delta ships have been designed to have a relatively low unit-production cost and have a material improvement flight cadence relative to our initial ship, VSS Unity,” Colglazier said on Virgin Galactic’s earnings call in August.

    “The Delta development process has yielded some excellent enhancements to the ship’s architecture, particularly with regard to manufacturability and maintainability,” he said. “And we are tracking well against our primary ship-performance criteria.”

     

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  • Sleep Number’s stock falls 30% as company saw demand change ‘abruptly’

    Sleep Number’s stock falls 30% as company saw demand change ‘abruptly’

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    Shares of Sleep Number Corp. tanked 30% in the after-hours session Tuesday after the mattress maker and retailer swung to a surprise quarterly loss, predicted a loss for the full year and said it reached an agreement with a shareholder that had been pushing for change.

    It was a “challenging” quarter for Sleep Number
    SNBR,
    -1.41%
    and the bedding industry, Chief Executive Shelly Ibach said. “The consumer demand trajectory changed abruptly midway through the quarter,” Ibach said.

    Sleep Number “acted quickly to further reduce costs, recalibrate our sales and marketing approach, and amend our credit agreement to provide additional covenant flexibility through the end of 2024,” she said.

    Sleep Number lost $2.32 million, or 10 cents a share, in the third quarter, versus earnings of $5 million, or 22 cents a share, in the year-ago quarter.

    Revenue dropped 13% to $473 million, the company said.

    Analysts polled by FactSet expected the company to earn 16 cents a share on sales of $509 million in the quarter.

    Sleep Number also kicked off a plan to reduce costs in light of the lower demand. It hopes the plan will result in about $50 million less in operating expenses next year, the company said.

    The cost-restructuring actions are “broad-based” and include layoffs as well as store closures, the company said.

    The layoffs will occur “across all areas of the organization,” including in corporate and research and development, the company said. It plans to close 40 to 50 stores by the end of next year, and slow down the rate of new-store openings and remodels.

    The restructuring will result in up to $20 million in one-time costs, with about $10 million of the costs falling in the fourth quarter, the company said.

    Sleep Number also dialed back its 2023 EPS outlook, calling for a per-share loss of up to 70 cents, including the fourth-quarter restructuring charges.

    That compares with a July guidance of 2023 EPS in a range between $1.25 and $1.75.

    Separately, Sleep Number appointed Stephen E. Macadam and Hilary A. Schneider to its board, effective immediately, expanding the board to 12 people.

    In conjunction with the appointments, Sleep Number entered into a cooperation agreement with shareholder Stadium Capital Management LLC.

    As part of the agreement, the board has established a “capital allocation and value enhancement committee” to review capital use and investments, it said.

    Independent director Michael J. Harrison said that the company was “grateful to have reached an agreement with Stadium Capital on a constructive path forward and are looking forward to working with Steve and Hilary toward our common goal of delivering long-term value for our shareholders.”

    Stadium Capital, which owns about 9% of Sleep Number, published a letter in September criticizing the company, its executives, and the “abysmal” shareholder returns.

    Shares of Sleep Number have lost 38% so far this year, contrasting with gains of about 14% for the S&P 500 index
    SPX.

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  • A Right-Wing Group Used ‘Trickery’ On Teachers, Union Says

    A Right-Wing Group Used ‘Trickery’ On Teachers, Union Says

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    Public school teachers in Ohio recently got some surprising news in the mail: They were due a “credit” from their union.

    Melissa Cropper, president of the 20,000-member Ohio Federation of Teachers, was listed as the sender of the “CREDIT DUE NOTICE.” All educators had to do was fill out the attached form and mail it back for an apparent refund.

    There was just one problem. The notice didn’t actually come from Cropper or the union ― it came from the Freedom Foundation, a conservative group whose mission is to get teachers and other public sector workers to drop their union membership.

    Anyone who carefully read the form would see that by signing it, a teacher would be authorizing the Freedom Foundation to submit it to their union and employer on their behalf to renounce their membership.

    “People are really pissed,” said Randi Weingarten, president of the American Federation of Teachers, the Ohio union’s parent group.

    Weingarten said she is accustomed to the foundation ― which has ties to GOP megadonors ― “misrepresenting” teachers unions and their work. But she believes the group crossed a legal line this time by listing Cropper as the sender of the document.

    “They lie all the time, and their MO is to divide and divide and divide,” she said. “This one was a complete fraud.”

    A teacher who quits their union would stop paying dues out of future paychecks. But the mailer didn’t just imply that teachers were owed a credit, Weingarten said ― it also suggested the union’s own leader “is inducing you to drop the union.”

    A letter an Ohio teacher received from the right-wing Freedom Foundation. The union has accused the group of “trickery” and fraud.

    Courtesy American Federation of Teachers

    The Freedom Foundation declined to answer detailed questions about the mailer campaign, such as how many were sent out and how many the group received back from teachers. But Ashley Varner, a spokesperson for the group, defended the use of the mailers in an emailed statement to HuffPost.

    “Freedom Foundation informs public employees, including teachers, of their constitutional right to leave their unions and stop paying dues because unions like AFT fail to do so,” Varner said. “The communication with teachers in Ohio was neither fraudulent nor misleading. Randi Weingarten’s claims are simply untrue.”

    Nonetheless, the Freedom Foundation backed down from using the mailers after receiving a cease-and-desist letter from the AFT, according to letters provided to HuffPost. The foundation agreed not to send any more mailers, and assured the AFT that it hadn’t distributed any outside of Ohio.

    The union’s general counsel, Dan McNeil, said in a letter to the foundation that its “reliance on trickery and deception to further its insidious goals is not only morally repugnant, it is also unlawful.” McNeil alleged that the effort ran afoul of both trademark law and identity fraud statutes, and that it amounted to “federal mail fraud.”

    Freedom Foundation executive vice president Brian Minnich wrote in a response that the group “respectfully disagrees” that the letter was meant to deceive teachers. Although the letter’s sender was listed as the union president, Minnich said the return envelope and tear-off form “clearly indicated the return would go to the Foundation.”

    “They lie all the time… This one was a complete fraud.”

    – Randi Weingarten, president of the American Federation of Teachers

    The mailers are part of a long-running conservative effort to weaken public sector labor groups that tend to support Democrats. Republicans in states around the country have taken aim at teachers unions in particular, pushing laws designed to make it harder for the groups to hang on to members and influence education policy.

    This right-wing cause got a major lift from the Supreme Court in 2018.

    The conservative majority ruled in its landmark case Janus v. AFSCME that public sector workers could not be required to pay any dues to a union, even if the union is still legally obligated to represent them. The decision effectively made the entire U.S. public sector “right to work,” and forced public sector labor groups to change the way they operate and focus more on member retention.

    After the ruling in Janus, the Freedom Foundation started pouring resources into campaigns encouraging workers to drop their unions. The recent Ohio mailers were part of a project called “Opt Out Today.”

    It’s difficult to unpack how the Janus decision has affected teachers unions nationally so far, in part because membership hinges on school staffing levels that fluctuate. The Freedom Foundation claims teachers have been opting out of AFT “in droves,” but Weingarten says this doomsday scenario has not come to pass.

    “They used Janus to try to defund unions. What’s happened in terms of our union is, it hasn’t worked,” she said. “But the amount of time, energy and effort we have to spend correcting the record and dealing with these misrepresentations and out-and-out lies, that takes time away from us servicing the members.”

    Weingarten said the Freedom Foundation’s use of the “credit due” mailer is a sign of “desperation.” She noted that in the group’s Oct. 12 response to the union’s cease-and-desist letter, the group said that it had “not forwarded a single request to opt-out received recently” from the Ohio mailer campaign.

    The union demanded a list of all members who received the mailers, but it says the Freedom Foundation hasn’t provided one yet. The union suggested in a follow-up letter that it might pursue legal action.

    “The AFT reserves all rights,” the letter read.

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  • The economy is growing at its fastest rate in 3 years and it may be because bosses are treating employees better. Just look at Starbucks gaining $10 billion in one day

    The economy is growing at its fastest rate in 3 years and it may be because bosses are treating employees better. Just look at Starbucks gaining $10 billion in one day

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    Coffee juggernaut Starbucks outperformed earnings expectations last quarter, sending the stock shooting up 12% since Thursday when it reported results for fiscal 2023. That was good for a single-day jump of about $10 billion in Starbucks’ market cap on Thursday. Executives attributed much of the coffee chain’s success this quarter to a new plan to improve working conditions in stores meant to help employees do their jobs better. Starbucks improved pay and scheduling headaches for in-store employees, replaced old equipment, and lowered turnover, all part of an effort to “reinvigorate the partner culture at Starbucks,” CEO Laxman Narasimhan told investors on an earnings call. Given the results Starbucks posted it appears to be working, and could be emblematic of a trend across the economy.

    Starbucks saw strong results across the board in terms of revenue, same store sales, transactions, and check size, which it attributed in part to its ability to be more productive. It’s a trend that’s been prevalent across the economy in the third quarter as productivity rose alongside worker pay. As the Axios Markets newsletter pointed out, economists have been surprised after years and years of stagnating productivity, including two straight quarters of decline in 2022, but Starbucks’ blowout quarter is an early sign that this won’t be business as usual. 

    When reached for comment Starbucks directed Fortune to a copy of its earnings release and call transcript. 

    Since October 2022, when Narasimhan took over as CEO from founder Howard Schultz (and inherited a toxic dynamic between the company and a restive union movement), the new chief has undertaken an extended effort to rehabilitate the company’s relationship with its in-store employees. He visited stores across the country, took 40 hours worth of barista training, and even worked as one—something he pledged to do once a month moving forward. This past quarter, Narasimhan said, was a testament that the company’s efforts to rebuild that relationship were paying off. And he has put his money where his mouth is, implementing a $450 million plan meant to make its stores run more smoothly and help baristas do their jobs faster. 

    This was a point reiterated by CFO Rachel Ruggeri. “The investments we’ve made are fueling growth—investments in our partners, in wages, in training, in our new store, in equipment,” she said.  

    A blowout quarter and a big investment in workers

    Starbucks’ strong quarter saw it outperform expectations on revenue, which was $9.37 billion  compared to an expected $9.29 billion. The $36 billion in revenue it had in fiscal 2023 represented a 12% increase over the previous year. The better working environment and investments in working conditions led Starbucks to report an 8% increase in comparable store sales globally driven by a 5% increase in average ticket and 3% increase in comparable transactions. 

    “We did all of this by investing over 20% of this year’s profits back into our partners in stores through wages, training, equipment, and new store growth,” Narasimhan said. “All this is further evidence that our strategy is working.” 

    Last fall, the company rolled out a plan to overhaul its in-store operations and make it easier for baristas to make its many famously complicated and time-consuming iced drinks, which were also a key source of union discontent. In this last quarter, the company installed 550 new nugget ice machines, 600 single cup brewers, and rolled out portable cold foamers to all U.S. stores, according to Narasimhan. The idea behind the plan was to give back more time to baristas—and by extension, to customers. The key was to increase speed, while still letting customers have endless options for customization, which comes with a higher price point. “Our customers continued to favor more premium beverages, creating a new normal as it relates to mix and customization,” Ruggeri said during the earnings call. 

    The increased efficiency in U.S. stores was one of the primary factors in operating margin shooting up by 3.1 percentage points from the year before, to 18.2%, according to Ruggeri. 

    All this has helped improve conditions for Starbucks employees. The company pointed to a 10% drop in employee turnover and a 16% boost in the length of barista tenure. Baristas also saw material improvements in working hours, which were up 5% in the quarter, and take-home pay, which was up 20%. 

    Productivity is increasing across the economy

    The trends at Starbucks point to similar directional trends across the U.S. economy where productivity increases have coincided with growth in hourly wages. 

    Overall productivity grew in the U.S. in the third quarter by 4.7% compared to the second quarter. That’s the highest quarterly growth rate since the third quarter of 2020, which came right after the economy cratered in the second quarter of that year due to the pandemic. Meanwhile, hourly compensation grew 3.9% in the third quarter. 

    When productivity, which measures the output of the economy against total hours worked, goes up, it implies more goods and services being produced with the same number of hours worked. That generally helps everyone in the economy because companies can produce more without hiring more workers, which means they don’t have to pass along their increased labor costs to consumers. But it’s been decades since productivity was on a steady trajectory of growth, both in the U.S. and globally. Coinciding with the productivity slump has been a widespread, decades-long pull back on capital expenditures—exactly the kind of thing Starbucks is bucking here.

    For instance, Starbucks plans to invest $1 billion in wages, employee training, and new equipment for its stores next year, and it has separated out a further $3 billion for capex, about 85% of that spent toward opening new stores and renovating existing ones. The company expects to renovate about 1,000 stores in the U.S. Starbucks has company here, as research from Bank of America shows that S&P 500 firms have increased capex spending for nine straight quarters.  

    One of the reasons companies, like Starbucks, may have to make such substantial investments is that the labor market is especially tight at the moment. Often when unemployment is low companies have to invest in ways to make their business run more efficiently, because they can’t rely on more manpower alone, to deliver more goods and services. The unemployment rate in October was 3.9%. In January of this year it stood at 3.4%, the lowest monthly rate since May 1969. 

    On its earnings call, Starbucks said that staffing and scheduling would be “areas of focus” next year, when the company plans to increase its store count by 4% in the U.S. to about 17,000 stores. By 2030, it plans to build 17,000 new stores globally for a total of 55,000 locations. And Starbucks is counting on happier, higher-paid, and more productive workers when it opens those stores.

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    Paolo Confino

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  • UAW Reaches Deal With GM

    UAW Reaches Deal With GM

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    General Motors and the United Auto Workers have struck a tentative deal, ending the union’s unprecedented six-week campaign of coordinated strikes that won record pay increases for workers at the Detroit Three automakers. What do you think?

    “​Great. I’ve been buying foreign cars for six​ straight weeks in solidarity.”

    Albert Houlihan, Turf Researcher

    Woman Who Had Abortion Shares How She Regrets Not Stopping For M&M McFlurry Afterwards

    “Hopefully they can find a way to automate these strikes so it’s less intense next time.”

    Dwight Gauthier, Unemployed

    “Surely there’s a better solution than paying fair wages.”

    Renee Jehle, Weapons Tester

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  • Santa Fe considers tax on mansions as housing prices soar

    Santa Fe considers tax on mansions as housing prices soar

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    SANTA FE, N.M. — Voters are deciding whether to tax mansions to pay for affordable housing initiatives in a state capital city prized for its desert-mountain vistas, vibrant arts scene and stucco architecture rooted in Native American and Spanish-colonial tradition.

    The tax on homes sold for more than $1 million is being pitched as a lifeline to teachers, service-sector workers, single parents and young professionals who can’t afford local mortgages or struggle to pay rent amid a national housing shortage and the arrival in Santa Fe of high-income digital nomads and affluent retirees.

    The Nov. 7 ballot measure is the latest bellwether for the popularity of so-called mansion taxes to fund affordable housing and stave off homelessness. It comes on the heels of a voter-approved initiative in Los Angeles and new proposals from Chicago to Massachusetts.

    If approved, the measure would add a 3% tax on residential property sales of $1 million or more — with no tax on the first $1 million in value.

    On a $1.2 million home sale, for example, the new tax would apply to $200,000 in value. The buyer would pay $6,000 to the city’s affordable housing trust fund.

    The city estimates that the tax would generate about $6 million annually for the trust, which underwrites price-restricted housing, down-payment assistance for low-income homebuyers and rental assistance to stave off financial hardship and evictions.

    The trust awards funds each year to affordable housing providers who can secure matching funds from other government and nonprofit sources, explained Alexandra Ladd, director of Santa Fe’s affordable housing office.

    But Santa Fe voters have shied away from prominent tax initiatives in the past, rejecting a proposed similar 1% tax on high-end home sales in 2009 and defeating a tax on sugary drinks to expand early childhood education in 2017.

    Second-term Santa Fe Mayor Alan Webber, a Democrat, supports the tax and says soaring housing costs are threatening the “heart and soul” of the city.

    “We’re attracting folks who can Zoom to work elsewhere and live in an outstanding place with great climate and culture and history and food,” he said. “We’ve become a magnet, and we don’t want to lose the local community that has lived here all their lives, or for generations, and to suddenly see that diversity give way to only higher-income people.”

    The proposal has earned endorsements from an array of local businesses, trade unions, school board members, former mayors and Democratic U.S. Senator Martin Heinrich.

    “The housing crisis in this town is outrageous,” said Susan Coulter, a retired scientist, who supports that tax despite concerns about the city’s financial controls.

    Cities and states are showing renewed interest in taxes on high-value real estate transactions to address housing affordability, according to Samantha Waxman, a deputy director for state fiscal policy at the Washington, D.C.-based Center on Budget and Policy Priorities.

    Voters in Los Angles last year approved a tiered-rate tax on residential and commercial real estate sales — starting at 4% for sales above $5 million — to address housing shortages. Chicago may ask voters next year whether to raise real estate transfer taxes, starting with sales over $1 million, to fight homelessness.

    A proposal in October from Democratic Massachusetts Gov. Maura Healey would allow local governments to impose a real estate transfer fee of up to 2% on property sale proceeds above $1 million — or a county’s median home sale price if greater.

    “We’re looking at these high-value homes that are being bought and sold,” Waxman said. “Then there’s also these challenges with affordable housing, housing prices increasing in general, and it being really difficult to afford rent and difficult to afford purchasing.”

    Perched at the southern end of the Rocky Mountains, Santa Fe is in the midst of a building boom, with thousands of recently approved housing units gradually coming online within city limits since 2021 — including an array of multifamily housing projects.

    Advocates for subsidized housing say that hasn’t translated into accessible prices, with most of the new units renting at free-market rates that can strain personal or family finances.

    Meanwhile, the city’s median home price has nearly doubled since 2017 to about $600,000, a city-commissioned analysis found.

    “People moving here with wealth that far exceeds the buying capacity of local workers, that pulls housing costs away from those workers,” said Daniel Werwath, executive director of New Mexico Inter-Faith Housing, a nonprofit developer of income-restricted housing. “I think we’re into a pretty crazy feedback loop.”

    The Santa Fe Association of Realtors says the proposed tax oversteps the city’s authority under state law, and has filed a preemptive lawsuit to block it.

    Drew Lamprich, the association’s president, says the change would take a bite out of home sales, and ultimately the local economy.

    “There will be folks that decide to buy somewhere else, not liking the divisiveness of this element,” he said.

    At a downtown polling place for early voting, retired architect Rita Meek said she fears the tax will increase tensions between relatively wealthy enclaves and predominantly working class neighborhoods.

    “I think we should be more united,” she said.

    But her husband, Peter Meek, supports the tax.

    “We’re losing a lot of our workforce: teachers, police officers, construction labor,” he said. “The people who can afford a million-dollar home should want to help.”

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  • Stock market today: Asian shares track Wall Street gains ahead of Fed decision on interest rates

    Stock market today: Asian shares track Wall Street gains ahead of Fed decision on interest rates

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    BANGKOK — Asian shares were mostly higher Wednesday after Wall Street advanced to claim back some of the ground it gave up in another losing month.

    Investors are awaiting a decision later Wednesday by the Federal Reserve on interest rates and updates on the state of the U.S. economy. The overwhelming expectation is that the Fed will keep its overnight interest rate steady. The bigger question is how long it will keep that main rate high.

    Tokyo’s Nikkei 225 index added 2.4% to 31,601.65 a day after the Bank of Japan held back from any major changes to its near-zero interest rate policy, though it adjusted its controls on government bond yields.

    The dollar weakened against the Japanese yen, trading at 151.28 yen. It jumped on Tuesday after the Japanese central bank’s decision.

    In Hong Kong, the Hang Seng edged less than 0.1% higher, to 17,126.70. The Shanghai Composite index gained 0.1% to 3,023.08.

    South Korea’s Kospi advanced 1% to 2,301.56 and the S&P/ASX 200 rose 0.9% to 6,838.30.

    European futures were higher early Wednesday. Inflation that has been wearing on European consumers fell sharply to 2.9% in October, its lowest in more than two years as fuel prices fell and rapid interest rate hikes from the European Central Bank took hold. But that encouraging news was balanced by worrisome official figures showing economic output in the 20 countries that use the euro shrank by 0.1% in the July-September quarter.

    Tuesday on Wall Street, the S&P 500 gained 0.6% to 4,193.80. The Dow Jones Industrial Average added 0.4% to 33,052.87 and the Nasdaq composite climbed 0.5%, to 12,851.24.

    More than 80% of the stocks in the S&P 500 strengthened. It closed October with a loss of 2.2% for the month. That’s its third straight monthly drop, the longest losing streak since the COVID-19 pandemic froze the global economy at the start of 2020.

    Pinterest jumped 19% after reporting stronger profit for the latest quarter than analysts expected. Arista Networks was one of the strongest forces pushing the S&P 500 upward, climbing 14% after also reporting stronger profit for the summer than Wall Street had forecast.

    Most big U.S. companies have reported stronger profit for the summer than expected, and Caterpillar also joined them. But the heavy machinery maker’s stock sank 6.7% after analysts focused on a slowdown in orders and growing inventories at dealers.

    VF Corp., the company behind Vans, Timberlands and other brands, dropped 14% after it reported weaker profit than expected. It also slashed its dividend 70% and withdrew its forecasts for revenue and profit this fiscal year.

    Higher bond yields have taken a toll, since they knock down prices for stocks and other investments, while slowing the overall economy and adding pressure on the entire financial system. The 10-year Treasury yield, which is the centerpiece of the bond market, has jumped from less than 3.50% during the spring to more than 5% recently, touching its highest level since 2007.

    The 10-year Treasury yield ticked higher to 4.91% early Wednesday from 4.89% late Monday.

    The Fed has already pulled its main overnight interest rate above 5.25% to its highest level since 2001. It’s been saying it will make upcoming moves based on what data say about inflation and the job market, where the worry is that too-strong growth could give inflation more fuel.

    Reports on the economy Tuesday came in mixed. One said that growth in wages and benefits for U.S. workers slowed during the summer, compared with year-earlier levels, but not by as much as economists expected.

    Another report said that confidence among U.S. consumers weakened last month, but not by as much as economists expected. Strong consumer spending has helped the economy avoid recession, but it could also fan inflation. That’s why the Fed is nervous about too strong growth in wages, as workers fight for higher pay amid high inflation.

    In other trading, U.S. benchmark crude oil advanced 48 cents to $81.50 a barrel. It lost 29 cents on Tuesday to $81.02. Brent crude, the international standard, picked up 65 cents to $85.67 a barrel.

    The euro fell to $1.0570 from $1.0575.

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  • The happiest country in the world? This Finnish company with a 10% lifetime employee turnover shows their real secret is trust

    The happiest country in the world? This Finnish company with a 10% lifetime employee turnover shows their real secret is trust

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    As the metrics of the World Happiness Report demonstrate, Finnish happiness is ultimately underpinned by values–like social support and freedom–that are created by trust.

    Indeed, there is no point in chasing happiness. What really counts is cultivating a culture that supports long-term well-being. And that’s what Finns do particularly well. 

    Finland is a high-trust society, and Finns trust their institutions and their fellow citizens. That same trust extends to the workplace and is visible in how employees trust their leaders and their colleagues.

    At Framery, a global company headquartered in Tampere, Finland, we prioritize trust in everything we do. It’s also why as a 400+-employee firm we’ve had less than 10% global turnover in all the years we’ve been in business–and why we’ve maintained market leadership in our sector. Trust drives results.

    However, it’s important to remember that trust must be earned over time, and that it is easily lost. Here are five critical ways we foster trust in our organization–principles that we believe can work at any level, for any team, in any corporation.

    Enforce 8-hour days

    Many workplaces have exciting policies like unlimited vacation days or four-day work weeks that on the surface seem to promise exceptional employee work-life balance. Yet the reality can often be much less cheerful: employees work even longer hours to make up for that extra free time or are afraid to use the benefits in fear of losing out on a promotion. This all chips away at their trust in each other, and in the company.

    At our firm, we have fairly normal vacation policies, but what’s different is that we make sure not to glorify all-nighters. We enforce strict rules around maximum working hours. All overtime hours must be taken as leave, and there is a set annual paid two-week vacation guaranteed for all new hires. The idea is that everyone, regardless of title, gets equal treatment and time to rest.

    By staying firm in our enforcement of vacation time and 8-hour working days, we demonstrate to our people that we stand by our policies and that they can trust us to look after their rights and well-being.

    Destroy closed doors

    In large corporations, there are usually layers upon layers of secrecy. Who gets invited to which meeting determines who’s privy to what information. That can create suspicion, distrust, and even paranoia.

    At our company, critical information is shared freely and often, everyone’s calendars are openly accessible to everyone else as a default, and full company financial reports are distributed to every employee once a month.

    Not only does this openness form the basis for company-wide trust, but it is also beneficial in guiding employees toward value creation. Our mission and goals make more sense when all our employees have the full picture of where we’re headed. With a free flow of critical information, our people can better self-direct their work toward communally beneficial outcomes.

    Unleash entrepreneurs

    Remote and hybrid work have brought about a greater variance in ways of working than ever before. The urge for many leaders now is to control and standardize those ways of working. Policies abound on how and where employees should work, demanding staff to, for example, come to the office on designated days of the week.

    This kind of micromanagement is unnecessary and detrimental to trust. At our company, we let teams decide how they operate. That can mean fully remote, hybrid, or fully in-person work–whatever working style and method fit best. What matters more than where and how is the overall direction of our efforts. 

    Management decides where we’re going, but we have a policy of empowerment in letting teams and individuals determine how we get there. Employees know better than the CEO how to structure their work and drive results. Different tasks require different environments and tools, and top-down mandates therefore often do more harm than good.

    Stop spying on employees

    Remote work has led to an increase in employee surveillance. Employees are finding out about corporate tracking of their work hours, emails, systems use, and more–all of it secret. 

    This corporate spying destroys trust. If employers are suspicious of their staff, then employees become wary of their employers too. Many workers become more occupied with gaming the tracking system than doing actual work. In fact, research shows that employee-monitoring software actually makes employees more likely to break rules, as the employees subconsciously begin to feel less in control of their own behavior.

    We believe employee data should only be used in employees’ favor, not against them. In an organization rooted in real trust, how people perform their work shouldn’t matter at all. We measure our people based not on how much work they put in, but on the results they generate.

    That also means our employees don’t have to ask supervisors to approve their hours: Whatever hours have counted as overtime can be freely used to shorten other workdays. We trust our employees to put in the right amount of hours without monitoring their every move.

    Maximize job security

    No matter what policies and freedoms are in place, trust in organizations is still ultimately fragile. It can be destroyed in an instant with something like surprise layoffs. If people feel replaceable, then they will never trust the company fully, and will always keep an eye out for ways to jump ship.

    We believe laying off employees should be avoided at all costs. We made a company-wide commitment at the beginning of the pandemic to not let any of our employees go. Instead, we invested in research and development and new processes–in our people. It wasn’t easy. The losses were deep. But we all committed to finding ways to cut costs together, and it paid off in the end: not only did we return to profitability but we also ultimately protected the foundation of all of the trust in our organization.

    When people aren’t afraid of being let go, they can begin to trust their leaders and co-workers in a whole new way. Suddenly everything clicks into place: honest feedback can be more freely given and received, information can flow more openly, and no excessive monitoring or management of ways of working is needed. Employees commit to the work and continuously do their best.

    The trust that’s given to employees will be returned tenfold–or even hundredfold. Everyone wins.

    Anni Hallila is the head of people and culture at Framery.

    More must-read commentary published by Fortune:

    The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

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  • ‘It’s kind of a perfect storm:’ UAW’s deals highlight why labor is winning so big despite record-low unionization rates

    ‘It’s kind of a perfect storm:’ UAW’s deals highlight why labor is winning so big despite record-low unionization rates

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    U.S. labor unions are once again flexing the muscles in the national spotlight.

    The United Auto Workers’ tentative agreements with Detroit’s Big Three automakers could end the union’s six-week strike. Gridlock persists in Hollywood between actors and major studios, while hospitality workers in Las Vegas, Detroit, Southern California and beyond are fighting for better pay and protections.

    But despite historic walkouts and record contract deals seen this year, there’s a lot stacked against labor organizers. Union membership rates in the U.S. have been falling for decades due to changes in the economy, employer opposition, growing political partisanship and legal challenges.

    “Even though we’re seeing stronger support for unions, (with) the highest popularity of union favorability in polls since at least the 1960s, translating the worker desire for representation into actual representation is really hard under our current system,” Alexander Colvin, dean of Cornell University’s School of Industrial and Labor Relations, told The Associated Press earlier this month.

    Still, some labor advocates see growing momentum. Here’s where things stand.

    What’s driving union activity now?

    Across the U.S., hundreds of thousands of workers have participated in strikes this year. Labor activism has surged in tandem with soaring costs of living and rising inequality, particularly the growing pay gap between workers and top executives. Those inequities only became more glaring during the COVID-19 pandemic as U.S. corporations raked in record profits.

    “It’s kind of a perfect storm, (so) you see a lot of union movement these days,” said Eunice Han, an assistant professor at the University of Utah specializing in labor economics.

    The tightest U.S. labor market in decades is also giving workers leverage to challenge their employers.

    The unemployment rate in the U.S. is close to 50-year lows and there are now about 1.5 open jobs for every unemployed person, according to recent government data.

    Open jobs means American workers are quitting in higher numbers because they are confident of landing a better paying job. The unemployment rate is 3.8%, further signaling leverage for workers.

    Success or partial victories in high-profile union fights can also inspire organizing across industries — and bring lessons for future contract talks. A takeaway from the UAW’s strike, for example, “is to act aggressively and creatively” while finding allies, said Cathy Creighton, director of Cornell University’s Industrial and Labor Relations Buffalo Co-Lab and a former field attorney for the NLRB.

    UAW President Shawn Fain “didn’t do things the same way that had been done in the past,” Creighton added, noting the tactic of hitting General Motors, Ford and Stellantis at once through a build-up of targeted strikes, which were communicated to members on platforms like Facebook Live. Support from government officials, including President Joe Biden, also strengthened the campaign.

    Union rates have been falling for decades

    While pickets lines seem to be everywhere this year, union membership rates have been declining for decades. Only 6% of U.S. private-sector workers belong to unions today, a sliver of the 35% that were union members in 1953.

    Todd Vachon, an assistant professor in the Rutgers School of Management and Labor Relations, points to the post-World War II Taft-Hartley Act, which restricted the power of labor unions — as well as factors like relocating manufacturing jobs overseas and an uptick in anti-union stances from both employers and lawmakers that grew in the 70s and 80s.

    Vachon notes one pivotal moment in particular, when President Ronald Reagan fired all striking air traffic controllers in 1981.

    “That sent a really clear signal to the business community that it’s a-okay to be completely anti-union and to be so in a very belligerent way, because even the president of the United States is doing it,” he said.

    Separately, with the rise of the gig economy, some large companies have recategorized employees as “contractors,” making it harder for them to unionize. And growth in industries that haven’t had a strong history of union membership, such as technology, has also contributed to the decline in unionization.

    Last year, the number of both public- and private-sector U.S. workers belonging to unions actually grew by 273,000, according to data from the Bureau of Labor Statistics. But the U.S. workforce grew at an even faster rate, meaning the percentage of those belonging to unions fell slightly.

    What labor laws matter for workers today?

    The National Labor Relations Act of 1935 granted private-sector employees the right to unionize. A 1961 executive order from President John F. Kennedy allowed federal employees to organize. That came around the same era that states also began to pass labor laws for their own public workers.

    Some states in the South and lower Midwest “will allow police and firefighters to collectively bargain, but not state employees. Or they’ll let state employees bargain, but they can only bargain over wages,” Vachon said. “That shows you how important the labor law is. It really sets the framework for which workers can either organize a union successfully or not.”

    A handful of states also have “right to work” laws which, in unionized workplaces, require unions to represent everyone regardless of whether individuals choose to pay dues or formally join. Such legislation has been criticized for undermining the financial resources and bargaining power of unions.

    Attitudes towards unionization have become increasingly partisan, too, and also divided geographically. Politically “blue” states tend to have higher unionization rates than “red” states. Several states have also dialed back on union protections in recent years, Han said.

    Today’s economy throws up unique challenges for organizing

    Unionization efforts have expanded but many are taking place where there is little history of organized labor, creating a higher bar for workers.

    Colvin points to Starbucks workers who have seen union drives clipped in the last year. Starbucks has been accused of chilling organization by closing unionized stores and firing pro-union workers.

    There are also limits for organizers under current labor law. That means that what worked in auto workers’ labor campaign, for example, may not be possible for other industries.

    “We have a labor law that was designed in the era in the 30s and 40s, when auto plants of 10,000 workers (were organizing),” he said. Starbucks is “split into these small coffee shops of 15 workers. … They need to join together to have any kind of bargaining power against a big employer. But our labor law isn’t structured to help them do that,” Colvin said.

    Service jobs can also be hard to organize due to part-time work and high turnover rates. The same can be said for Amazon warehouses, where there have been pushes for unions.

    According to a Gallup poll, public approval of stronger unions now stands at 67%, down slightly from the 71% last year, but mirroring levels last seen in the 1960s. Creighton and others add that young people in particular are leading today’s charge.

    But the desire to organize can only go so far without policy change, experts say.

    “We’re absolutely at a turning point in people’s consciousness,” Vachon adds. “Whether that translates into actual a change of direction for union density, I think, is going to depend a lot on how that consciousness plays out in the political arena.”

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  • Detroit Is Paying Up to End the UAW Strike. Now Carmakers Will Live With the Costs.

    Detroit Is Paying Up to End the UAW Strike. Now Carmakers Will Live With the Costs.

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    Updated Oct. 30, 2023 12:50 pm ET

    The United Auto Workers campaign against Detroit’s three automakers can be described as one thing for the union: a win.

    The strike, now in its seventh week, is nearing its conclusion with General Motors on Monday reaching a tentative labor deal with the UAW following similar pacts with Ford Motor and Chrysler-parent Stellantis.

    Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

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  • General Motors reaches tentative agreement with UAW, potentially ending 6-week strike

    General Motors reaches tentative agreement with UAW, potentially ending 6-week strike

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    DETROIT — General Motors and the United Auto Workers union have reached a tentative contract agreement that could end a six-week-old strike against Detroit automakers, two people briefed on the deal said Monday.

    The agreement follows the pattern set with Ford last week and Jeep maker Stellantis over the weekend.

    The deals will last four years and eight months and include 25% general pay raises and cost of living adjustments. Combined they bring the wage increase to over 30% over the life of the contract.

    The people briefed on the matter, who didn’t want to be identified because they were not authorized to speak publicly about the deal, said the agreement was to be announced early Monday.

    The contract with GM is similar to those reached by the other two automakers, but there are some differences.

    GM was the last company to reach a deal and the union added a lucrative factory in Tennessee to the strike list on Saturday to turn up the pressure. The UAW reached tentative agreement last week with Ford and it wasted no time in hitting GM where it hurts financially.

    Nearly 4,000 unionized workers on Saturday walked out of GM’s largest North American plant in Spring Hill, Tennessee, hours after the deal with Stellantis was announced. They joined about 14,000 GM workers already striking at factories in Texas, Michigan and Missouri.

    President Joe Biden was asked about the deal Monday, as he boarded Air Force One back to the White House. He gave a thumbs-up and said: “I think it’s great.”

    Also Monday, 8,200 Stellantis workers in Canada represented by a different union, Unifor, briefly went on strike before reaching a deal that comes with base hourly wage increases of nearly 20% for production workers. General Motors and Ford workers in Canada have already voted to ratify a three-year contract agreement with the company.

    Spring Hill, the plant where workers hit picket lines Saturday, produces the engines for vehicles assembled at nine plants as far afield as Mexico, including Silverado and Sierra pickups. It’s a big money maker for GM that could have potentially amplified the company’s financial pain after workers walked off the job last week in Arlington, Texas, where full-size SUVs including the Tahoe and Suburban are produced. Spring Hill also produces the electric Cadillac Lyriq, GMC Acadia and Cadillac crossover SUVs.

    Presidents of the Ford union locals voted unanimously in Detroit on Sunday to endorse that tentative contract after UAW President Shawn Fain explained its details, the union tweeted.

    As he explained the particulars to the full membership in a later livestream, Fain, along with Chuck Browning, the UAW vice president, said the deal represents a “historical inflection point” for reviving union power in an America where “we were being left behind by an economy that only works for the billionaire class.”

    “UAW members at Ford will receive more in straight general wage increases over the next 4 1/2 years than we have over the last 22 years combined,” Browning said.

    Fain called the deal “a turning point in the class war that has been raging in this country for the past 40 years.”

    The Ford and Stellantis pacts, which would run until April 30, 2028, include 25% in general wage increases for top assembly plant workers, with 11% coming once the deal is ratified.

    The Ford agreement revives cost-of-living adjustments that the UAW agreed to suspend in 2009 during the Great Recession.

    At Stellantis, workers get cost-of-living pay that would bring raises to a compounded 33%, with top assembly plant workers making more than $42 per hour. Top-scale workers there now make around $31 per hour.

    Starting wages for new Stellantis hires will rise 67% including cost-of-living adjustments to over $30 per hour. Temporary workers will get raises of more than 165%, while workers at parts centers will get an immediate 76% increase if the contract is ratified.

    Like the Ford agreement, it will take just three years for new workers to get to the top of the assembly pay scale, the union said. Similarly, the union won the right to strike over plant closures.

    Bruce Baumhower, president of the local union at a large Stellantis Jeep factory in Toledo, Ohio, that had been on strike since September, said he expected workers to vote to approve the deal because of pay raises including the immediate 11% raise on ratification. “It’s a historic agreement as far as I’m concerned.”

    The UAW began targeted strikes against all three automakers on Sept. 15 after its contracts with the companies expired. At the peak, about 46,000 UAW workers were on strike — about one-third of the union’s 146,000 members at all three companies.

    ____

    Bajak reported from Boston. AP writers John Raby in Charleston, West Virginia, Corey Williams in Sterling Heights, Michigan, Haleluya Hadero in Jersey City, New Jersey, and Michelle Chapman in New Jersey, contributed to this report.

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  • GM’s stock bounces of more than 3-year low after report of tentative deal reached with UAW to end strike

    GM’s stock bounces of more than 3-year low after report of tentative deal reached with UAW to end strike

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    Shares of General Motors Co.
    GM,
    +0.04%
    bounced 1.2% off a 3 1/2-year low in morning trading Monday, after CNBC reported that the automaker reached an tentative deal with the United Auto Workers that would end the six-week long labor strike. The report comes a day after the UAW widened its strike against GM, as the Associated Press reported, hours after a tentative deal was reached with fellow Big 3 automaker Stellantis N.V.
    STLA,
    -0.19%
    and about a week after Ford Motor Co.
    F,
    -1.61%
    also reached a deal. CNBC reported that the UAW’s 4 1/2-year agreement with GM includes a 25% wage increase, including a 68% increase in starting hourly wages to $28 an hour. and UAW didn’t immediately respond to a request for comment. The stock, which closed Friday at the lowest price since Aug. 7,. 2020, has tumbled 28.1% over the past three months while the S&P 500
    SPX,
    +0.81%
    has shed 9.2%.

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  • Explosion off Nigeria points to threat posed by aging oil ships around the world

    Explosion off Nigeria points to threat posed by aging oil ships around the world

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    OKITIPUPA, Nigeria — It was the dead of night when the ship caught fire, Patrick Aganyebi remembers, but the flames made it seem as bright as day.

    The explosion that night woke him and knocked him to the floor. He tucked his phone and his ID card in his pockets, strapped on a life jacket and made his way to the upper deck. As the flames barreled toward him, he prepared to jump nearly 100 feet (30 meters) into the sea.

    Five workers were killed and two others presumed dead in the blast on the Trinity Spirit, a rusting converted oil tanker anchored 15 miles (24 km) off the coast of Nigeria that pulled crude oil from the ocean floor. It was by the grace of God, Aganyebi said, that he and two fellow crewmen escaped, rescued by a pair of fishermen as the burning vessel sank along with 40,000 barrels of oil.

    The Trinity Spirit’s explosion in February of last year stands among the deadliest tragedies on an oil ship or platform in recent years. The Associated Press’ review of court documents, ship databases, and interviews with crew members reveals that the 46-year-old ship was in a state of near-total disrepair, and the systems meant to ensure its safe and lawful operation — annual inspections, a flag registry, insurance — had gradually fallen away.

    The Trinity Spirit fits a pattern of old tankers put to work storing and extracting oil even while on the brink of mechanical breakdowns. At least eight have been shut down after a fire, a major safety hazard, or the death of a worker in the last decade, according to an AP review. More than 30 are older than the Trinity Spirit and still storing oil around the world.

    Jan-Erik Vinnem, who has spent his career studying the risks of offshore oil production, said he’s sometimes shocked when he sees pictures of oil ships in Africa.

    “I call them ‘floating bombs,’” he said.

    ___

    This story was supported by funding from the Walton Family Foundation. The AP is solely responsible for all content.

    ___

    AGING HULLS

    The Trinity Spirit was part of a class of vessels that extracts oil offshore and stores it at sea. They are known as floating production storage and offloading units — FPSOs — or as FSOs, floating storage and offloading units, when used only for storage. Since the 1970s, they’ve become increasingly popular for developing oil in deep waters and in places where no pipelines exist. According to the environmental group SkyTruth, there are some 240 in operation today.

    FPSOs are unlike most ships for one key reason: They stay in place. Once attached to the ocean floor, they can linger at the same oil field for years or even decades. They may be surveyed by in-country regulators or hired inspectors, but they operate outside the normal flow of shipping traffic and the added safety and legal inspections that take place in port.

    “If a vessel is sitting in a country’s domestic waters and is not going around trading … then you’re not going to have that same level of oversight,” said Meghan Mathieson, strategy director at the Canadian-based Clear Seas Centre for Responsible Marine Shipping.

    More than half the current fleet of FPSOs are recycled oil tankers, according to Oslo-based Rystad Energy, which keeps data on the ships. Senior analyst Edvard Christoffersen said that without a major repair, most oil ships have hulls built to last about 25 years. But some FPSOs are used far longer, sometimes to dangerous effect.

    In the same month that the Trinity Spirit caught fire, inspectors found problems with an aging FPSO moored off the coast of Malaysia. The Bunga Kertas was built as an oil tanker in the 1980s, and press coverage of its conversion to an FPSO in 2004 said the vessel had an intended service life of 10 more years.

    But it was 18 years later when a safety issue on the Bunga Kertas led to a pause in operations. The ship’s hull had “ integrity issues,” according to stakeholder Jadestone Energy. Four months later a diver was killed while repairing the damage. Petronas, the operator at the time, did not respond to a request for comment.

    Until this fall, another aging ship floating off the coast of Yemen seemed dangerously close to spilling a massive amount of oil. The FSO Safer was built in the same year as the Trinity Spirit, and became a floating hazard over years of neglect amid the country’s civil war. Seawater had leaked into the ship’s engine room by 2020.

    “It could break up at any time – or explode,” the United Nations said in a statement this spring.

    The ship held more than a million barrels of oil — risking a spill that could have decimated fisheries in the Red Sea, threatened desalination plants and washed oil on the shores of countries around the Horn of Africa, according to the U.N. After years of alarm and negotiations, the oil was transferred onto another tanker this August, but the rusting Safer remains off Yemen’s coast, awaiting funds to be scrapped.

    Age isn’t the only measure of a ship’s health: Climate, storms and wave patterns can add stress to ship components or increase the pace of corrosion, just as careful maintenance can extend a ship’s life.

    But the fleet’s growing age is well known in the industry. The average hull age of FPSOs has increased from 22 to nearly 28 years since 2010, according to Rystad Energy. The American Bureau of Shipping — one of several companies known as classification societies that certify vessels’ safety — launched a working group in 2021 to address the challenges of older FPSOs, noting that 55 ships were approaching the end of their intended lives.

    “A lot of these things are foreseeable,” said Ian Ralby, a maritime security expert who helped sound the alarm about the Safer.

    “If they are not well maintained and not watched carefully,” Ralby said, “they can sink, they can spill, and they can, as the Trinity Spirit showed, blow up.”

    DANGEROUS TO ABANDON

    There has been little to no public explanation of what led to the Trinity Spirit’s explosion, though multiple Nigerian agencies had responsibility for overseeing the ship. The Trinity Spirit had been on the same oil field for more than two decades. According to Aganyebi, after the ship arrived in Nigeria, it was never brought to shore for major upgrades or repairs.

    Warning signs began years before it caught fire. In 2015, the American Bureau of Shipping canceled its classification and ceased inspections of the ship. There’s no record the Trinity Spirit had insurance after that point, according to Lloyd’s List Intelligence. In the next several years, the ship lost its privilege to fly the flag of Liberia, becoming a stateless vessel.

    By 2019, Nigeria’s petroleum regulator had revoked the Trinity Spirit’s license to pump oil. Nigeria’s head of maritime safety, quoted in local press coverage, said his agency had directed the ship to stop operating five years before the blast. Yet the Trinity Spirit was never forced to leave.

    Up till the moment of the explosion, there was oil on board. As recently as 2021, according to satellite imagery and ship transponder data, oil was loaded onto a tanker that later docked at a Shell refinery in the Netherlands.

    Adeyemi Adeyiga, a spokesperson for Nigeria’s Upstream Petroleum Regulatory Commission, which regulates the country’s oil resources, said the sale was legal because the oil was produced before the license was revoked. And a spokesperson for Shell said the company conducts robust reviews of its supply chain and complies with all laws and regulations.

    Though the federal government investigated the Trinity Spirit’s explosion, more than a year later no findings have been released. For months, it seemed the only scrutiny would fall on the surviving men.

    Not long after their escape, and still in the throes of recovery, Aganyebi and a fellow crewman were arrested on accusations of “Murder, Arson, and Malicious Damage,” according to their charging documents. Police were acting on a complaint from Shebah Exploration and Production Company Limited — the Trinity Spirit’s longtime operator.

    An attorney in Lagos took on the case pro bono.

    “They committed no offense, they did nothing wrong. They were staffers of the company,” Benson Enikuomehin said. In an interview, he accused Shebah of drumming up criminal charges to distract from the company’s missteps. Anything that took place on the Trinity Spirit should be considered illegal after the license to the oil field was revoked, he said.

    Yinka Agidee, an attorney specializing in Nigeria’s oil and gas sector who was not involved in the case, said the Trinity Spirit represented an “accident waiting to happen,” and showed that local authorities failed to enforce their own orders.

    “I’m not sure if it’s a question of people closing their eyes or deliberately not doing what they’re supposed to have done,” she said. “But that has resulted in an accident and there has been a loss of life. So we need some explanation.”

    Interviews and an exploration of documents provide a lack of clarity about who was responsible for the Trinity Spirit in the final years of its decline. Though Shebah hired Aganyebi and the rest of the Trinity Spirit’s crew, CEO Ikemefuna Okafor said in an email to the AP that the company wasn’t responsible for the ship’s neglect. The company reported the surviving crew to police, he said, because it had evidence of illegal storage of oil on the ship.

    According to Okafor, liquidators seized ownership of the Trinity Spirit in 2018 due to Shebah’s outsized debt. Yet in a deposition given one year before the explosion, the company’s former president, Ambrosie Orjiako, described how Shebah continued to run operations.

    Sustaining fuel purchases, food supplies, and “skeletal manpower” wasn’t easy, Orijako said, because “there’s no revenue coming in.” But he managed to fund the minimal operations with family resources, he said, because the FPSO “would be dangerous to abandon.”

    Adeyiga, the spokesperson for Nigeria’s Upstream Petroleum Regulatory Commission, said it was still finalizing its investigation into the ship’s explosion and would continue working to prevent similar tragedies from happening.

    The Nigerian Maritime Administration and Safety Agency did not respond to repeated requests for comment, but issued notice in December that all FPSOs and FSOs in Nigeria’s waters must have a flag, be certified by a classification society, and maintain official plans for ship maintenance and emergency response.

    SAVE OUR SOULS

    The deck of the Trinity Spirit was an expanse of rust. Orange rust coated the floor, crept over pipes and trailed from crevices in the walls, according to cell phone photos taken four months before the explosion. Equipment failures plagued the ship’s interior: The engine room flooded twice, Aganyebi said, and the main generator plant was damaged and never repaired.

    Shebah had started running operations on the ship in 2004, taking over from Houston-based ConocoPhillips. But the site’s wells had passed peak oil production several years earlier, according to the energy research firm Wood Mackenzie. Within a few years Shebah’s venture showed signs of financial stress.

    Oil and gas operators tend to operate on the edge of financial wealth or financial ruin, said David Hammond, founder of the nonprofit Human Rights at Sea.

    “These things go from boom to bust,” he said. “The workers are the last people to be looked after.”

    Aganyebi worked in the engine room of the Trinity Spirit. Within a year of joining the crew in 2014, he said, Shebah stopped reliably paying his wages. Lawrence Yorgolo, who operated the crane on the ship, and Pius Orofin, a deck operator — the only other survivors of last year’s fire — alleged the same in interviews with the AP. The men said they stayed on board the ship because they had few other options and hoped they would someday be paid.

    The staff sent repeated letters asking for the money they were owed, the men told AP. One of their last attempts was dated July 2019, with a subject line of “SAVE OUR SOUL (SOS).” They wrote they had worked 15 months without salary and endured, with “pains and hardship,” the “harsh condition and occupational hazards” of life on board the Trinity Spirit.

    Shebah by that time owed millions of dollars. A trio of banks had sued the company over its alleged failure to make payments on a $150 million loan, and in 2016 a judge ruled that Shebah must repay nearly the full amount. A government-run entity, the Asset Management Corporation of Nigeria, moved to take over the company and the assets of its president. The ship’s staffing dwindled from nearly 40 people to 10.

    For those who remained, there were times on the ship when there was nothing to eat, the survivors told AP. Yorgolo recalled how the crew went hungry one year on Christmas. On a separate occasion — the worst of them, he said — the engine room flooded and the staff worked for three days without food. The radio operator sent a message pleading with oil operators nearby to come to their aid.

    “Our management was furious,” Yorgolo said.

    When the radio operator next went to shore, according to Aganyebi, Yorgolo and Orofin, Shebah didn’t allow him back on the ship. He was the designated person to fire a flare or call for help in an emergency. Had the radio operator been on board the night of the explosion, Aganyebi said, “maybe those people that have died — they wouldn’t have died.”

    The AP’s attempts to reach the former radio operator were unsuccessful.

    When it broke in two and began to sink, the Trinity Spirit had at least 40,000 barrels of oil on board, according to Nigeria’s environmental department, which responded to examine the spill. It was capable, like most FPSOs, of storing more than a million barrels.

    The agency said oil wasn’t leaking from the submerged tanks nor had it washed up on shore, but letters still arrived from community members in nearby Ondo and Delta states complaining about the spill. Oil sheens were visible fanning out from the vessel in satellite imagery for days.

    Five bodies were recovered, and two were never found.

    SINKING SHIP

    Among the more than 30 ships identified by the AP as older than the Trinity Spirit is the Al-Zaafarana, floating off the coast of Egypt. At 54 years, it is one of the oldest FPSOs still in service. Close behind it are FPSOs in Malaysia and Brazil, each at least half a century old.

    Along Nigeria’s coast, about 200 miles (320 km) south of where the Trinity Spirit caught fire, the FPSO Mystras is still in service at 47 years old, although industry reports have noted structural issues on the ship. The classification society DNV severed ties with the Mystras three years ago, ending its regular inspections. According to Rystad Energy, it was originally designed to operate only through 2014.

    The Mystras’ owner, NNPC Limited, did not respond to AP’s requests for comment.

    Further inland, the Trinity Spirit’s surviving crew members have been left to eke out a living as they wait for the wages they say were never paid. Aganyebi’s vision is poor from the glare of the explosion; Orofin’s hearing is damaged from the noise. He has a long scar on his leg. Both men spent 19 days in jail.

    Yorgolo, who was the only survivor not charged with a crime, fell on his back when he jumped from the burning vessel and was unconscious when fishermen pulled him into their boat. He believes he wasn’t named as a suspect only because he spent months in the hospital suffering from an injured spine.

    The charges were dropped in October last year after the Ondo State Ministry of Justice reviewed the case. In conversations with AP, the men vehemently denied setting the vessel on fire or illegally storing oil. They blamed the explosion on their employer, Shebah, and the years without maintenance on the ship.

    For Aganyebi, it was clear the company had abandoned the Trinity Spirit long ago.

    “No medical personnel, no safety officer, no radio man in that gigantic vessel,” he said.

    Off the coast of Nigeria, the ship is still visible — split in two pieces and half submerged. As recently as September, in satellite imagery, oil appeared to be leaking from the site of the wreck. It’s unclear when authorities will remove the hazard or salvage the remaining oil, as slowly, the ship sinks further into the sea.

    ___

    Wieffering reported from Washington, D.C. Associated Press reporters Michael Biesecker in Washington, Sarah El Deeb in Beirut and Chinedu Asadu in Abuja, Nigeria, contributed to this report.

    ___

    Follow the reporters: @helenwieffering and @GraceEkpu

    Contact AP’s global investigative team at Investigative@ap.org or https://www.ap.org/tips/

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  • Some striking UAW members carry family legacies, Black middle-class future along with picket signs

    Some striking UAW members carry family legacies, Black middle-class future along with picket signs

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    WAYNE, Mich. — As Britney Johnson paced the picket line outside Ford’s Wayne Assembly plant, she wasn’t just carrying a sign demanding higher pay and other changes.

    She also carried a legacy of car factory jobs and union wages that allowed generations of her family to enjoy middle-class lifestyles and that for years had been unattainable for many Black Americans.

    Johnson’s great-grandfather, grandfather and mother all worked on assembly lines for one or more of Detroit’s automakers, as did some of her uncles.

    “We told her she’s representing our family,” Johnson’s mother, Tracy Brooks, jokes.

    It seems the efforts of Johnson and her co-workers were starting to pay off. All striking Ford workers were called Wednesday by the United Auto Workers to return to their jobs after the union said it reached a tentative contract agreement with Ford that would give them a 25% general wage increase, plus cost of living raises that will put the pay increase over 30%, to above $40 per hour for top-scale assembly plant workers by the end of the contract. Union members still must approve the deal.

    Ford’s deal was followed Saturday by a similar one with Stellantis and could prompt an agreement with General Motors that would end the nearly 6-week-old strikes that at the peak saw about 46,000 workers walk off their jobs and thousands more laid off.

    Union wages, and the battles to keep them, have elevated the fortunes of countless Black families, Brooks said.

    Brooks’ grandfather, Bobbie Allen Sr., left Texas in the early to mid-1900s and found work at Ford Motor Co. Despite having only an eighth grade education, Allen was able to build homes, buy 40 acres of land in rural southeastern Michigan, purchase luxury cars and take his family on vacations.

    “It meant a lot, being in the union,” Brooks said. “Those were the good jobs that were available for Blacks. They knew they could go in there and work hard, make money and obtain things like homes and cars. It allowed them to have the ability to take care of their families and help to build that Black middle class.”

    In the late 1960s and early 1970s, there was a “significant rise” in the Black middle class nationwide, particularly in Detroit and other metro areas, said Andre Perry, a senior fellow at Brookings Metro, a program at the public policy nonprofit, the Brookings Institution.

    Black people were able to buy homes in urban neighborhoods that were once predominantly white.

    “Black people could take advantage of that and buy homes in neighborhoods throughout Detroit,” Perry said. “And as a consequence, you had also thriving commercial corridors, businesses and other ancillary enterprises that supported the rise in income among Black workers.”

    The union provided protection for Black workers who historically faced harsher treatment in the workplace than their white colleagues, Brooks added.

    “Without the union jobs, (employers) can do anything, say anything and you’re out the door,” she said. “At least with the union, you have some type of cushion.”

    Brooks, 61, was in her early 30s when she began working the assembly line at what was then Daimler Chrysler. Her seven years in that job helped pay for her training to become a preschool teacher and buy a home.

    “(My grandfather’s) goal was to have his own property,” Brooks said. “It was his, that no one could take and he worked hard to get that. Being able to own land and property, that was one of the things that was emphasized with us — that property was money.”

    Giving city residents the chance to earn a good living and buy homes in Detroit was included in a 2019 land development deal with Fiat Chrysler, which merged with PSA Peugeot in 2021 to form Stellantis. Detroit required the automaker to hire more than 3,800 residents for its new assembly plant in the city, with pay starting at $17 per hour, climbing to $28.

    “What we want is for people to own homes and raise families in this city,” Mayor Mike Duggan said in 2019 “If you’re making $60,000 you can get a nice house in the city of Detroit.”

    The auto industry and union jobs have been “so important to our quality of life and economic future here in Detroit,” said Anika Goss, chief executive of Detroit Future City, a nonprofit focused on improving the lives of the city’s residents through community and economic development.

    As the auto industry muddled through downturns, car buyers’ shifting tastes and the migration of jobs overseas, cities dependent on manufacturing jobs suffered.

    In 1980, there were 84,920 people in Detroit employed as machine operators and laborers, according to U.S. Census data. A decade later, that number had dropped to 52,316.

    The Chicago and Detroit metropolitan areas each lost more than 100,000 manufacturing jobs between 1995 and 2005, the Brookings Institution wrote in 2006.

    Currently, individuals and families earning between $55,000-$139,000 are in the middle-class income bracket. Only about 25% of Detroit’s residents are in that range, and about two-thirds of city residents earn less than $50,000 per year, Goss said.

    Yolanda Martin, 55, is a second-generation Ford employee who has spent 34 years with the company. She said a two-tier wage system prevents newer employees from making the same financial gains as legacy autoworkers like herself and her late father, who spent 40 years at Ford.

    “That is something that I believe is so detrimental to the middle class. It basically wiped out the opportunity for them to be able to make those” higher salaries, said Martin, who has held various positions at Ford and is currently apprenticing to become an industrial electrician.

    Martin described her childhood during the 1970s and 1980s in her predominantly Black Detroit neighborhood as among the “happiest times” of her life. The Grandmont-Rosedale community was safe, had plenty of shopping and entertainment, and residents looked out for one another. Families usually had two parents and regularly took vacations, and most children received a new car once they learned how to drive because at least one parent worked for an automaker, she explained.

    The community is still strong today and unlike other areas of Detroit, Grandmont-Rosedale staved off blight and maintained its resiliency, according to Tracy Hadden Loh, a fellow at the Brookings Institution, adding that 92% of the neighborhood’s residents are Black.

    Now living in Novi, an upper-middle-class suburb about 28 miles (45 kilometers) northwest of Detroit, Martin worries that future generations of autoworkers won’t be able to afford to live in nicer communities or send their children to better schools.

    “I shouldn’t be working next to a person who makes half of what I make, and they’re doing the exact same thing,” Martin said. “And that’s what I think the fight is about, to kind of bring it to where we’re all on an even playing field.”

    ___

    Jefferson reported from Chicago. News researcher Rhonda Shafner contributed from New York.

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  • Some striking UAW members carry family legacies, Black middle-class future along with picket signs

    Some striking UAW members carry family legacies, Black middle-class future along with picket signs

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    WAYNE, Mich. — As Britney Johnson paced the picket line outside Ford’s Wayne Assembly plant, she wasn’t just carrying a sign demanding higher pay and other changes.

    She also carried a legacy of car factory jobs and union wages that allowed generations of her family to enjoy middle-class lifestyles and that for years had been unattainable for many Black Americans.

    Johnson’s great-grandfather, grandfather and mother all worked on assembly lines for one or more of Detroit’s automakers, as did some of her uncles.

    “We told her she’s representing our family,” Johnson’s mother, Tracy Brooks, jokes.

    It seems the efforts of Johnson and her co-workers were starting to pay off. All striking Ford workers were called Wednesday by the UAW to return to their jobs after the union said it reached a tentative contract agreement with Ford that would give them a 25% general wage increase, plus cost of living raises that will put the pay increase over 30%, to above $40 per hour for top-scale assembly plant workers by the end of the contract. Union members still must approve the deal.

    Ford’s deal was followed Saturday by a similar one with Stellantis and could prompt an agreement with General Motors that would end the nearly 6-week-old strikes that at the peak saw about 46,000 workers walk off their jobs and thousands more laid off.

    Union wages, and the battles to keep them, have elevated the fortunes of countless Black families, Brooks said.

    Brooks’ grandfather, Bobbie Allen Sr., left Texas in the early to mid-1900s and found work at Ford Motor Co. Despite having only an eighth grade education, Allen was able to build homes, buy 40 acres of land in rural southeastern Michigan, purchase luxury cars and take his family on vacations.

    “It meant a lot, being in the union,” Brooks said. “Those were the good jobs that were available for Blacks. They knew they could go in there and work hard, make money and obtain things like homes and cars. It allowed them to have the ability to take care of their families and help to build that Black middle class.”

    In the late 1960s and early 1970s, there was a “significant rise” in the Black middle class nationwide, particularly in Detroit and other metro areas, said Andre Perry, a senior fellow at Brookings Metro, a program at the public policy nonprofit, the Brookings Institution.

    Black people were able to buy homes in urban neighborhoods that were once predominantly white.

    “Black people could take advantage of that and buy homes in neighborhoods throughout Detroit,” Perry said. “And as a consequence, you had also thriving commercial corridors, businesses and other ancillary enterprises that supported the rise in income among Black workers.”

    The union provided protection for Black workers who historically faced harsher treatment in the workplace than their white colleagues, Brooks added.

    “Without the union jobs, (employers) can do anything, say anything and you’re out the door,” she said. “At least with the union, you have some type of cushion.”

    Brooks, 61, was in her early 30s when she began working the assembly line at what was then Daimler Chrysler. Her seven years in that job helped pay for her training to become a preschool teacher and buy a home.

    “(My grandfather’s) goal was to have his own property,” Brooks said. “It was his, that no one could take and he worked hard to get that. Being able to own land and property, that was one of the things that was emphasized with us — that property was money.”

    Giving city residents the chance to earn a good living and buy homes in Detroit was included in a 2019 land development deal with Fiat Chrysler, which merged with PSA Peugeot in 2021 to form Stellantis. Detroit required the automaker to hire more than 3,800 residents for its new assembly plant in the city, with pay starting at $17 per hour, climbing to $28.

    “What we want is for people to own homes and raise families in this city,” Mayor Mike Duggan said in 2019 “If you’re making $60,000 you can get a nice house in the city of Detroit.”

    The auto industry and union jobs have been “so important to our quality of life and economic future here in Detroit,” said Anika Goss, chief executive of Detroit Future City, a nonprofit focused on improving the lives of the city’s residents through community and economic development.

    As the auto industry muddled through downturns, car buyers’ shifting tastes and the migration of jobs overseas, cities dependent on manufacturing jobs suffered.

    In 1980, there were 84,920 people in Detroit employed as machine operators and laborers, according to U.S. Census data. A decade later, that number had dropped to 52,316.

    The Chicago and Detroit metropolitan areas each lost more than 100,000 manufacturing jobs between 1995 and 2005, the Brookings Institution wrote in 2006.

    Currently, individuals and families earning between $55,000-$139,000 are in the middle-class income bracket. Only about 25% of Detroit’s residents are in that range, and about two-thirds of city residents earn less than $50,000 per year, Goss said.

    Yolanda Martin, 55, is a second-generation Ford employee who has spent 34 years with the company. She said a two-tier wage system prevents newer employees from making the same financial gains as legacy autoworkers like herself and her late father, who spent 40 years at Ford.

    “That is something that I believe is so detrimental to the middle class. It basically wiped out the opportunity for them to be able to make those” higher salaries, said Martin, who has held various positions at Ford and is currently apprenticing to become an industrial electrician.

    Martin described her childhood during the 1970s and 1980s in her predominantly Black Detroit neighborhood as among the “happiest times” of her life. The Grandmont-Rosedale community was safe, had plenty of shopping and entertainment, and residents looked out for one another. Families usually had two parents and regularly took vacations, and most children received a new car once they learned how to drive because at least one parent worked for an automaker, she explained.

    The community is still strong today and unlike other areas of Detroit, Grandmont-Rosedale staved off blight and maintained its resiliency, according to Tracy Hadden Loh, a fellow at the Brookings Institution, adding that 92% of the neighborhood’s residents are Black.

    Now living in Novi, an upper-middle-class suburb about 28 miles (45 kilometers) northwest of Detroit, Martin worries that future generations of autoworkers won’t be able to afford to live in nicer communities or send their children to better schools.

    “I shouldn’t be working next to a person who makes half of what I make, and they’re doing the exact same thing,” Martin said. “And that’s what I think the fight is about, to kind of bring it to where we’re all on an even playing field.”

    ___

    Jefferson reported from Chicago. News researcher Rhonda Shafner contributed from New York.

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  • UAW escalates strike against lone holdout GM after landing tentative pacts with Stellantis and Ford

    UAW escalates strike against lone holdout GM after landing tentative pacts with Stellantis and Ford

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    DETROIT — The United Auto Workers union has widened its strike against General Motors, the lone holdout among the three Detroit automakers, after reaching a tentative contract agreement with Jeep maker Stellantis.

    The escalated walkout began Saturday evening at a Spring Hill, Tennessee plant, GM’s largest in North America, just hours after the Stellantic deal was reached. Its nearly 4,000 workers join about 14,000 already striking at GM factories in Texas, Michigan and Missouri.

    The UAW did not immediately explain what prompted the new action after 44 days of targeted strikes. The added pressure on GM is substantial as Spring Hill makes engines for vehicles assembled in a total of nine plants as far afield as Mexico, including Silverado and Sierra pickups. One plant already on strike it supplies with engines, in Arlington Texas, makes full-size SUVs including the Tahoe and Suburban. Vehicles assembled at Spring Hill include the electric Cadillac Lyriq, GMC Acadia and Cadillac crossover SUVs.

    “The Spring Hill walkout affects so much of GM’s production that the company is likely to settle quickly or close down most production,” said Erik Gordon, a University of Michigan business professor. The union wants to wrap negotiations with all three automakers so “Ford and Stellantis workers don’t vote down (their) tentative agreements because they want to see what GM workers get.”

    The Stellantis deal mirrors one reached last week with Ford, and saves jobs at a factory in Belvidere, Illinois, that Stellantis had planned to close, the UAW said.

    On Sunday, presidents of the union locals involved voted to endorse their tentative contract with Ford after UAW President Shawn Fain explained it, said a union official who spoke on condition of anonymity because they were not authorized to make the information public. The vote count was not immediately known.

    Fain was to address the full membership, which will now vote on the pact, on Facebook later Sunday.

    GM said it was disappointed with the additional strike at the Spring Hill plant, which has 11 million square feet of building space, “in light of the progress we have made.” It said in a statement that is has bargained in good faith and wants a deal as soon as possible.

    In a statement, Fain lamented what he called “GM’s unnecessary and irresponsible refusal to come to a fair agreement.”

    “Everybody’s really fired up and excited,” Spring Hill assembly line worker Larry Montgomery said by phone on Sunday. He said workers were taken by surprise by the strike call. “We thought it was going to happen earlier.”

    UAW Local 1853 President John Rutherford in Spring Hill didn’t immediately return a telephone message.

    Fain said in a video appearance Saturday night that 43,000 members at Stelantis would have to vote on the deal — just as Ford workers must. About 14,000 UAW workers had been on strike at two Stellantis assembly plants in Michigan and Ohio, and several parts distribution centers across the country. The company makes Jeep and Ram vehicles.

    The pact includes 25% in general wage increases over the next 4 1/2 years for top assembly plant workers, with 11% coming once the deal is ratified. Workers also will get cost-of-living pay that would bring the raises to a compounded 33%, with top assembly plant workers making more than $42 per hour. At Stellantis, top-scale workers now make around $31 per hour.

    Like the Ford contract, the Stellantis deal would run through April 30, 2028.

    Under the deal, the union said it saved jobs in Belvidere as well at an engine plant in Trenton, Michigan, and a machining factory in Toledo, Ohio.

    “We have reopened an assembly plant that was closed,” Fain said. The deal includes a commitment by Stellantis to build a new midsize combustion-engine truck at the Belvidere factory that was slated to be closed. About 1,200 workers will be hired back, plus another 1,000 workers will be added for a new electric vehicle battery plant, the union said.

    Vice President Rich Boyer, who led the Stellantis talks, said the workforce will be doubled at the Toledo, Ohio, machining plant. The union, he said, won $19 billion worth of investment across the U.S.

    Fain said Stellantis had proposed cutting 5,000 U.S. jobs, but the union’s strike changed that to adding 5,000 jobs by the end of the contract.

    Gordon, the University of Michigan professor, said the Stellantis deal “shows that the car companies feel they are at the mercy of the UAW, that the UAW is not going to give any mercy, and that companies will be co-governed by their boards and the UAW.”

    He said competing companies with non-unionized workforces, which include Toyota and Tesla, “couldn’t have gotten a better year-end gift.”

    Under the Stellantis contract, a top-scale assembly plant worker’s base wage will exceed all increases in the past 22 years. Starting wages for new hires will rise 67% including cost-of-living adjustments to over $30 per hour, it said in a statement. Temporary workers will get raises of more than 165%, while workers at parts centers will get an immediate 76% increase if the contract is ratified.

    Like the Ford agreement, it will take just three years for new workers to get to the top of the assembly pay scale, the union said.

    The union also won the right to strike over plant closures at Stellantis, and can strike if the company doesn’t meet product and investment commitments, Fain said.

    Bruce Baumhower, president of the local union at a large Stellantis Jeep factory in Toledo, Ohio, that has been on strike since September, said he expects workers will vote to approve the deal because of the pay raises above 30% and a large 11% raise immediately. “It’s a historic agreement as far as I’m concerned.”

    Some union members had complained that Fain promised 40% raises to match what he said was given to company CEOs, but Baumhower said that was merely an opening bid.

    “Ultimately, the numbers they did come to agree with is what the UAW wanted,” said Jermaine Antwine, a 48-year-old Stellantis worker who had been picketing the automaker’s Sterling Heights, Michigan, plant Saturday. A team leader in materials at the plant, the Pontiac, Michigan man has has 24 years with the automaker.

    Negotiations between the UAW and Stellantis had intensified Thursday, the day after the Ford deal was announced.

    The union began targeted strikes against all three automakers on Sept. 15 after its contracts with the companies expired. At the peak, about 46,000 workers were on strike against all three companies, about one-third of the union’s 146,000 members at the Detroit three.

    With the Ford deal, which set a template for the other two companies, workers with pensions will see small increases when they retire, and those hired after 2007 with 401(k) plans will get large increases.

    Other union leaders who followed aggressive bargaining strategies in recent months have also secured pay hikes and other benefits for their members. Last month, the union representing Hollywood writers called off a nearly five-month strike after scoring some wins in compensation, length of employment and other areas.

    ____

    Bajak reported from Boston. AP writers John Raby in Charleston, West Virginia, Corey Williams in Sterling Heights, Michigan, and Haleluya Hadero in Jersey City, New Jersey, contributed to this report.

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  • UAW increases pressure on lone holdout GM after reaching tentative pacts with Ford and Stellantis: ‘Everybody’s really fired up’

    UAW increases pressure on lone holdout GM after reaching tentative pacts with Ford and Stellantis: ‘Everybody’s really fired up’

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    The United Auto Workers union has widened its strike against General Motors, the lone holdout among the three Detroit automakers, after reaching a tentative contract agreement with Jeep maker Stellantis.

    The escalated walkout began Saturday evening at a Spring Hill, Tennessee plant, GM’s largest in North America, just hours after the Stellantis deal was reached. Its nearly 4,000 workers join about 14,000 already striking at GM factories in Texas, Michigan and Missouri.

    The UAW did not immediately explain what prompted the new action after 44 days of targeted strikes. The added pressure on GM is substantial as Spring Hill makes engines for vehicles assembled in a total of nine plants as far afield as Mexico, including Silverado and Sierra pickups. One plant already on strike it supplies with engines, in Arlington Texas, makes full-size SUVs including the Tahoe and Suburban. Vehicles assembled at Spring Hill include the electric Cadillac Lyriq, GMC Acadia and Cadillac crossover SUVs.

    “The Spring Hill walkout affects so much of GM’s production that the company is likely to settle quickly or close down most production,” said Erik Gordon, a University of Michigan business professor. The union wants to wrap negotiations with all three automakers so “Ford and Stellantis workers don’t vote down (their) tentative agreements because they want to see what GM workers get.”

    The Stellantis deal mirrors one reached last week with Ford, and saves jobs at a factory in Belvidere, Illinois, that Stellantis had planned to close, the UAW said.

    GM said it was disappointed with the additional strike at the Spring Hill plant, which has 11 million square feet of building space, “in light of the progress we have made.” It said in a statement that is has bargained in good faith and wants a deal as soon as possible.

    In a statement, UAW President Shawn Fain lamented what he called “GM’s unnecessary and irresponsible refusal to come to a fair agreement.”

    “Everybody’s really fired up and excited,” Spring Hill assembly line worker Larry Montgomery said by phone on Sunday. He said workers were taken by surprise by the strike call. “We thought it was going to happen earlier.”

    UAW Local 1853 President John Rutherford in Spring Hill didn’t immediately return a telephone message.

    Fain said in a video appearance Saturday night that 43,000 members at Stelantis would have to vote on the deal — just as Ford workers must. About 14,000 UAW workers had been on strike at two Stellantis assembly plants in Michigan and Ohio, and several parts distribution centers across the country. The company makes Jeep and Ram vehicles.

    The pact includes 25% in general wage increases over the next 4 1/2 years for top assembly plant workers, with 11% coming once the deal is ratified. Workers also will get cost-of-living pay that would bring the raises to a compounded 33%, with top assembly plant workers making more than $42 per hour. At Stellantis, top-scale workers now make around $31 per hour.

    Like the Ford contract, the Stellantis deal would run through April 30, 2028.

    Under the deal, the union said it saved jobs in Belvidere as well at an engine plant in Trenton, Michigan, and a machining factory in Toledo, Ohio.

    “We have reopened an assembly plant that was closed,” Fain said. The deal includes a commitment by Stellantis to build a new midsize combustion-engine truck at the Belvidere factory that was slated to be closed. About 1,200 workers will be hired back, plus another 1,000 workers will be added for a new electric vehicle battery plant, the union said.

    Vice President Rich Boyer, who led the Stellantis talks, said the workforce will be doubled at the Toledo, Ohio, machining plant. The union, he said, won $19 billion worth of investment across the U.S.

    Fain said Stellantis had proposed cutting 5,000 U.S. jobs, but the union’s strike changed that to adding 5,000 jobs by the end of the contract.

    Gordon, the University of Michigan professor, said the Stellantis deal “shows that the car companies feel they are at the mercy of the UAW, that the UAW is not going to give any mercy, and that companies will be co-governed by their boards and the UAW.”

    He said competing companies with non-unionized workforces, which include Toyota and Tesla, “couldn’t have gotten a better year-end gift.”

    Under the Stellantis contract, a top-scale assembly plant worker’s base wage will exceed all increases in the past 22 years. Starting wages for new hires will rise 67% including cost-of-living adjustments to over $30 per hour, it said in a statement. Temporary workers will get raises of more than 165%, while workers at parts centers will get an immediate 76% increase if the contract is ratified.

    Like the Ford agreement, it will take just three years for new workers to get to the top of the assembly pay scale, the union said.

    The union also won the right to strike over plant closures at Stellantis, and can strike if the company doesn’t meet product and investment commitments, Fain said.

    Bruce Baumhower, president of the local union at a large Stellantis Jeep factory in Toledo, Ohio, that has been on strike since September, said he expects workers will vote to approve the deal because of the pay raises above 30% and a large 11% raise immediately. “It’s a historic agreement as far as I’m concerned.”

    Some union members had complained that Fain promised 40% raises to match what he said was given to company CEOs, but Baumhower said that was merely an opening bid.

    “Ultimately, the numbers they did come to agree with is what the UAW wanted,” said Jermaine Antwine, a 48-year-old Stellantis worker who had been picketing the automaker’s Sterling Heights, Michigan, plant Saturday. A team leader in materials at the plant, the Pontiac, Michigan man has has 24 years with the automaker.

    Negotiations between the UAW and Stellantis had intensified Thursday, the day after the Ford deal was announced.

    The union began targeted strikes against all three automakers on Sept. 15 after its contracts with the companies expired. At the peak, about 46,000 workers were on strike against all three companies, about one-third of the union’s 146,000 members at the Detroit three.

    With the Ford deal, which set a template for the other two companies, workers with pensions will see small increases when they retire, and those hired after 2007 with 401(k) plans will get large increases.

    Other union leaders who followed aggressive bargaining strategies in recent months have also secured pay hikes and other benefits for their members. Last month, the union representing Hollywood writers called off a nearly five-month strike after scoring some wins in compensation, length of employment and other areas.

    ____

    Bajak reported from Boston. AP writers John Raby in Charleston, West Virginia, Corey Williams in Sterling Heights, Michigan, and Haleluya Hadero in Jersey City, New Jersey, contributed to this report.

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    Tom Krisher, Frank Bajak, The Associated Press

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  • UAW escalates strike against lone holdout GM

    UAW escalates strike against lone holdout GM

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    DETROIT — The United Auto Workers union has widened its strike against General Motors, the lone holdout among the three Detroit automakers, after reaching a tentative contract agreement with Jeep maker Stellantis.

    The escalated walkout began Saturday evening at a Spring Hill, Tennessee plant, GM’s largest in North America, just hours after the Stellantic deal was reached. Its nearly 4,000 workers join about 18,000 already striking at GM factories in Texas, Michigan and Missouri and Tennessee.

    The UAW did not immediately explain what prompted the new action after 44 days of targeted strikes. The added pressure on GM is substantial as Spring Hill makes engines for vehicles assembled in a total of nine plants as far afield as Mexico, including Silverado and Sierra pickups. One plant already on strike it supplies with engines, in Arlington Texas, makes full-size SUVs including the Tahoe and Suburban. Vehicles assembled at Spring Hill include the electric Cadillac Lyriq, GMC Acadia and Cadillac crossover SUVs.

    “The Spring Hill walkout affects so much of GM’s production that the company is likely to settle quickly or close down most production,” said Erik Gordon, a University of Michigan business professor. The union wants to wrap negotiations with all three automakers so “Ford and Stellantis workers don’t vote down (their) tentative agreements because they want to see what GM workers get.”

    The Stellantis deal mirrors one reached last week with Ford, and saves jobs at a factory in Belvidere, Illinois, that Stellantis had planned to close, the UAW said.

    GM said it was disappointed with the additional strike at the Spring Hill plant, which has 11 million square feet of building space, “in light of the progress we have made.” It said in a statement that is has bargained in good faith and wants a deal as soon as possible.

    In a statement, UAW President Shawn Fain lamented what he called “GM’s unnecessary and irresponsible refusal to come to a fair agreement.”

    “Everybody’s really fired up and excited,” Spring Hill assembly line worker Larry Montgomery said by phone on Sunday. He said workers were taken by surprise by the strike call. “We thought it was going to happen earlier.”

    UAW Local 1853 President John Rutherford in Spring Hill didn’t immediately return a telephone message.

    Fain said in a video appearance Saturday night that 43,000 members at Stelantis would have to vote on the deal — just as Ford workers must. About 14,000 UAW workers had been on strike at two Stellantis assembly plants in Michigan and Ohio, and several parts distribution centers across the country. The company makes Jeep and Ram vehicles.

    The pact includes 25% in general wage increases over the next 4 1/2 years for top assembly plant workers, with 11% coming once the deal is ratified. Workers also will get cost-of-living pay that would bring the raises to a compounded 33%, with top assembly plant workers making more than $42 per hour. At Stellantis, top-scale workers now make around $31 per hour.

    Like the Ford contract, the Stellantis deal would run through April 30, 2028.

    Under the deal, the union said it saved jobs in Belvidere as well at an engine plant in Trenton, Michigan, and a machining factory in Toledo, Ohio.

    “We have reopened an assembly plant that was closed,” Fain said. The deal includes a commitment by Stellantis to build a new midsize combustion-engine truck at the Belvidere factory that was slated to be closed. About 1,200 workers will be hired back, plus another 1,000 workers will be added for a new electric vehicle battery plant, the union said.

    Vice President Rich Boyer, who led the Stellantis talks, said the workforce will be doubled at the Toledo, Ohio, machining plant. The union, he said, won $19 billion worth of investment across the U.S.

    Fain said Stellantis had proposed cutting 5,000 U.S. jobs, but the union’s strike changed that to adding 5,000 jobs by the end of the contract.

    Gordon, the University of Michigan professor, said the Stellantis deal “shows that the car companies feel they are at the mercy of the UAW, that the UAW is not going to give any mercy, and that companies will be co-governed by their boards and the UAW.”

    He said competing companies with non-unionized workforces, which include Toyota and Tesla, “couldn’t have gotten a better year-end gift.”

    Under the Stellantis contract, a top-scale assembly plant worker’s base wage will exceed all increases in the past 22 years. Starting wages for new hires will rise 67% including cost-of-living adjustments to over $30 per hour, it said in a statement. Temporary workers will get raises of more than 165%, while workers at parts centers will get an immediate 76% increase if the contract is ratified.

    Like the Ford agreement, it will take just three years for new workers to get to the top of the assembly pay scale, the union said.

    The union also won the right to strike over plant closures at Stellantis, and can strike if the company doesn’t meet product and investment commitments, Fain said.

    Bruce Baumhower, president of the local union at a large Stellantis Jeep factory in Toledo, Ohio, that has been on strike since September, said he expects workers will vote to approve the deal because of the pay raises above 30% and a large 11% raise immediately. “It’s a historic agreement as far as I’m concerned.”

    Some union members had complained that Fain promised 40% raises to match what he said was given to company CEOs, but Baumhower said that was merely an opening bid.

    “Ultimately, the numbers they did come to agree with is what the UAW wanted,” said Jermaine Antwine, a 48-year-old Stellantis worker who had been picketing the automaker’s Sterling Heights, Michigan, plant Saturday. A team leader in materials at the plant, the Pontiac, Michigan man has has 24 years with the automaker.

    Negotiations between the UAW and Stellantis had intensified Thursday, the day after the Ford deal was announced.

    The union began targeted strikes against all three automakers on Sept. 15 after its contracts with the companies expired. At the peak, about 46,000 workers were on strike against all three companies, about one-third of the union’s 146,000 members at the Detroit three.

    With the Ford deal, which set a template for the other two companies, workers with pensions will see small increases when they retire, and those hired after 2007 with 401(k) plans will get large increases.

    Other union leaders who followed aggressive bargaining strategies in recent months have also secured pay hikes and other benefits for their members. Last month, the union representing Hollywood writers called off a nearly five-month strike after scoring some wins in compensation, length of employment and other areas.

    ____

    Bajak reported from Boston. AP writers John Raby in Charleston, West Virginia, Corey Williams in Sterling Heights, Michigan, and Haleluya Hadero in Jersey City, New Jersey, contributed to this report.

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  • Biden Hails “Historic Agreement” After Striking United Auto Workers Reach Tentative Deal With Second Major Automaker

    Biden Hails “Historic Agreement” After Striking United Auto Workers Reach Tentative Deal With Second Major Automaker

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    The United Auto Workers union announced Saturday evening that it had come to a tentative labor agreement with Stellantis, the parent company of Chrysler, Jeep and Ram, on a new contract following a six-week strike.

    The agreement, which covers nearly 15,000 workers, follows closely on the heels of a similar deal reached between the union and fellow “Big Three” automaker Ford—a significant victory for President Joe Biden, who threw his full-throated support behind striking auto workers.

    “We have won a record-breaking contract,” UAW President Shawn Fain said in a video posted on social media Saturday evening. “We truly believe we got every penny possible out of the company.”

    Fain added that the overall value of the Stellantis agreement, which includes a 25 percent wage increase for UAW members, was double what the company initially offered when the strike began in September.

    The UAW also secured the right to strike if Stellantis closes any plant or fails to fulfill promised investments. “If the company goes back on their words on any plant, we can strike the hell out of them,” Fain said.

    In a statement released by the White House, Biden congratulated the union and Stellantis on “a historic agreement that will guarantee workers the pay, benefits, dignity and respect they deserve.” The tentative contract, he said, “is a testament to the power of unions and collective bargaining to build strong middle-class jobs while helping our most iconic American companies thrive.”

    Early in the strike, top Republicans gleefully embraced the opportunity to tie the president to an expanding work stoppage that threatened to reignite inflation or plunge the country into a recession. Those comments grew louder when Biden made history in late September by visiting striking workers at the picket line in Detroit, encouraging the union to “stick with it.”

    But the president’s gamble paid off. On Thursday, Biden took the Ford agreement as an opportunity to tout the country’s third-quarter GDP report, which showed 4.9% growth and subsiding inflation, defying warnings of a recession, and to call out the chaos roiling the GOP.

    “I hope Republicans in Congress will join me in working to build on this progress, rather than putting our economy at risk with reckless threats of a shutdown or proposals to cut taxes for the wealthy and large corporations while slashing programs that are essential for hard-working families and seniors.”

    Now, the only Big Three company still waiting to come to a tentative agreement is General Motors. On Saturday evening, a local UAW chapter in Tennessee announced that a GM manufacturing facility that employs 4,000 union and non-union workers would be joining the strike, an escalation meant to ratchet up pressure on the company.

    A GM spokesman said the company was “disappointed by the UAW’s action in light of the progress we have made.”

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    Jack McCordick

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  • WSJ News Exclusive | UAW Expands Strike With GM After Reaching Tentative Agreement With Stellantis

    WSJ News Exclusive | UAW Expands Strike With GM After Reaching Tentative Agreement With Stellantis

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    Updated Oct. 28, 2023 10:03 pm ET

    The United Auto Workers called a fresh strike at a General Motors factory in Tennessee, a surprise walkout after negotiators had been working nearly around the clock to finalize a new contract this weekend.

    Workers at GM’s factory in Spring Hill, Tenn., were ordered to go on strike Saturday evening, according to people with knowledge of the union’s plans. The strike came just as the UAW confirmed that it reached a tentative agreement with Chrysler parent Stellantis on a new labor contract.

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