Detroit Three Gird for Labor Clash as UAW Hikes Strike Pay

(Bloomberg) -- The United Auto Workers is increasing strike pay for members, a move that could give workers more incentive to stay on picket lines if there’s a walkout during potentially contentious negotiations with Detroit Three carmakers this year.

At the union’s bargaining convention starting Monday in Detroit, UAW President Gary Jones said strike pay will increase to $250 a week through the end of this year, from $200 a week previously. The union will start paying out to $275 a week starting in January.

The compensation would cushion the financial blow to UAW members if they decide to walk off the job, and serves as a warning shot to automakers that union workers are prepared for tough negotiations. General Motors Co., Ford Motor Co. and Fiat Chrysler Automobiles NV are slated to negotiate new four-year labor deals beginning this summer.

“No one goes to the bargaining table expecting to strike,” Jones said. “But the UAW goes to the bargaining table prepared to strike if our members need to strike. We don’t fear it. Raising the strike fund is an important symbol that we have their backs.”

The union last went on strike in 2007, when workers briefly walked out on both GM and what was then DaimlerChrysler. The UAW has seen its clout wane in recent years after failed bids to unionize U.S. plants run by Nissan Motor Co. and Volkswagen AG. It’s also been set back by an ongoing Justice Department probe into illicit payments funneled through a worker training center to union leaders and Fiat Chrysler labor-relations executives.

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