United Auto Workers members at Alabama’s ZF factory reached a deal with company executives on Wednesday, ending a 29-day strike.
On September 20, roughly 190 unionized employees rejected a contract offer from ZF, citing insufficient pay raises and underwhelming benefits improvements, and joined the United Auto Workers strike, then on its fifth day.
The ZF Group, also known as ZF Friedrichshafen AG, is a critical parts supplier for the automotive industry, generating roughly $46.35 billion in revenue in 2022 alone. Its Alabama factory provides front axles for a nearby Mercedes Benz facility, initially raising concerns for the German brand’s production. However, despite losing part of its workforce, the ZF plant remained open throughout the strike and continued shipments to its automotive clients.
Under the new agreement, ratified this Wednesday, United Auto Workers members employed by ZF will no longer be subject to wage tiers, which grants additional pay and better benefits to seasoned employees. Wage tiers have been a point of contention between Detroit-Three manufacturers and union leadership, who argue that the system sows division among employees while locking higher compensation behind years of service.
Depending on their previously assigned tier, ZF factory workers will receive a pay raise of either 22% or 13% over the course of four years, eventually bringing rates for all staff to $23 an hour. Additionally, employees at all levels can now access preferred provider organization health plans and take a paid holiday on Juneteenth.
The United Auto Workers strike is now in its 36th day. Union chief Shawn Fain is expected to give updates on negotiations with Detroit-Three manufacturers this afternoon at 4 p.m. EST.
