Aug 24 (Reuters) – A joint venture battery plant said on Thursday it will hike the wages of workers at its Ohio plant by an average of 25% after some U.S. senators blasted the facility for paying workers as little as $16 an hour.
Ultium Cells, a joint venture of General Motors (GM.N) and LG Energy Solution (373220.KS), said workers must still ratify the interim wage increase that takes effect Aug. 28. The UAW said the increase is worth $3 to $4 an hour for workers.
The interim wage increase will be retroactive to December 2022 and some workers will receive between $3,000 to $7,000, based on hours worked.
“Providing this wage increase is the right thing to do for our team members,” Ultium said.
Workers voted in December to join the United Auto Workers union but have not yet reached a contract. “We continue to bargain in good faith with the UAW to reach a comprehensive contract for our employees, including a final wage scale,” Ultium said.
UAW President Shawn Fain said in a statement “after months of public pressure and worker organizing, Ultium was forced to take a first step towards economic justice for the workers who are powering GM’s electric vehicle future.”
GM, Chrysler-parent Stellantis (STLAM.MI) and Ford Motor (F.N) are in negotiations to reach new labor agreements cover 146,000 workers before the current contracts expire on Sept. 14. The UAW will disclose the results of a strike authorization vote Friday.
Democratic senators and the UAW have heavily criticized Ultium for paying low wages at the Ohio plant and noted some make just half as much as workers did at a nearby shuttered GM assembly plant. Fain has said it would take an entry level worker at Ultium 16 years to earn as much as GM CEO Mary Barra, who received $29 million in compensation in 2022, makes in a week.
U.S. Senator Sherrod Brown, Democrat of Ohio, and other senators wrote in July it was a “national disgrace that the starting wage at any current American joint venture electric vehicle battery facility is $16 an hour,” arguing it represents “poverty-level wages” amid “extreme financial gains for the companies, executives, and investors.”
In July, a group of 28 senators including Senate Majority Chuck Schumer urged automakers to include battery workers under the national labor agreements. Ultium rejected that idea.