Detroit – Leaders of Blue Cross Blue Shield of Michigan and the United Auto Workers reached a “verbal agreement” Tuesday on a new contract, potentially ending a 77-day strike by 1,300 unionized call centre and claims processing workers.
Phone calls between BCBSM CEO Daniel Loepp and UAW President Shawn Fain in recent weeks resulted in a “verbal agreement” between the two leaders to reach a collective bargaining agreement, Blue Cross said late Tuesday.
The tentative agreement includes “significant across-the-board wage increases,” a $6,500 ratification bonus for Blue Cross Blue Shield employees and a $5,000 ratification bonus for employees of BCBSM’s Blue Care Network HMO, the UAW said.
The strike centred in part on a wage scale that requires workers to work 22 years before earning top wages. The tentative agreement would reduce that to five years, according to the UAW.
“Wage progression and job security were concerns we knew we had to address in this round of bargaining,” UAW Secretary-Treasurer Margaret Mock said in a statement on Tuesday.
Negotiating teams from the union and the Detroit-based health insurer were expected to formalise and ratify agreements into a new collective bargaining agreement on Wednesday, Blue Cross said.
UAW members will remain on strike until the contract is ratified by the membership, the union said.
“President Fain and I have agreed in principle on the structure of a new collective bargaining agreement that would provide significant income and job security for our union members,” Loepp said in a statement Tuesday. “On Wednesday, our bargaining teams will meet to formalise our agreement – bringing our employees one step closer to returning to work.”
The announcement of an agreement comes more than two months after nearly 1,300 BCBSM workers represented by the UAW walked off the job on 13 September after failing to reach an agreement on a new contract for unionised workers across the state.
The strike included BCBSM call centre and claims processing workers. The striking workers said they wanted to stop the outsourcing of their jobs, unfair labour practices and wage disparities between veteran and younger workers.
Mock, who heads the union’s Technical, Office and Professional (TOP) department, said the tentative agreement includes new protections against outsourcing during the life of the new contract.
“Pay progression and job security were concerns we knew we had to address in this round of bargaining,” said Mock. “Twenty-two years to reach top pay is unacceptable. Thanks to the solidarity of our members on the picket lines and the hard work of our negotiators at the table, we were able to win many of our demands”.
Tina Gates, president of UAW Local 1781, which represents the striking Blue Cross workers, said the health insurer had reduced its ranks from as many as 5,000 workers to 1,300 over years of outsourcing.
“Over the years we have lost so much work. They’ve taken our work and given it to outside contractors,” Gates said in mid-September, when BCBSM workers went on strike. “We used to have over 4,000, 5,000 people (in the union) across the state. Now we have 1,300 people. So we’re tired of bleeding. We’re tired of them taking our jobs.
The union made the salary of the Blue Cross CEO an issue throughout the strike.
According to Crain’s Detroit Business, Loepp’s total compensation in 2021 will be $15.6 million, with a base salary of $1.6 million.
The mid-September UAW strike at Blue Cross began two days before the United Auto Workers began a strike at the Detroit Three automakers. All three of the UAW’s contracts with Stellantis NV, General Motors Co. and Ford Motor Co. expired at 11:59 p.m. on Sept. 14.
Earlier this month, the union’s autoworker members ratified contracts with the Detroit Three, ending nearly 10 weeks of work stoppages at selected plants.
Separately from BCBSM, union officials said the contract for UAW members at BCBSM’s Blue Care Network will expire on 15 December.
“I congratulate and thank President Fain for reaching out and working directly with me to get us to the starting line of the ratification process,” Loepp said.
If ratified, the contract will cover about 1,300 UAW members from Locals 2500 and 1781 in Detroit, Locals 2145 in Grand Rapids and 2256 in Lansing, UAW officials said.