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GM is about to avoid a major disaster

GM CEO Mary Barra Testifies To House Hearing On The Company's Ignition Switch RecallGM CEO Mary Barra Testifies To House Hearing On The Company's Ignition Switch Recall
General Motors CEO Mary Barra testifies before the full House Energy and Commerce hearing room in a hearing entitled "The GM Ignition Switch Recall: Why Did It Take So Long?" April 1, 2014 on Capitol Hill in Washington, DC.Photograph by Allison Shelley — Getty Images

A worker strike that could have hampered General Motors’ production is no longer an immediate threat to the nation’s largest automaker. The United Auto Workers union and GM reached a tentative agreement late Sunday, avoiding a work stoppage.

The union did not disclose details of the deal, which covers 52,600 members at GM. UAW officials said in a statement that the agreement will give workers “significant” wage gains and job security protections. It also gives entry-level workers a path to reach the more senior worker class, where wages are higher.

The UAW-GM deal comes a few days after union members officially ratified a new deal with Fiat Chrysler Automobiles. That agreement was the second attempt by UAW and FCA to broker a contract that satisfied workers. The first was dismissed with a 65% no vote—the first time UAW members had dismissed a national agreement in 33 years.

While the UAW used its deal with FCA as a blueprint in its negotiations with GM, the union sought to secure sweeter terms for GM workers given the automaker’s recently improved financial performance. The company reported a $3.1 billion operating profit in its quarterly earnings last week.

Union leaders will vote to ratify the deal on Wednesday. The UAW’s rank-and-file who work at GM’s U.S. plants will have a chance to approve the deal shortly thereafter. Should UAW members okay the contract with GM, the agreement will likely serve as a roadmap for the union’s talks with Ford.