Stellantis Rejects UAW’s Proposal to Reinstate Jobs Bank, Escalates Legal Battle with 8 New Lawsuits

Stellantis rejects a controversial UAW proposal to bring back the costly Jobs Bank system, filing more lawsuits as tensions rise over job security and production commitments.

Automaker and Union Clash Over Jobs Bank Proposal and Plant Closures

In a deepening standoff, Stellantis has rejected a United Auto Workers (UAW) proposal to reinstate the once-defunct Jobs Bank, a system that would prevent layoffs by keeping employees on payroll even without production work. Stellantis, which filed an initial lawsuit against the UAW on October 3, followed up with eight additional lawsuits targeting 23 UAW local unions across the country.

The Jobs Bank, first introduced in the mid-1980s and adopted by Detroit’s Big Three automakers, became a major financial burden, contributing to Chrysler’s bankruptcy in 2009. By the early 2000s, Chrysler had over 2,000 employees in the Jobs Bank, incurring unsustainable costs for workers who were paid but not assigned any tasks. Despite its controversial past, the UAW is pushing for a modern revival of the system to protect jobs at the Belvidere, Illinois plant, which Stellantis idled, and to cover approximately 900 employees who transferred to other locations.

Stellantis Rejects UAW’s Job Security Demands

Stellantis swiftly rejected the UAW’s Jobs Bank proposal, arguing that reinstating the system would be a return to pre-bankruptcy conditions that nearly collapsed the company. The automaker contends that such provisions are no longer viable in today’s competitive and volatile market, particularly with the ongoing challenges surrounding the transition to electric vehicles (EVs).

“The company cannot revert to terms and conditions that jeopardize its future,” Stellantis said in a statement, stressing that the company already agreed to place Belvidere employees on temporary layoffs, offering 74% of pay and full healthcare benefits during the transition. Stellantis further reiterated that plans for Belvidere have not been cancelled but delayed, as the company navigates market uncertainty and slower-than-expected EV adoption.

Stellantis Threatens Legal Action Over Potential UAW Strike

With the UAW poised to escalate its fight, Stellantis has preemptively warned that any strike initiated by the union would be illegal under the terms of Investment Letter 311, a key document cited in ongoing contract disputes. The company, bracing for potential production halts, vowed to hold the UAW accountable for “tens of millions” in daily revenue losses and other damages resulting from what it claims would be an unlawful strike.

In the midst of the legal battle, Stellantis emphasized its readiness to meet with UAW leaders but remains firm in its refusal to reinstate outdated and costly contract provisions. As negotiations continue, the looming threat of further legal action underscores the mounting tension between the automaker and the union, with the future of U.S. auto manufacturing hanging in the balance.

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