Honda Motor will hike the pay of some U.S. employees by 11% following the United Auto Workers' historic contract victories at its unionized Detroit competitors, according to a company memo seen by Bloomberg.
"Honda continuously reviews our total rewards packages to ensure we remain competitive within our industry," the company's human resources department wrote in a memo for locations including Ohio, Indiana and Georgia. "Effective Monday, Jan. 8, 2024, associates on pay progressions will receive base wage increases of 11%."
Honda spokesman Chris Abbruzzese confirmed the pay raise as well as shortened progression time for production associates at Honda's U.S. facilities. He said since 2021, Honda has added more than 10 new benefits including child care reimbursement and a student loan repayment program.
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"We will continue to look for opportunities to ensure that we provide an excellent employment experience for Honda associates," Abbruzzese said in an email.
The UAW's high-profile strike and record-breaking contract
This has motivated nonunion companies to boost their own pay. Honda's move follows Toyota Motor's earlier this month to
UAW President Shawn Fain said raises like Toyota's are a direct result of the UAW's success, and won't be enough to stop the union from organizing those companies.
"Toyota, if they were doing it out of the kindness of their heart, they could have chosen to do it a year ago," Fain said in an interview with Bloomberg News last week.
In a Nov. 3 memo viewed by Bloomberg, Subaru of Indiana Automotive, the only U.S. manufacturing site for Subaru, said it has been asked by "many" employees to respond to the Detroit automaker agreements.
"It is SIA's intentions to continue to respond to market conditions and inflationary pressures responsibly and reasonably as our financial means permit us to do so," the company said in an internal memo, adding that it plans to announce a formal response on Nov. 22.
In an emailed statement, SIA spokesman Craig Koven said the company would "be providing our associates a pre-holiday announcement that will include a response to current industry circumstances."
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Under the UAW's tentative agreements with General Motors, Ford Motor and Stellantis, union members will get 11% raises as soon as the new contracts are ratified. Over the life of the contract, the automakers agreed to give a 25% wage increase and restoration of a cost-of-living allowance, which takes top pay up 33% over that time, as well as giving new workers a faster progression to the top wage of $42 an hour.
"One of our biggest goals coming out of this historic contract victory is to organize like we've never organized before," Fain has said. "When we return to the bargaining table in 2028, it won't just be with a Big Three, but with a Big Five or Big Six."
