Rouge Revolution

For auto workers, the plan was as revolutionary as Henry Ford's $5-a-day wage in 1914. This time it was Henry Ford II who pioneered in industrial statesmanship. He agreed to U.A.W. demands for a pension plan covering the Ford Motor Co.'s 107,000 workers in the Rouge and 32 other plants. The union estimates that some 5,000 workers are eligible for retirement at once.

To make the retirement plan possible, the U.A.W. said that the company assumed a massive liability of $200 million so that the plan would include the years present workers have already worked for Ford. In addition, Ford will contribute $15 million a year. The initial payment is big because the average seniority of Ford workers is one of the highest in the industry.

The agreement, which averted a threatened strike, was reached after 22 hours of continuous negotiations in a Book-Cadillac hotel room between Ford's lanky personnel chief John S. Bugas and the U.A.W.'s self-effacing Richard T. Leonard. Details of the plan are still to be worked out, but its broad outlines were stated by Leonard.

Every Ford worker, on reaching a retirement age yet to be determined (probably 65), will receive an annual income for life equal to 1% of his average pay multiplied by his years of service. Thus, at current rates, a typical worker could retire after 30 years on a $77-a-month Ford pension. If a worker dies before retirement age, his family will receive all he paid in, plus interest. Workers will contribute 2 1/2% a year to the pension fund on earnings up to $3,000; over $3,000, payments will be 5%. The company's contribution will be approximately 17 1/2% of the current payroll. To compute the benefits for past service, Ford agreed to use each worker's 1946 earnings, highest ever in peacetime, as the basis.

In terms of U.A.W. politics, the plan was a triumph for Dick Leonard, and a blow to U.A.W.'s President Walter Reuther, whom Leonard has opposed. (Leonard has been a supporter of ex-President R. J. Thomas.) In addition to pensions, the equivalent of about a 15-c--an-hour raise, Leonard got a 7-c--an-hour increase in wages for Ford workers. The U.A.W. expects the Ford plan to become a model for the industry.

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