G.M.'s New Pattern

General Motors, which set a new pattern for labor and management five years ago by tying wages to the cost of living, last week modernized the pattern. It agreed to a request by the C.I.O.'s United Auto Workers that the bulk of the cost-of-living increases be incorporated in base pay rates. Thus, of the 24-c- in cost-of-living increases granted since 1950, 19-c- will become a permanent pay increase.

Though the G.M.-U.A.W. contract (renewed in 1950) still has two years to run, and the union had no legal means of forcing its reopening, G.M. agreed to do so on the union's plea that long-term contracts must be "living documents'' subject to revision in the light of changing economic conditions. Said G.M. President Harlow Curtice, who wants to keep the comparatively strike-free status G.M. enjoys in the auto industry: "[The agreement was] a practical solution to problems created by the Korean war with its resulting inflationary impact. . . ."

Other major contract changes:

P:The annual pay boost for higher productivity will be raised from 4-c- to 5-c- an hour.

P:Some 40,000 skilled G.M. workers will get an additional raise of 10-c- an hour.

P:A new and more flexible formula will gear pay to the Government's new cost-of-living index. Wages will rise a penny for every index increase of .6%, drop a penny for every decline of .68%, compared to a rise or fall of 1-c- for every 1.14 points in the old index.

"Our agreement," said C.I.O. President Walter Reuther jubilantly, "shows that free labor and free management, exercising their rights and privileges, facing up to their responsibilities and using their common sense, can in our kind of democracy, work out their problems across the bargaining table." Reuther promptly went after Ford and Chrysler for a similar settlement, plus some extra concessions on pensions and medical benefits.

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