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Labor: Delphi Using Bankruptcy to Force Wage Concessions

By Joyce Kryszak

Buffalo, NY – The bankruptcy filing by Delphi leaves workers in Lockport, and those from 31 other Delphi plants, with an uncertain future.

But industry analysts say the bankruptcy trend is a threat to all unionized labor in America. Experts say United Airlines was the first to use using bankruptcy to force wage concessions.

Now, with Delphi's filing, the expectation is that a similar movement will ripple through all sectors of the auto industry. Alex Blair is a labor professor with Cornell Labor Studies. Blair says there is much more at stake than just wages.

"What they really want to do is to use bankruptcy to get rid of the legacy costs," Blair said. "That includes pensions and health insurance for retirees. They can't negotiate it away. So, both companies are trying to get rid of those obligations by using bankruptcy."

But it's expected Delphi's former parent company, General Motors, might have to pick up the $11 billion tab for current Delphi unionized retirees.