The United Auto Workers said Wednesday its members had approved a new four-year union contract with General Motors, marking a key step in the company's post-bankruptcy restructuring.
The $2 billion contract covers more than 48,000 workers at GM, adds 6,400 new jobs and is effective immediately, the UAW said.
GM, the biggest US automaker, is the first of the Detroit "Big Three" to clinch a new UAW contract. The union is in negotiations with Ford and Chrysler.
"The UAW and GM entered into this set of bargaining as America struggles with record levels of unemployment and an economy that shows little sign of improvement," UAW president Bob King said in a statement.
"Because of President Obama's and the American taxpayers' backing of our jobs and our companies, we were determined to work together with GM management to grow jobs in the US and to get more Americans back to work and we are doing just that."
Battered by a steep US recession that ended in June 2009, GM filed for bankruptcy protection on June 1 of that month. It emerged in July as a new entity led by the US government, which pumped in some $50 billion to help the giant automaker survive.
The US government still owns a large part of the "new" GM, which had a record-setting initial public offering of shares in November and has since then posted robust profits.
"When GM was struggling, UAW members shared deeply in the sacrifice... Now that GM is posting profits again, our members are sharing in the success, while ensuring GM's continued profitability," King said.
Under the terms of the contract, GM will add 6,400 new jobs in the United States, the UAW said in the statement.
That element will be "providing jobs for UAW members who have been laid off over the last several years, creating thousands of new jobs, and bringing work back to the United States and to UAW GM plants that had been moved to Mexico and other parts of the world."
"The agreement is a win-win for our employees and our company," Dan Akerson, GM chairman and chief executive, said in a statement.
"It underscores the alignment between the UAW and the new GM in our efforts to drive long-term success, and gives all of our employees a direct stake in the quality of our products and our performance," Akerson said.
GM preserved a two-tier wage structure and succeeded in keeping the pay of longer-term workers frozen at an average of $29 per hour until the next contract negotiations in 2015.
"Importantly, it protects GM’s low break-even level in the event of a US industry downturn, and preserves GM's fortress balance sheet, with no pension increases and the capping of the hourly defined benefit pension plan population," the automaker said.
The UAW highlighted that the contract provides "significant gains" for entry-level workers, bringing wages to $19.28 over the term of the contract.
A tentative agreement had been reached on September 16.
The final vote tally was 65 percent in favor of the agreement among production workers, and 63 percent in favor among skilled trades workers, the union said.
Retirees, many of whom were angered by the contract's lack of pension improvements, were not eligible to vote.
The contract also provides a $5,000 signing bonus for all employees, and up to $4,000 in inflation protection and other payments over the term of the agreement.
It also improved profit sharing, replacing the old plan with a new, more simple and transparent plan, with higher possible payouts, the UAW said.
Shares in GM tumbled 3.7 percent to $20.41 in an overall lower close on the New York Stock Exchange.