UAW Leaders Support GM Pact

The contract would allow GM to make progress toward achieving parity on labor costs with foreign-based competitors that have been feasting on its market share.

For the UAW, the health care and pension fund for its members will be sheltered from the risk of bankruptcy at GM, and their employer will be in better financial shape to promote its long-term survival.

That said, workers' benefits will be subject to risks in the financial markets, since the fund will have to sustain a healthy level of returns in order to afford its obligations.

If UAW members vote to approve the contract, the union is expected to move forward with similar negotiations with the rest of Detroit's Big Three, Ford (F Quote) and Chrysler. An agreement with GM would clear the way to achieve the same arrangement for the others.

Shares of GM rose 70 cents, or 1.9%, to $37.16.