Updated from 12:27 p.m. ESTThe United Auto Workers union said it has been told by several public officials that Delphi ( DPHIQ) will file motions Friday to reject its union agreements, a move that could potentially pave the way for a costly labor strike. UAW Vice President Richard Shoemaker, in a statement on the union's Web site late Wednesday, said that Delphi Chief Executive Steve Miller has told the public officials that the auto-parts maker will be filing its motions in the bankruptcy court Friday morning. Delphi has said it will use the motions to gain court approval to reject collective bargaining agreements and terminate hourly post-retirement health care and insurance benefits. "We have not been advised of this by any Delphi representatives," Shoemaker said in the statement to union leaders. "Nevertheless, I thought we should pass this information on to you as we have no reason not to believe those who provided us with this information." A spokesman for Delphi wasn't immediately available for comment. The move to reject the contracts wouldn't be a surprise; Delphi has said it would file the motions by March 31 if an agreement on wages couldn't be reached. The company and its former parent, General Motors ( GM), have been negotiating with the union to lower wages as part of Delphi's efforts to emerge from bankruptcy protection. The three sides managed to reach one agreement last week, when the companies announced a plan to offer buyout packages to thousands of workers in return for early retirement. But the wage cuts have remained a thornier issue, and a Delphi proposal earlier this week was reportedly overwhelmingly rejected. GM spokesman Jerry Dubrowski confirmed that no agreement has been reached on wage negotiations between Delphi and the UAW, and he said that, unless the situation changes Thursday, Delphi does plan to file motions Friday to void its union contracts.
"If Delphi were to file these motions, it does not affect our desire to reach a consensual agreement," Dubrowski said. "Delphi is making a motion to seek permission to do this. That doesn't mean a judge will grant permission. As a matter of fact, the judge will establish a calendar, schedule hearings, and this will take some time before it gets to a final decision process. We will continue to work with Delphi and the union to reach an agreement that makes sense for everyone." According to the Associated Press, the judge overseeing Delphi's case scheduled a May 8 hearing on the motion, and wouldn't decide whether to cancel Delphi's contracts until after that time. Dubrowski declined to comment on what might happen if an agreement is not ultimately reached and a strike occurs, except to say that, "these things tend to play out over the course of weeks and even months." GM shares recently traded at $21.75, down 40 cents, or 1.8%.