By on October 27, 2011

Watch UAW President Bob King on New Contracts: Top Priority Was Creating Jobs on PBS. See more from PBS NewsHour.

Though UAW boss Bob King has said that organizing transplant factories is a life-or-death struggle for the union, but the real make-or-break issue this year was the contract negotiations with the Detroit Automakers. And though King roundly denies that a rift has been formed in his union over two-tier wages, the facts simply don’t back that position up. In the last contract to be ratified (with Chrysler) for example, only 54.8% of the union approved the deal… hardly the “overwhelming support” that King claims. Moreover, 55.6% of the skilled-trades workers at Chrysler rejected the contract, according to the Detroit Free Press. King’s narrative of experienced workers “demanding” higher wages for the Tier Two brothers “in the greatest spirit of solidarity” just doesn’t hold up to scrutiny.

The divide between skilled-trades and other workers at Chrysler was a particular problem for the union because its contract allows the 5,000 skilled-trades workers to reject their own portions of the contract even if the union as a whole approved it… which is precisely what happened. But, after meeting with skilled-trade representatives, King decided to do what the union has often been loath to do: trample the better-paid workers in favor of newer hires. The Freep reports:

On Wednesday, the UAW held two meetings to resolve the split vote. If the skilled-trades workers had voted against the contract because of changes that specifically affect only their work, then the UAW would have tried to renegotiate a portion of the Chrysler agreement, King told reporters Wednesday.

“It was overwhelmingly clear that the issues were economic issues and not skilled-trades issues,” King said.

King said he doesn’t anticipate a major backlash from skilled-trades workers after the decision. “We did not go against what the skilled trades voted for,” King said. “We went with what the majority of members said — that they thought this agreement should be ratified.”

That was probably the right decision to make, and King should be commended for it, but it exposes his rhetoric of solidarity as pure farce. In recent years the union has already created a backlash by approving the “innovative labor practices” that threaten to push Tier 1 workers at the Orion Assembly plant into the lower wage tier without a union vote. Once again, King is going against the rules of engagement, which say that any union decision must be ratified by members. The only difference: now he’s backing lower-paid workers. Again, it’s a commendable stand and it shows King’s commitment to returning to some form of solidarity, but it also demonstrates and exacerbates the union’s internal divisions.

Meanwhile, at Ford, King admits that negotiations were “very rocky,” which is something of an understatement. Even though Ford offered the most generous contract of all the Detroit OEMs, the contract got off to a bad start, as workers at several of the first plants to vote refused to ratify the contract. Only after Ford said it would hire strike breakers if the contract failed did the UAW leadership threaten that the deal wouldn’t get any sweeter for members, and the contract eventually passed. But at the Ford plants where the contract failed, there are still signs of internal pressure at the union. At Local 900, which represents three Ford Detroit-area plants, workers were most troubled that more Tier Two hires would be brought in in lieu of giving established workers more overtime.

Meanwhile, at GM the Orion Plant’s “innovative labor practices” seem set to spread to the soon-to-be-reopened Spring Hill plant, even though GM and the UAW insisted that Orion would be a one-off deal in order to build subcompact cars in the US. Automotive News [sub] reports

About 40 percent of Orion’s 1,500 workers make an entry level wage. Under the new contract, they’ll be paid $16 to $19 an hour, a little more than half of what traditional UAW workers make.

A 100 percent entry level work force won’t happen. Several hundred former Spring Hill workers who are either still laid off or relocated to other GM plants should get first shot at the new jobs.

But it’s likely that the vast majority of the 1,710 new jobs will be filled by new employees – and there’s no restricton on the use of entry level wage earners.

If that doesn’t inflame divisions between the UAW’s tiers, it’s hard to say what will. The Orion agreement inspired picketing of the UAW’s headquarters, even though it was made as GM was going into its bailout-bankruptcy and was sold as a necessary move for survival. With GM making profits again, it’s proving that the dissidents who said that Orion-style rollbacks would spread across the workforce were right. As details emerge from Spring Hill, expect more protests and further breakdowns in UAW solidarity.

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9 Comments on “Bob King Defends UAW Contract Priorities...”


  • avatar
    Conslaw

    It’s pretty clear Bob King’s highest priority wasn’t free designer hair care products.

    Seriously, the UAW Had to get the wages of the Tier 2 workers up. That was priority one. They made substantial progress. They were able to make sure most of the new and redesigned models went to UAW plants. At least they got bonuses in an environment that was not friendly to pay increases. Overall, it was about as good a contract as could have been expected.

  • avatar
    OldandSlow

    Look at the bonuses each UAW member gets at Ford and GM. It was the key ingredient to get Tier 1 workers to sign on to a contract that boosted wages at the Tier 2 level.

    The rock and a hard place is that with out Tier 2, Ford and GM would move more production down South of the Rio Grande than they already have.

    Notice that I haven’t mentioned Chrysler. That’s because FIAT isn’t going to see robust sales at home in Italy due to austerity measures.

  • avatar
    racer-esq.

    There are two kinds of unions, trade unions and industrial/government unions.

    Trade unions (e.g. carpenters, electricians, plumbers) set minimum standards for their workers, educate their workers, and provide pensions for their workers from the dues. They let companies layoff and fire workers with ease, but set minimum wage and benefit standards that union companies must meet for the workers they are employing. They almost function as a brand more than a union, e.g. “Make sure your computer has a Pentium processor”/”Make sure your contractor uses licensed union plumbers.”

    Industrial and government unions (e.g. UAW, cops, teachers, bureaucrats), on the other hand, seek to maximize both wages AND employment. They seek to make it difficult for companies to fire bad workers and very difficult for companies to layoff unnecessary workers. It is these kind of unions that make it almost impossible for an organization to function. The reason government cannot function is NOT (sorry libertarians) that government inherently cannot function, it is unionized government workers. These unions also force luddite attitudes on manufacturers. Fear of automation (which leads to better products and higher paid/higher skill jobs – albeit fewer of them) led the UAW to push the jobs banks on manufacturers. It is not what the Detroit automakers were paying the workers that were working that made them uncompetitive, it’s what the Detroit automakers were paying the workers that were NOT working.

    If the UAW wants to survive it needs to become more like a trade union. It already has taken over some of the pensions, but it also needs to provide much more flexibility in term of firing and layoffs. If the UAW continues to stand in the way of progress by protecting jobs, not just pay standards, then the Detroit automakers will again fail to be competitive in an increasingly automated, rapidly changing world.

  • avatar
    mikey

    So, no labour related work stoppage at a UAW represented plant in 2012. No suprise. 6 Months ago Mr King was making all kinds of threats and noise.

    As I predicted, cooler heads prevailed, and both sides came out with a fair agreement. Two tiered was,and still is, a sour point. The UAW/CAW had no choice, but to eat “two tiered”. Nasty as it is,we wouldn’t be here today, without “two tiered” or VEBA, or as we call it the CAW HCT [health care trust]

    I love the “trust” part. My future health care is in the hands of some folks that never got past grade seven.

    Now as far as “skilled trade” goes. I can’t remember a contract in the last 40 years,where the tradesman didn’t figure that they got shafted.

    • 0 avatar
      highdesertcat

      mikey, I know that you and I look at things from differing perspectives, but history is clear about what the UAW has done to the US auto manufacturers with their demands (over the past six decades).

      It is also a testament as to why the UAW is not doing well in its recruiting efforts in the south of the US. The UAW adds an additional layer of expense for both the employer/manufacturers AND its members.

      But in the end it will be the consumer and buyers of new cars who decide who or what will prevail. Those who support the UAW and its former and current efforts to collectively bargain their members out of their jobs and drive their employers into bankruptcy, will choose to buy UAW-made vehicles.

      Those who do not…. buy something else.

      • 0 avatar
        mikey

        @highdesertcat

        Yeah, your right, we come from two different schools of thought. But I will agree, as far as history being clear. Where we differ is in the area,of what the future might hold.

        Three years ago the former big three,and the UAW were, for all intents and purpose’s toast. Now it been debated here, and everywwere else, ad nausiem, were the bail outs were a good, or a bad thing?

        Today as we sit here. The former big three and the UAW are certainly alive. Are they well? Who knows? Do they have a competitive product? Well, again, your right, thats the consumers call.

        The Europeans? Nice cars, if you you don’t mind paying for repairs,and up keep. The Japanese? With the currency problems,and the logictics of building high quality, and at same time maintaining production numbers. The Japanese have hit the same wall the big three hit 15 years ago.

        The Koreans?…These guys have the ball now. The big question is,what will they do with it?

        IMHO… The death of the UAW, and the domestic auto industry,is still a toss of the dice.

      • 0 avatar
        highdesertcat

        I’m a firm believer in ‘market-driven’ outcomes. That’s why I say the market will determine what is bought, by whom, and at what price point.

        If Americans choose to overwhelmingly support the UAW and its efforts, then Americans will overwhelmingly buy UAW-made goods. If they don’t, then its business as usual aka the status quo.

        OTOH, I am also an avid supporter of the theory that the US auto industry is in a shake-out flux at this time and that the dust won’t settle until after the 2015 model year.

        If the UAW can still find a place for itself and its members when the dust clears, I say more power to them. But with intrusive government regulations, OSHA requirements and all-encompassing employer mandates outlining worker rights and responsibilities, I see nothing that the UAW can offer to its membership or to the car makers, except for higher costs.

        The bottom line here is for car makers to make money and I cannot see how the UAW can help them to make money. Other, non-union, car makers seem to do pretty well without help from the UAW.

        So that brings to mind that even more money can be made by moving yet more assembly to Mexico, like Mazda is doing, for instance. The current US economic policy today is such that it is simply more advantageous to assemble in Mexico and import under the provisions of NAFTA. It would also keep a lot more Mexicans home instead of over here.

        I know this is not a popular concept but making money is not a popularity contest. If it were, then Toyota, Honda, Nissan et al would have stayed home and exported to the US instead of coming over here for tax purposes.

        With the UAW attitude and its opposition toward non-union transplants in the US, moving production south would cure a lot of the UAW’s complaints while the manufacturers would be raking in more money. That’s how I see it.

  • avatar
    Omnifan

    One correction. Ford didn’t threaten to hire replacement workers. One of the local UAW officials spread that one around.

    Also, why wouldn’t the union focus on a raise for Tier 2 workers? It was the only way to impress the non-union autoworkers that the union was good for something.

  • avatar
    cheezeweggie

    Typical Union mentality dictates maximizing wages and benefits with total disregard for anything else. ‘Merican auto manufacturers were never successful in the small car segment because of the lack of profit. It’s obvious the UAW would rather hand these jobs over to the competition than maintain a competitive wage scale and increase their ranks. Their “solution” is to increase labor costs in their existing near-bankrupt niche, and to unionize the on-shore competition, pricing them out of the market and forcing them to move off-shore.

    When I worked as a union electrical apprentice, the union members were concerned that they had not received a pay increase in 4 years. Their wages were already substantially higher than their non-union counterparts and their market share was reduced to prevailing wage jobs (schools etc). Their need for the green reduced their job prospects to a niche market that could totally evaporate with the stroke of a pen in Harrisburg (PA).

    It’s obvious that unions are more concerned with short term gain than the possibility of increasing their ranks and improving the business climate that is necessary for them to exist. Larger ranks increase their political power necessary for their future in an increasingly anti-union government. It looks to me that they are no different than the corporate greed that they supposedly oppose.


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