Industryweek 6146 Vw

Union Vote at VW's US Plant Being Carefully Watched

Feb. 12, 2014
"What we're seeing is an attempt to jump-start the America labor movement," said Gary Chaison, a labor relations expert at Clark University in Massachusetts.

CHICAGO - Workers at Volkswagen's plant in Tennessee were voting Wednesday on whether to form a union, a decision seen as a referendum on the health of the U.S. labor movement.

The United Auto Workers (UAW) has never managed to organize in an American plant owned by a foreign manufacturer, and a win at VW's Chattanooga, Tenn. facility would be a significant victory.

Despite strong traditions of organized labor in their home countries, German, Japanese and South Korean automakers have strongly resisted unionization efforts in the United States.

But Volkswagen (IW 1000/7) opened the door to the UAW last year under pressure from German unions to give the Tennessee plant a seat on VW's global works council, which gives employees a say in the management of the company.

Despite the tacit support of VW management, analysts said it's not clear whether the UAW will succeed in the secret ballot when votes are tallied Friday.

Convincing workers in the southern United States to pay union dues isn't easy, especially after the UAW was blamed for the downfall of the Detroit Three carmakers.

Politicians from the governor on down have spoken out against the unionization efforts, warning that it will make it harder to attract business to Tennessee and could make it harder to compete with a Mexican VW plant for production of a new sport utility vehicle.

Outside groups have also poured money into billboards and radio ads urging workers to reject the union.

Fighting for Survival

The vote comes as the American labor movement is fighting for its survival. The rate of unionization in the United States has dropped to its lowest since the 1930s: a paltry 11.3%.

The UAW alone has seen its membership rolls plummet from a peak of 1.5 million in 1979 to 383,000 today.

Automation and the outsourcing of production accounted for many of the union jobs lost in the 1970s, 1980s and 1990s. Efforts to weaken unions through legislation have also taken a toll.

"What we're seeing is an attempt to jump-start the America labor movement," said Gary Chaison, a labor relations expert at Clark University in Massachusetts.

"If they can somehow win at VW, it would be a very important sign that there still is some appeal left in the American labor movement."

Success at VW would also increase pressure on fellow German automakers BMW (IW 1000/37) and Daimler AG (IW 1000/18) to open the door to unionization efforts at their U.S. facilities.

It could even boost the union's claims for recognition at factories run by Japan's Nissan (IW 1000/31), Honda (IW 1000/29) and Toyota (IW 1000/8) and South Korea's Kia (IW 1000/106) and Hyundai (IW 1000/56).

Pivotal Moment for Labor

"This is going to be a pivotal moment for the auto industry and for labor," said Harley Shaiken, a labor expert at the University of California, Berkeley.

If the UAW succeeds, VW would establish the nation's first German-style works council.

Such councils -- which are only allowed in the United States if they include union representation -- are far more collaborative than traditional unions.

The UAW already shifted to a more collaborative approach as it sought to help General Motors (IW 500/5) and Chrysler emerge successfully from a government-backed bankruptcy.

But a formal works council at VW would prove to be a powerful example that other automakers -- and industries -- could be drawn to adopt, Shaiken said.

"It's a new model to compete globally," Shaiken said.

Including the input of workers in the production process allows companies to develop new methods and harness innovation more effectively, he said.

And when workers share in the success of their companies, the entire economy benefits.

Mira Oberman, AFP

Copyright Agence France-Presse, 2014

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!