Despite intense pressure from the Tennessee’s Republican establishment to keep the union out Volkswagen has opened discussions with the United Auto Workers about establishing a German-style “works council” at its Tennessee assembly plant.
The talks with the UAW revolve around “the possibility of implementing an innovative model of employee representation for all employees,” according to the letter, which was released to the media in Chattanooga.
The letter is signed by Frank Fischer, the plant’s chairman and CEO, and Sebastian Patta, the facility’s vice president for human resources.
VW apparently opened discussion with the UAW under pressure from the company’s Works Council and the labor representatives on VW’s board of supervisors, who have long been critical to the Piech family’s control of the growing Volkswagen empire. German law divides the board of supervisors, which hires and fires top managers, between representative of investors and labor, though in theory the investors hold the deciding share.
Nonetheless, the structure gives labor representatives substantial influence over company strategy and policy and they have insisted the Chattanooga, Tenn. plant have representatives on the Works Council in Germany.
Members of the works council are nominally independent of the unions that negotiate contract terms with employers. On a practical level, however, the union representatives control the works council because of their ability to win office- and plant-wide elections.
VW operates more than 100 plants around the world all and the works council representatives from outside German are virtually all representatives of local union around the globe. Only the Chattanooga plant doesn’t have a union to represent employees and workers representatives in Germany have demanded that the Chattanooga plant have representatives on the global council
Volkswagen of America has looked at various options that might satisfy the works council but so far haven’t found a mechanism that would satisfy the German unions, American labor law and Tennessee.
UAW president Bob King said in a recent union the UAW has been. “We have been getting great support from the German union,” King said. The UAW also has threatened to sue if it sets up what describes as a “company union,” which is outlawed by the National Labor Relations Act.
King also has quietly lobbied the German metalworkers union for support for months and used his position as a labor representative on the board of Adam Opel AG, General Motors principal subsidiary in Europe, to strengthen his own union’s links to their European counterparts. King was asked to serve on the Opel board by GM vice chairman Steve Girsky.
Tennessee Gov. Bill Haslam and U.S. Sen. Bob Corker, both Republicans, have argued that inroads by the union would hurt the state’s ability to lure other large manufacturers to the state. There is also a concern that if the UAW is successful at Volkswagen, unionization efforts could gain steam among other German automakers like Mercedes in Alabama and BMW in South Carolina.
(Volkwagen hustling to keep up with diesel demand. For more, Click Here.)
“The Volkswagen Group respects the employees’ right for an employee representation on plant level at all locations worldwide,” the letter from the plant managers said. “This certainly also applies to the Chattanooga plant.”
The discussion with the UAW is necessary because a works council can only be established in the United States through an established trade union, according to the letter. Some experts have disputed whether that’s a requirement but the decision might have been sealed earlier this summer when Democrats in the U.S. Senate succeeded in pushing through appointments to the National Labor Relations Board that gave it a pro-labor majority.
(Click Here to read about the UAW’s efforts with Volkswagen.)
Fischer and Patta stressed in the letter that it will be up to the workers to decide how they want to be represented, but called for fostering a cooperative spirit. They wrote that they want to prevent any attempt by outside influences from “driving a wedge into our great team.”
The UAW and its German allies, however, have stressed the only outside forces at play in the debate are conservative groups, campaigning to keep any union out of the Chattanooga plant.
In principle a works council sounds nice until the company stacks it with people who will vote the party line and thus take power away from the Union and make it look like an equitable situation when it’s not really.
When either side has a significant advantage, the other party gets exploited and big corporations usually have the advantage. That’s why Unions exist to try and balance the working conditions, job security, compensation, etc.
It still amazes me the over-compensation CEOs of U.S. companies receive even when they destroy the company.