VW’s plant in Tenn. becomes epicenter of challenge to ‘micro-unions’

VW’s plant in Tenn. becomes epicenter of challenge to ‘micro-unions’
Outcome could impact UAW efforts at Mercedes, Nissan
Daniel Wiessner and Bernie Woodall
Automotive News | September 28, 2016 – 6:46 am EST
Volkswagen has joined other large companies and a chorus of business groups and Republican lawmakers in challenging a union strategy of organizing splinter groups of workers, but experts say recent court decisions approving the tactic suggest it is here to stay.

Volkswagen has joined other large companies and a chorus of business groups and Republican lawmakers in challenging a union strategy of organizing splinter groups of workers, but experts say recent court decisions approving the tactic suggest it is here to stay.

The German automaker’s U.S. subsidiary earlier this month brought a case in a Washington, D.C.-based federal appeals court seeking to overturn a vote by a group of skilled trade workers at its Chattanooga, Tenn., assembly plant to join the UAW.

The dispute is a high-profile test of whether unions, which have struggled to reverse a long slide in private sector membership, can seek new members by targeting smaller groups, rather than organizing whole plants or companies as in the past.

Every appeals court to consider a case under a standard backed by the National Labor Relations Board has sided with unions, including five this year. Those cases have involved fragrance and cosmetic department workers at a Macy’s store and FedEx drivers whose unions exclude the people who load their trucks, among others.

Companies and business groups say that what they derisively call “micro-unions” threaten to balkanize workplaces and pit groups of workers against each other. They say the standard used to approve the units tilts too far in favor of unions.

“This makes it almost inevitable that any union target will eventually be organized,” said David French, the vice president of the National Retail Federation, which has warned that smaller bargaining units could be particularly harmful to retailers.

With court losses piling up, the business lobby is backing a stalled effort by Republicans in Congress to reinstate a previous, more business-friendly standard for scrutinizing proposed units of workers.

Community of interest

The concept of organizing small bargaining groups within a larger operation is not new, but got a lift from the NLRB in a 2011 case involving a unit of certified nursing assistants at an Alabama nursing home.

Under the standard set by the agency in that case, employers that want to block a “micro-union” must show workers excluded from a unit share an “overwhelming community of interest” with those who unionized, and so were unfairly left out. In some cases, unions may have avoided including those workers because a majority of workers oppose unionizing.

The UAW in 2014 lost a close vote to unionize more than 1,300 employees across Volkswagen’s Chattanooga plant before winning last year by focusing on 150 skilled trade workers.

Volkswagen spokesman Scott Neal Wilson said the company has a “longstanding belief in the right of all of our employees to decide the question of union representation as one group.” The company declined to further discuss its case.

In filings with the NLRB, the automaker argued that the agency’s standard for reviewing bargaining units was vague and difficult to apply on a case-by-case basis. Volkswagen urged the board to abandon or at least clarify the standard, saying it was so broad it could “be manipulated to fit virtually any unit the union seeks.”

If the Volkswagen unit stands, it could provide a path to organize Nissan and Mercedes workers in Mississippi and Alabama, where the union has struggled for decades, UAW President Dennis Williams said in an interview.

Local union chapters are best situated to decide what tactic works at a particular plant, Williams said, but what has become clear is that the law supports the UAW’s ability to split up workers.

“You can do that in skilled trades, you can do that in production, you can do that in technical, you can do that in engineering,” he said.

Nearly a dozen labor lawyers, union officials and legal experts told Reuters that Volkswagen is likely to lose its closely-watched case in light of the recent appeals court decisions. They also noted that the D.C. Circuit has a growing reputation for deferring to federal agencies.

And the court, which will likely consider Volkswagen’s appeal next year, has indirectly backed the idea of small bargaining units. In 2008, three years before the NLRB laid out its new standard, the court approved a unit of stagehands for the Blue Man Group that excluded some of their coworkers, using strikingly similar language to that later adopted by the board.

“Volkswagen’s chances are extremely slim,” said Charlotte Garden, a professor and labor law expert at Seattle University School of Law.

Potential for conflict

Meanwhile, business interests are trying to get Congress to change the law. A number of trade groups are backing a bill by Republicans in the U.S. House and Senate that would reinstate a previous standard. The bill has stalled, as Republicans are unlikely to be able to override a presidential veto, but could win new momentum if the party makes significant gains in November elections.

Just because courts have sided with the NLRB doesn’t mean “micro-unions” are a good idea, said Phillip Wilson, president of the Labor Relations Institute, a right-to-work advocacy group.

If an employer is planning layoffs, for example, a larger unit with more members may not put up a fight if it can ensure most of the pink slips go to workers in other, smaller units.

“It hurts the members and it also can be very disruptive to the company,” Wilson said.

Courts that have signed off on smaller bargaining units have ruled federal law favors unions’ proposed bargaining units as long as they are appropriate. Ensuring workplace peace is not a requirement of the law, said William Gould, a professor at Stanford Law School who was the NLRB’s chairman under President Bill Clinton.

“To the extent that you balkanize the workforce, you have the potential for more conflict,” he said. “But that simply does not determine whether a unit is appropriate.”

The case is Volkswagen Group of America Inc v. National Labor Relations Board, U.S. Court of Appeals for the D.C. Circuit, No. 16-1309.

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Anti-UAW worker group at VW Tennessee plant loses representation

Anti-UAW worker group at VW Tennessee plant loses representation
Bernie Woodall
Automotive News | September 23, 2016 – 12:01 pm EST
A worker group created as an alternative to the UAW at Volkswagen AG’s plant in Tennessee has failed to meet minimum membership requirements under the German automaker’s labor policy, VW said on Thursday.

A worker group created as an alternative to the UAW at Volkswagen AG’s plant in Tennessee has failed to meet minimum membership requirements under the German automaker’s labor policy, VW said on Thursday.

The UAW has been verified as representing at least 45 percent of workers at the plant, allowing the union members to meet regularly with management.

The American Council of Employees (ACE) was formed on the heels of a February 2014 election in which the UAW lost the right to represent all of the plant’s 1,500 workers. Emboldened by the UAW’s loss, a nucleus of anti-UAW workers who founded ACE had visions of becoming the dominant worker representation group at the plant.

On Thursday, VW announced that the ACE’s membership among the plant’s workers had fallen below 15 percent, the threshold for recognition by VW.

After the UAW loss in 2014, VW set up an unconventional policy that would allow more than one worker group to represent workers in plant affairs. This does not include the right to collective bargaining for worker wages and benefits, as the UAW has at U.S. plants of General Motors, Ford Motor Co. and Fiat Chrysler Automobiles .

The VW policy allows increasing levels of access to plant management based on a group’s support level.

The UAW first was recognized by VW in December 2014. ACE won its recognition in February 2015.

Efforts to reach an attorney who has represented ACE workers were not successful. The group’s founding members are no longer employed at the VW plant.

The UAW claims that it has support of a majority of VW Chattanooga hourly plant workers. It has not attempted another plant vote because, its leaders have said, it does not believe a fair election could occur because of strong anti-union Tennessee politicians and national lobbying groups that it says influenced the February 2014 vote.

VW’s Thursday announcement does not affect the UAW’s effort to represent a subset of about 165 workers at the Chattanooga plant, including the right to collective bargaining.

In December 2015, that subset of skilled trades workers who maintain plant machinery voted to join the UAW, but VW has refused to bargain with them.

The National Labor Relations Board has sided with the UAW several times and ordered VW to the negotiating table. Having lost at the NLRB, VW earlier this month filed an appeal in federal court.

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GM-Unifor workers ratify contract, 2% wage increases

GM-Unifor workers ratify contract, 2% wage increases

Melissa Burden, The Detroit News 12:52 p.m. EDT September 25, 2016
Union workers at General Motors Co. facilities in Canada ratified a four-year contract with Unifor, with 64.7 percent voting in favor of the agreement Sunday. It includes 2 percent wage increases now and in 2019, a CA$6,000 signing bonus and $554 million in plant investments.

The Unifor union said 66.5 percent of production workers at the three GM facilities in Canada voted to ratify, while 56.5 percent of skilled trades workers did.

Vote totals by plants were not immediately available. The deal covers nearly 3,900 union workers at GM’s Oshawa Assembly Plant, St. Catharines Propulsion Plant and a parts and distribution center in Woodstock. Workers at GM’s CAMI Assembly Plant in Ingersoll, Ontario, are covered under another contract with Unifor that expires next year.

Members will receive the signing bonus and lump sums of CA$2,000 to be paid in December 2017, 2018 and 2019. New hires will receive $1,000 in December 2019.

Union members will receive their first general wage increase in nine years, getting 2 percent at ratification and another 2 percent in September 2019, pushing assembler wages to CA$35.78 from CA$34.41 today.

“In the negotiations with GM, the union set clear objectives which we reached, including our top priority to secure investment and product for our members and the future of the auto industry,” Unifor President Jerry Dias said in a statement. “With Fiat Chrysler and Ford we will accept nothing less.”

The automaker said in a statement, “This mutually beneficial new agreement will enable new product, technology and process investments that will preserve jobs and place our Canadian operations at the forefront of advanced manufacturing flexibility, innovation and environmental sustainability. GM Canada is also in discussions with the federal and Ontario governments toward potential support agreements to help optimize the competitiveness of our Canadian operations for the future.”

Negotiations on Monday will shift to Fiat Chrysler, and when a deal is secured the union will shift to Ford Motor Co.

A framework for the GM deal was reached late Monday and averted a possibly costly strike. Bargaining began in August and Unifor selected GM on Sept. 6 as the company it would focus negotiations with because it felt it would be the toughest company.

Colin James, president of Unifor Local 222 which represents the Oshawa employees, said Sunday he thought the deal would pass. “The mood on the floor was pretty positive,” he said.

The deal includes (CA)$554 million in investment with the largest amount — CA$400 million — going to Oshawa Assembly. The facility with 2,400 workers was in serious jeopardy leading up to the talks. Union members there launched a community campaign earlier this year to drum up support for continued investment and new products for the plant which has seen sharp reductions in employment over the past few decades and faced uncertainty of product allocation past 2019.

The contract will bring some Chevrolet Silverado work from GM’s Fort Wayne Assembly Plant in Indiana to the Oshawa plant. Unifor President Jerry Dias early Tuesday said the Oshawa plant would be the first in North America capable of building both cars and trucks.

James said Oshawa is slated to handle final general assembly and paint work for Chevrolet Silverado light- and heavy-duty trucks that would come from the Fort Wayne Plant. Volume is expected to be 70,000 or more a year starting in 2018, he said.

The investment also secures extension of the Chevrolet Impala and Cadillac XTS sedans into 2020, James said. James said Oshawa will pick up some Impala volume from Detroit-Hamtramck Assembly.

The Oshawa plant has two lines: the flex line, which runs two shifts and employs about 1,650, build the Buick Regal, XTS and Impala. The plant will continue to run a one-shift consolidated line that builds the Chevrolet Equinox until the changeover of the program next year; that line employs 750 people.

Details were not provided about any new jobs coming to Oshawa, but Dias and James indicated hiring would be needed.

The CA$150 million investment at St. Catharines is slated to include moving some powertrain work from Mexico, Dias told reporters early Tuesday in Toronto. It also is said to include new transmission work, extended production of the V-6 engine built in the facility and an additional variant to boost fuel efficiency of an existing module. Woodstock will receive $4 million for facility reconfigurations.

It’s not clear if the investment for St. Catharines includes more jobs. The plant employs about 1,400 hourly workers who build V-6 and V-8 engines, six-speed transmissions and other components.

Unifor’s more than 700 GM temporary employees in all facilities will be converted to full-time and the contract includes an accelerated wage grow in for second-tier workers. Dias said new hires will move to a defined contribution pension plan. The plan requires new hires and the company to contribute 4 percent of earnings.

A Unifor spokeswoman said Saturday that if bargaining with FCA begins immediately, a strike deadline of 11:59 p.m. Oct. 10 would be set. Analysts expect Unifor will be focused on securing investment and new product for the Brampton Assembly Plant. The facility has 3,450 employees who produce the Chrysler 300, Dodge Charger and Dodge Challenger.

mburden@detroitnews.com

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Canadian GM workers ratify 4-year labor contract

Canadian GM workers ratify 4-year labor contract
Union sets Oct. 10 strike deadline for FCA contract talks
John Irwin
Automotive News | September 25, 2016 – 12:01 am EST
General Motors workers represented by Canadian union Unifor today ratified a four-year contract with the automaker that includes $421 million (C$554 million) in investments and a key change to pension plans for new hires. About 65 percent of workers approved the contract, Unifor said.

General Motors workers represented by Canadian union Unifor today ratified a four-year contract with the automaker that includes $421 million in investments (C$554 million) and a key change to pension plans for new hires.

About 65 percent of workers approved the contract, Unifor said in a statement. About 67 percent of production workers voted in favor of the deal, compared with 57 percent of skilled trades workers.

“The gains made in this agreement are historic and more than what has been achieved in the past 10 years,” Unifor President Jerry Dias said in a statement. “Unifor has shown what is possible when workers have a union, and a united bargaining committee to speak on their behalf.”

FCA deadline set

Unifor will now resume negotiations with FCA, where investments in the Brampton, Ontario, assembly plant will likely take center stage. Negotiations with FCA will be patterned off the deal with GM. Unifor has set a tentative strike deadline of Oct. 10.

“In the negotiations with GM, the union set clear objectives which we reached, including our top priority to secure investment and product for our members and the future of the auto industry,” Dias said. “With Fiat Chrysler and Ford we will accept nothing less.”

The deal includes 2 percent wage gains for hourly workers in Year 1 and Year 4 of the contract. Workers will receive a $4,561 (C$6,000) signing bonus, in addition to annual $1,520 lump sum payments in Year 2 through Year 4 for legacy workers.

The deal includes $304 million (C$400 million) in investments at the Oshawa assembly plant, which will receive product commitments for its flex line.

“This mutually beneficial new agreement will enable new product, technology and process investments that will preserve jobs and place our Canadian operations at the forefront of advanced manufacturing flexibility, innovation and environmental sustainability,” GM said in a statement.

GM said it is “in discussions” with the federal and Ontario governments to discuss “potential support agreements to help optimize the competitiveness” of its Canadian operations.

“Further details on our plans will be shared after completion of our discussions with governments,” GM said.

According to a source who attended the Unifor Local 222 meeting, union leadership told workers that the Oshawa plant will receive unfinished Chevrolet Silverados from Fort Wayne, Ind., for final assembly, confirming a report last week by Reuters. A highlights brochure handed out to employees says the investments include the “implementation of a new flexible assembly module” that will allow GM to “meet unmet demand in a critical market segment.”

The plant will also continue production of the Cadillac XTS and Chevrolet Impala, according to the brochure. Its consolidated line will close in 2017, Dias said last week.

The Oshawa plant was identified by Dias as the factory most in danger of closing and in most dire need of new investment. Unifor made securing product at Oshawa and other Detroit 3 plants its top priority in negotiations in the face of increased competition with Mexico and the southern U.S. for auto manufacturing investments.

The deal includes $114 million (C$150 million) in investments at the St. Catharines engine and transmission plant, according to the brochure. The investments include a “next generation transmission module” and an “additional variant, introducing the latest technology for fuel efficiency, into [an] existing module,” the brochure reads.

Dias said last week that the St. Catharines plant will receive production from Mexico under the contract.

The contract further includes $3 million ($C4 mllion) in investments at the Woodstock, Ontario, parts distribution center to “improve material flow,” Unifor said in the highlights brochure.

Pension concession

One notable concession from Unifor in the agreement is a new defined-contribution pension plan for new hires. The plan requires employees to contribute four percent of their earnings to the pension plan, an amount to be matched by GM. Workers can elect to contribute another 1 percent of their pay to the plan, in which case GM would contribute another 2 percent.

Pension plans for legacy workers will remain unchanged.

Temporary workers will immediately be placed onto the same 10-year wage ladder new hires are on. The “supplemental workforce employees” would start at the beginning of the new-hire wage scale, meaning it would take them 10 years to catch up to the base rate of $25.96 (C$34.15) per hour.

Wages for new hires begin at $15.90 per hour, up slightly from $15.58 under the previous contract. Wages will increase each year under the 10-year progression. Under the previous contract, wages were frozen for the first three years.

According to the brochure, GM will hire “up to 50 apprentices” combined for the Oshawa and St. Catharines plants. Unifor says it also “negotiated a procedure to allow Skilled Trades to put forward a business proposal to pull back work that GM had planned to contract out.”

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Canadian auto workers select FCA next for negotiations

Canadian auto workers select FCA next for negotiations

Michael Wayland, The Detroit News 2:18 p.m. EDT September 22, 2016

Unifor will turn its attention to Fiat Chrysler Automobiles NV, after the Canadian auto workers union reached a tentative agreement earlier this week with General Motors Co.

Unifor’s negotiations with FCA are expected to go more smoothly than those with GM, which was seen as the union’s biggest challenge in winning new investment with the Detroit automakers.

GM’s deal, which averted a strike that could have disrupted production in Canada and the U.S., is expected to be a template for the union’s negotiations with FCA and Ford Motor Co. GM’s nearly 3,900 Unifor members who work at Oshawa, St. Catharines and Woodstock will vote Sunday on whether to ratify the four-year agreement.

“ If members support the recommendation and approve the new four year Collective Agreement we will shift our focus and immediately resume negotiations with FCA,” said Jerry Dias National President in a statement on Thursday. “Unifor will be seeking a pattern settlement that includes our top priority — investment.”

The GM agreement included $554 million in new investments, wage increases for current and new employees who top out at $34 an hour, and a signing bonus. It would also move 700 temporary workers to full-time status. Negatively for the union, it included the elimination of a defined-benefit pension plan for new hires.

Dias has touted these negotiations as a battle for the future of Canada’s auto industry.

Canada lost more than 53,000 automotive jobs from 2001 to 2014, according to a study by Ontario’s Automotive Policy Research Centre. Tony Faria, professor emeritus in the office of automotive and vehicle research at the University of Windsor’s Odette School of Business, said assembly production in the country peaked in 1999. Despite some year-over-year gains, it has declined steadily since. This new contract could help reverse that trend, Dias said.

The biggest part of the negotiations between FCA and Unifor are expected to be over the company’s Brampton Assembly plant, as its Windsor Assembly plant has received billions of dollars in new investments in recent years for the Chrysler Pacifica minivan.

FCA Canada on Thursday confirmed Unifor’s decision, but declined to directly comment on the negotiations.

“FCA Canada is committed to working collaboratively with Unifor to develop an agreement that balances the needs of Unifor and our employees, while enhancing the Company’s competitiveness in Canada,” the company said in an emailed statement. “As negotiations are now beginning in earnest, the Company can offer no further comment.”

That’s far different from Brampton Assembly, which has not received major investments in five years.

The plant’s 3,450 employees produce the Chrysler 300 and Dodge Charger and Challenger large cars for the automaker.

FCA invested an undisclosed amount when all three vehicles were redesigned for the 2015 model year. Prior to that, the facility’s last public investment was $20 million in 2011.

FCA CEO Sergio Marchionne raised eyebrows earlier this year in Brampton by saying Windsor Assembly, which produces minivans, could produce the Chrysler 300. He gave no commitment to shift production.

Dias previously told The Detroit News that he didn’t view “Marchionne’s comments as somehow threatening our members in Brampton,” saying all automakers are increasing the use of flexible assembly lines capable of building multiple vehicles.

mwayland@detroitnews.com

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