Innovative Contracts for UAW Are Essential, Inevitable

Opposition to some of the exciting adventures in labor-management relations in the auto industry is small but apparently growing. If it increases, it could slow--but not stop--the movement toward new, more democratic relationships between auto workers and their bosses.

One reason the critics are even partially effective is that, sadly, neither union leaders nor management executives seem to know exactly which direction they want their adventures to take them, or how far.

A vocal, though small, minority of delegates to the United Auto Workers’ convention in Anaheim last week angrily denounced innovative programs being adopted at auto plants around the country. The harshest attacks were made against the most radical programs, and, ironically, much of the criticism came from the union’s militants, who should be leaders in demanding drastic changes in the old, established and often repressive system of work in the factories. These militants, usually from the political left, seemingly want to cling to the past.

“Now is not the time for union partnerships with reactionary corporate America,” said Victor Reuther, a retired UAW founder and brother of the late UAW President Walter Reuther. He is rightly concerned that if unions are not careful, they could be co-opted by shrewd managements more concerned with increased profits and productivity than with workers.

But, as UAW Western Regional Director Bruce Lee said, unions can prevent abuses of workers under new systems just as they have under old ones. He also noted that “some of the most vehement opponents of our new agreements at the General Motors’ plant in Van Nuys, for example, are the very people who for years have denounced working conditions there as rotten.”

Both management and union leaders, who need courage to press ahead with the dramatic changes required in their contracts, should recall Alexis de Tocqueville’s observation that a “democratic society has less to fear from boldness than from paltriness of aim.”

Changes in labor relations in the auto industry--and other industries, too--are both essential and inevitable. In time, there must be contracts across the nation like the one negotiated for the planned Saturn plant in Spring Hill, Tenn., where GM is spending $5 billion to build a highly automated small-car facility that will be jointly operated by union workers and their management “partners.”

Workers there will share equally in most decisions made by the company. Management perquisites such as executive dining rooms and special parking spaces will not exist. Many of the programs are comparable to those used by the Japanese.

The contract changes planned or already made are spurred, of course, by increasingly severe foreign competition. But, in contrast to past UAW practices, the changes are coming about primarily on a local-by-local basis at individual plants, with relatively little pressure from the international leaders at the UAW’s Detroit headquarters.

Traditionally, the UAW’s top officers have provided the leadership that has made the union one of the nation’s most progressive and given UAW members some of the best and most innovative labor contracts in the country. The union’s international leaders negotiated contracts that provide wages of about $13 an hour, plus almost that much added on for fringe benefits.

The national contracts give auto workers all of the usual union benefits, such as health care and pensions. In addition, they provide a host of other benefits, such as 95% of their pay for extended periods of time during temporary layoffs and 100% when, for instance, they are laid off due to plant closures. They have job banks to help laid-off workers find other jobs, extensive, corporatewide training and retraining programs and profit sharing.

In contrast, UAW local unions in the past negotiated on important but less-pioneering issues such as break time, production line speed and layoff procedures and seniority. Little innovative thinking was required or expected at the local level.

But foreign imports made deep inroads in auto industry employment and UAW membership, which is down by more than 400,000 from its 1.5-million peak in 1969--with further declines coming.

Something had to be done, and much of the initiative for changes needed to meet foreign competition shifted from the top union leaders to the locals. Instead of negotiating changes in nationwide contracts, the international union is accepting many major changes in factory life at the local level.

Exact figures are unknown, but auto industry and union leaders estimate that between 25% and 30% of the industry is already working under some form of new-style union contract that actually began taking shape in the early 1970s with the guidance of former UAW Vice President Irving Bluestone.

But the truly major changes so far have been made, or are coming, in only a few plants: General Motors in Van Nuys; the General Motors-Toyota joint venture in Fremont, Calif.; the planned Mazda plant in Flat Rock, Mich., near Detroit, and the Saturn facility.

The major complaints of critics are (1) that relatively small local unions lack the united strength of the entire union needed to negotiate basic contract changes with giant corporations, and (2) that the locals are forced by management to make such concessions as weakened seniority provisions and fewer job categories in return for what Reuther calls “the illusion of a worker voice in management decision.”

And these local-by-local negotiations, the critics say, allow the companies to “whipsaw” other locals into accepting inferior contract terms.

But, while some concessions are being made by local unions, the contract gains outweigh the losses, and, without the changes, the decline in auto industry jobs would be more precipitous than ever.

While there has been a shift in direction-giving from the international headquarters to the local level, the Saturn contract, which contains the most drastic changes, was negotiated by the international officers, led by Vice President Don Ephlin. But almost all other new-style contracts were negotiated by local officers, with the help of regional leaders such as Lee.

While Ephlin, UAW President Owen Bieber and most other top international officers are generally going in the same direction, they are moving at different speeds and sometimes differ substantially on important points.

For instance, Ephlin is clearly the most adventurous and wants the international to play a more aggressive role in bringing about revolutionary changes in the workplace. Bieber says he doesn’t want the auto industry “Saturnized” and wants to wait and see how the new systems work before pressing ahead at a more rapid pace. Ephlin, in contrast, sees the Saturn contract as the pattern for the future and says he wants more changes made--quickly.

Corporate executives, unlike union members and officials, don’t air their differences in public. But there are problems within the companies, too. The top industry leaders want change because in almost every instance where it has come about, productivity has soared and worker grievances and absenteeism have plummeted.

But the changes mean that company officials must share real, not illusory, power with workers. And the ranks of supervisors will be thinned substantially as workers assume more supervisorial roles. Such losses of power, and supervisorial jobs, are naturally being resisted by many company executives. They, too, are divided on the direction of future labor relations and how dramatic the changes must be to make the U.S. auto industry fully competitive with foreign companies.

One fact is clear: In the effort to meet foreign competition, wages of U.S. workers cannot be reduced even close to the levels paid in, say, South Korea, where production workers often earn less than $2 an hour, or in Mexico, where the minimum wage has just been raised by 80 cents to $3.80 a day.

But, by adopting new ways of working, and managing, the work life of Americans can be improved, U.S. firms can become increasingly competitive and the deep erosions being made by foreign firms in U.S. manufacturing industries can be slowed if not halted entirely.