Perot Ouster Good News for GM Workers

Bashing General Motors has been relatively easy for the multibillionaire, super-patriotic maverick, H. Ross Perot. After all, GM is a dandy, $800-billion target that does, indeed, operate at the slow pace so often and loudly damned by Perot.

But unions should cheer GM’s decision to oust Perot from the auto maker’s board of directors and from his job as head of Electronic Data Systems, the computer services company he founded in 1962 and sold to GM two years ago for $2.5 billion when EDS had only about 15,000 employees.

With massive infusions of data-processing work from its new parent, GM, EDS has grown enormously since then. It now has a total of about 47,000 workers--in every state and in many nations around the world--every one of them non-union.

Some of Perot’s bitter denunciations of GM may be valid, such as his criticism of the company’s slow response to the challenge of Japanese competition and its leisurely introduction of new models and equipment to improve sales.

But the free-wheeling, outspoken--some say loudmouthed--Perot seems to ignore the fact that many of GM’s decisions in recent years have been imaginative, even daring--such as its purchases of Perot’s EDS and Hughes Aircraft Corp. and its far-reaching experiments with robots through another subsidiary, GMF Robotics. And some of GM’s most exciting adventures have come in its dealings with its workers and their unions.

It was almost an invitation to trouble in the first place for GM to buy Perot’s EDS because he is a born fighter, an individualist who loves brawls. He is clearly enjoying, and personally profiting from, his GM battles, which began almost as soon as GM adopted EDS as a wholly owned subsidiary in 1984.

Perot gets lots of laughs when he attacks GM as a top-heavy, inefficient company almost buried in bureaucracy. He likes to compare GM with EDS, saying, “The first EDS’er to see a snake kills it. At GM, first thing you do is organize a committee on snakes. Then you bring in a consultant who knows a lot about snakes. Third thing you do is talk about it for a year.”

Consulting with both experts and employees before acting is not as silly as Perot makes it sound, and certainly it isn’t when you’re managing more than 800,000 workers worldwide, as GM does.

For the past several years, GM has developed some exciting, effective labor relations programs in cooperation with the United Auto Workers, which represents most of its U.S. employees, hardly signs of a corporation living in the past. Some of those programs have been “in committee” for a year, sometimes longer. But when a consensus is reached among often-strongly opposing viewpoints within the giant company, the result can be very effective.

GM has visitors coming to its U.S. plants from all over the world to study the GM-UAW agreements that give workers unique job protections and a real voice in the corporate decision-making process in many of its operations. These include the Buick division in Michigan and other states, the Van Nuys Chevrolet plant, the Toyota-GM joint-venture plant in Fremont, Calif., and the planned facility to build Saturn cars in Tennessee.

Perot, on the other hand, is more impulsive. No lengthy committee meetings were needed, for instance, for EDS to decide to write a furiously anti-union letter to EDS “team members” a few months after GM took over Perot’s firm.

Kenneth Riedlinger, EDS senior vice president and a close associate of Perot, wrote letters to each EDS employee saying he wanted to “share with you my intentions and plans to defeat this effort . . . to organize salaried team members (employees) by the UAW.”

The Perot company executive wrote that “never in our 22-year history have any of our team members found it necessary to have a union interfere in the personal relations” between workers and managers. He wrote that “We don’t intend to lose or even jeopardize” the company’s non-union status. “Labor unions have no place in EDS, and we intend to do everything legally and ethically possible to prevent even a single unit from being organized by a union.”

Then, using a military style that has come to personify Perot’s own career, Riedlinger wrote, “I want each of you to understand my firm commitment to oppose union efforts until total victory is ours.”

Perot runs his own operations in a highly individualistic fashion. Most employees are called “customer service representatives” and are paid “based on their contributions to the company,” an EDS spokesman explained.

There is no seniority system. Managers evaluate each worker, who advance, or lose ground, based on the impression they leave with their managers.

Perot’s activist role and his non-committee decision-making style was evinced most recently outside EDS when Marine Lt. Col. Oliver L. North arranged for Perot to put up $2 milllion for ransom money in an unsuccessful, secret attempt to obtain the release of several American hostages, including those held in Lebanon.

Sometimes called a “corporate guerrilla,” Perot may have been called on by GM initially to help shake the company out of what he calls its lethargic state.

But if he had been given the power to do battle not just with the GM executives, but also with its hundreds of thousands of workers and its militant unions, labor wars at GM might have come to resemble those fought in the 1930s when union supporters were engaged in literally bloody picket line wars to help the UAW gain recognition as the representative of most of GM’s blue-collar workers.

Rare Victory at Cannon

Union victories don’t come often these days, and certainly they don’t come quickly. But it took less than a week for a union recognition strike to win an agreement with Cannon Films, currently the industry’s single-largest producer of motion pictures.

Members of the International Alliance of Theatrical and Stage Employees (IATSE) struck last week for recognition of their union by Cannon. The company, also the largest non-union studio in Hollywood, said the strike was having no immediate impact on production.

But on Monday, Cannon and IATSE announced their breakthrough contract that will cover all Cannon films shot in the United States and budgeted at more than $6 million. It will run for two years beginning Jan. 1, and its terms are the same as those in contracts that the union has negotiated with other studios.

Cannon said it will also join the rest of the industry next month to negotiate a new, industrywide contract with the IATSE to cover low-budget films below the $6-million level.

For the industry, it is something of a plus because it means that the union’s officials agreed to negotiate two different kinds of contracts: one for high-budget and one for low-budget films.

It is estimated that about 40% of movies are now made with non-union production workers, such as camera operators, grips, stage hands, electricians and other craft workers.

Cannon does have contracts with the Screen Actors Guild, the Writers Guild and the Directors Guild, but until now has refused to negotiate with the IATSE as representative of production workers.

The failure of the union to get contracts with Cannon for craft workers made it hard for IATSE to negotiate contracts with unionized film makers that could, rightly, complain that union scales put them at a labor-cost disadvantage with their rivals in the industry.

Cannon Group chairman Menahem Golan called the agreement a “monumental step” for Cannon, and a “turning point in our life in Hollywood.”

IATSE President Al DiTolla said the pact is the union’s crowning achievement in its pledge to be more aggressive in organizing non-union film companies like Cannon. While no one said so openly, the union’s campaign was also prompted by complaints from unionized companies that their labor costs were higher than those of non-union competitors like Cannon.

Also unmentioned in company or union statements about the new contract was that Cannon Group Inc., the parent of Cannon Films, is under a formal investigation by the Securities and Exchange Commission involving its financial condition and accounting practices. Nor did they mention that the parent firm reported a $5.8-million loss in the first nine months of 1986.

With those problems, Cannon surely didn’t need the picket lines around its facilities, lines that undoubtedly helped the firm decide quickly that it was time to settle the labor dispute.