Auto Merger May Lead to New Labor Alliance
Daimler-Benz’s German union is considering an alliance with the United Auto Workers at Chrysler Corp. that would negotiate benefits for the 410,000 workers who would work for DaimlerChrysler, a Daimler board member said Thursday.
The new “global labor council” being considered by the two unions would collectively bargain for benefits for DaimlerChrysler workers on both continents. Discussions are in their early stage after Daimler agreed last week to acquire Chrysler for $43 billion, to create the world’s fifth-largest auto maker.
“The best solution would be to create some sort of global workers council,” said Peter Schoenfelder, a Daimler employee representative who sits on the company’s supervisory board.
The global council would open a channel between Germany’s largest union, IG Metall, which represents about 100,000 Daimler-Benz workers, with the UAW, a once formidable U.S. labor group that still represents most of Chrysler’s 100,000 employees.
On Thursday, Daimler-Benz’s policy-setting supervisory board, as expected, approved the planned acquisition of Chrysler, the largest foreign takeover ever of a U.S. company. The 20-member supervisory board has 10 worker representatives and 10 from management.
The acquisition is subject to approval by shareholders of both companies in votes later this year.
Unions tentatively backed the merger after Daimler and Chrysler management promised that it would not lead to factory closures or job cuts.
UAW President Stephen Yokich said he has sought a formal role in decision-making at the combined company.
Representatives of both IG Metall and the UAW said they plan to meet in the next few weeks to coordinate bargaining strategies with the new DaimlerChrysler. No dates have been set.
The two labor groups will have to negotiate differences in negotiating style, language and legal systems as they attempt to preserve worker interests in the auto maker, incorporated in Germany.
While differences in the cost of living and different social systems in the U.S. and Germany make collective bargaining on the two continents difficult, the creation of the global council linking the two unions would be a first step, Daimler’s Schoenfelder said.
In Germany, workers councils don’t negotiate basic wage agreements. That is done directly by unions. The councils do negotiate employee benefits such as overtime pay, bonuses and worker retraining after factory closures.
Daimler workers earn on average $2,550 to $2,800 a month, work 35 hours a week and receive 30 days paid holiday a year. Chrysler workers earn an average $3,200 a month, work 40 hours a week and get 35 days holiday a year. Both companies have profit-sharing plans for workers.
The new DaimlerChrysler will have a 24-member supervisory board with 12 members representing management and 12 representing workers, in accordance with German law, Daimler said. Management will wield a majority through the chairman’s dual vote. The management appointees will be evenly split between Daimler and Chrysler.
