Motor Co.’s push to wring contract concessions from the United Auto Workers union has driven a wedge between top UAW leaders and the general membership, analysts say.
Despite endorsements from UAW President Ron Gettelfinger and his team of negotiators, media reports indicate widespread opposition to the givebacks with several large locals rejecting the deal outright.
At stake, according to a document circulated within the union and obtained by Ward’s, are more than $2 billion in investments that would support some 7,000 jobs – including new hires.
“It’s more than a little odd; it’s unprecedented and historical,” Gary Chaison, industrial relations professor at Clark University in Worcester, MA, says of the disconnect. “Usually the rank and file fall in line behind the leadership and ratify the agreement.”
Ratification pleas from UAW President Ron Gettelfinger and Vice President Bob King have fallen on deaf ears at manyplants.
“This agreement is another step in meeting the challenges of a very difficult time in the U.S. auto industry, and we look forward to presenting it to UAW Ford workers,” Gettelfinger says in a statement.
The current round of voting marks the third time since 2005 that UAW members have been asked to accept major concessions, and the second time an existing contract has been reopened to do so.
In keeping with the union’s time-honored held practice of pattern bargaining, proposed modifications to the union’s current Ford contract, originally ratified in 2007, are designed to put the auto maker on equal footing with cross-town rivalsGroup LLC and Co.
and GM granted givebacks linked to their respective bankruptcies earlier this year. Meanwhile, Ford held fast against the global recession that crippled its competitors.
Among the concessions being sought are a 6-year ban on some strikes, a wage freeze for new hires, restructured work rules and an agreement to enter into binding wage arbitration.
In return, Ford promises its 41,000 UAW-represented hourly workers a $1,000 quality bonus to be paid in March, new product commitments at some plants and an agreement to study the feasibility of adding production in the U.S.
According to the UAW document, Ford pledges:
• An additional product “never before assembled in the U.S.,” for its assembly plant in Wayne, MI, future home to the next-generation Ford Focus.
• A “new” product for the auto maker’s assembly plant in Avon Lake, OH.
• An additional engine for its manufacturing site in Romeo, MI, for installation in the Avon Lake product.
• 60,000-80,000 units annually of a new product, solely for export, to be assembled in Louisville, KY.
• Battery-pack sourcing and rear-drive axle assembly at two Michigan plants, Ypsilanti and Sterling Heights, respectively.
Workers in Ypsilanti and Sterling Heights are among those who have voted against the tentative agreement, though there is a movement afoot to stage a second vote in Sterling Heights. Critics of the initial vote’s outcome claim the impact of a rejection was not explained sufficiently.
The Detroit News reports work promised to Sterling Heights could be shifted to aCorp. plant with a non-union workforce in North Carolina.
Jeff Terry, president of UAW Local 228 which represents Ford workers in Sterling Heights, says he is unaware of any sanctioned mechanisms that would allow a second vote. But he does not rule out the possibility.
“The membership is the highest authority,” Terry says, adding he will “follow the direction of the membership.” If opposition scuttles the deal, the UAW document warns investments and related products “could be committed elsewhere by 2011 if we do not secure them now.”
The new contract “would help Ford improve its current and long-term competiveness in the U.S.,” Joe Hinrichs, Ford group vice president-global manufacturing and labor affairs, says in a statement.
Harley Shaiken, a labor expert at the University of California, Berkeley, agrees this vote is unlike those of the past.
“There’s a mechanism here that is supposed to give you a warning, and that’s when local leaders vote,” he says, noting this balloting overwhelmingly favored the concessions.
“The (UAW) had support in secondary leadership, but when it went in the plants it was met with opposition,” Shaiken says.
Chaison was “stunned” when 92% of members at UAW Local 249 voted thumbs-down. UAW Local 249 represents nearly 4,000 UAW members who assemble fullsize pickups and midsize cross/utility vehicles in Claycomo, MO.
Perhaps even more surprising is the “us-against-them” mentality among rank-and-file union workers, Chaison says.
Prior to the vote, the affable King was booed by members during an onsite speech in which he urged them to vote for the concessions.
“It is very rare for King to be booed, but I think what it reflects is people are really angry with the context (of the agreement) and circumstances,” Shaiken says. “His reputation as a leader goes back decades.”
In a statement to members on its website, Local 249’s bargaining committee hinted a strike may be imminent due to workload concerns at the plant.
“Management, from supervisors all the way to the plant manager, refuses to follow the negotiated process to resolve workload issues that they agreed to in the 2007 local agreement,” the statement says.
“This puts your local leadership in a position that could lead up to a strike if not resolved,” it says. “We cannot and will not let any of our members fail by allowing the company to set up jobs that hurt people or nobody can perform 10 hours a day, 365 days a year.”
Calls to Local 249 seeking comment went unreturned.
Other plants that have rejected the concessions include a Livonia, MI, transmission plant; a Plymouth, MI, climate-control plant; and AutoAlliance International in Flat Rock, MI.
“I always felt a tentative agreement pretty much was an agreement,” Chaison says. “There may be the occasional plant that disagrees, but it’s rare you get widespread rejection.”
A handful of sites have voted in support of the concessions, including Wayne Assembly; Ford’s Cleveland Engine and Casting plants in Brook Park, OH; Twin Cities Assembly in St. Paul, MN; and an Automotive Component Holdings LLC facility in Indianapolis.
Ironically, Twin Cities workers have little to lose. Their plant is slated to close in 2011 as Ford phases out production of its Ford Ranger compact pickup.
Should the deal be rejected, it would be damaging to UAW leadership, Chaison says.
Gettelfinger, who is slated to retire in June 2010, is “fighting for his legacy,” he says, adding a rejected deal “will undermine the bargaining power of the UAW and it will hurt Ford.”
Shaiken disagrees that the credibility of the UAW leadership is at stake and says if the agreement is defeated, both sides may go back to the drawing board. But it would be “a tough situation to go back and renegotiate,” he adds.
Even if the contract were recast to assuage UAW concerns, it could end up hurting the union in the long run, Shaiken says.
“The danger is that a modestly better contract up front could result in significant (labor) outsourcing down the road,” he says, “and I suspect that’s what Gettelfinger and King feared.”
Meanwhile, the timing for a dispute could scarcely be worse from Ford’s perspective.
Unlike Chrysler and GM, Ford has not dipped into the Treasury Dept.’s coffers as a hedge against the recession. So it’s public star has been rising.
Ford also has been gaining market share and may even post a surprise profit when it releases its third-quarter financial results next week, and UAW members see little reason to consent to concessions.
“UAW members watch the same programs and read the same magazines where all this is said,” Shaiken says. “And when you have such a successful marketing campaign, it makes it a particularly difficult ratification campaign.”
Adds Chaison: “Essentially, workers are saying ‘Ford is not a bankrupt company and it is saying it’s turning the corner. Either these are bad times or good, but don’t tell us both at the same time.’”
Chaison suspects the non-strike clause in the contract modification may be leaving a bitter taste in members’ mouths.
“The strike is only useful in good times, and Ford has been saying it’s heading to good times,” he says. “So (UAW members) are saying, ‘We’re not giving up our strike weapon if we think it’s going to be useful in the future.’”
But the modifications don’t eliminate all strike capabilities, a fact Gettelfinger is trying to drive home to the rank and file.
“Members at Ford retain the right to strike on every issue – and I say every issue – improvements in wages in benefits,” Gettelfinger says this week on Detroit-area radio station WJR AM-760. “And there’s no arbitrator, where the wage and benefit issue would go, that could cut the wages or benefits.
“If Ford was to propose a cut, we would maintain the right to strike. That would never even go to arbitration.”
Voting is expected to conclude by Monday.