UAW Counting Strike Votes As Contract Negotiations Continue

The United Automobile Workers are tallying strike votes as union leadership decides which contract terms are worth fighting over. While this is par for the course in any contract negotiation with General Motors, Ford, or Fiat Chrysler Automobiles, this year’s talks have been mired in scandal and economic uncertainty.

Despite the continued strength of the U.S. economy, the automotive industry has been busily preparing itself for a global recession — encouraging quite a bit of restructuring over the past year. Meanwhile, the UAW finds itself the subject of a federal corruption probe that has severely undermined its credibility. We know that at least one automaker, Fiat Chrysler, was actively bribing union officials. Following the recent conviction of the former head of the union’s FCA Department, Norwood Jewell, General Motors has also been implicated.

“This conduct strikes at the core of who we are and what we stand for. Almost 50 years ago, UAW delegates adopted our Ethical Practices Code,” a union statement said in response to the growing scandal. “This Code must always be at the center of any decision by our officers, and states that actions taken by Union officials must be guided solely and unfailingly by serving our members and this Union. Anything less is unacceptable and will not be tolerated.”

The UAW has a lot working against it. Corruption charges have sown seeds of distrust within the union. There’s also a growing disparity between longterm union members and new ones in terms of pay. According to Wards Auto, older workers making $31 per hour have pulled down hefty profit-sharing checks but newer workers are making closer to $13 per hour and receive little in the way of profit sharing or benefits.

As nice as a wage bump would be, manufacturers are growing increasingly concerned about their bottom line. R&D costs are rising, labor hasn’t gotten any cheaper, and most firms have been hemorrhaging cash as they attempt to buy their way into electric vehicles, autonomous driving, and data-based services. The trade war has also made materials and supply chains more expensive over a period where sales growth is heading in the wrong direction worldwide.

However, union members are looking at the tasty gains the industry witnessed over the last few years. While the general climate may not look appealing, most automakers are still enjoying healthy profits. Workers don’t see any reason why companies can’t share.

Unfortunately, there’s a lot standing in the way of that actually happening. Assuming America’s automakers agree to a wage increase, they’ll likely incorporate that sum into how much labor they plan on accepting from the UAW in the future. In order to get the best deal possible, negotiations may have to focus on plant investments — which would help secure regional jobs — or profit sharing. Of course, absent wage increases are usually the kind of thing union members like to strike over.

Currently, GM and Ford hook up UAW employees with $1,000 for every $1 billion made in North America. Meanwhile, Fiat Chrysler pays $800 for every 1 percent added to its profit margin. So long as companies continue making money, it usually translates into more money for workers overall. This unfortunately does not guarantee a payday like a wage hike would.

Local unions have been asked to have their tallies in by August 29th to provide adequate time before labor agreements expire in September. For what it’s worth, experts are not optimistic about the possibility of avoiding strikes.

[Image: General Motors]