Report says that might be part of a deal to unionize suppliers
May 17, 2003
A provocative report from a Wall Street auto analyst contends the UAW will liftits plant-closing moratorium in contract talks this year in return for help unionizing the growing number of workers at parts suppliers.
Such a deal would allow domestic automakers, especially financially troubled Ford Motor Co., to shut plants and eliminate tens of thousands of plant-level jobs. It would come with a promise the automakers will help the union "replace every lost Big Three union job with a supplier industry union job," says the report from JP Morgan Chase & Co. analyst David Bradley.
It notes discussions with Sean McAlinden, an auto industry labor consultant with the Center for Automotive Research in Ann Arbor. The report cites McAlinden's pipeline into the "backroom bargaining now under way," and that the "outline of an industry deal is now being worked out."
The report adds the contract will be reached without a strike since the union is concerned about the financial health of Detroit's three automakers, who've lost substantial market share to foreign automakers like Honda and Toyota over the last 20 years. Language in the national UAW contract prohibits a plant from closing during the life of the four-year agreement.
UAW national talks with the former Big Three begin July 16-18.
The pact governing UAW hourly workers at Ford, General Motors Corp. and the Chrysler Group expires Sept. 14.
The UAW represents about 275,000 hourly workers at the automakers, down from about 315,000 in 1999. Overall UAW membership has fallen from 1.5 million in 1979 to about 638,000 last year.
The report predicts a deal helping the UAW organize suppliers -- the majority of whom are not unionized -- "would be implemented through additional provisions in new Big Three supply contracts that would favor unionized suppliers."
GM spokesman Tom Wickham cautioned "negotiations have yet to begin" and called the report "purely speculative."
A UAW spokesman did not return a call. Bradley and McAlinden also did not return calls.
McAlinden told Reuters that the UAW might allow GM to cut 25,000 hourly jobs, or about 20 percent of its blue-collar work force, and close up to 10 U.S. plants over the next three years. In exchange, he said, GM would agree to assist in a major UAW organizing drive among automotive supplier companies, and help ensure that at least 25,000 union jobs were added there.
Ford still needs UAW approval for the five U.S. plants Ford has said it intends to close.
Any deal in which the UAW and automakers collaborate to unionize third parties might clash with existing federal labor laws, said a labor law professor.
"There's a part in the National Labor Relations Act that makes it an unfair labor practice to enter into an agreement to force another employer to unionize. Such an agreement by the union and the automakers would really be walking a fine line along the law," said Ellen Dannin of Wayne State University Law School.
