UAW authorizes strike; union targets General Motors first in contract talks - Detroit Free Press

Phoebe Wall Howard and Jamie L. LaReau Detroit Free Press

Published 10:18 AM EDT Sep 3, 2019

The UAW will seek to negotiate a contract with General Motors this fall as a template for talks with Detroit's two other automakers, setting up a confrontation with a company that has angered workers with plans to idle four U.S. factories.

UAW leadership made the decision, spokesman Brian Rothenberg said.

Factory workers have said they feel angry and mistreated by the company since GM's announcement of plant reductions in November.

“Mary Barra said from the outset of these talks that we will stand up (together) as we tackle a changing industry. We are ready to stand strong for our future,” UAW President Gary Jones said in a statement released at 9 a.m. Tuesday.

“We are focused. We are prepared and we are all ready to stand up (together) for our members, our communities and our manufacturing future,” Jones said.

GM responded: "We look forward to having constructive discussions with the UAW on reaching an agreement that builds a strong future for our employees and our business," said a statement from David Barnas, a GM spokesman.

The UAW, which represents nearly 150,000 hourly workers at Ford, GM and Fiat Chrysler Automobiles, also said workers at each local of all three companies have voted to authorize a strike: 95.98% approval at Ford, 96.4% at GM and 96% at FCA.

The strike authorization is procedural and routine, part of the bargaining process that happens every four years when a new national contract is being negotiated. The current pact expires Sept. 14.

"The vote does not mean there will or will not be a strike. It gives authority to the UAW international president and international executive board to call for a strike," the UAW said.

“No one goes into collective bargaining taking a strike lightly," Jones said. "But it is a key tool in the tool belt as our bargaining team sits across from the company. Ultimately, the company holds that destiny in their hands as they bargain. Clearly the UAW stood up for them in a very dark time," a reference to concessions from the union when GM and FCA predecessor Chrysler were forced into bankruptcy 10 years ago and bailed out by the U.S. government. "Now that they are profitable, it is time for them to stand up for all of us,” the union said.

The national UAW contract talks, critical each time they are conducted because of the large number of workers affected, the auto industry's importance to the U.S. economy and their history as a barometer of labor strength, carry extra drama this year. Union leadership is under a darkening cloud because of a corruption investigation that last week led to FBI and Internal Revenue Service raids at Jones' suburban Detroit home, the California home of Jones' predecessor, Dennis Williams, and two other UAW sites.

The scandal, previously centered on misspent millions meant to help workers through the union's joint training center with FCA, has led to nine charged and eight guilty pleas, with the latest charge touching UAW-GM operations and contract kickbacks.

Shift in strategy

Privately, people close to contract negotiations said the union had been leaning toward negotiating with Ford first because the company is perceived as more friendly to workers. No one expected GM to get a pass, but going first is a totally different strategy.

“The UAW chose to take on its toughest target first to set the standard for the industry," said Harley Shaiken, a University of California, Berkeley professor who talks frequently with labor and industry leaders as a national analyst. "The choice indicates that jobs in general and the fate of GM's four ‘unallocated’ plants — a term the UAW would like to return to obscurity — in particular, will be front and center in the talks. Addressing this issue will be a heavy lift, but is central to address given the anger of the membership. They sacrificed when times were bad and now they're being asked to sacrifice in a time of record profits.”

He added, “The UAW has embraced a tough, strategic focus indicating that it doesn't intend to skip a beat in these critical negotiations whatever the innuendo and unfounded allegations that have emerged in recent days.”

In November, GM said it would idle Lordstown Assembly in Ohio, Detroit-Hamtramck Assembly, and transmission plants in Warren and near Baltimore. The plants are closed except D-Ham, which is operating until January, and whose future is sure to be a topic of the talks.

“Although I am surprised the UAW picked GM as the target, it makes some sense. The UAW will have the most public perception support due to the high-profile plant closings," said market economist Jon Gabrielsen, who advises automakers and suppliers.

Marick Masters, business professor at Wayne State University, said the choice makes sense.

“Among the Detroit Three, it appears to be in the best financial position. It has also incurred the wrath of many workers for plans to close plants. The challenge for both sides, to avoid a strike, is to manage expectations. A lot is at stake. The negotiations are perhaps more pivotal than those which occurred in 2009 and 2011.”

Meanwhile, Michelle Krebs, executive analyst at Autotrader, said GM was "an obvious choice."

She explained, "It has excess capacity that must be dealt with. Already, GM has closed one, high-profile assembly plant – the Lordstown, Ohio, plant that made the now-defunct Chevrolet Cruze. Other plants were labeled last fall by GM as having no product allocated."

The contract negotiation news comes just days after FBI and Internal Revenue Service agents raided Jones' Canton home on Aug. 28.

The raid was part of a nationwide sweep of sites tied to the autoworker union. Agents also raided the California home of Dennis Williams, who preceded Jones as UAW chief; the union’s northern Michigan conference center; a UAW regional office in Missouri, where Jones was based previously; and the home of Williams aide Amy Loasching in Wisconsin.

The multiagency raids were a big step as federal officials escalated their corruption investigation of the union. Nine people have been charged in the long-running investigation. All but one were associated with misuse of money intended for training at the UAW-FCA joint training center.

More: UAW raid boosts distrust, complicates contract talks with Detroit automakers

More: FBI raids two UAW presidents' homes as part of nationwide sweep in corruption probe

The raid casts a dark cloud over ongoing negotiations between the UAW and the Detroit Three.

The current UAW contract with the Detroit Three was hammered out in 2015 without a strike at GM, Ford or FCA.

But FCA workers are angry that the company has been profitable and they sacrificed during the Great Recession and Chrysler's 2009 bankruptcy. UAW members are also upset with the union about the scandal involving millions of dollars siphoned from the union and company's joint training center.

Some in the FCA rank-and-file don't want Jones overseeing contract talks now.

"He should step down during bargaining," said Kenneth Mefford, a UAW member who works for Fiat Chrysler Automobiles Warren Truck Assembly plant.

Mefford said he and co-workers are frustrated too because local union leaders have not given workers an indication of what a tentative contract might contain.

"We have no idea what we'll be voting on in two weeks and most of the hierarchy is under federal investigation," said Mefford. "If you've been served or summoned, for the good of everybody, step down."

UAW members' anxiety is high at GM too over the automaker's decision last November to "unallocate" product at four U.S. plants, indefinitely idling them and leaving some 2,800 active U.S. hourly workers in jeopardy.

"The union is really bitter and angry over the sudden unallocation of products," said John Ryan Bishop, a UAW worker at GM's Flint Assembly plant. "GM is using it as a negotiating tactic. It's had record profits in the past few years, so GM had to have a strong tactic to knock the union back on its heels a little bit."

More: UAW members are preparing to live on $250 a week. Here's why

More: GM's hourly workers in Warren speak out ahead of debates, factory shutdown

GM's job upheaval

GM declined to comment specifically on the UAW members' strike authorization.

“GM’s focus during negotiations is to reach an agreement that builds a strong future for our employees and our business,” Barnas said.

The plants that could be permanently shuttered if GM does not award them new products to build are: Detroit-Hamtramck, scheduled to idle in January; Lordstown Assembly in Ohio; and Warren Transmission and Baltimore Transmission. As part of GM's restructuring, it also cut about 4,000 white-collar jobs and closed the assembly plant in Oshawa, Ontario. The restructuring plan will save GM up to $2.5 billion this year, it said.

More: GM workers uprooted, but not relocating for new jobs

More: General Motors to close Detroit, Ohio, Canada plants

More: UAW members are preparing to live on $250 a week. Here's why

GM has said it has jobs for all of its affected hourly workers at its other plants, especially those in growth areas of the business such as Flint Assembly where GM makes its high-selling heavy-duty pickups. But often, the plants with jobs could be in other states, requiring a worker to make a permanent move to stay employed.

The UAW has criticized GM for allocating some vehicles, such as the Chevrolet Blazer SUV, to Mexico for assembly. GM defends its production footprint, saying it has 33 plants in the United States and only four in Mexico. GM said it employs 46,000 U.S. hourly workers compared with 16,000 in Mexico and it said it's invested $23 billion in U.S. manufacturing since 2009 compared with $5 billion in Mexico in that time frame.

Ready to walk

But the UAW training center scandal is having a negative impact on how the process is viewed by many union members, comments to the Free Press have shown.

Michael Grimes, a former UAW administrative assistant who retired last year, pleaded not guilty on Aug. 28 in federal court to charges of conspiracy to commit wire fraud and money laundering. He is accused of conspiring with other union officials to accept hundreds of thousands of dollars in bribes and kickbacks in a case that has now ensnared GM along with FCA. The schemes involved millions of dollars in contracts for watches, backpacks and jackets.

UAW Vice President Cindy Estrada, who heads the FCA department for the union, was apparently referenced but not named in the Grimes filing.

GM has said it is cooperating with the investigation. FCA has said it is "a victim of illegal conduct by certain rogue individuals."

But that scandal, along with GM, FCA and Ford workers being quick to remind the automakers of the sacrifices the rank-and-file made during the Great Recession, has left workers anxious. They say now it's time for the Detroit Three to show loyalty.

GM is "making record-breaking profits and they're coming after us to take our benefits and our jobs," said Danielle Murry, a 44-year-old machinist who's worked for GM for 19 years. She faces relocating now that GM has idled the Warren Transmission plant where she worked.

Many UAW workers say they are reluctant to give concessions in the current round of contract talks after helping GM out in 2008. When asked last month if UAW workers would potentially strike, Murry said, "You have to stand up for yourselves. They've done nothing but take from us."

Similarly, Mario Washington, 48, has worked 19 years for GM, the majority of that time at Detroit-Hamtramck as a forklift driver. In February, he transferred to Flint in the same job.

Washington said the factory jobs are physically taxing on workers' bodies and the hours can be long, so he doesn't want to see his wages or benefits compromised.

"I've been involved in two strikes, but neither lasted long," Washington told the Free Press earlier this summer. "But I'll sit out till the cows come home to preserve our way of life, our jobs and the future employees who want to come in."

Contact Jamie L. LaReau at 313-222-2149 or jlareau@freepress.com. Follow her on Twitter @jlareauan. Read more on General Motors and sign up for our autos newsletter.

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