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The UAW won big against Detroit automakers. Unionizing Tesla and Toyota will be tougher

<i>John J. Kim/Chicago Tribune/Tribune News Service/Getty Images</i><br/>UAW President Shawn Fain
John J. Kim/Chicago Tribune/Tribune News Service/Getty Images
UAW President Shawn Fain

By Nathaniel Meyersohn, CNN

New York (CNN) — The United Auto Workers hopes the significant wage and benefit gains in tentative agreements with Ford, General Motors and Stellantis, the parent of Jeep and Chrysler, will spark unionization efforts throughout the US auto industry.

But the UAW’s ambitious plans to organize Tesla and other non-union automakers face steep odds.

“One of our biggest goals coming out of this historic contract victory is to organize like we’ve never organized before,” UAW President Shawn Fain said Sunday, signaling that the union plans to marshal the new contracts at the Detroit automakers to win over other workers. “When we return to the bargaining table in 2028, it won’t just be with the Big Three. It will be the Big Five or Big Six.”

In the 1970s, the UAW had 1.5 million members. Today, its membership has dwindled to 380,000, even while American automobile manufacturing has surged in recent decades. To grow, the UAW will need to gain a foothold at non-union automakers, which produce more than half of the cars assembled in the United States.

Yet big wins at the Detroit automakers won’t change the significant obstacles the UAW must surmount to unionize foreign-owned auto plants in the South — including Toyota, Hyundai, Honda, Volvo, Mercedes, BMW, Nissan and Volkswagen — and Tesla, which has non-union plants in California and Texas.

These companies have been elusive targets for the union in the past. In order to make progress, the UAW will have to overcome fierce management resistance, employee surveillance, unfavorable labor laws and political leaders in the South who are hostile to unions.

“This is a sizable victory. I wouldn’t minimize that,” said Harry Katz, a professor at Cornell University’s School of Industrial and Labor Relations. “I just don’t know that it’s going to overcome all the difficulties facing organized and un-organized labor.”

Even if union efforts fail, however, the contract agreements could force non-union automakers to preemptively increase workers’ wages and benefits to try stave off union pressure.

Historically, UAW talks with the Detroit automakers have been closely watched by non-union automakers and suppliers.

Already, Toyota has raised wages in the wake of the UAW’s tentative settlements, which raise the top wage to more than $40 an hour and increase starting wages to more than $28 an hour.

Pro-union publication Labor Notes reported Tuesday that Toyota workers got pay increases of $2.94 to a maximum of $34.80 per hour for production workers and $3.70 to a maximum of $43.20 per hour for skilled trades employees. (Toyota confirmed it raised wages, but did not say by how much.)

Anti-union companies

The UAW will have to overcome weak protections for labor organizing in the United States and automakers’ aggressive tactics to defeat unions.

Companies often try to persuade workers against voting in favor of a union, hiring “union-avoidance” consultants in an attempt to dissuade employees and weaken workers’ unionization efforts. Even if a majority of workers casts ballots in favor of a union, negotiations on pay, benefits and other areas can drag on for years — and the longer companies can stall, the better it is for them, and worse it is for workers.

Employers also generally face weak remedies for violations of workers’ rights to organize under the National Labor Relations Act. Employers do not face monetary penalties for illegally retaliating against workers for exercising their rights, and workers do not receive compensatory damages when they face illegal retaliation.

“It’s very difficult to organize in the face of serious and significant management opposition,” said Thomas Kochan, a professor at the MIT Sloan School of Management.

Many automakers in recent decades have moved to the South, drawn by cheaper labor, fewer regulations, tax incentives and anti-union laws. Every state in the South has “right to work laws,” which allow workers to opt out of paying fees to a union at their workplace, even if they benefit from union bargaining agreements, undercutting a union’s financial resources to strategize and collectively bargain.

Workers have also outright rejected the UAW in recent years at Nissan and Volkswagen in Tennessee; Toyota in Kentucky; Mercedes-Benz in Alabama; and other foreign-owned plants in the South, sometimes with help from Republican state officials. Tennessee Gov. Bill Lee in 2019 visited Volkswagen’s plant in Chattanooga to encourage workers to reject the union. Former South Carolina Gov. Nikki Haley, now a contender for president, said in 2015 she was a “union buster” when recruiting automakers to the state.

President Joe Biden, in contrast, became the first President to speak at a UAW picket line during the recent strike, when he briefly joined a protest in Michigan.

As automakers race to build electric vehicles, though, many are opening new facilities in the South. The region has picked up 66% of planned EV jobs, according to a recent report by the Environmental Defense Fund.

Pay at southern auto factories is lower than top UAW wages, according to a study this year by researchers at Alabama A&M University and Jackson State University, but the wages are typically higher than other industries in the South.

This means that auto companies have more leverage over their employees if they threaten to leave, Kochan said.

Companies “will argue, with some basis of reality, that jobs in their plants are higher paying than workers can achieve in other jobs in the South,” he said.

The Fain factor

Despite the challenges, the UAW’s seeming victories against the Detroit automakers put the union in its best position in years to mount successful campaigns at foreign automakers, experts say.

“These settlements send a strong message to non-union workers in other automakers and across the auto supply chain that this is what a strong union can do for you,” Kochan said. “There’s going to be more organizing on the basis of these settlements and the UAW’s intent to try to recoup organizing losses.”

The UAW for years has been plagued by corruption, which has hurt its ability to organize new workers. But it could be harder for anti-union forces to make that argument against Shawn Fain, who ran on an anti-corruption platform, and the current UAW leadership.

“Fain will bring incredible energy and an inspired organizing staff and will no doubt build on workers in the transplants who have been following what he’s won in Detroit,” said Harley Shaiken, a professor emeritus at the University of California, Berkley. “All that said, it could prove to be a long uphill fight.”

The UAW could have the strongest shot unionizing Volkswagen in Chattanooga, Tennessee, labor experts say. The union lost a close vote there in 2019.

It may be easier for UAW to organize Volkswagen and other European automakers like BMW and Mercedes-Benz than automakers from Asia, experts say.

In Europe, automakers are unionized, and European labor leaders could push the automakers to remain neutral on US organizing efforts. European companies may be more amenable to US unions due to their deep and mutually beneficial experience with them. Union representatives at Volkswagen, for example, are on the company board.

UAW also has its sights set on Tesla, which controls around 60% of the US electric vehicle market.

The UAW has tried and failed to organize at Tesla, led by Elon Musk, in the past. Musk, the world’s richest man, is an outspoken opponent of unions and the National Labor Relations Board has repeatedly cited Tesla and Musk for illegal or improper anti-unionizing activities. Last year, the NLRB said it was unlawful for Tesla to prohibit employees from wearing shirts bearing union logos, and the agency directed Musk to delete a 2018 tweet saying employees would lose their stock options if they formed a union.

Employees at Tesla’s Fremont California factory have formed an organizing committee with the UAW, Bloomberg reported, in what could be a first step to trying to form a union again. (A UAW representative declined to comment to CNN.)

“Tesla will be the biggest and most public battle, given what we can expect as all-out resistance from Elon Musk,” Shaiken said.

Calling on Biden

Union advocates want President Joe Biden to help the UAW advance its efforts at non-union companies receiving federal funds.

Now that the UAW has tentative agreements at the Detroit automakers, some union advocates are calling on Biden to use his administration’s influence to set standards at non-union electric vehicle plants in the South.

The Biden administration is giving federal incentives to speed up automakers’ transition to EVs. Union organizers and supporters want the Biden administration to push automakers that receive federal funding to adopt a position of neutrality on unions and negotiate a set of baseline standards.

“The Big 3 and other automakers are locating EV manufacturing plants, battery and other supply-line facilities in rural, Black communities in the South,” a group of more than 60 Black elected officials wrote to Biden this week. “With the influx of transplant companies…the Biden Administration must do more to ensure the standards of the current UAW agreements are the norm, not the exception.”

Erica Smiley, executive director of the advocacy group Jobs with Justice, which helped organize the letter to Biden, said the UAW must expand organizing in the South, a region that is now crucial in the auto industry.

If the union fails to expand, the rise of non-union labor in the region could undercut the UAW’s strong contracts with the Detroit automakers, Smiley warned.

“This isn’t the time to say ‘we’ve won’ and move on,” she said. “The strength of this agreement won’t be widely felt and will be quickly undermined if the rest of the industry isn’t held to higher standards.”

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