Tag Archives: labor

Volkswagen Tennessee and the Works Councils

20 Feb

VW Bluecross Concept

Be careful what you agitate for. 

Last week, workers at the new-ish Volkswagen plant in Chattanooga, Tennessee voted to reject UAW unionization by a very narrow margin. 

Let’s not forget, shall we, that Volkswagen, AG has a global reach.  Here are its stated corporate “Basic Principles”: 

Top performance

To survive in the face of competition and to achieve top performance, the Volkswagen Group needs employees who enthusiastically give their best. A good balance between demands and ability (the so-called “flow channel”) is the basic precondition for optimum performance and results. For this reason, we do not want our employees to be overstretched, but also not understretched, so that they are able to deliver top performance and advance the success of our company. 

Leading by example

The management assumes a decisive role in this entire process. Our principle has to be “Lead, Demand and Promote”. The Group will only be able to achieve its goals with exemplary leadership and constructive cooperation between management and workforce. This includes both targeted and continual personnel development and work organisation, which we continue to develop with the so-called “Volkswagen Way”. 

Active involvement

A standard survey of employees across the Group was introduced in the form of the so-called “mood barometer”. The “mood barometer” gives employees the opportunity to anonymously voice their opinion and so to become actively involved in the organisation of the company. The results form the basis for continually developing our strengths and for exploiting potential that is brought to light. The high rate of participation shows that employees have positively accepted this instrument as an expression of their esteem. In this way, they make a contribution to the continued development of the company. 

Social responsibility

Not only does Volkswagen’s corporate culture focus on people, it also represents the sustainability of economic and social goals, “corporate social responsibility”. The “Declaration on Social Rights and Industrial Relations” expresses Volkswagen’s global understanding of social responsibility on the basis of minimum standards.

This includes Volkswagen’s active cooperative conflict resolution between the Works Council and the company management. We created European and Global Works Councils early and without any statutory obligation. We do not cling to traditional questions of co-determination. Rather, we discuss the development of the company with our Works Council representatives. This is the way from co-determination to shared responsibility.

In other words, Volkswagen has made a global commitment to maintain a positive and cooperative relationship with its employees.  It wants them to be happy and productive. Unfortunately, that sort of mentality is completely anathema to our post-Reagan “greed is good” labor-bashing stock price culture. 

But Volkswagen is thriving, building everything from the VW Polo to the million-dollar Bugatti Veyron, with some Audis and Bentleys in between. The Volkswagen Works Councils are an integral part of the company’s success. The push to unionize in Tennessee was not so much pushed by the UAW as it was by Volkswagen itself, because under American law the council can’t be set up without union representation. In fact, the Chattanooga plant is the only Volkswagen facility anywhere in the world where workers are not represented by a Works Council or labor union. 

This would also be something new for the United Auto Workers. They wouldn’t have the same relationship with VW as they do with Chrysler, General Motors, and Ford. Rather, the idea is to create something called a “works council,” which are widespread across Europe and enjoy tremendous influence over how plants are run. In America, that kind of body can’t be established without a union vote — but crucially, the works council would be independent of the union, meaning the UAW would give up some control as soon as it gained it.

Why does the company favor works councils

There are three major advantages of councils. You’re forced to consider in your decision making process the effect on the employees in advance…this avoids costly mistakes. Second, works councils will in the final run support the company. They will take into account the pressing needs of the company more than a trade union can, on the outside. And third, works councils explain and defend certain decisions of the company towards the employees. Once decisions are made, they are easier to implement.

Works councils don’t call strikes because they don’t need to. Their inherent authority helps to avoid crises before they arise. The UAW would not be running labor relations from the outside, and the vote in Tennessee was done via secret ballot

Currently, the Chattanooga plant manufactures Volkswagen’s Passat sedan, which is nearing the end of its life-cycle. It is a unique factory that can build more than one model side-by-side on the line, and it’s slated to get Volkswagen’s upcoming mid-sized 3-row SUV, to replace the Routan minivan and slot between the expensive Touareg and the smaller Tiguan. 

As VW negotiated with the UAW in advance of the works council vote, politicians in the notoriously anti-union, anti-worker South remained relatively quiet. That is, until it seemed as if the plant would, in fact, become the first auto plant in the South to vote to unionize. Republican politicians tripped over themselves to predict armageddon if the vote was successful, and panacea if it wasn’t. For instance

That doesn’t mean, however, that the vote is unopposed. National anti-union groupsand the state’s Republican leaders are campaigning against the UAW, saying unionization will spread like a contagion through Tennessee’s other auto plants. “Then it’s BMW, then it’s Mercedes, then it’s Nissan, hurting the entire Southeast if they get the momentum,” said Sen. Bob Corker (R.-Tenn.).

BMW also uses works councils in other countries, to great success. It has operated a non-union plant in South Carolina since the mid-90s. But this wasn’t at all a fair vote. Big-money corporate anti-labor (Republican) interests from Washington interfered and campaigned against the works councils

Two of Tennessee’s most powerful Republicans, Gov. Bill Haslam and U.S. Sen. Bob Corker, insist they know how to run an auto company better than VW. Despite this successful international auto company’s actual business experience with work councils, these GOP politicians say that they know what’s best, that they just know unionization won’t be good for VW.

A union-hating group, the National Right to Work (For Less) Committee, travelled to Chattanooga from its headquarters near Washington, D.C. with a carpetbag full ofcash for legal challenges to the unionization effort. And GOP crank Grover Norquistsent his Washington, D.C.-based organized labor-hating group, Center for Worker Freedom (To Work For Less), to Tennessee to thwart the Chattanooga workers’ right to unionize.

VW objected to the interference. CEO of VW Chattanooga Frank Fischer asked the outside agitators to stop, saying, “Volkswagen is committed to neutrality and calls upon all third parties to honor the principle of neutrality.”

They ignored him — disregarding a CEO, a figure before whom Republicans typically grovel! That is how much Republicans hate unions.

They refuse to believe what VW is saying, that works councils are valuable management tools, despite evidence that the model already succeeds in the United States.

Corker went so far as to say that he had spoken with VW corporate, and that they had told him that VW would announce that it would be building the mid-sized SUV in Chattanooga (instead of in, e.g., Puebla Mexico) only if the vote to establish works councils failed.

… it was the conduct of U.S. Sen. Bob Corker (R-Tenn.) that most damaged the prospects for a free election. After stating that he would stay out of the vote, Corker returned to Tennessee to claim that he had been assured that VW would manufacture a mid-sized SUV in Chattanooga if the workers rejected the union. Head of the Chattanooga plant, Frank Fischer, immediately disowned his remarks and stated that the decision on where to expand production was separate from the union vote. Unperturbed by this denial, Corker accused Fischer of speaking from “old talking points” and stood by his comments. Corker’s remarks made a fair election impossible and did much to turn the vote against the union. He had used the authority of his office to say that a vote against the UAW was vote for more work in Tennessee, even though, according to VW management, his comments were unfounded.

Now that the election is over, Corker should have no problem disclosing who assured him that the rejection of the union would result in VW locating the SUV production in Chattanooga. If VW executives said this – which seems unlikely given the company’s respect for labor rights throughout the globe – that comment could form the basis of an unfair labor practice complaint. If not, it appears that Corker suggested this in order to pressure VW workers to vote against the union. While third parties are held to lesser standards in NLRB elections than the parties directly involved – allowing Corker to make comments that might be ruled illegal if made by VW or the union – the NLRB can set aside elections because of third party interference in exceptional circumstances such as these.

What are they so afraid of? Employees having rights, apparently

…a UAW victory would show that even billionaire anti-union zealots can be beaten. Right-wing groups are furious that Volkswagen is not fighting the UAW, so they have chosen to do so on their own. National organizations funded by the billionaire Koch Brothers and other right-wing activists have taken to the airwaves to demonize the UAW. State politicians have attempted to blackmail autoworkers to vote no by stating that Volkswagen may lose state financial support if it becomes unionized. Unionization, one elected official explained, “was not part of the deal.”

Promising auto lines out of turn? Threatening to withhold or withdraw negotiated, promised incentives? Blackmail? The anti-union Southern GOP and big-money interests may have won this round, but it’s also beginning to backfire

DPA, the German news agency, quoted [head of VW’s global works council Bernd] Osterloh as saying that, without a mechanism for “co-determination,” as Germans refer to the works council system, VW’s works council could “barely” agree to further investments in the US. The works council approves all decisions on investments in plants or their closure.

“I can absolutely imagine that a future VW facility in the USA, should another one be built there, would not definitely go to the south again,” Mr Osterloh said.

Ugly stuff, that. It would be a rich irony if the malicious intervention from Republican union-busters and Washington corporate interests in Tennessee resulted in the expansion halt that they threatened would happen if the works council was allowed to pass. Works councils cannot be formulated in the United States without union involvement – the company cannot create one unilaterally

Indeed, Mr. Osterloh’s comments have been interpreted to mean that VW head office in Wolfsburg will not permit the Bluecross-based SUV to be built in Chattanooga specifically because of the defeat of the works council and the malicious, false intervention by the likes of Senator Corker. 

Volkswagen wanted this union vote to pass, because it wanted the works council set up now – not in a few years when people get around to changing the rules. Republican lawmakers and special interests thwarted this, and it’s mind-boggling that these CEO-worshippers would deliberately thwart the wishes of a big manufacturer,  and threaten a big employer in the process. 

Since 1999, I have owned a Golf, a Jetta Wagon, two GTIs, a Passat Wagon, a Chattanoogan TDI Passat, two Beetles, and a TDI Beetle Convertible. I love the design, driving experience, features, engine choices, and build quality of Volkswagens. 

The Republican party and its lobbyist paymasters have long ago jettisoned good policy and good government for ideological purity. This has been – simply put – bad for America. It’s high time these nihilists were hoist by their own petards. 

The Right to Work Isn't

12 Dec

Yesterday, Michigan’s Republican governor signed the Republican lame-duck legislature’s improperly named “right to work” statute. Already, people are clamoring for a similar law to be passed in New York, so that we, too, can join the other, enlightened states that have such legislation – states like Alabama, Mississippi, Texas, and Oklahoma. Tea party states. N0bama states. 

Giving laws exquisitely misleading names is a hallmark of the last few decades. The PATRIOT act offends most American values we used to hold dear. The Defense of Marriage Act doesn’t defend any marriage; it prevents the federal government from recognizing the legality of same-sex marriages if states allow them. There are tons more, and it’s a bipartisan issue

But “right to work” statutes sound fantastic – it would be great if the government actually instituted a law that gave people a fundamental right to work. However, such laws were actually a hallmark of Leninist dictatorships, where people were given make-work do-nothing jobs because who cares? Everyone works for the state, anyway. 

Isn’t it hilarious that the proponents of an American “right to work” scheme are the same people who shout “socialism” at a market-based, conservative Heritage Foundation-created Obamacare? They also scream “MARX” and “LENIN” at you when you suggest that we should join the rest of the industrialized world and guarantee every American the right to access to quality health care. 

As an aside – if you yell “socialism” at everything Obama does, and the economy starts to improve – if your personal situation improves – then “socialism” is going to gain in popularity. Dummies. 

Back to Michigan and “right to work”. What it does is interfere with the right to contract. What it does is interfere with the right of workers to collectively organize and negotiate with management for better pay, better benefits, better work conditions. By weakening those labor protections, you weaken the right to organize and to freely associate. 

Right-to-work laws prohibit “union security agreements”, which are contracts between unions and management whereby the union can require labor to join a union as a condition of employment. This ensures that labor can effectively negotiate working conditions with management at something approaching a level playing field; it gives the exploited labor some leverage. What these laws are not is some sort of statutory guarantee of available employment for every citizen of a state. 

That’s not always how it shakes out. For instance, right-to-work North Carolina has a 9.3% unemployment rate right now, while liberal Massachusetts has a 6.6% rate. You’d think that employers, unshackled by unions, would flock to North Carolina and hire wildly.  Indiana’s unemployment rate dropped somewhat after it passed a right-to-work statute. No huge drop, however. And what do you give up for that? The right to work for crappy wages with crappy benefits? How does this help grow the middle class, or lift the middle class up? How does this advance our society in any meaningful way? How does this enhance the dignity of work? 

The American assault on labor began in earnest when Reagan broke the air traffic controller’s union. Since that time, wages have stagnated, and income inequality has skyrocketed. When you weaken labor, you turn America into a plutocratic banana republic, where the very rich pay off the politicians to ensure that their wealth is protected and secured at the expense of the remaining 99% of Americans. That’s what conservatism in America has wrought

Instead of making it easier for workers to be exploited more by their management, the government should be protecting the rights of workers to be treated fairly and equitably. We should be protecting the right of people to organize and associate with each other in order to ensure good treatment in the workplace. We should be expanding – not contracting – the rights of labor, and by doing that you strengthen America. An America where people don’t march in the streets when multinational corporations legally avoid paying taxes by exporting their profits to holding companies in tax havens. We don’t march in the streets when people shoplift so they can get chemotherapy treatment. We don’t march in the streets for much of anything, except to stand in line for Zhu Zhu Pets or to rail against some fantasy Kenyan socialism. 

What Michigan did is done, and perhaps its unemployment rate will drop, in time. But so will New York’s, and so will everyone else’s. The question is – what are the quality and type of the jobs being created, and why should we further erode the constitutional guarantee of free association. Instead, Michigan is about to free ownership to treat workers as fungible chattel. 

WTF, America?

The Right to Work Isn’t

12 Dec

Yesterday, Michigan’s Republican governor signed the Republican lame-duck legislature’s improperly named “right to work” statute. Already, people are clamoring for a similar law to be passed in New York, so that we, too, can join the other, enlightened states that have such legislation – states like Alabama, Mississippi, Texas, and Oklahoma. Tea party states. N0bama states. 

Giving laws exquisitely misleading names is a hallmark of the last few decades. The PATRIOT act offends most American values we used to hold dear. The Defense of Marriage Act doesn’t defend any marriage; it prevents the federal government from recognizing the legality of same-sex marriages if states allow them. There are tons more, and it’s a bipartisan issue

But “right to work” statutes sound fantastic – it would be great if the government actually instituted a law that gave people a fundamental right to work. However, such laws were actually a hallmark of Leninist dictatorships, where people were given make-work do-nothing jobs because who cares? Everyone works for the state, anyway. 

Isn’t it hilarious that the proponents of an American “right to work” scheme are the same people who shout “socialism” at a market-based, conservative Heritage Foundation-created Obamacare? They also scream “MARX” and “LENIN” at you when you suggest that we should join the rest of the industrialized world and guarantee every American the right to access to quality health care. 

As an aside – if you yell “socialism” at everything Obama does, and the economy starts to improve – if your personal situation improves – then “socialism” is going to gain in popularity. Dummies. 

Back to Michigan and “right to work”. What it does is interfere with the right to contract. What it does is interfere with the right of workers to collectively organize and negotiate with management for better pay, better benefits, better work conditions. By weakening those labor protections, you weaken the right to organize and to freely associate. 

Right-to-work laws prohibit “union security agreements”, which are contracts between unions and management whereby the union can require labor to join a union as a condition of employment. This ensures that labor can effectively negotiate working conditions with management at something approaching a level playing field; it gives the exploited labor some leverage. What these laws are not is some sort of statutory guarantee of available employment for every citizen of a state. 

That’s not always how it shakes out. For instance, right-to-work North Carolina has a 9.3% unemployment rate right now, while liberal Massachusetts has a 6.6% rate. You’d think that employers, unshackled by unions, would flock to North Carolina and hire wildly.  Indiana’s unemployment rate dropped somewhat after it passed a right-to-work statute. No huge drop, however. And what do you give up for that? The right to work for crappy wages with crappy benefits? How does this help grow the middle class, or lift the middle class up? How does this advance our society in any meaningful way? How does this enhance the dignity of work? 

The American assault on labor began in earnest when Reagan broke the air traffic controller’s union. Since that time, wages have stagnated, and income inequality has skyrocketed. When you weaken labor, you turn America into a plutocratic banana republic, where the very rich pay off the politicians to ensure that their wealth is protected and secured at the expense of the remaining 99% of Americans. That’s what conservatism in America has wrought

Instead of making it easier for workers to be exploited more by their management, the government should be protecting the rights of workers to be treated fairly and equitably. We should be protecting the right of people to organize and associate with each other in order to ensure good treatment in the workplace. We should be expanding – not contracting – the rights of labor, and by doing that you strengthen America. An America where people don’t march in the streets when multinational corporations legally avoid paying taxes by exporting their profits to holding companies in tax havens. We don’t march in the streets when people shoplift so they can get chemotherapy treatment. We don’t march in the streets for much of anything, except to stand in line for Zhu Zhu Pets or to rail against some fantasy Kenyan socialism. 

What Michigan did is done, and perhaps its unemployment rate will drop, in time. But so will New York’s, and so will everyone else’s. The question is – what are the quality and type of the jobs being created, and why should we further erode the constitutional guarantee of free association. Instead, Michigan is about to free ownership to treat workers as fungible chattel. 

WTF, America?

So You Want to do Business in New York

18 May
Inflatable Rat

Inflatable Rat was unavailable for comment

Governor Cuomo is wildly popular, and he’s getting loads of credit for helping to fix the state’s fiscal crisis, and also for implementing and advocating for reforms of the way in which the state does its business. Perhaps, however, the change he’s brought has been too tentative and not wide-reaching enough.  

Take, for instance, the case of Howard Nielsen, the owner of Sticky Lips BBQ in Rochester. I first became aware of his restaurant when I saw the new one being constructed along Jefferson Road, and I had a very nice lunch there recently. He’s written an exasperated open letter right on the front page of his restaurant’s website, called “So You Want to do Business in New York“.  

The land on which the restaurant sits is owned by the Genesee Valley Regional Market Authority and leased to Sticky Lips, which owns the building. It’s a small property – a former Roadhouse restaurant – and Sticky Lips completed its renovations through a private non-union contractor. It’s not a “public work”, he’s not required under any regulation or statute to retain the services of union labor, and he is just a guy who owns a restaurant who built it out and paid a bunch of people a lot of money to renovate and build it out. He didn’t use any public money to do so. 

But the shakedown began when, halfway through the project, a guy from the carpenter’s union showed up. It was a small job, and he was told, “no thanks”.  Two days later, there was an OSHA guy camped out across the street with “a telephoto lens”. A few weeks later, a guy from the electrical union showed up. They were also told, “no thanks.” Two days later, an inspector from the state Department of Labor was on site, demanding to see the contracts to determine whether prevailing wages were being paid. 

I’m generally pro-union, and I respect the notion of collective bargaining to ensure that workers who choose to unionize are treated fairly. But that should apply to big business, or public works. Ultimately – it’s the workers’ choice whether to work for a union shop or not, and small businesses renovating a non-chain restaurant should, frankly, be left alone, much less harassed. And why is it that state and federal inspectors are seemingly acting in concert – one could even say on behalf of – the union? 

Now? Sticky Lips’ contractors were all subpoenaed for a May 16th hearing at the Labor Department for an investigation of whether laws were broken. Nielsen continues, 

Bob Bibbins pressured me to go online to register this project with the labor department, which would automatically commit me or my contractors to pay prevailing wages.  He said he would start the violation from the date he showed up, but wouldn’t put that deal in writing.  I did not submit to this online filing. My lawyer at Woods Oviatt Gilman gave Bibbins our stance that we own the building privately and we are only making improvements to the building and not the land which it sits on.

Furthermore,

In the meantime, Bibbins is going to push this and see that I pay these prevailing wages. He has subpoenaed the contractors, who have to show up May 16th and attend before Ralph Gleason, public work wage investigator. He has been designated by the Commissioner of Labor to conduct an investigation concerning Sticky Lips BBQ, “an entity subject to an investigation by the New York State Department of Labor concerning a public work project pursuant to the provisions of Article 8, New York State Labor Law.”

All I did was to put many construction workers to work. I bought hundreds of thousands of dollars of construction materials from local companies. At this restaurant, I have created over 120 good-paying jobs. The business will collect and pay hundreds of thousands dollars in sales, property, employment, and other taxes. Between my three restaurants, I have over 200 employees. I am contributing to the state, I am creating jobs. I am the type of businessman the state wants. I feel like I am being attacked by these two unions, who have put pressure on the N.Y.S. Labor Department to see this through.

Not only do I need to reinvest my profits to grow my business, but now I have to pay thousands of dollars in legal fees and worst case scenario – if the Labor Department wins, many more thousands for this prevailing wage issue.

Is this the type of business practice I should expect from New York State as I try to grow my business in the upcoming years?

Nielsen has appended some documents to his letter to prove his point. So, why exactly was this relatively small venture targeted?