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German-style works council may be coming to US VW plant

By Pamela Wolf, J.D.

The United Auto Workers issued a statement on September 6 regarding its discussions about representation and a works council for the Volkswagen plant in Chattanooga, Tennessee. If fruitful, the discussions may lead to the introduction of a new labor relations model in the United States.

The VW-UAW discussions take place at a time when traditional unions in the United States are on the decline. According to the U.S. Bureau of Labor Statistics, the union workforce membership rate was 11.3 percent in 2012, down from 11.8 percent in 2011. In 1983, the participation rate was 20.1 percent. The public sector membership rate in 2012 was 35.9 percent as compared to a private sector rate of 6.6 percent. New York had the highest union membership rate in 2012 at 23.2 percent, and North Carolina had the lowest participation rate at 2.9 percent.

However, 2013 has seen substantial backlash via non-traditional labor groups against stagnant wages in the face of rising corporate profits during the recovery from the U.S. economic downturn. Alternative labor groups, often backed by unions, have staged several nationwide strikes and protests by low-wage workers in the fast food and retail market segments.

Meanwhile, the UAW confirmed that officials of Volkswagen Group, the Volkswagen Global Works Council, and the UAW met in Wolfsburg, Germany, on August 30, in continuation of a series of meetings between their respective representatives. “The meeting focused on the appropriate paths, consistent with American law, for arriving at both Volkswagen recognition of UAW representation at its Chattanooga facility and establishment of a German-style works council,” the UAW said.

“VW is a company that is globally recognized as being at the forefront of respecting the basic human rights of workers to organize and collectively bargain as spelled out in the United Nations Guiding Principles on Business and Human Rights, the International Labor Organization’s Declaration on Fundamental Principles and Rights at Work, and the Organization for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises,” the UAW continued. “Every major VW assembly facility in the world, with the exception of the Chattanooga facility, has worker representation and a seat on the VW Global Works Council.”

The UAW touted VW’s Global Labor Charter and its Social Charter, noting that they go beyond international labor standards to establish principles that govern labor relations and social matters, including remuneration systems, information and communication, training, occupational health and safety, social and ecological sustainability, labor standards at suppliers and, most recently, principles for the use of temporary workers. In addition, the Charter establishes annual labor-management meetings and gives employee bodies the right to hold workforce meetings at least once a year during which management informs the workforce on the economic situation and developments in the area of human resources and social matters, the UAW said.

“Volkswagen is a company that has extensive experience with union representation and the UAW believes the role of the union in the 21st century is to create an environment where both the company and workers succeed,” the union said. “The UAW appreciates the opportunity to have direct discussions with VW management. Ultimately, however, it’s the workers in Chattanooga who will make the decision on representation and a works council.”

The UAW said that should the Chattanooga workers choose to have representation and a works council, it is committed to an open, fair and respectful dialogue with VW to create an environment in which Tennessee workers can participate in VW’s global work council system.

“VW workers in Chattanooga have the unique opportunity to introduce this new model of labor relations to the United States, in partnership with the UAW,” according to the union. “Such a labor relations model would give workers the job security that would accompany their having an integral role in managing the company and a vehicle to provide input on workplace improvements that will contribute to the company’s success.”