Just over a year ago, I wrote a controversial prognostication about this very week.
The headline summed up the argument: “Why the UAW will strike in 2015 -- no matter what’s offered.” My opinion hasn’t changed in the subsequent 12 months, but the details have gotten clearer now that it looks as though the union’s tentative agreement with Fiat Chrysler is headed for defeat.
The issue is not whether the FCA-UAW tentative agreement is a good contract in terms of worker’s economics -- it is, especially relative to recent UAW agreements.
It is just that the agreement is the wrong contract, at least in terms of winning ratification among the 37,000 hourly employees at FCA US.
The primary reasons are now clear: The agreement stops short of eliminating the gap between Tier 1 and Tier 2 employees, and it doesn’t lay out what products will be made where and by whom.
The tentative agreement has lost by significant margins in many FCA locals that have already voted, and won in a few others. Some large locals have yet to weigh in, so mathematically it still could pass. We don’t know for sure because the union and its locals haven’t released the number of votes -- just percentages.
But here’s the thing: Unlike previous negotiations, the UAW can no longer afford close ratification votes.
In 2011, production workers at what was then Chrysler Group narrowly passed the contract that is still in place today, but skilled trades workers rejected it. The union, however, decided that since the gross number of “yes” votes was larger than the gross number of “no” votes, the 2011 contract passed.
That didn’t sit too well with some, who thought the union -- even stripped of its right to strike in 2011 -- may have been overly motivated to see the 2011 agreement pass. That left questions over whether the union had its members’ best interests at heart -- or its own.
A close vote this time could carry more serious consequences for the UAW.
With the passage of controversial right-to-work laws in Indiana and Michigan, a close vote that leaves a near-majority of members disaffected can have a deep financial impact on the union’s own ability to conduct its business. FCA has four assembly plants, three engine plants as well as other unionized facilities in Michigan. In Indiana, it runs the largest transmission plant in the world, in Kokomo.
Already on social media, some UAW members are threatening to withhold their dues if they don’t like the results of the bargaining. Previously, the union could largely ignore these folks as cranks, but when their voices are amplified online, a call to punish the union for leaving money on the table can grow quickly out of hand.
The UAW needs a win -- a BIG win -- among its membership at FCA for ratification. That means it needs to deal with the issues that are riling up its members about what’s been offered.
And it needs to get its rejected tentative agreement fixed, back before its members and approved before negotiations move on to Ford and later General Motors. Failure to finish at FCA will make getting an eventual agreement that much harder for the UAW, since contracts at Ford and General Motors are likely to be more lucrative, given their respective financial positions.
These next few days will be crucial, but I think I’ll cancel my weekend plans.
I have a feeling I’m going to be busy.