WOLFSBURG, Germany -- Volkswagen AG and the UAW have discussed setting up a German-style labor board at VW's assembly plant in Chattanooga, Tenn., the automaker's human resources chief said today.
Since the plant opened in 2011 to build the redesigned Passat sedan, VW has said it wants to offer workers there a so-called works council like those that help set pay and benefits at other VW plants around the world.
VW executives now are more confident that this organized labor model would work in the United States, said Horst Neumann, VW's board member for human resources, during a meeting with reporters and analysts. Executives may release a works council plan in May or June, and if the proposal wins support from VW's managing board, formal negotiations with a labor union could begin as soon as the second half of the year.
"The UAW would be the natural partner," Neumann said, noting that the union knows the industry and has ties to IG Metall, the union that represents most VW workers in Germany. "We are not obliged to do it," he said. "It will depend on the negotiations."
In works councils, which are common in Germany, workers and management at a plant vote for representatives who negotiate the pay, benefits and working conditions for all employees at the plant. They can choose between both union and non-union candidates. Members may simultaneously join a national union -- such as IG Metall -- which negotiates for its members nationwide.
VW wants a works council because it would make it easier to stay attuned to the thoughts of workers in Chattanooga and reach future agreements on working conditions, Neumann said.
But VW's lawyers have told the company that a works council would run afoul of U.S. labor laws if no union is formally involved, he said. As a result, the company has had talks with UAW President Bob King, who has tried unsuccessfully to organize workers at auto plants in the South.
For the UAW, which has lost members as the Detroit 3 downsized and other automakers have moved plants to states where unions hold less sway, the talks have the potential to provide a new way of organizing.
King, 66, is scheduled to step down in June 2014. He said two years ago that the union does not have a future if it cannot organize workers at plants in Mississippi, Alabama, Georgia and Tennessee.
“The UAW is very interested in the specific model that VW wants to present in the months ahead, and we are looking forward to open, fair and respectful dialogue, and cooperation with VW as we have expressed in our vision of the 21st century UAW," King said in a statement. “Volkswagen, known globally for its system of cooperation with unions and works councils, has an open mind about letting the employees in Chattanooga also be part of the global VW system of co-determination."
Neumann said the UAW would need to be willing to give up some control over pay, benefits and working conditions to be involved in VW's organized labor plan. From his talks with King, he said, he is unsure whether the UAW wants to try the works council approach, or whether it sees the talks with VW as "just a way to get into the company."