Driving a Hard Bargain

Toronto, Canada--Canadian auto workers and their union gambled and won when they severed ties to the United Auto Workers (UAW) International union. When the UAW International Executive Board approved the Canadian region's motion to strike out on its own on December 10, 1984, many observers believed that the economic ruin of Canada's auto workers' union would result. Yet, as auto workers in both the United States and Canada get ready to do battle with General Motors (GM), Ford and Chrysler when their contracts expire this fall, it is the Canadian union that seems better prepared and more determined to challenge corporate demands.

Breaking with the UAW

Tensions between the U.S. and Canadian sections of the UAW over corporate demands for concessions came to a head during negotiations with General Motors in 1984. In that year, Canadians learned that UAW President Owen Bieber was actively thwarting Canadian attempts to resist company proposals already accepted by the union in the United States. Specifically, GM (and the UAW) wanted workers to accept lump sum payments and profit-sharing; the Canadians insisted on annual wage increases. When the wage dispute forced a strike in Canada that quickly began to affect jobs and production in the United States, Bieber threatened to withdraw strike authorization, and with it, strike pay for the 36,000 Canadian GM workers. But the Canadian section refused to buckle under pressure from the company and its own union leadership, and won its demands after a 13-day strike.

By the end of 1984, the Canadians, led by outspoken director Bob White, felt compelled to seek greater autonomy within the International Union. As White, now president of the Canadian Auto Workers (CAW), told Multinational Monitor, "We were really fighting our own leadership in the United States as much as the corporations." White went to the International Executive Board meeting in Detroit that December determined to limit U.S. interference in future bargaining in Canada. The Board rejected White's bid for greater autonomy within the International Union by a vote of 24-1, and the stage was set for the independence of the Canadian UAW.

While Bieber tried to divert attention from the Canadian split, former UAW President Doug Fraser said out loud what many of his American colleagues were saying behind closed doors: that the Canadian region had been a financial drain on the International Union, which might be better off without it. He implied that the Canadians would have serious difficulty without the financial support of the entire UAW.

In addition, critics on both sides of the border suggested that General Motors, Ford and Chrysler would likely curtail investment in Canada, or, worse, close down existing plants because of the "militancy" of the Canadian union. The Detroit News, referring to White as "a doctrinaire socialist," editorialized that "future parts plants will go up in the United States, not Canada," and speculated that the Auto Pact, which mandates that U.S. automakers produce as many cars and parts in Canada as they sell there, might be jeopardized. Fraser said, "If Bob White thinks he's going to get a better deal out of those auto companies than the Canadian UAW has been getting in the last 15 years, he's crazy." He also warned that auto workers north of the border "may well get screwed in terms of benefits under the new regime."

The International union's interference in the strike negotiations precipitated the split, but the U.S. and Canadian sections had been moving in different directions for some time.

In 1979, when the Chrysler Corporation sought federal loan guarantees to stave off bankruptcy, the U.S. government agreed on the condition that Chrysler workers make wage concessions. The UAW saw no alternative means to save the workers' jobs, and decided to accede to the government's demands.

In Canada, however, the government reluctantly guaranteed Chrysler a loan (which was never used) on the condition that the corporation assure a number of jobs for Canadians. The only government pressure on Canadians to accept concessions came from Washington.

Furthermore, the more politicized Canadian labor movement was ready to respond aggressively to corporate demands for concessions, having fought concessions in the form of federally legislated wage controls in the late 1970s under the government of Prime Minister Pierre Trudeau. Organized labor refused to sit on his Anti-Inflation Board throughout its three-year history, and the UAW in Canada conducted an active education campaign to inform its members about the politics of wage restrictions.

When Chrysler demanded concessions from the Canadian workforce, the union was prepared. As Sam Gindin, Research Director of the CAW, wrote recently, the union debated "why [concessions] were disastrous for working people; why they would not bring job security to workers; how they would fragment workers; why accepting them would be to agree that unions had bargained 'too well' in the past and should, therefore, forever be weakened; and why, in general, acquiescence to their logic would eventually destroy the lifeblood of unions."

By fall 1982, as Chrysler was beginning to recover from its brush with bankruptcy, the Canadian section led a six week strike and won a wage increase of $1.15 an hour, the exact wage reduction Chrysler concessions had imposed three years earlier. In a classic case of the tail wagging the dog, the Americans later settled without a strike for 75 cents an hour. Chrysler made record profits the following year.

The next major challenge came in the 1984 bargaining with General Motors, when the American UAW agreed to lump-sum payments and profit-sharing instead of annual wage increases.

The Canadians oppose lump sums on principle, because they do not increase a workers' base rate and therefore do not affect overtime pay or cost-of living increases; they also need to be renegotiated at the same level in each subsequent bargaining just to retain the same rate of pay. The union objects to profit-sharing because it is uncertain, and because it links workers financially and psychologically to corporate decision- making over which they have no control.

The Canadians expected resistance to their position from General Motors, but Bieber's attempt to undercut their position was an unpleasant surprise. The UAW's support of profit-sharing reflected its willingness to identify with corporate interests.

During the 1970s and 1980s, the corporations sought to introduce programs designed to restructure the workplace and, theoretically, to increase worker participation in decision- making on the shop floor and to improve product quality. Known as Quality of Work Life (QWL) programs, Employee Involvement programs and Quality Circles, they were viewed by critics as disguised attempts to speed up the assembly line and to subvert the union's role as workers' advocate by obscuring the ongoing conflicts between labor and management. On the matter of cooperating with management, the unions in the two countries once again adopted opposite positions.

Believing that the interests of the corporation and the interests of workers could be merged, the union in the United States supported QWL and similar programs. Even though these programs often met with significant rank-and-file opposition, and though many were cancelled locally, corporations continued to push them with the support of the UAW. "Union leaders have said repeatedly that cooperation with industry is a definite and necessary part of the strategy to protect auto workers' long- term interests in a changing industry," a reporter for the Monthly Detroit noted in 1984. In its May 1990 bargaining convention, the UAW reiterated its support for collaborative efforts with the auto manufacturers, now termed "jointness".

But in Canada, after experimenting with these programs in a number of different locations, the union has concluded that they are an integral part of a corporate agenda to water down the influence of unions and their representatives on the shop and office floor. Worse, they blur the distinction between corporate objectives and workers' interests.

Attacking the corporate agenda

The newest version of these workplace cooptation programs is the "team concept" (see "Management by Stress," Multinational Monitor, January/February 1990). Opposition to it will almost certainly be a major issue for the CAW in its upcoming "Big Three" negotiations. At a meeting of the CAW Council on September 29, 1989, the union unanimously endorsed official opposition to the team concept. (The CAW Council is made up of roughly 300 elected delegates from every CAW local across Canada, and meets quarterly. Every UAW region once had these democratic councils, but they have been eliminated in the United States.)

Following considerable study by the CAW's National Executive Board and debate at the Council, the delegates approved a "statement on the Reorganization of Work."

It denounces the team concept and the so-called partnership between labor and management as providing the illusion of an equal partnership while allowing management to maintain all of its substantive power:

This 'partnership' and its promises are false. For all the talk about jointness and worker control, employers are certainly not putting true equality between themselves and their employees on the agenda. Management will continue to guard the management's rights clause jealously and to decide unilaterally when to modernize, how much to invest, what to produce, with what kind of technology and so on. The truth is that management's agenda is not about surrendering power, but of finding more sophisticated ways to extend it.

The UAW and the auto manufacturers claim that a new cooperative approach is needed to make North American producers internationally competitive. While stressing that the union is not opposed to changes that improve productivity and restating its commitment to quality, the CAW rejects the team concept and the ideology of competitiveness on which it is founded because they pit worker against worker in a race they cannot win. The CAW paper says:

Accepting 'competitiveness' ... means trying to undermine fellow workers in other Canadian facilities and workers in other developed countries. It forces us to compete with countries whose living standards remain below where we were decades ago and it leads toward comparisons with regimes that keep standards low by denying basic human and trade union rights. It means concessions today and even more concessions tomorrow as other workers feel forced to join the downward spiral. Unlike quality and productivity, the logic of competitiveness adds a dimension that threatens all our achievements.

The CAW's position is that ultimately workers and their employers do not have shared interests. "What we are really saying is we have a different agenda than the corporation on most issues both inside the workplace and outside the workplace," explains White.

Following a day-long debate at the Canadian Council, the union established a massive program to educate its membership about the team concept and the union's opposition to it. As part of the program, local union leaders from around the country are being brought together in courses lasting six to 12 hours to prepare them for upcoming negotiations and to enable them to respond to the concerns of their union colleagues.

Under pressure, however, the CAW has made some compromises to the team concept. In return for recognition of the union prior to the plant being operational (and before it approved the "Statement on the Reorganization of Work"), the CAW accepted a form of the team concept at the CAMI plant, a new joint venture by GM and Suzuki. Still, White distinguishes the CAW attitude toward team concept from that of the UAW. "We are not going around selling the fact that we are on the same team as employers," he says. And, he notes, the CAW has not allowed the team concept at CAMI to subvert its purpose entirely and erase hard-fought, union-won gains. "We don't have team leaders on the shop floor disciplining people. We still have a strong union on the shop floor with grievance procedures, transfer rights [and job] classifications." The CAMI plant also has a wage and benefit package based on the Big Three pattern. The union views this as a compromise, not a model, and is carefully studying the way the plant functions.

Meanwhile, in the United States, the UAW reaction to the team concept differs drastically from that of the CAW. The UAW encourages local agreements for team concept and other joint programs that enhance "competitiveness" and abandon the union's traditional opposition to intensification of the work pace. In the major debate of its 1989 convention in California, the union rejected a proposal to oppose team concept.

The CAW looks ahead

Poised to enter fall negotiations with the major auto-makers and to challenge the proposed extension of the team concept, the CAW can look back on its achievements since it severed ties with the International union and proved wrong the doomsday predictions of many ob servers.

CAW membership, for example, has increased by a third since 1984, from 120,000 to 160,000 members; the union now rivals the Steelworkers as the largest industrial union in Canada. The most significant source of this growth was the addition (forcing a major dispute in the Canadian labor movement) of 20,000 fish workers in Atlantic Canada, who broke away from their U.S: based international union, the United Food and Commercial Workers, in order to join the CAW. In addition, the union merged with 4,500 airline workers and has undertaken major organizing drives in both traditional and non-traditional CAW occupations. The CAW has moved from a southern Ontario-based industrial union to one with representation in all 10 provinces.

In Big Three bargaining in 1987, the CAW won its main demand: increases in pensions, including partially-indexed pensions for future retirees. At the same time, the union gained annual wage in-creases in each year of the three-year agreement. The UAW, on the other hand, accepted lump sum payments in the second and third years of its agreements.

At the end of January,1990, the CAW strike fund had grown to $37 million, and should reach $40 million by the time negotiations with the automakers start. That amount is sufficient to lead a strike at General Motors for eight weeks � virtu-ally the same length the UAW strike fund would last � even though the CAW recently increased weekly strike pay from $100 to $150 after four weeks.

Corporate investment in Canada seems not to have been affected by the union's independence either. In March, 1986, General Motors announced that it would spend $2billion to develop a state-of-the-art Autoplex in its largest Canadian facility in Oshawa, Ontario, which employs over 16,000 auto workers. The GM-Suzuki joint venture (CAMI) and other investment has continued.

Investment may decline as a result of the U.S.-Canada Free Trade Agreement, however. Already a number of plants have closed, moving production to right-to-work states and to Mexico.

Yet the CAW remains steadfastly opposed to the kind of worker-management cooperation which seems to be the path of choice for the UAW. The consequences of these differing approaches are highlighted by the contrasts in the state of the Canadian and U.S. auto workers' unions. While the UAW is urging a demoralized and declining membership to become partners with the automakers, the CAW is enlarging its membership and mobilizing it to take on the corporations.

George Ehring is a freelancer who writes regularly on labor issues.