US car Workers - After 33 years, Chrysler workers said NO!

Winter 2015

When the UAW announced it had arrived at a new contract with GM, avoiding a strike deadline by only minutes, a "labour expert" from Cornell University explained: "It's sending a message to the membership that we took them to the strike deadline. You need to have the membership think, feel and believe you got everything you could."

It was the third strike deadline offered by the UAW leadership within a few weeks: one at a Ford local, which had a reputation for being intransigent, one at Chrysler and this last one at GM. All three deadlines were set after the first contract negotiated by the UAW and management was turned down by Chrysler workers. And in all three cases, a new contract was announced with barely minutes to spare.

It was obvious that the strike deadlines at both GM and Chrysler were little more than a smarmy bit of theatrics. The bourgeois media noted that the International (the US-wide union leadership) hadn't even bothered to send picket signs to most local halls - despite a strike that supposedly was only hours away at Chrysler. The main piece of information workers got at both Chrysler and GM was simply to wait for orders - above all, not to walk out if the deadline expired and the orders hadn't yet arrived. In other words, not to let anything interrupt production and the flow of profit.

These sham strike deadlines were almost certainly provoked by the workers' rejection of the first Chrysler contract - and by worry about what that rejection might hold in store for the auto companies and for a UAW leadership closely wedded to them.

The solid "no" vote by Chrysler workers was at the very least a harsh embarrassment for UAW leaders. The last time a new contract had been rejected by the union membership was 33 years ago and also at Chrysler. (The rejection by Ford workers in 2009 was of a proposal in mid-contract to align the Ford contract with the changes imposed on GM and Chrysler workers, by the bankruptcy court and by pressure from the Bush and Obama administrations.)

More than an embarrassment to union leaders, the rejection at Chrysler created stirrings of fear in the business community. And that fear was openly expressed in the business press, along with anger at UAW leaders for losing control of the ranks.

Without fail, every commentator reproached the UAW leadership for losing the "social media war," pursuing a "staid game plan" in contrast to the "clever and forward thinking social media strategy launched by the UAW in 2011" . These comments were made by Brent Snavely of the Free Press.

The new president of the UAW, Dennis Williams, was reproached for the rhetoric he had used at the union's bargaining convention, promising to "bridge the gap" between first and second-tier workers. The union staff was reproached for producing a "Highlights" document that was the "weakest and most poorly written ... just not a clever document." Sean McAlinden, chief economist for the Centre for Automotive Research, said of the UAW leadership: "They not only didn't bring a good deal for the membership [that it could understand]. They underperformed for management. They can't control their people. Somebody gauged this wrong."

The Detroit News put it this way: "UAW leaders must do a better job of communicating to members; clearly detail the highlights of the contract and persuade members this is the best deal possible - all failures the first time around."

The Detroit Free Press found the UAW leadership had "failed to come up with a winning strategy to get the message out." And the Freep's business writers wanted UAW leaders to "figure out what went wrong and fast."

Old clothes in a new garment case

The UAW leadership was certainly more triumphalist in announcing the second agreement they negotiated with Chrysler, calling it "one of the richest ever negotiated."

Backed up by the media, which lined up before the vote to sell the contract, UAW leaders trumpeted a supposed "direct path to traditional wages" for all workers hired since 2009 under the two-tier system. This was supposed to be the answer to one of the big grievances workers had expressed against the first version, the fact that two-tier had not been eliminated.

But, in fact, this new version doesn't eliminate the different tiers either. The only second-tier workers who will get the "traditional wage" (a "first" tier wage) during the four years covered by the 2015 contract are those with five, six, seven or more years of seniority.

But very few workers have five years seniority or more. Recall what was happening to Chrysler and the whole auto industry five years ago. The companies were reeling from the collapse of 2008-2009, barely hiring, and in many places, still laying off people. Most of the increased hiring came in 2012, 2013, 2014 and 2015. And not a one of the workers hired in those years will make it up to the "traditional wage rate" within the four years of this contract. But four years is all that Chrysler is legally bound to by this contract. And the workers whose seniority is four years or less will make almost the same under the second version of the Chrysler contract, as they would have made under the one they voted down!

The promise that workers will reach the "traditional wage" five, six or seven years from now, after this contract expires, is meaningless - worth no more than the promise UAW leaders made in 2011 that the 25% cap on the number of second-tier workers would be restored in September 2015.

We know what happened to that promise! A UAW vice president said he couldn't find it in the contract! It was written only in the "Highlights".

But even if the promise had been written in the contract, so what? No one should forget that in 2009, the UAW leadership pushed through a deal that tore up a lot of promises written in earlier contracts. They introduced two-tier across the board, got rid of medical care for retirees; brought in those killing "alternate work schedules" to most plants; tore up overtime provisions, got rid of the "Jobs Bank" and cut Supplemental Unemployment Benefits protection for laid off workers, and dumped "traditional" wages and benefits for workers in parts plants.

No, their promises aren't worth the paper they are written on.

The 2015 Chrysler contract did not get rid of two-tier - neither in the first version negotiated, nor in the second. In fact, it created two additional lower-paid tiers: Mopar workers and axle workers. And it solidified two more, even lower-paid tiers: the so-called temporary "part-time" workers who have been transformed into temporary FULL-TIME workers - with two different pay scales, depending on whether they were hired before, or after, the start of the 2015 contract. Tucked away, deep inside both versions of the Chrysler 2015 contract, is a "supplemental agreement" to allow Chrysler to use "temporary" (Monday & Friday) employees on a permanent basis EVERY day of the week. The temps, working full time for years, will be paid even less than the second-tier workers.

So, yes, there still are tiers; there still is no bridge between the tiers; the workforce is still divided - with more divisions the companies will try to use against the workers.

There were other problems with the second contract - carried right over from the first version. For example, the killer "alternate work schedules" remain in place.

What potentially will cost workers the most in this contract, is the agreement that the company and top UAW leaders, working together, can cut medical coverage during the course of the contract. By ratifying this contract, workers gave them a blank cheque to reduce medical coverage, and reduce it again, and still again, over the next four years.

Kristin Dziczek, director of the Centre for Automotive Research, summed up the re-negotiated Chrysler contract this way: "I think they packaged it in a way that was much more appealing even though it likely doesn't cost Chrysler more money than the first agreement."

No it doesn't!

But it will cost the workers, without any doubt. The results of this contract will only reinforce the slide in labour costs that has been developing for decades. Chrysler's labour costs sank to only 3.7% of revenue in 2014, down from 8.1% only 15 years ago - the result of hidden and open wage and benefit cuts and a vicious speed-up. Chrysler's labour cost may be lower, due to its greater use of second-tier workers and its near elimination of its own parts plants, but the same regression is obvious at the other two US companies: GM's labour costs, having dumped Delphi and other parts obligations, went from 15.8% in 1999 down to 4.9% last year; Ford went from 9.4% down to 6.7%. All of them dumped their obligations for retiree health care.

This slide in the share taken by labour is the mirror image in reverse of the enormous and growing amount taken by the companies, all of which have rung up historic levels of profit. And that profit has been almost immediately disbursed to stockholders - in the form of dividends and stock buybacks - as well as to the banks and to executives.

GM, at the behest of one rich stockholder agreed to hand over $5bn (£3.3bn) in stock buybacks by the end of 2016. And wealth produced by Chrysler workers has been the cash cow that paid for the first merger with Fiat, and which tomorrow will pay for the merger Fiat/Chrysler's boss, Sergio Marchionne, is searching to make with almost anyone.

A new strategy to sell an old contract

Chrysler workers, confronted with a contract that was little more than a repackaging of the first deal, voted "yes" by a bigger margin than the one that expressed their "no" three weeks earlier.

So what happened? How did a two-to-one NO vote get transformed into a three-to-one YES vote in just three weeks?

It's true, UAW leaders polished their sales technique. The UAW brought in Berlin Rosen, a New York public relations firm, to sell the second version of the contract, the same firm that had helped grease the skids under Detroit city workers and retirees during the Detroit bankruptcy.

Supposedly, Berlin Rosen made the UAW website and Facebook page more user friendly. And local leaders made sure the union's Facebook page was flooded the second time around with comments in favour of the new contract. The common refrain was typified by these two comments:

From a second-tier worker at Sterling Stamping: "That's nothing to complain about in this day and age. You have to be realistic. You have to make progress in increments."

From a skilled trades worker at Warren Truck Plant: "I was relieved - I think a lot of people are. I didn't want to strike."

Berlin Rosen also dredged up several local union leaders to appear in videos on the union's Facebook page, congratulating the workers for voting "no" the first time! They pretended the rejection was just what the UAW leadership wanted to strengthen its hand at the bargaining table!!!

It's possible that Chrysler workers didn't see all the tricks and schemes involved in the second version of the contract. But the number of workers who picked apart the first one, posting the problems they discovered on various Facebook and other internet forums, makes it seem very unlikely that they all went blind, just because the leadership found a better way to sell what was essentially the same contract.

The fact is, that by scheduling the strike vote as they did, the UAW leadership threw cold water on the hot atmosphere that had been sizzling, up until then. The possible strike was announced, seemingly out of the blue: "you will be on strike starting tomorrow at midnight". No previous warning, no preparation, no discussion of what might happen - and this to a workforce, most of whom have never been on a strike. It's been almost four decades since UAW workers were called out on a company-wide strike: the one at Ford in 1976. Chrysler's workers, like Ford's and GM's, constitute a workforce that has little tradition of strikes, little knowledge even of what is involved. Suddenly, they were confronted with the possibility not only of going out on strike, without having the faintest idea of what was involved, but also of going out on strike behind a leadership in which they had no confidence, one they knew they couldn't trust.

To drive home the point, local leaders at some of the plants went around the shop floor, twisting arms, spreading scare talk about what might happen if there was a strike.

It seems obvious that the UAW leadership issued the strike call as a bluff, a threat, not against the companies, but against the ranks who had dared for once to make their own opinion known. In the days leading up to the first vote, hundreds of workers had posted every piece of information they could on internet forums, and several thousand had expressed their opposition in the same forums. Some had confronted the leadership in officially called meetings, at least in Kokomo, Sterling Heights Assembly, Jefferson Assembly and Toledo. Workers in Toledo organized a sizeable demonstration. Workers wanted to express their anger, and they did - but mostly only on social media.

They didn't find the way to organise their forces: that is, to meet with each other to find out what others were ready to do, to discuss it over what they wanted, to make some decisions about what they would do together - not even in their own plants, much less with any co-ordination between plants. No one stepped forward to serve as a leadership of this opposition, no one who even spoke for it, other than in local venues.

If the workers had really been determined, they might have pushed past these limits, and in the process created the organisation they needed, and found the leadership they needed. But maybe they were blocked because they weren't ready to go further this time. In any case, there will be a next time.

Of course, this contract cycle is not over yet, GM is not finished, Ford not begun as of the date we write this. And nothing says that workers can't strike in the middle of a contract - nothing other than legalisms and "rulebooks" that serve only the companies, legalisms that hold workers back, but only so long as the workers accept them.

BUT whatever happens, workers have learned something about the force they represent, the possibilities they have. All they need do is reflect on how disturbed the whole bourgeois media was because Chrysler workers voted NO. The wailing, hand-wringing and editorials aimed at pulling the workers back - all of that testifies to how worried the capitalists in the auto regions were, and all because of one NO vote.

Whatever reasons Chrysler workers had for reversing their vote, they nonetheless did something important with that first NO. After so many years of acquiescing, letting the companies push them backwards, accepting things they didn't want to accept, Chrysler workers finally refused.

For the future, that can count.

October 29, 2015