VW Labor Rep: If Southern Workers Aren't Unionized, We May Not Build There Anymore

In a stunning (and encouraging) turn for the labor community Wednesday morning, Volkswagen’s top labor representative suggested the company may head to more unionized pastures for its next U.S. plant construction, rather than build in the South following the defeat of a European style “works council” at the Chattanooga plant. Via Reuters:

Volkswagen’s top labor representative threatened on Wednesday to try to block further investments by the German carmaker in the southern United States if its workers there are not unionized.

Workers at VW’s factory in Chattanooga, Tennessee, last Friday voted against representation by the United Auto Workers union (UAW), rejecting efforts by VW representatives to set up a German-style works council at the plant.

German workers enjoy considerable influence over company decisions under the legally enshrined “co-determination” principle which is anathema to many politicians in the U.S. who see organized labor as a threat to profits and job growth.

Chattanooga is VW’s only factory in the U.S. and one of the company’s few in the world without a works council.

“I can imagine fairly well that another VW factory in the United States, provided that one more should still be set up there, does not necessarily have to be assigned to the south again,” said Bernd Osterloh, head of VW’s works council.

“If co-determination isn’t guaranteed in the first place, we as workers will hardly be able to vote in favor” of potentially building another plant in the U.S. south, Osterloh, who is also on VW’s supervisory board, said.

Questions about the legality of actions by Tennessee Senator Bob Corker and other local politicians leading up to last week’s vote have put the United Auto Workers (UAW) — the union hoping to organize workers at VW and elsewhere in the south — on an uncertain path:

This intervention by the state’s U.S. Senator on the first day of the election may be grounds for the NLRB to set aside the results. One approach would be for the UAW to argue that Sen. Corker’s statement constituted an unfair labor practice by the company if it could prove he was an agent of Volkswagen. This could put Corker in an awkward position during an examination by the NLRB, with the choice of either giving up his source and risk implicating Volkswagen, or saying that he fabricated his insider knowledge. If an unfair labor practice was found, then the standard for setting aside the election would be lower because such a finding would show that the election was tainted. If the unfair labor practice were so egregious that it made the possibility of conducting a new fair election unlikely, then the Board could impose an order requiring the company to bargain with the union.

However, given the difficulty of proving Corker was acting as an agent of Volkswagen, it is unlikely that an unfair labor practice attributable to the company will be found here, let alone one that would warrant the relatively extreme measure of issuing a bargaining order.

But Indiana University law professor Kenneth Dau-Schmidt notes that UAW could make a different legal case that the election should be set aside, by arguing that the remarks by outsiders “upset laboratory conditions” for the election. “You don’t need an unfair labor practice to upset laboratory conditions,” Dau-Schmidt explains. “If in fact [Senator Corker] made fraudulent statements with the intent of intimidating workers, that would be a violation of laboratory conditions.”

No matter the UAW’s legal decision, VW’s position remains worker-supportive. According to Reuters, the works council is “undeterred by last Friday’s vote” and “will press on with efforts to set up labor representation at Chattanooga.”

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Steve Cooper
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