Auto suppliers first to test Michigan right-to-work law

David Barkholz

Published: December 17, 2012 6:00 am ET

Related to this story

Topics Public Policy, Automotive

DETROIT (Dec. 17, 2:15 p.m. ET) — United Auto Workers President Bob King expects few defections by his members when Michigan’s right-to-work law takes effect in March.

Unionized workers at parts suppliers will be among the first to test King’s confidence. As supplier contracts with UAW expire and are renewed or negotiated after the law takes effect, employees will be able to leave the union.

Contracts with the Detroit 3 expire in September 2015, so the law will have no impact on those plants until then. There’s a provision in the law that prohibits the legislation from abrogating existing contracts.

King, who negotiated Detroit 3 contracts for about 115,000 auto workers last year, said the union is providing value to members, as evidenced by the fact that 90 percent of UAW-represented auto workers in right-to-work states have chosen to stay in the union. “We’re going to continue doing the best job we can and be rewarded with the loyalty of the membership,” King said. He spoke by phone from Geneva, where he was attending a meeting of global union federations.

UAW has about 151,000 members in Michigan at assembly and parts plants, public employers and other businesses. UAW would not disclose how many are in the auto industry.

The legislation is a threat to the lifeblood of a union still trying to organize nonunion automakers in the South.

For Detroit 3 auto workers, dues amount to two hours of wages per month, or about $600 per year.

Last week Michigan became the 24th state to enact so-called right-to-work legislation. Under right-to-work, employees cannot be required to join a union, stay in a union or pay union dues at companies at which unions have won the right to bargain collectively for workers.

King said UAW and other unions fought hard to prevent the legislation because right-to-work undermines wages and benefits and suppresses workplace democracy. Michigan Republican Governor Rick Snyder signed the legislation last week after it was fast-tracked through the Republican-dominated state legislature in a matter of days, with no committee hearings, during a lame-duck session.

King said the best way to keep members from leaving the union is to bargain hard for wages and benefits and continue to represent worker interests in health, safety and work rules. “That’s why there’s solidarity in the workplace,” King said.

In addition to representing about 115,000 Detroit 3 auto workers across the country, UAW represents tens of thousands of workers employed by parts suppliers. An exact number was not available from UAW.

But as supplier contracts expire sooner and workers can choose to leave the union, the true value proposition of UAW will be put to the test, said Neil De Koker, president of the Original Equipment Suppliers Association in suburban Detroit. The association represents about 430 parts suppliers, including most of the largest ones that do direct contracting and engineering with the carmakers, the so-called Tier 1 suppliers.

De Koker said right-to-work laws in many Southern states have proved a magnet to automakers and their suppliers desiring to operate without unions.

He said right-to-work in Michigan will make the unions more accountable for how they spend the dues of members because those members will be in a position to leave the union if they disagree with that spending.

He said UAW spends heavily on the political campaigns of mostly Democratic Party candidates despite a membership that includes many conservatives and Republicans.

In 2011, UAW collected about $122 million in dues passed through to the International, according to the union’s most recent regulatory filing.

“The unions are really going to have to focus on the priorities of their members,” De Koker said.

Adam Forman, a Detroit lawyer with Miller Canfield, said Michigan parts suppliers with union contracts that expire soon need to make preparations for right-to-work.

They will need to have a mechanism for turning off the collection of union dues for workers who leave the union, Forman said.

He said they also have to be careful about communicating the rights of workers under the new legislation so as not to conflict with regulatory prohibitions against swaying workers to belong or not belong to unions.


Comments

Auto suppliers first to test Michigan right-to-work law

David Barkholz

Published: December 17, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

DC banning PS foam containers

July 30, 2014 2:34 pm ET

Washington D.C. Mayor Vincent Gra signed into law on July 29 a bill that will ban polystyrene foam food and drink containers from the District.    More

Image

Pressure is on to replace aging gas pipes

July 30, 2014 2:47 pm ET

Polyethylene is the plastic replacement material of choice for modernizing the natural gas distribution system — so much so some are concerned...    More

Image

Magna expanding interiors site in Slovakia

July 29, 2014 1:47 pm ET

Magna International Inc. plans to nearly double the size of its manufacturing facility in Trnava, in western Slovakia, to accommodate new automotive...    More

Image

One51 adding injection molder Straight to its bin molding portfolio

July 29, 2014 10:12 am ET

Dublin-based One51 plc has had its purchase of British trash bin maker Straight plc cleared by the United Kingdom's Competition and Markets Authority.    More

Image

Formosa to be compensated for Vietnam riot

July 28, 2014 1:44 pm ET

Taiwan's Formosa Plastics Group will receive $2.39 million from the Vietnamese government and insurance companies for damages suffered during the anti...    More

Market Reports

Plastics Recyclers Data Report & Directory

This exclusive MS Excel database contains all the companies from Plastics News' ranking of top North American Recyclers and Brokers by reprocessed volume and also includes a directory with materials processes, services offered and company contact information. Data is based on primary research by PN editorial staff.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events