The United Auto Workers Union (UAW) is the winner in the recently-concluded Ford contract negotiations. While its rank and file members will not see pay raises or recoup concessions, the union stands to gain millions in dues.
On Tuesday October 18, two large UAW local unions—Local 600 in Dearborn, Michigan, and Local 862 in Louisville, Kentucky—voted to approve their contract with Ford. The two locals had enough votes to push the contract over the line for company-wide ratification.
Before Tuesday’s vote, the fate of the contract seemed uncertain. Ford workers were almost evenly split on the new deals. An interior-parts plant in Saline, Michigan had almost 60 percent of its production workers vote against the contract. The vote totals went from 53 percent against last Friday to 63.2 percent in favor Tuesday.
Several local union leaders felt the contract did not go far enough. “People feel they deserve more,” Gary Walkowicz, a UAW Local 600 official who led a “Vote No” campaign, told Bloomberg Business Week days before the vote. “There is a lot of anger out here.”
One member went so far as to say that national leadership was more interested in gaining more dues than in what was best for workers.
Jeff Redden, a 16- year truck plant veteran and one of the leading voices against the contract at local 862 accused the union of becoming “too cozy with the company.” Speaking to WHAS11, a Louisville news station, he criticized the union for agreeing to a $6,000 bonus instead of fighting for pay raises.
He notes that the union can take its cut from the bonus immediately, while periodic raises would require the union to wait for the increased dues to come in.
Do the math—multiply the union’s dues take of 1.15 percent from the $6,000, or $69.00 per worker, times the roughly 41,000 Ford hourly workers—and the UAW stands to gain almost $3 million from the bonuses. (The UAW will also gain dues from the 12,000 jobs created by the contract.)
The UAW needs the new members and infusion of cash. As detailed by the September 22 Reuters special report “Crunch Time at America’s Richest Union,” the UAW has lost over 44 percent of its membership over the last decade.
[T]he UAW is facing its own financial reckoning. America’s richest union has been living beyond its means and running down its savings, an analysis of its financial records show.
Unless King and other officials succeed with a turnaround plan still taking shape, the next financial crisis in Detroit may not be at one of the automakers but at the UAW itself.
That picture of the growing financial pressure on the 76-year-old union emerges from a Reuters analysis of a decade of UAW financial filings and interviews with dozens of current and former union officials and people close to the union.
In an interview with Reuters, Mike Smith, an archivist at the UAW’s Walter Reuther library, notes that, “one of the axioms of the labor movement, is membership is power. It is power in the sense of increased dues for the particular union the members belong to. Also membership equals political power, clout in the workplace.”
To get this increase in membership – for dues and political power – the union will often promise their membership the moon.
Terry Bowman, a Ford UAW worker in Michigan, supports the contract but blames the union for inflated expectations.
Ford hourly workers should not be entirely blamed for their anger over the lack of additional increases. Union bosses are very good at promising the moon, and most hourly workers have been around long enough now to remember the good times of the 90s. … When contracts came around in ‘96 and ‘99, the union was pretty much able to write their own contracts because Ford did not want to “upset the boat,” and all autoworkers at that time received raise after raise.
Their anger is understandable when you realize that they have been filled with unrealistic and unattainable promises from their union officials who have for too long not been held accountable for their actions.
In short, the UAW leadership’s lavish promises have come crashing hard against economic reality.