National labor disputes to cast shadow over UAW talks

More than 20,000 dockworkers on the West Coast are locked in a bitter labor dispute and oil industry workers are on the largest strike since 1980 just as the UAW plans a bargaining convention that will set the tone for contract talks with the Detroit Three later this year.

Experts say the two high-profile labor disputes reflect a labor movement emboldened by a recovering economy and that sees an opportunity to resolve long-festering issues.

The oil refinery and dockworkers disputes also are emerging at a time when even Republican presidential candidates such as Jeb Bush and Rand Paul have begun to talk about income inequality and Wal-Mart Stores announced it would grant pay raises to 500,000 full-time and part-time workers to at least $9 per hour.

The labor dispute between the Pacific Maritime Association, which represents a coalition of companies that operate 29 ports, and 20,000 members of the International Longshore and Warehouse Union, has dragged on for eight months. The PMA recently began shutting down ports because it claims workers are conducting a work slowdown.

Meanwhile, the U.S refinery workers strike that began Feb. 1 now involves more than 5,000 workers at 11 plants, including nine refineries, and accounts for 13% of the country’s fuel capacity.

For the oil industry workers, who are represented by the United Steelworkers, the key issues are safe staffing levels and safety. But the union also wants wage increases.

Those national labor disputes may still be raging in the background as hundreds of elected UAW leaders arrive in Detroit next month for a bargaining convention. During that convention, the union will develop its strategy and goals for negotiations that will begin this summer with General Motors, Ford and Chrysler.

Rising expectations

This year, UAW leaders and the management of automakers must figure out how to deal with the rising expectations of more than 140,000 autoworkers. They agreed to concessions in recent contracts but have watched auto companies book billions in annual profits as the industry recovers.

“What we are seeing is — with the recovery — people are seeking to regain some of what they have lost. And we are seeing that play out in the longshoreman dispute and the oil refinery strike,” said Harley Shaiken, a professor and labor economist at the University of California, Berkeley. “I think we will see more attempts by workers, where possible, to gain back some of what they gave in the midst of the economic crisis.”

In 2011, the UAW pushed for and won a revised profit-sharing formula that has led to record profit-sharing checks in recent years for autoworkers and also won a raise for entry-level workers. But older autoworkers hired before 2008 haven’t had a raise in more than 10 years.

“Those workers want a raise because their lives, their bills don’t go up and down based on last year’s profits,” Shaiken said.

Right to strike

The UAW also will have the right to strike for the first time since 2007. The union agreed to a “no-strike” clause as part of contract modifications adopted during the bankruptcies of GM and Chrysler in 2009.

In 2011, General Motors and Chrysler also were still recovering from the recession and emerging from taxpayer-funded emergency loans, making a strike politically impossible.

Arthur Wheaton, a professor of labor studies at Cornell University, said a strike by the UAW remains politically difficult because of the sensitive stage of its organizing campaigns in the South.

In Chattanooga, Tenn., Volkswagen has certified the UAW as a representative for more than 45% of its hourly workers. And, under a new labor policy, the automaker is allowing the union to meet with management on a regular basis.

The UAW also has established a local chapter near Tuscaloosa, Ala. where it is attempting to organize workers at a Mercedes-Benz plant.

“The UAW doesn’t want to come across as adversarial and/or look like it’s on a mission to go to war,” Wheaton said. “I do not expect a strike.”

UAW President Dennis Williams has said a strike is always the last, and final option.

“If you look at our track record, 98% of all of our contracts are settled without a dispute,” Williams said in December. “Striking is a failure on both parties’ part and we don’t plan on failing, but we will be prepared.”

In America, labor strikes have largely become a relic of the past as union membership has declined as conservatives have successfully nibbled away at the union’s political power with right-to-work laws that allow employees to opt out of paying union dues.

In 2014, there were just 11 major work stoppages involving 1,000 or more workers — the second-lowest annual total since 1947, according to the U.S. Bureau of Labor Statistics. The department defines a major work stoppage as either a strike and/or an employer lockout that lasts for at least one shift.

Tough talks ahead?

But whether the UAW goes on strike later this year isn’t the only way to measure what could easily become a contentious and difficult round of contract talks.

Wheaton said it’s clear that the Detroit Three are worried about this year’s contract talks and are already taking steps designed to reduce tensions.

GM, for example, decided to ignore the cost of last year’s high-profile recalls when it calculated profit-sharing checks.

The result: GM workers get checks as large as $9,000 before taxes — about $2,000 higher than if it had included recall costs.

Meanwhile, Ford has been loudly trumpeting its employment growth. This month, Ford added 1,550 jobs at four plants to meet demand for the new 2015 F-150 pickup and has hired more than 15,000 new workers since 2011.

The influx of new entry-level workers caused Ford to bump up the wages of as many as 500 lower-paid employees already on the automaker's payroll from $19.28 to $28.50. Ford is required by its contract to employ no more than 20% of its workers at the entry-level wage.

Ford will likely seek the elimination of that cap in contract talks this year. The UAW’s Williams has vowed to win raises for autoworkers at each automaker for legacy and entry-level workers even though automakers will want to prevent labor costs from rising.

“There are some very big issues to be resolved around the commitment to flexible compensation and raises,” said Kristin Dziczek, director of the labor and industry group for the Center for Automotive Research. “I could see that that could lead to … a stalemate in negotiations.”

Contact Brent Snavely: 313-222-6512 or bsnavely@freepress.com. Follow him on Twitter @BrentSnavely.