July 11 (Bloomberg) -- Five months after workers at a Volkswagen AG car factory in Tennessee voted against forming a union, the United Auto Workers said it would open a local office there that could lead to the creation of a German-style worker council.
UAW officials said Local 42 at the Chattanooga assembly plant would give employees a voice in the workplace along the lines of the councils popular at companies in Germany, where the carmaker is based. While participation is voluntary, the intent is to eventually convince the company to formally recognize the UAW as a bargaining unit by showing broad worker support, union leaders said in a statement yesterday.
“Upon Local 42 signing up a meaningful portion of Volkswagen’s Chattanooga workforce, we’re confident the company will recognize Local 42 by dealing with it as a members’ union that represents those employees who join the local,” Gary Casteel, the UAW secretary-treasurer, said in a statement.
The union lost a Feb. 14 election supervised by the National Labor Relations Board by a vote of 712 to 626. The loss set back UAW efforts to organize workers at manufacturing plants in the U.S. South, which has long resisted labor unions.
Volkswagen, which consented to the vote in February, said yesterday it has no agreement with the UAW and it didn’t participate in the announcement.
“Just like anywhere else in the world, the establishment of a local organization is a matter for the trade union concerned,” the company said in a statement. “There is no contract or other formal agreement with UAW on this matter.”
Kristin Dziczek, director of the industry and labor group Center for Automotive Research in Ann Arbor, Michigan, said setting up the local is a way to “bring some kind of critical mass” to its organizing effort, following the February loss.
It’s important for the UAW to gain members and stem losses in recent years, Dziczek said. The union has lost 75 percent of its members since 1979 as the U.S. auto industry shrank.
Patrick Semmens, vice president at the National Right to Work Committee, said the local could only serve in an advisory capacity under U.S. labor law. The Springfield, Virginia-based committee says it was formed to fight coercive efforts by labor groups to organize workers,
It wouldn’t be eligible to negotiate wage and benefits, he said. The UAW can’t hold a new vote until a year after the earlier ballot, he said.
Semmens said his group is concerned the formation of the local will lead to backdoor effort to organize workers without a secret ballot.
“Just the fact that you have a local doesn’t change anything,” said Larry Drapkin, a labor attorney in the Los Angeles office of Mitchell Silberberg & Knupp LLP. “It is indicative that they aren’t going away.”
The UAW could next seek voluntary recognition from Volkswagen or ask for a new vote next year, Drapkin said.
Volkswagen, based in Wolfsburg, Germany, didn’t fight the UAW’s February campaign, and was open to introducing the German-style worker council in Chattanooga to represent both salaried and blue-collar workers.
“Our plant in Chattanooga has the opportunity to create a uniquely American works council, in which the company would be able to work cooperatively with our employees,” Frank Fischer, chairman and chief executive officer of Volkswagen Chattanooga, said in a statement before the February vote.
Tennessee officials, including Governor Bill Haslam and Senator Bob Corker, both Republicans, opposed efforts to organize workers at the plant.
David Smith, a spokesman for Haslam, said in an e-mail, “that there is no agreement between the company and the UAW.”
Casteel said the union had continued talks with Volkswagen after the vote and had “arrived at a consensus with the company.”
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