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Volkswagen AG may soon need to negotiate wages and benefits with a UAW local in Tennessee after the National Labor Relations Board rejected the automaker’s appeal that skilled-trades workers couldn’t organize separately from others at its U.S. factory.
In a 2-to-1 vote on Wednesday, the board affirmed union representation for the maintenance workers at the automaker’s Chattanooga, Tennessee, plant, denying Volkswagen’s challenge that the organizing votes must include production employees. The workers that petitioned for union status are “readily identifiable as a group,” and have the right to bargain under independent union representation, the board said in its statement.
“The Employer failed to meet its burden of demonstrating that the additional employees it seeks to include share an ‘overwhelming community of interest’ with the petitioned-for unit,” the board said. Volkswagen’s request for review “is denied as it raises no substantial issues warranting review.”
Union membership gives Volkswagen’s U.S. employees a voice for the first time in the company’s labor decisions, through “works councils” like the company uses in Germany, according to Arthur Wheaton, a director at the Worker Institute at Cornell University. It also creates an additional burden for the company, he said, and could lay the groundwork for the whole plant -- including the production employees -- to unionize eventually. The company is already under pressure since its diesel-emissions cheating was revealed in September.
“The biggest concern for companies is a loss -- or a perceived loss -- of power,” he said in a telephone interview. “From the Volkswagen management perspective, it’s another headache or another thing to do when they’re really busy. From the workers’ perspective it gives them a voice in the product and company.”
Volkswagen is “reviewing the decision and evaluating our options,” company spokesman Scott Wilson said in an e-mail.
The Detroit-based union is engaged in a long-term effort to represent all hourly employees at the Chattanooga plant, even after losing an organizing vote in 2014 that included all of the plant’s hourly workers. The UAW effort has seen pushback, including from U.S. Senator Bob Corker, a Tennessee Republican who told Chattanooga workers in 2014 that Volkswagen would reward them with a new product should they choose not to unionize. Volkswagen denied that incentive.
“With today’s order, the NLRB has clearly stated that it views the skilled-trades election in Chattanooga as a legal and appropriate step toward meaningful employee representation,” Gary Casteel, secretary treasurer of the UAW, said in a statement after the decision. “We hope Volkswagen’s new management team will accept the government’s decision and refocus on the core values that made it a successful brand -- environmental sustainability and meaningful employee representation.”