UAW Decides to Delay Choosing Target Company for Negotiations

08/26/96

Reuters reported that the UAW's bargaining committees met on Thursday and decided to postpone choosing a target company for its negotiations with Detroit's Big Three automakers. The decision is surprising because it represents a break with tradition: normally the union would have picked one of the Big Three companies, concentrated their bargaining effort on forging an agreement with that company, and then taken the resulting agreement to the other two companies. The union was expected to pick a lead or target company for bargaining on Thursday.

The UAW is presently bargaining a successor agreement to the auto workers' triennial contract, which expires September 14. The auto workers' contract with the automakers details the rights and responsibilities of over 400,000 workers.

UAW President Stephen Yokich said the UAW put off choosing a lead company so that the union could meet with each of the automakers' chief executives on Thursday and Friday. Such meetings are unprecedented, as the automakers' CEOs rarely get involved with bargaining until shortly before the contract is settled.

Yokich said the UAW's talks with the automakers have been unusually productive this year and he wants to see that progress continue. Yokich told a press conference, "There might not be a need" for a target company this year. The UAW made its announcement at Thursday's meeting of its bargaining committees, which involved 500 UAW leaders from around the country. Yokich also said that the union may still choose a lead company for bargaining as early as Sunday.

Yokich described the decision to continue bargaining with all three companies instead of picking one target company as "good common, honest sense." He said, "If you've got three companies that are moving along in their negotiations and these three companies want to reach agreement, you don't stop them. You meet with them."

The automakers each said they respected the UAW's decision, acknowledged that talks have been productive, and said they would continue to work towards a settlement.

Wall Street analysts saw the UAW's unorthodox move as a positive sign. PaineWebber analyst Michael Ward said, "Yokich is coming out and saying, 'We're pretty close to an agreement here, and if we are, let's just get it done.' If that's true, that tells me it's pretty much a carryover contract, and that's a positive development for the stocks."

Yokich became UAW president last year and has a reputation for breaking traditions. His strategy garnered praise from UAW local leaders. Bruce Perry, president of UAW Local 95 at GM's Janesville, WI. truck plant, said, "It's something different. This is Steve Yokich." Perry added, "I think it's visionary. We're going to see which of the Big Three can best meet our needs."

As enthusiastic as UAW leaders may have been about their new strategy, they still recognized that bargainers have a long way to go to resolve difficult issues such as outsourcing and job security issues. Speaking about the automakers' practice of shipping work to countries and plants where they can pay local workers pennies on the dollar, Edward McNulty, president of UAW Local 14 at GM's Toledo, Ohio transmission plant said "I cannot compete with somebody on the outside who is making less money than I am. We have a major problem with global sourcing."

Paul Dever -- The Auto Channel