A “European-style” works council in the United States?


The creation of a “European-style” works council at the Volkswagen plant in Chattanooga, Tennessee, is fuelling controversy in a US region hostile to unions.

After numerous setbacks, the supporters of organised social dialogue at the plant – the group’s only factory in the world without a works council – are on the verge of achieving their goal.

A works council, in the United States, would be unprecedented. In this country where whole sections of the economy are not covered by the federal law on social dialogue and where anti-union sentiment is strong, even in subsidiaries of European groups like Deutsche Telekom, worker participation in the management of a company depends entirely on the employer’s good will.

Jonathan Walden, an employee at the plant, told Equal Times that he sees the works council as an “opportunity to do something new and innovative”.

As soon as the United Automobile Workers (UAW), which is keen to organise workers employed at foreign car manufacturers to compensate for falling membership at US automakers, announced the formation of a local union for Volkswagen workers in Chattanooga, at the beginning of July, Walden joined.

In the Southern United States “trade unions are the exception rather that the rule” admits the new member, who had never joined a union before.


A controversial issue

There is such scorn for trade unions in this region of the US that the support gathered by UAW among Volkswagen employees in Chattanooga, and the subsequent launch, last year, of discussions regarding a works council sparked an outcry among the local authorities.

The governor of Tennessee, Republican Bill Haslam, voiced his concerns over the plant’s future if it were to be unionised.

Meanwhile, Senator Bob Corker suggested that if the workers voted in favour of the UAW, Volkswagen would decide against Chattanooga for the manufacture a new SUV line in addition to the Passat sedan already produced at the plant.

The two former business leaders feel that the UAW is partly to blame for the bankruptcy of the US auto capital, Detroit.

In this context, as employee Jonathan Walden explains, the decision to join the union was not straightforward.

“I had to learn about it, to understand how they work, what they do, before supporting the formation of a local union” said Walden, who Volkswagen hired to work in the paint department shortly after the factory opened in spring 2011.

What seems to be motivating the Volkswagen workers in Tennessee to join the union is not the potential to strike or to ask for better pay but the prospect of taking part in the company’s economic life through a works council.

“It wasn’t straightforward, because it is a very controversial issue,” he adds.

The controversy is such that when, at the beginning of the year, the plant’s assembly line workers voted against union representation by 712 votes to 626, the UAW attributed the defeat to “a firestorm of interference and threats from special interest groups”.

The chair of Volkswagen’s global works council, Bernd Osterloh, a member of the powerful German metalworkers’ union IG Metall, said that production of the new model risked being allocated to the Volkswagen plant in Mexico if Tennessee’s political representatives did not stop meddling in the company’s internal affairs.

“Co-determination is a key factor in our success,” he told the German financial daily Handelsblatt, in an interview widely covered by the US media a year ago.

Although Volkswagen’s US subsidiary is careful not to comment on the formation of a union for workers at the Chattanooga plant – “that’s the business of the union in question,” we are told – the company seems determined to resolve the need for a works council.

Soon after the UAW succeeded in forming a union for the employees at the company in Tennessee, the Volkswagen Group of America announced, in mid-July, that the production site chosen to assemble the sport utility vehicle (SUV) for the North American market was indeed Chattanooga.

In the same press release, Volkswagen announced the appointment of Osterloh to the subsidiary’s board of directors.

Tennessee’s Republican representatives are not impressed.

Thanks to the latest gains, “colleagues that were previously opposed to the works council have now joined the union,” says Walden.