Planet Money - How unions are stopped before they start

Episode Date: October 20, 2023

Union membership in the U.S. has been declining for decades. But, in 2022, support for unions among Americans was the highest it's been in decades. This dissonance is due, in part, to the difficulties of one important phase in the life cycle of a union: setting up a union in the first place. One place where that has been particularly clear is at the Volkswagen plant in Chattanooga, Tennessee.Back in 2008, Volkswagen announced that they would be setting up production in the United States after a 20-year absence. They planned to build a new auto manufacturing plant in Chattanooga. Volkswagen has plants all over the world, all of which have some kind of worker representation, and the company said that it wanted that for Chattanooga too. So, the United Auto Workers, the union that traditionally represents auto workers, thought they would be able to successfully unionize this plant. They were wrong.In this episode, we tell the story of the UAW's 10-year fight to unionize the Chattanooga plant. And, what other unions can learn from how badly that fight went for labor. This episode was hosted by Amanda Aronczyk and Nick Fountain. It was produced by Willa Rubin. It was engineered by Josephine Nyounai, fact-checked by Sierra Juarez, and edited by Keith Romer. Alex Goldmark is our executive producer.Help support Planet Money and get bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Quick note, we mentioned Amazon in the show. Amazon is a sponsor of NPR, and they pay to distribute some of our content. This is Planet Money from NPR. In May 2011, hundreds of people dressed business casual show up, have some hors d'oeuvres, and witness the grand opening of a brand new 2 million square foot auto manufacturing plant. This is spectacular. This is the good stuff. It's like a fun party. Some of the guests are cars.

The crowd is invited to an enormous room with rows and rows of chairs facing a stage. The opening ceremony is about to begin. The overhead lights dim and the video screens flash the Volkswagen logo. The future for Volkswagen begins here in Chattanooga.

I gotta say, this is such a weird announcement. Yeah, it kind of gets weirder. As part of the opening ceremonies, there's an interpretive dance by people in white bodysuits, and it kind of appears like they're assembling a Volkswagen. Afterwards, there is a more just straight-ahead press conference. Right. Tennessee Senator Bob Corker is there, and he's emotional. The greatest moment in my public career was receiving the call from the Volkswagen group that they were coming to Chattanooga. And I want to thank all of you for making that decision.

The opening of this Volkswagen manufacturing plant in Chattanooga, Tennessee, was the culmination of years of negotiation. The company had shut down its only American plant back in the 1980s, and this was their comeback. And the competition to win Volkswagen's new plant was fierce. Around that time, southern states were desperate to lure in big companies. South Carolina gave BMW more than $130 million in incentives, and Alabama gave Mercedes more than $250 million worth of incentives to build a plant there. And Tennessee, they wanted in. They wanted a car plant, too. Stephen Sylvia, professor of international relations at American University, he says the state did everything they could to woo Volkswagen. Well, Bob Corker works very closely with the state establishment, and they get a range of subsidies and other benefits they offer

Volkswagen. They offer tax abatements. They offer them land. They offer them educational facilities. When you add it all up, it comes to more than $570 million in aid, tax breaks, and incentives. Right. And at the time, a typical auto plant cost about a billion dollars. So that is how Das Auto came back to the States and set up in Tennessee. Now, just to remind you of what this moment was like, the plant opens as the country is still recovering from the financial crisis. For locals, this is like this one shiny star in a long, dark night. When the Volkswagen plant starts hiring, 85,000 people apply for just 2,000 jobs.

2,000 new jobs making cars. And of course, this is interesting not just to locals, but also to unions, specifically the United Auto Workers. You know, the union that traditionally represents people who work in car manufacturing and currently has members on strike. They want these to be union jobs. Right. Because the way the UAW sees it, Chattanooga is one place where they maybe can regain some ground. The UAW used to represent a majority of auto workers in the U.S.

Back in 1979, they had more than 1.5 million members. By the time this plant opened, that number had fallen to below 400,000. And Stephen says that decline is in part because of right-to-work laws that make it hard to form and fund a union. But it's also because a bunch of foreign-owned car companies came into the U.S. and set up non-union factories. The UAW has had a frustrating time for almost 20 years trying to organize foreign-owned car plants and failing. But the arrival of Volkswagen in the South? For the UAW, this seems different, potentially good.

The UAW leadership saw Volkswagen as their best opportunity. Their best opportunity for good reason. Because Volkswagen has plants all over the world, and they all have some kind of worker representation. Plus, the company had actually come out and said that they wanted that in Chattanooga at their new plant. So management was open to a union. The UAW definitely wanted a union. Now it's just a matter of convincing the workers. Yeah, you'll want a union too.

What could go wrong? Hello, welcome to Planet Money. I'm Amanda Aronchik. And I'm Nick Fountain. Union membership in the U.S. has been declining for decades. In part because of how difficult this one phase in the life.S. has been declining for decades, in part because of how difficult this one phase in the life cycle of any union has become. The setting up of that union. And if you want a case study in just how many ways things can go wrong, well, look no further

than Chattanooga. Today on the show, we look at three attempts over 10 years to establish a union at this one car plant in Tennessee. And what these attempts tell us about why union campaigns live or die. One of the 2,000 workers hired by Volkswagen at their new plant in Chattanooga is Steve Cochran. I was there the first day the first car was produced. So I've been there since the groundbreaking pretty much. Steve's job is to maintain the equipment. When something breaks, he's one of the people they call to fix it.

He used to work at Goodyear Tire Factory. His entire career has been working in factories. Right. And he says when you work at one of these places, you got to stay sharp. You know, even though there's a lot of automation in there, there's still a lot of hands on the car, screwing in bolts and stuff. So I still got all 10 toes and 10 fingers. And there's a lot of people out there that don't my age, you know, because they get them hung up in something or do something dumb. And I like to go home with all my digits and all the same way I come in, you know. I get that.

I get that. I feel like that's a reasonable thing to expect from work. Oh, yeah. Now, Steve had been in a union before when he'd worked for Goodyear. So when he heard that Volkswagen was supportive of unions, he was like, yeah, great. That's what I want, too. If you get a job at General Motors, Ford, or any of the places like that, it's life-changing. That changes your life for years.

It changes everything that you ever do. That should be the same thing when you get a job at Volkswagen. Volkswagen had set starting wages at the plant at $14.50 an hour, which was pretty decent for Chattanooga. But Steve is pretty sure that if they had a union, they'd probably get higher wages, better benefits, more time off. Not long after the plant opens, the United Auto Workers hold their first meeting in Chattanooga. Steve shows up and he's into it. Pretty quickly, he decides that not only does he want a union, he wants to be a union organizer. So he starts campaigning for the UAW.

He's making flyers. He's talking to people, doing social media. He's trying to convince his co-workers, we need a union. We need the UAW. Now to establish a local chapter that is able to sit down and negotiate with Volkswagen, they have to prove that a majority of workers actually want a union. Here is how that happens. Union officials go around with authorization cards. This is Professor Steven Sylvia again. So they're not membership cards, but they're authorization cards. What they say on them is, I authorize the UAW to be my representative in collective bargaining. Right. The first step to getting a union at the plant is getting signed cards from a majority of the workers,

which the UAW says they got. But here's where things go a little sideways. Remember how Volkswagen ended up in Tennessee, that $570 million worth of incentives? Yeah. Many of those politicians behind those incentives do not want the UAW at this plant. They do not want the UAW in Chattanooga. They do not want the UAW on a boat. They do not want it with a goat.

They do not want the UAW anywhere near anything. Right. The way they figured, a union at the plant could lead to contagion. Next thing you know, all the companies in Chattanooga would end up unionized. That would be expensive for business. So Volkswagen, trying to be pro-labor, but also trying to keep things, you know, kind of chill with the Republicans running the state.

They are stuck in this mushy middle. And they do this kind of weird thing. They reject the cards, don't recognize the union. But at the same time, they still insist they do want a union. So the UAW decides to try the next option for setting up a union, with an election, which to Volkswagen seems more acceptable. An election is called, there's a week and a half of official campaigning where the UAW makes their case and people opposed to the union make theirs.

And then there's going to be a secret vote. Both sides campaign everywhere. There are billboards, TV ads, radio ads, testimonials. A lot of people who don't work at the plant also get into the mix, like Maury Nicely. He's a lawyer who works for an anti-union group called Southern Momentum. This is the top of the UAW in Detroit. This is part of a presentation that Morey gave to workers to convince them not to vote for the UAW. And in this moment in the presentation, he's pointing to a pyramid, which is on the screen.

Understand, you're at the bottom of this pyramid. Revenue goes up to the top and control goes down. I spoke with Maury, and according to him, he was brought into this campaign by some Volkswagen workers who did not want a union at the plant. If you want to think of Southern Momentum, think of it as it's basically a loudspeaker for these employees who are concerned about the UAW, who beyond Southern Momentum, didn't have a voice. Southern Momentum was partly funded by donations from members, but Moria also acknowledges that money came from people who didn't work at the plant, local businesses, and people who really didn't want the UAW to come to Chattanooga. Another person who really didn't want the UAW to come to Chattanooga, Senator Bob Corker, one of the politicians who offered Volkswagen that $570 million plus in incentives and said that the plant opening was the greatest moment in his

public career? Well, right before the big vote, he shows up in a news segment pointing out how dangerous and radical the union leaders are. The officers a month ago talking about fighting and combat and all of those kind of things. If that's the environment you want, UAW certainly is the people for you to choose or the people to choose. Then on the first day of voting, he delivers a shocker. He says he has it on good authority that if workers reject the union, Volkswagen would commit to expanding its operation and build its new SUV right there in Chattanooga. After three days of voting, it's finally time to tally up the votes and see who's won. For the union, 626 votes. Against it, 712. It's decided there will be no union at the plant in

Chattanooga. And to Maury from Southern Momentum, Bob Corker and a bunch of local politicians weighing in like this on the union election, that totally made sense. These were Tennessee politicians. These were Chattanooga politicians. These were citizens saying this is not the best thing for our state. And that's exactly what those people should be doing. But for maintenance worker Steve Cochran, the senator had gone too far. I'd say he was probably one of the biggest deciding factors. And the media ran with it. They pushed it everywhere, on the news, radio, everything in the world. To Steve, the senator had intimidated the workers.

And he thinks some of them might have changed their votes. Some people, out of a fear thing, I ain't going to say they believed him, but they said, you know, what if? You know, what if? What if Bob Corker is right? What if Volkswagen sets up a new plant elsewhere? What if they cut our jobs? What if? What if? What if? So that was union campaign number one. Doomed, Steve would say, by a politician putting his finger on the scales. And maybe that is the takeaway from this first

campaign. Sometimes big, powerful people interfere with union drives and change the outcome. The past bunch of years, leaders at Amazon and Boeing have gotten in trouble for this, threatening dire consequences if their workers unionize. For workers, sometimes those threats can overshadow the potential upsides of joining a union, like how much more vacation they might get or more pay. Right. Which brings us to chapter two, the micro unit. After the failure of the 2014 campaign in Chattanooga, the UAW decides that they should try again and quickly. We got to do something different. So Steve and some of his fellow workers come up with a new plan. They decide instead of trying to organize the whole plant, what if they start a micro unit?

You know, a small group that would get to bargain directly with management. In this case, it would be just for the skilled workers. So not like workers on the line, but electricians and machinists, those kind of jobs. When there's 150 of you, you know, you're like, you know about all of them, you know. So you kind of talk to each other and stuff and know how things are going to shake out. Steve thinks a bunch of these skilled workers are going to vote for a micro unit. Many of them have been in unions before and they supported the UAW in the first campaign. And the plan is if they win, then they can scale up and unionize the whole plant.

The process plays out kind of like it did the last time. Steve and the other organizers try to get people to sign authorization cards. Volkswagen again rejects those cards. Again, there's some campaigning, then an election. And this time, the UAW wins. We won by 68%. You actually did better than that, Steve. 71% of workers voted for the micro unit.

This is a big deal. All of these foreign-owned car companies, BMW, Mercedes, Nissan, they'd been setting up plants in the South and none of them had unions. Now, at this point, Volkswagen's management's like, wait a second, we're not really into this whole microunit thing because we do want some kind of worker representation, but it needs to represent all the workers, not a fraction of them. We can't negotiate with just some of you. That's verboten. Oh, no. This is when Stephen, the professor, says that Volkswagen's attitude towards the union hardens. And so what happens is they go to fight it. So they hire Littler Mendelssohn, which is a very well-known union busting law firm. And then they learn about the union avoidance playbook. This is where it's injected into the Volkswagen bloodstream. Once it's there, it just takes and they just run with it. We should mention that we reached out to Volkswagen for this story and they just run with it.

We should mention that we reached out to Volkswagen for this story and they declined to comment. So now, instead of the fight happening with ads and billboards and flyers, it's going to happen with lawyers. Lots of lawyers. Volkswagen and the UAW asked the National Labor Relations Board to weigh in on the dispute. They're the federal agency that oversees union elections. And for a peek into how that agency works, we called up Wilma Liebman. She's a former chair of the Labor Board and also a former Planet Money guest. By the way, I came here about a couple months ago to do an interview for a different Planet Money episode. Wilma knows a lot about labor unions.

That's why we call her. She's also worked for the UAW as a consultant and as one of their ethics officers. Wilma says that the UAW went to the board to try to get Volkswagen to recognize the micro unit. And Volkswagen, they refused. And here's where it gets interesting in an albeit kind of wonky way.

A lot of times when this kind of thing happens, Wilma says, companies will actually weaponize the whole labor board process and use it to gum things up. I think some employers slow walk it. So they make it look like they're engaging in good faith bargaining. But if they really are determined to avoid unionization and having to bargain with the union, there are different ways that the whole process can be slowed down. Wilma says that's what happened here. Generally, the labor board has permitted these micro units, but Volkswagen argued that grouping those skilled workers together, that did not qualify. Maintenance workers like Steve work with everyone in the

plant. They weren't really what's known as a community of interest. They weren't a self-contained group. The UAW, of course, argues that this micro unit that they're trying to set up is a community of interest. Volkswagen's like, nope. So back and forth, hearing this, appealing that. Volkswagen drags this whole thing out as long as they can, which Wilma says is perfectly legal. There's no real penalty for employers using all these kinds of delaying strategies. There's no fines. There's no damages to speak of. It doesn't have much in the way of teeth.

Despite all of that, around the end of 2016, it's finally starting to look like Volkswagen is running out of things to appeal. And the UAW might get their micro unit. But then, big plot twist. A new president is elected, Donald Trump. You may remember him. And the political orientation of the labor board completely changes. Yeah. So this agency is famous for what's typically called flip-flopping every time the White House changes. A more formal expression is policy oscillation. I, too, have been accused of policy oscillation by my family. It happens to the best of us. So here is what happens.

A new chair is appointed by the president, and now the board is like, you know what? We need to look at how we define community of interest again. Tighten up those rules for forming a microunit. All of a sudden, the UAW is back at square one. Wilma says the labor board can be annoyingly inconsistent over time, that the rules are always changing. I think the reasons for that are pretty obvious. It's, you know, the labor and capital have deep divides. And labor law and the role of unions in the U.S. have always been subject to very deeply held and divided views. The UAW and Volkswagen continue to fight over the micro

unit thing in the background for years. Kind of gets stuck in a stalemate. So the takeaway from the second failed union drive in Chattanooga, timing really matters. Under some administrations, the NLRB seems to take the side of management, like what happened to the UAW in Chattanooga. And under others, the NLRB is just way more union friendly, like how they had a bunch of rulings in favor of the new union at Starbucks and for some grad students who have organized around the country. Just kind of depends on who's in charge. Meanwhile, Steve and his buddies, they still want a union. Coming up after the break, they take their fight to the factory floor.

Try a little spontaneous protest. Argentina's currency is plummeting and a leading presidential candidate there has a solution, replace its peso with the U.S. dollar. Each time that we got elections, each time that there was a shift in office or that could be a shift in office, the exchange market was shaking for some time. In our next bonus episode, Argentina's long and complicated relationship with the U.S. dollar. Planet Money Plus listeners can check that out now. If that is you, thank you for your support. can check that out now if that is you. Thank you for your support. If it is not you, it could be. Sign up at plus.npr.org. By 2018, the plant has been open for seven years. Steve and the other union supporters have been trying to get a union set up pretty much the whole time. But this conflict has sort of been a slow burn. Yeah, they never really had a big dramatic type moment that you see in a union movie.

But then a week and a half before Christmas 2018, that moment happens. And it basically launches the union's third campaign. It happens when the company changes this one policy. So we have a shutdown every Christmas and every summer, you know, for putting new equipment in or whatever it is. It's called winter shutdown and they pay us for that week. The shutdown was so that they could change up the assembly lines so they could start making their new SUV. This time it was going to take even longer than the week they usually needed, three extra days. Normally how this would work is that workers would have the option to just not get

paid for those days. But this time, management makes an announcement and says, hey everybody, for those three extra days, you're going to have to use your paid time off. We were just like, you know, really? People were like, I don't know, I ain't doing that. They didn't like it, so. At that moment, there are a bunch of people working on the floor of the plant, and they're all looking at each other over these half-assembled cars, muttering to each other about management taking away three of their already limited paid days off. For a lot of the workers, that's three out of just 10 days that they get each year. If y'all make us use all of it up, then when are we going to have to take time off to be with our families, be sick, take our kids to the doctor? You know, so it's kind of like, you know, that doesn't work for me.

And meanwhile, the workers know that the people who made this new policy are sitting just upstairs, up in their glass-walled offices. This one guy said, man, what can we do? You know, because I'm going to walk up there during our break time. I said, I'll go up there with you. By break time, the number of angry people has grown. About 50 of us marched upstairs and said, no, we're not going to do this. At first, management kind of digs in. But the workers, they dig in too.

Yeah, because when break time ends, they don't go back to the floor. Production just stops. They couldn't start the line back up because there's so many people missing from the line. Steve says he could see on the managers' faces that their little protest, it was working. So the workers and the managers are in this standoff. The cars on the plant floor are not being assembled. Finally, the managers say, OK, they'll think about it. By the end of the day, they're like, fine, you don't have to use your paid days off.

When that happened, that actually changed the way they handled that stuff for a little while. But it didn't stick. Steve says that not too long after, they actually changed the policy back. And Steve, he used this moment. He told his colleagues, if they had a union this flip-flopping by management around policies, it would not be happening. So I explained to people, if we had had a contract and that stuff was written in a contract, then we wouldn't have to do that no more. All that stuff is just not left up to somebody's, this is how I feel about today. In the months after this mini protest, Steve and the other union supporters are actively trying to drum up support for another election. But you know what was also happening around this time? The FBI has raided the home of United Auto Workers Union President Gary Jones. This is part of a probe regarding alleged corruption within the U.S. auto industry.

Yeah, the whole time they're campaigning, this corruption scandal at the UAW is all over the news. Again, in addition to the pro-union side, there's a campaign against the union, and they are making a very big deal of this scandal. So, you know, a lot of the discussion in the campaign flowed down to, is this really who you want representing you? Southern Momentum's Maury Nicely again. He says he doubled down on this message, made the whole campaign very personal. Is this who you want? Look, guys, is this who you want to marry?

Is this who you want to step up, look, guys, is this who you want to marry? Is this who you want to step up and say I do too? When the campaign for the third election wrapped up, the vote tally came in. For the union, 776. Against it, 833. The union loses again. Now, some of this obviously had to do with the UAW's legal problems. The corruption scandal was like a gift. Oh yeah, oh yeah, absolutely. I mean, I certainly take no revelry in that, but that obviously colored and influenced that election. Morey says he knew workers who were open to the idea of joining a union.

They just didn't want to join the UAW. So the takeaway from union drive number three, it's kind of a self-evident one, maybe don't have a giant scandal in the middle of your union election. Right. But Maury said there was more going on here than just the scandal. The real reason, he says, that this third union drive failed, really why they all failed, was because of where they were taking place. We are a very right-leaning state,

and particularly in terms of politics. And union equals Democrat, right? And an anti-union equals Republican. And so, you know, when you come into Tennessee, you're probably already dealing with that. On this point, union organizer Steve Cochran actually agrees. He says people decide whether they're pro or anti-union based partly on their political identities.

But he says that didn't happen by accident. It was the result of a deliberate campaign by anti-union forces. They've politicized it. That's the biggest one that I've seen where they're saying, well, if you vote in favor of unions, you're a Democrat. And I'm like, no, that's not true. That has nothing to do with anything inside my workplace. It just doesn't.

I mean, sorry, but Democrat, Republican, either one, you know, it doesn't matter. But they've done a real good job of doing that, you know, playing them kind of politics with people. Steve has been at this for more than 10 years. He's tried three times to get his plan organized. But he says he's still not done. Do you think there's, is there a plan to try to unionize the whole plant again? Oh, always. Oh, oh yeah, absolutely.

Yeah, always. Always. It's kind of a thing. You either give up or die, you know. I mean, you know, you keep pushing or you die. It's one or the other, you know, don't give up. Steve has been watching the big UAW strikes happening right now across the country. If those go well for the union, maybe next time more workers at his plant in Chattanooga will vote yes.

This episode was produced by Willow Rubin, engineered by Josephine Neonai, fact-checked by Sierra Juarez, and edited by Keith Romer. Ida Poroside helped with research. If you want to read more about union organizing at car manufacturing plants, Steve and Sylvia's got a new book out. It's titled The UAW's Southern Gamble. Special thanks this week to Blake Farmer, Michael Gilliland, and Bob Kim. I'm Amanda Aronchik. And I'm Nick Fountain. This is NPR.

Thank you for listening. And a special thanks to our funder, the Alfred P. Sloan Foundation, for helping to support this podcast.