A new reality looms for UAW in GM bankruptcy
— -- Facing declining membership and ever more demands for concessions, the UAW may need to merge with another union to remain viable, according to labor relations experts.
From a peak of 1.5 million members in the late 1970s, UAW membership dropped to 431,000 at the end of 2008. And there continue to be major job cuts this year.
"A responsible union leader would at least have to explore the idea of merger with another union," said Richard Block, a professor of labor relations at Michigan State University.
Gary Chaison, professor of industrial relations at Clark University in Worcester, Mass., said UAW retirees will gain influence. Under the GM recovery plan, a union-run retiree health care trust fund, known as a VEBA, would own a big chunk of GM stock. "Essentially, the UAW has gone from being a bargaining agent to being a protector of retirees."
That dual role — representing active workers and being the fiduciary of the multibillion-dollar VEBA — could create tension. "If you own a large portion of a company, does this affect your ability to strike or your desire to strike?" Chaison asked. "Do you look at your members' compensation as a labor cost? It's a totally different perspective."
In 1995, the UAW, United Steelworkers and International Association of Machinists announced their intention to merge. But the complex issues involved proved too difficult, and it never happened.
Leo Gerard, president of the steelworkers union, said he still would be open to such a deal. "I was for it then, and I would be for it now."
The UAW did not answer a request for comment.
If the UAW has taken hits, it still has major resources, including a skilled staff and assets of more than $1 billion, according to its 2008 federal report.
It also has potent allies in the Obama administration to help soften the harshest demands of management and bondholders in restructuring.
It also has members that understand the situation, Chaison said. "That's critically important. You can't claim that concessions are being foisted on them by a company that's really doing well. Those days are over."
