Volkswagen's Chattanooga plant may become the first auto factory in the United States to create a European-style works council to represent employees, and such a move could provide a foothold for the United Auto Workers in the South.
"It looks like a done deal," said Mike Randall, publisher of the industry trade magazine Southern Business and Development.
Horst Neumann, VW's board member in charge of human resources, said the automaker was in talks with the UAW about setting up a German-style labor board at the Tennessee plant.
Neumann said the company may release a plan for the works council labor board in May or June, and formal talks with a union could begin as soon as the second half of the year if VW's managing board approves, according to an Automotive News report.
Workers at the plant also would need to OK the works council, which would represent employees in talks about such issues as pay, benefits and working conditions. Such councils are common in Germany and usually tied to a union.
VW's attorneys have told the company that a works council would run afoul of U.S. labor law if no union is formally involved, Neumann said, so the automaker has talked with the UAW.
Bob King, the UAW's president, said in an emailed statement that the union "is very interested in, and has great respect for, the German system of co-determination where the company has strong collaboration with management, unions and works councils."
"I am pleased that Volkswagen, known globally for its system of cooperation with unions and works councils, has an open mind about letting the employees in Chattanooga also be part of the global VW system of co-determination," he said.
But Ron Harr, the Chattanooga Area Chamber of Commerce chief who this week led a business delegation to VW's headquarters in Wolfsburg, Germany, said the UAW should not have a presence at the plant.
"We really don't understand any need for having a union," he said. "Volkswagen has far more applicants than it has jobs and the employees seem extremely happy to work there. VW also has involved employees in major decisions and changes in shifts and other workplace issues. So we hope it doesn't happen."
Harr said unions in the U.S. are different from those in Europe and having a UAW presence in Chattanooga might make it more difficult to attract added automotive suppliers to the region.
"One of the great advantages that Chattanooga has enjoyed is being in a right-to-work state without the major presence of unions," he said.
On Tuesday, employees at the Enterprise South industrial park plant were mostly noncommittal about a works council and the UAW, though there was some sentiment in favor of such a labor board if it's run as it is in Germany.
Michael Schumacher, who has worked at the plant for several months, said it could benefit workers and management as they discuss problems at the factory that has 3,200 employees.
"That's successful in Europe," he said. "It can be beneficial for both sides."
The management at the VW plant, where the Passat sedan is assembled, has said in the past that any decision about unionizing is up to the workforce.
Randall said that VW's failed Pennsylvania plant that closed in the 1980s was a union shop.
Still, he said the works council concept "sounds like a better arrangement to me than what we've seen with unions with the Big 3 over the last 30 years," citing General Motors, Ford and Chrysler.
If the works council comes about, it also could open the door to organizing efforts at other Southern auto plants, which have traditionally turned back attempts at unionizing.
Randall said the German automakers, such as BMW and Mercedes, would more likely be attracted to the idea than would Asian companies.
In Chattanooga, efforts to organize the plant ratcheted up about a year ago when union materials were passed out to workers. However, the UAW later said it was targeting Nissan's plant in Canton, Miss.
Business Editor Dave Flessner contributed to this report.
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