Labor-Management Cooperation: UAW Drive to Organize Parts Suppliers Shows Cultures Can Change, Official Says

Online, April 27, 2011 (Newswire.com) - 72 DLR C-1
Labor-Management Cooperation
UAW Drive to Organize Parts Suppliers
Shows Cultures Can Change, Official Says

LANSING, Mich.-The United Auto Workers union's six-month-old push to organize employees at automotive parts suppliers is in many ways "about changing a culture," and so far that appears to be possible, Cindy Estrada, the UAW vice president in charge of that effort, said April 14 at a labor-management conference.

Other speakers at the conference, sponsored by the Michigan Labor Management Association, echoed that theme. Bob Chiaravalli, chief executive officer of Strategic Labor and Human Resources LLC, said other sectors would do well to look at the auto industry as an example of how bad decisions can have costly ramifications for the future, as well as how communication between labor and management can save companies.

In the auto-parts sector, "people are really stepping up to the plate," Estrada said. Union and industry officials are eager to "rebuild trust," she said. In order for that to happen, she said, workers need to feel their input is being heard. "We don't want to go in a room where someone hears our opinion," she said. "We want to have a program."

"Workers are going to be more comfortable talking about their problems with union leadership than with management," Estrada said. "We're able to help bring (workers' concerns) to the level of management," sifting through worker complaints and focusing on those that represent "valid problems" with potential solutions, she said.

Top management involved in the effort has so far been responsive to workers' needs, in some cases replacing middle managers that were stuck in a union-versus-management mindset, she said.

Crisis can be an opportunity, Estrada said. "It's amazing, as you saw in Chrysler and GM, what a bankruptcy will do to both parties," she said. She cited Dana Corp., which recently reached a new contract agreement with UAW (55 DLR A-9, 3/22/11) as a recent example of success.
Workers at Dana's Lima, Ohio, plant, a "legacy" plant with numerous work rules, needed to be convinced that those rules needed to change in order for the company to stay competitive. "That was a struggle," she said. However, she noted, once workers were given the same information management had about Dana's situation, they were convinced that a new program that included profit-sharing was a better way to ensure success at the company and preserve jobs for the longer term. Workers need to "have skin in the game," she said.

"It's all very new, but I feel the communication's there," Estrada said. "We're having the dialogue. The commitment's there. I'm hoping as we go along we can show these examples" to other companies and "start to make these changes everywhere," she said.
Still, "I'm really concerned about the wages in the supplier sector," Estrada said. "We want workers to be invested in long-term viability, but it also is going to take paying a living wage." With companies like Dana, she said, UAW has negotiated "creative" systems that do not price employers out of their markets but do let workers pay grocery bills.

Health Sector 'Next Generation' for Restructuring
The health and hospital industry, Strategic Labor's Chiaravalli said, is likely to be the "next generation" to go through turbulent times. "They're having to address the same types of issues that have led to the automotive restructuring," namely erosion of workers' pay and job security, dependence on a complex set of systems, and revenue that is closely tied to volume.

A key difference, he said, is that many automotive jobs are for blue-collar, factory workers, while "hospitals have some of the most highly educated people around." Since labor costs are a large share of revenue-45 percent in the best-managed hospitals-"any work in that area is going to make that institution more viable."

Labor-management committees, Chiaravalli said, should be looking at "common issues," such as wellness programs, that can yield agreement without confrontation and allow labor and management representatives to hone their negotiating skills. "If you have a bad relationship, test those skills out with dialogue," he said. "I think we've missed the boat as < a href=" http://www.hrstrategy.biz/labor-relations/">Labor Relations professionals" by not considering such tactics earlier, he said.
"The only way it's going to get better is if every worker's voice is heard," said Michael Duggan, Detroit Medical Center president and chief executive officer. DMC, he said, listened to workers on the emergency-room floor and streamlined its patient check-in system, reducing wait times from two hours or more to 29 minutes or less. "We changed the culture of the organization to say, make the employees come forward; we'll listen to their ideas," he said.
Chiaravalli suggested managers think of labor agreements as business plans, and prepare well in advance of negotiations. "I don't think a year is too long," he said.

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