Tesla and the UAW seem to be on a collision course. Last week, the union filed unfair labor practice charges with the National Labor Relations Board, alleging Tesla has broken the law in its attempts to prevent its production workers at the Tesla factory in Fremont, California, from voting in favor of the union. If the NLRB finds in favor of the union, it could order Tesla to recognize the union even without a vote. Can you see a federal government agency doing such a thing in the Age of Trump? No, me either.
Mention labor unions and you instantly divide everyone in the room into armed camps. Some view labor unions as the spawn of Satan, forcing poor unfortunate employers to pay people for standing around on their shovels all day doing no work. The old joke is, “What is big and orange, has 10 wheels, and sleeps 4?” Answer: “A state highway department truck.”
On the other side of the coin, you have people who say we can thank unions for the 40 hour work week, health insurance, limits on child labor, and a host of other policies that make working for a living a little more palatable. If you want a taste of what the other side looks like, consider this James Taylor song.
Let me get my personal biases out of the way right up front. I am the great grandson of Irish immigrants who worked in the mills in New England before becoming entry level middle class workers as conductors and motormen for local public transportation organizations. That was a time when mill owners would close and lock the windows in the mills to keep drafts from disturbing the cloth being spit out by the weaving machines. As a result, my ancestors had lungs filled with wool and cotton fibers. They tended to die before they got out of their 40s.
I will try to keep my inborn prejudices from influencing this article, but my ancestors came to America when “No Irish Need Apply” signs were on display outside the employment offices of most businesses and that knowledge still rankles. I am also married to a public school teacher who could have lost her pension at several points in her career when she had disagreements with the administration. It was her membership in a union that saved her every time. Our lives would be significantly different (and not for the better) were it not for the support of her union.
“This is the beginning of something,” Harley Shaiken, a labor professor at the University of California, Berkeley tells Automotive News. “They’re provoking ongoing conflict with a significant number of workers at a point where Tesla needs it the least.” Shaiken is referring to the fact that Tesla is struggling to negotiate tricky waters on its way to ramping up production of the Model 3, its entry level electric sedan. “You’ve got a turning point here,” he adds. “Tesla, which has been so innovative in so many ways, seems to be reverting to 1930s-style union avoidance in the way it’s dealing with the UAW.”
Shaiken has a point. Last fall, 700 Tesla employees woke up one morning to find they had been summarily fired — no warning, no notice, no exit interviews or letters of recommendations. Not even a free FroYo from Elon. The company said all of them were under-performers, but the UAW hints darkly that many were let go for being suspected union sympathizers.
I have never worked at the Fremont factory, so I can’t know the truth of things from my own personal experience. I have read news reports about long hours, forced overtime, demanding production schedules, and repetitive injury claims, however. What I do see, from the comfort of my arm chair, is a cultural clash between the world of high technology and the world of manufacturing, together with a certain high-handedness on the part of management that assumes that just because the company has embarked on a lofty mission, the workers should shut up and thank God for a chance to work at Tesla.
“There are a lot of changes coming,” says Kristin Dziczek, director of the industry, labor, and economics group at the Center for Automotive Research. “The UAW’s success depends on the strength of the case and the political environment of the NLRB. [Unfair labor practice complaints] are a pressure point for Tesla. It’s partly a message to potential bargaining units: We’ve got your back when things aren’t fair.”
Fear of unions has been a major factor in where foreign auto manufacturers like BMW, Nissan, Vokswagen, Mercedes, and others chose to build their US factories. Most decided to build them in the Deep South where anti-union animus is strong. The UAW lost an organizing campaign at a VW factory in Chattanooga, Tennessee in 2014 and at a Nissan plant in Mississippi last year. Membership is declining and it needs to put up a few wins to avoid becoming irrelevant. Tesla is certainly a juicy target.
There are no good guys and bad guys in this story. As a former colleague of mine used to say, “Some people are never sastisfied,” and no, that is not a typo. I was heavily involved with the Saturn division of General Motors at one point in my life. GM, believe it or not, went to extraordinary lengths to disrupt the traditional conflicts between labor and management that had grown up over the years. (See Rivethead: Tales From The Assembly Line for more on this issue.)
Its deal with the UAW at the Spring Hill factory in Tennessee was a model of fairness and equity for all stakeholders. But some old-line UAW members still weren’t sastisfied and continued their guerrilla campaign against the company even though most of the workers at Spring Hill were more than happy with the three-page long contract the parties agreed to. They were successful. When push came to shove, GM decided to close the Spring Hill facility and all the people who worked there lost their jobs, including the malcontents. Thanks, fellas.
The divide between Tesla and its workers was on display just last week. A somewhat inaccurate report by CNBC described chaos on the Model 3 assembly line with hundreds of parts being used that did not meet design specifications. That led to allegations that Tesla was using remanufactured parts in new cars, a classic no-no for any manufacturer. Tesla pushed back against the claims, saying many of the employees had never worked in a car assembly plant before and had no idea what they were talking about.
Tesla issued a statement to Automotive News that said, “It’s worth remembering that each year, roughly 20,000 [unfair labor practice complaints] are filed with the NLRB by unions like the UAW as an organizing tactic.” One reason why Tesla can appear to remain above the fray is that people are literally begging to work there. Last year, it got 500,000 applications for 2,500 jobs. That means it’s harder to get a job at Tesla than it is to get accepted to Harvard or Stanford.
But they can’t have everything their own way, Harley Shaiken says.”The last thing Tesla needs is a protracted fight with its own workers and a union organizing campaign. To profitably manufacture electric cars, they’re going to need a highly motivated workforce.” And he has a word of advice for Tesla. “I don’t see a corporate campaign now, but something like that could absolutely be a result. A hard line exacerbates these problems.”
Back in 1990, a consultant by the name of Charles Hughes wrote a book entitled “Making Unions Unnecessary.” His advice was simple. Treat people with dignity and respect and most of the issues that arise between labor and management will never come up and workers will feel no need for union representation. Tesla is in danger of weaponizing its war against the UAW just as Donald Trump has weaponized his war against immigrants. A wise corporate manager would take things in a different direction. That’s free advice, Elon, and worth precisely what you paid for it.