United Auto Workers (UAW) sounds alarm about Nissan’s ‘contract workers’

Anne T. Sulton, Ph.D., J.D.

J.A. Senior International Correspondent

Nissan Motor Company, headquartered in Japan, is a multi-national company manufacturing a variety of passenger vehicles and trucks. It is the sixth largest auto manufacturer in the world. In 2003, Nissan opened its sprawling plant in Canton, employing thousands of workers to build the Altima, Titan, Armada and other popular models of mid-priced vehicles. These workers are paid a living wage, earning about $24 per hour. Nissan recently announced its controversial strategy of hiring 1,000 “contract workers” at a starting wage of $12 per hour. Reportedly, these “contract workers” are being hired by temp agencies (such as Kelly Services) as temporary full-time workers and would receive wage increases during their first five years of service. Temp agencies usually charge a fee of 30% or more on top of the

wage paid to the worker. Consequently, the cost to Nissan likely is closer to $18 per hour, rather than just the $12 per hour paid to the worker. Describing efforts to unionize blue collar workers as part of the 21st Century struggle for civil rights, the United Auto Workers union (UAW) is criticizing Nissan’s “contract workers” strategy and targeting the Canton plant for unionization of the workers. UAW’s task is complicated by the fact that the temporary “contract workers” might not be eligible to join a union for at least five years. The UAW’s task also is complicated by the fact that it has failed in its attempts to unionize workers of automakers building vehicles in Southern States. Twice at the turn of this century, Nissan workers in Tennessee soundly rejected the UAW’s efforts to unionize workers there. In 2005 and 2007, UAW also failed to unionize workers at Nissan’s Canton plant. Given Nissan’s new “contract workers” strategy, the UAW has an opportunity to re-new their call for workers to join the union. UAW is asking Nissan for access to workers at the plant so that UAW can make a direct face-to-face pitch to workers about the benefits of unionization. Nissan has taken steps to ensure that its Canton plant workforce is intelligent and skilled. Nissan has nothing to fear by allowing UAW to visit its workplace to speak directly with Nissan workers. In the final analysis, the workers must make the decision about whether or not they want a union to represent their interests. Workers should be fully informed of the opportunities provided by and responsibilities of union membership. The best place for them to be informed is in their workplace. Workers should have the opportunity to ask the UAW the hard questions – not just about the cost of union dues. Among the hard questions is the amount of input the local workers will have into decisions made by the national or regional union offices. Too often, unions do not represent well the interests of the workers needing them most, e.g., when discipline is being considered by the employer. Many workers considering joining a union focus on pay and benefits. But many union contracts contain provisions affecting seniority and call-back (important in case of layoffs) and discipline (union reps advocate on behalf of employees being considered for suspension and/or termination). Unions historically have successfully improved pay, benefits, working conditions, and terms of employment for their members. Multi-national companies historically have enjoyed higher profits when they keep personnel costs low. Nissan’s “contract workers” strategy might help Nissan control operating costs and increase its profit margins. However, Nissan runs the risk of its strategy being seen by some as a form of subtle intimidation that foments discontent in the workplace among co-workers. The prospect of current Nissan workers (earning nearly $24 per hour) working beside new “contract workers” (earning $12 per hour) certainly will send the message to current Nissan workers that they can and will be replaced by “contract workers” willing to work for half the pay. Bottom line – which consumers would choose to purchase a vehicle from a foreign company wherein the American workers reportedly are not happy? Certainly, the writing is on the wall. As the UAW argues, “contract workers” making $12 per hour potentially will drive down the wages being paid to current workers earning about $24 per hour. Under Nissan’s current strategy, it is conceivable that in the near foreseeable future all of the workers at the Canton plant will be paid less than $20 per hour. If the workers vote for UAW representation, can what is now written on the wall be re-written? Perhaps. The UAW might be able to successfully argue that wages and benefits should not be reduced, that seniority rights should be adopted, and that union reps can advocate on behalf of union members when discipline is being considered. Without the UAW, will what is now written on the wall be re-written? Probably not. Multi-national profit-making corporations do not have a reputation for paying workers more than one penny above what they believe a worker will accept as pay for services rendered. Nissan’s new “contract workers” strategy is an example of this business approach. The UAW is seeking the support of community and church leaders in its quest to educate Nissan workers about the benefits of union membership. For additional information on the UAW’s efforts, please contact the UAW at UAW.org