Corker gives Volkswagen the gears over UAW deal at Tennessee plant

Republican senator worries the German carmaker will become a laughingstock over works council.

September 11, 2013   by ASSOCIATED PRESS

NASHVILLE — Volkswagen would become a “laughingstock” if it goes through with a deal to have the United Auto Workers represent workers at its Tennessee plant, US Sen. Bob Corker said.

The Tennessee Republican told The Associated Press in a phone interview that he was dismayed when VW sent a letter to employees regarding its discussion with the UAW about creating a German-style works council at the Chattanooga plant.

“For management to invite the UAW in is almost beyond belief,” Corker said. “They will become the object of many business school studies – and I’m a little worried they could become a laughingstock in many ways – if they inflict this wound.”

Corker, who played a large role in persuading Volkswagen to build its lone US assembly plant in the city where he was once mayor, said he hopes the company pulls back from its decision to engage in talks with the UAW.


“We’ve talked to management, and to me it’s beyond belief that they’ve allowed this to go that far and displayed this kind of naivety that the UAW is somehow different than they were years ago,” Corker said.

The Wolfsburg, Germany-based company has faced pressure from labour representatives on its supervisory board, who have called it unfair for the company to deal with organized labour at every one of its major facilities around the world except for at its US plant.

“The Volkswagen Group respects the employees’ right for an employee representation on plant level at all locations worldwide,” the letter from the plant managers said. “This certainly also applies to the Chattanooga plant.”

The UAW’s top organizing official in Tennessee, Regional Director Gary Casteel, called Corker’s comments “ludicrous” and said Volkswagen wants the works council because its other factories have been successful due to collaborative relationships between management and workers.

According VW’s letter to the workers, the discussion with the UAW is necessary because a works council can only be established in the US through an established trade union. Some experts have disputed whether that’s a requirement, and politicians such as Corker have suggested the UAW should be left out of a works council at the plant.

“There’s plenty of unions other than the UAW,” he said. “Why would they choose one that has created such a mentality in these plants of us-versus-them?”

Corker said the Southeast would become less attractive to foreign automakers if the UAW gains a foothold, adding that he worries that Volkswagen would become less competitive if the UAW represents workers at the plant

Casteel responded that Ford Motor Co. has continued to invest millions at factories in Louisville, Ky., where thousands of workers are represented by the UAW, and Ford has prospered as well. The UAW isn’t viewed as a problem in attracting investment to the Louisville area, he said. “Nobody in Kentucky is saying that having that Ford facility in Louisville is causing them any economic hardship,” Casteel said.

The UAW’s relationship with Volkswagen in Chattanooga would be different from how it bargains with General Motors, Ford and Chrysler, Casteel said, although he wouldn’t say exactly how. In Germany, unions bargain for wages, while works councils weigh in on job security, safety and other plant-specific matters.

Corker and the UAW have been at odds since he pushed for wage and benefit concessions for union workers as part of the government bailout of automakers in 2009. Corker maintains that his role in the discussions helped the auto industry emerge from the economic crisis in stronger shape.

Many union workers at the General Motors plant in Spring Hill, Tenn., blamed Corker for the facility being idled during the company’s bankruptcy, and argue that contract negotiations ensured that auto assembly was restarted with jobs that would have otherwise gone to Mexico.

Entry-level workers at Volkswagen’s plant in Chattanooga earn $15 an hour, which is similar to the starting income of UAW workers at GM, though the current contract imposes a cap of 25% of workers making that wage by 2015.

AP Auto Writer Tom Krisher contributed to this report from Detroit.

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