UAW Freezes Rival Out of Rebound

Just because you are one of the most profitable manufacturing facilities within your company does not necessarily mean that you get to keep your jobs.  This is the hard lesson that one GM facility found out in Moraine, OH.


As this WSJ story tells, auto works at the GM assemble plant in Moraine, OH were not part of the UAW.  They were instead part of different union one in which they were kept out of the negotiations process with the UAW when it came time to decide what plants stayed open and which ones were closed as part of the GM bankruptcy plan.


While other people are back to work making cars and parts as auto volumes have rebounded.  The people in Moraine, OH are still looking for work.


Full story here via WSJ

• But here in Moraine, the GM assembly plant closed for good. Despite being one of GM's most productive and cooperative factories, Moraine was closed following the company's 2007 labor pact with the United Auto Workers union. Under a deal struck by the UAW during GM's bankruptcy two years later, Moraine's 2,500 laid-off workers were barred from transferring to other plants, locking them out of the industry's rebound.
• What is clear is that the United Auto Workers—though weakened by decades of attrition and the rise of a nonunion auto workforce—was still powerful enough to play a big role in picking winners and losers and in shaping the industry that emerged from that critical period.
• Moraine workers could apply for a job at another GM plant, but would be treated as new hires, receiving half the wages of their old jobs and getting at the end of the line behind applications recommended by the UAW.
• "We are living proof of all that went on in the auto industry," said Mike Polder, a Lordstown worker who was laid off for most of 2009. Two years earlier, GM had threatened to shut Lordstown and shift small-car assembly to Mexico. Mr. Polder and his wife braced themselves for a move. But the UAW cut a deal with the company that made the factory more competitive; GM rewarded the plant with the Chevy Cruze, its most successful small car in decades.
• President Obama "got hundreds of millions of dollars from labor bosses for his campaign, and so he's paying them back in every way he knows how," Republican presidential contender Mitt Romney said at a campaign stop in Michigan. "One way, of course, was giving General Motors and Chrysler to the UAW."
• In the case of Chrysler, the UAW was given a 55% stake in the company in exchange for forgiving $6 billion in debt to the union's health-care trust fund. "The UAW ended up with a large equity stake because people thought it wouldn't be worth anything," the task force's leader, financier Steven Rattner, said in a recent interview.
• Moraine's workers got nothing in the bankruptcy deal. Their plant, which had closed months earlier, was ultimately sold to a developer. The workers were barred from transfers to UAW plants, as were thousands of others who had worked for Delphi Corp., GM's former parts arm.

• In the fall of 2007, GM promised work to dozens of UAW-represented plants in exchange for concessions on wages and health care, including some of the very changes offered by the IUE. By the time GM doled out enough work to satisfy the UAW, there was nothing left for Moraine.
• "Operational business decisions at GM and Chrysler, including on issues about how facilities were operated and staffed, were made by the companies themselves," White House spokeswoman Amy Brundage said. "What the president and his task force did was demand that the companies produce overall plans to achieve financial viability, and provided the resources to restructure and achieve those goals."
• After the shutdown, many of Moraine's workers landed at Sinclair Community College, trying to reinvent themselves in fields such as health care and information technology. But they have had limited success. College surveys show that being from the plant carries a stigma among employers, who fear that workers will try to unionize their businesses, said Deborah Norris, Sinclair's vice president of workforce development.