Labor's rank and file still believe in collective bargaining's power to bolster middle class

When members of the United Auto Workers (UAW) approved a new contract with Fiat Chrysler on October 22, they ended a contentious round of negotiations that exposed rank-and-file discontent over a two-tier wage system that one worker described as “at odds with union principles.”

In a rare move just a few weeks earlier, Fiat Chrysler’s 36,000 workers had rejected an agreement proposed by their leaders, protesting that it failed to close a pay gap that kept newer employees lagging behind the earnings of their more senior counterparts.

Ultimately, a renegotiated contract – which was promoted by UAW leadership with messaging assistance from a public relations firm – contained provisions that appear to have assuaged rank-and-file concerns by decreasing the time it takes for less senior workers to move up the pay scale.

This episode represented one of the few occasions in recent memory when negotiations between unions and a major corporation have attracted sustained public attention.

The New York Times characterized the workers’ initial repudiation of the contract proposed by their representatives as further evidence of deepening populist discontent directed against established institutions and mainstream politicians, in this case leaders of their bargaining team. Similar qualms also appeared to have surfaced during the ratification process currently underway for a new contract between General Motors and the UAW.

In addition to this increasing popular tendency to question authority, the Fiat Chrysler negotiations raise important questions about the status of collective bargaining at a time when the inequality of bargaining power between workers and employers has reached epic proportions. The workers' reaction suggests the continuing relevance of collective bargaining as a social practice and the need to consider how it might attain renewed vitality and legitimacy in the 21st century.

Importantly, how did collective bargaining shift from negotiating over new protections and benefits to fighting over what gets cut? And what has this shift this meant for the middle class unions built?

The UAW workers' initial rejection of the Fiat Chrysler deal underscore the continuing perception among workers that collective bargaining remains a key ingredient for creating a vibrant middle class.

Walter Ruether (second from right) in the oval with JFK and several civil rights leaders.Reuters

Glory days

During collective bargaining’s glory days in the three decades following World War II, UAW leader Walter Reuther observed that it had helped to create a “whole new middle class.”

Buoyed by national and regional agreements covering thousands of workers, unions successfully negotiated steady wage increases, employer paid health insurance and pensions that brought greater security to workers haunted by the devastation of the Great Depression. The impact of this bargaining extended beyond union ranks, as a segment of nonunion employers followed suit in an effort to assuage their employees and inhibit union growth.

Indeed, wage and productivity gains aligned closely from the end of World War II well into the 1970s, and income and wealth inequality narrowed, making entry into the middle class more possible for both workers and their families. The subsequent extension of collective bargaining into the public sector boosted working conditions and living standards for government employees and made upward mobility accessible to an even wider range of workers.

‘Concession bargaining’

Collective bargaining’s glory days, however, were short-lived.

President Ronald Reagan’s crushing of the air traffic controllers' strike in 1981 helped introduce a new lexicon to the world of labor negotiations. Where bargaining had previously produced consistent gains for workers, employers now felt empowered to seek “givebacks,” insist on two-tier wage systems and pursue an overall approach that came to be known as “concession bargaining.”

Increasingly, unions began to regard bargaining as “successful” if they were merely able to resist major concessions and retain previous gains, especially in the besieged private sector. Although collective bargaining still served a valuable social function, its ability to empower workers, boost living standards and extend vital protections became more limited.

As private sector bargaining lost its luster, workers in the public sector also came under fire. Efforts to curtail public sector bargaining have mushroomed at the state level, with legislatures in Wisconsin and Michigan restricting public sector bargaining and other states contemplating similar action.

Meanwhile, the Supreme Court will soon rule on a case that could sharply reduce the resources needed by public sector unions to bargain effectively on their members’ behalf.

Labor discontent in Warren, Michigan?Reuters

A profound shift

The implications of these developments are profound.

Although current levels of income and wealth inequality and wage stagnation stem from multiple sources, many observers cite the decline of collective bargaining as one influential factor. The diminished social and economic role of collective bargaining also manifests itself in more subtle ways.

During its post-World War II heyday, collective bargaining became a familiar social practice. On visible public stages we’d witness the choreographed handshakes between labor and management at opening sessions, regular updates to the press on bargaining progress, the potential or reality of strikes and the approval of final agreements. All of this depicted workers dealing with their employees on a equal footing and exercising power to shape not only their workplace lives but also the direction of the nation’s economy.

Rejections of proposed contracts and periodic strikes reminded the public that collective bargaining allowed workers democratic participation in shaping the outcomes of negotiations.

Bargaining also illustrated how parties with differing interests could resolve conflict, a capability sorely lacking in the hyper-partisanship that now dominates our political culture. These images underscored the prominent place and social legitimacy that collective bargaining once occupied in American public life.

Its power remains

Nonetheless, collective bargaining still has the capacity to play a significant social role.

In the public sector, the advent of collective bargaining for home care and child care workers has upgraded their working conditions dramatically, improved the quality of care and enabled once marginalized workers to gain long overdue dignity and respect. Other public sector unions have introduced an innovative concept known as “bargaining for the common good,” accompanying traditional bargaining proposals with broader demands on behalf of their constituencies.

For example, Seattle teachers recently gained additional recess time for students during their bargaining, and in Los Angeles, the “Fix LA” coalition of unions won a commitment from city leaders to restore public jobs lost during the recession and review ways to generate additional revenue for public services. These successes suggest the social benefits that may emerge from a more politicized form of collective bargaining.

There are also new developments among private sector workers that seek to adapt or redefine the bargaining process. The movement among fast food workers for a US$15 hourly wage seeks to create a “community bargaining table” by using street protest, legal action, community support and political pressure to persuade companies to enter into a bargaining relationship.

New legitimacy

Elsewhere, workers are exercising their legal protection to engage in concerted action and seeking to bargain with employers even though they lack official union representation. These adaptations have the potential to reclaim the social potential of collective bargaining and help it gain new legitimacy.

The actions of UAW members at Fiat Chrysler remind us that the workers have not forgotten the meaning of bargaining power, the importance of democratic participation and the ability of collective bargaining to promote equality and fairness in both the workplace and society.

Although the glory days of collective bargaining are unlikely to return, the need for its reemergence remains both necessary and urgent.

Bob Bussel does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.