How To Save The Auto Industry

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How HR can save the auto industry:
Union Aspect
Charlie Crowther

When the auto industry was thriving in its prime many years ago, the United Auto Workers Union (UAW) negotiated new contracts for the auto workers of the Big Three automotive manufacturers in the US: GM, Ford and Chrysler. Included in these contracts were the now controversial full-employer paid healthcare and major salary and wage hikes. As we are falling deeper and deeper into this economic recession, most companies are trying to cut back costs anywhere they are able. But, with the huge benefits that these auto workers are receiving from the negotiations that took place years ago, the “Big Three” are not able to compete with the foreign automotive manufacturers like Toyota, Nissan or Honda who are taking over the auto market in the United States. The auto manufacturers have been trying to renegotiate with the UAW, but according to UAW.org, they achieved their goal of no cost-shifting in their healthcare plans. “Our UAW bargaining teams in the auto industry set a clear goal at the very beginning of these negotiations: no cost-shifting in health care. Thanks to exceptional solidarity and resolute bargaining, we were able to achieve this goal and more” (UAW.org). I spoke to the Vice President and Director of HR of a hospital in the Northwest suburbs who said he believes “the big problem lies with the people who have retired and are still getting their lifetime health benefits.” There are some contracts that not only cover healthcare for the employee, but for the immediate family of the employees. The UAW claims to be giving in by letting their employees choose what coverage they want in terms of healthcare. “When a worker or dependent loses coverage under the terms of the collective bargaining agreement, she or he will now be able to choose among the available benefits rather than being required to take all of them” (UAW.org). By giving their members the choice, it makes the UAW appear to be making an effort at cooperating with the failing auto makers. They may be giving the union members the choice to switch to a smaller plan with less coverage, but how many workers are going to be taking advantage of that plan? To this point, it does not seem to be doing much for the industry. Also, the UAW refuses to lower the wages and salaries of its members to match those of the foreign competition manufacturing in the U.S. This creates a rate problem in that the auto manufacturers have enough money to pay only part of their workforce and they have to lay the other part off, or they have enough people to do the work at hand, but not enough money to pay them all. In order for the auto makers to stay competitive, they have to keep up with their research
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