Source: faculty.ccbcmd.edu
Labor Studies Program
LBST 113 Grievance and Arbitration
UAW-GM Contract History
“. . .the man whose life is spent performing a few simple operations . . .generally becomes as stupid and ignorant as it is possible for a human creature to become.”
Adam Smith, British economist
“Before 1933, General Motors had no dealings with labor unions except for a few craft organizations in the construction field. For this and perhaps other reasons we were largely unprepared for the change in political climate and the growth of unionism that began in 1933. One is inclined to forget that unionization in large industries was not then the custom in the United States. The significance of large-scale unionization was not yet clear to us. We knew that some political radicals regarded unions as instruments for the attainment of power. But even orthodox “business unionism” seemed to us a potential threat to the prerogatives of management. As a businessman, I was unaccustomed to the whole idea. Our early experiences with AF of L unions in the automobile industry were unhappy; the chief issue with these unions became organizational. They demanded that they represent all our workers, even those who did not want to be represented by them. Our initial encounter with the CIO was even more unhappy; for that organization attempted to enforce its demands for exclusive recognition by the most terrible acts of violence, and finally seized our properties in the sit-down strikes of 1937. . . .What made the prospect seem especially grim in those early years was the persistent union attempt to invade basic management prerogatives. . . .In the end, we were fairly successful in combating these invasions of management rights. . . .The issue of unionism at General Motors is long since settled. We have achieved workable relations with all of the unions representing our employees.”
Alfred P. Sloan. My Years With General Motors. (1963) pp.405-406
30 December, 1936–11 February, 1937–sit down strike of 44 days in Flint, MI, results in first National UAW-CIO-GM Agreement (handout)–under this agreement, the UAW had a period of six months to negotiate a full agreement, but the UAW-CIO was given exclusive representation rights for those plants which were named–open shop status was continued
In Flint, UAW Local 156 had 40,000 members, including GM, parts plants, dime store workers and bus drivers, as the UAW-CIO replaced GM as the dominant social force in the area
February 1937-June, 1937–GM claimed the UAW pulled 170 wildcat strikes as leaders in the shop struggled with foremen for departmental control–while GM officially refused to recognize the UAW-CIO informal steward system, in fact foremen bargained constantly over departmental issue (line speed, discipline)
Alfred P. Sloan:”our rights to determine production schedules, to set work standards, and to discipline workers were suddenly called into question.”
February-March, 1937–in negotiations with the UAW for a new contract, GM refused to recognize a shop steward system, insisting instead on a committeeman structure, in which a UAW-CIO committee person could represent 400 workers–at Chrysler, in contrast, a steward represented 20-30 workers
Walter Reuther, then a UAW-CIO Executive Board member, stated that a committeeman system is “far superior” to non-union status but not as strong as a steward structure
GM reorganized after the UAW-CIO sit down strike in three ways:
1. Created a new manufacturing practice, so that there would be at least three separate sources for each part, so that the union could not shut down the whole corporation, as it had during the original sit down strike, by seizing control of strategic facilities
2. Agreed to continued negotiations with the UAW-CIO on a longer contract only if the union leadership became “partners” in maintaining order in the shops
3. Foremen began to make it clear in each department that GM was willing to take a strike over the issue of production standards or the right to discipline
GM also expanded a campaign to maintain the loyalty of their foremen–for 10,000 foremen/supervisors, in 1934, were put on salary, but were also paid OT, even though exempted from the Fair Labor Standards Act; in 1941, a policy paid them at 25% above the rate of workers being supervised–also created the General Motors Institute where foremen were trained to be “tough but fair”
In the summer of 1937, there was a public reaction against sit down strikes, and even John L Lewis, president of the United Mine Workers and of the CIO, promised an end to the sit down movement, since it frightened the bosses in the steel, textile, aircraft and meatpacking industries, which the CIO was trying to organize
In the summer, 1937, the US. Supreme Court declared that sit down strikes were illegal
In the fall, 1937, the UAW-CIO leadership split and GM took advantage of the chaos by firing many union activists–GM also allowed outside forces, like the Ku Klux Klan and the Black Legion, to operate inside the shop, and encouraged followers of Father Charles Coughlin to challenge the leadership of the UAW-CIO
Under internal pressures, UAW-CIO President Homer Martin sent to GM President William Knudsen (who knew how to yell “hurry up!” in 18 different languages) an official letter, agreeing “That the corporation will be allowed to discharge or otherwise discipline union members known to be or guilty of instigating unauthorized strikes”–also agreed that the UAW-CIO would take disciplinary action against any member involved in sit down strikes
In November, 1937, Walter Reuther led a rank-and-file caucus to demand repudiation of this letter
Martin eventually reversed himself, but was also found to have been negotiating with Harry Bennett, of Ford, for recognition of a UAW-AFL organization, with Martin as president
In November, 1937, at Pontiac Fisher Body, conflicts between the union and the foremen (over speed-up, the collection of dues on company property and time, and the authority of foremen and stewards) led to a sit down strike of more than 500 workers–in a display of sheer power, GM fired four union leaders, using Martin’s letter for support, and then moved work to a non-union facility in Linden, NJ, laid off 1,350 workers and put the rest of the Pontiac shop on a four-day work week
1937 UAW-GM Agreement: In contract negotiations, GM finally agreed to a grievance procedure–in these negotiations, GM continued to insist on three basic management “rights”:
1. Determine production standards
2. The right to discipline
3. Also agreed to “seniority protection” for layoffs/recall but not for promotions, which would still be at the foeman’s discretion
Over the next 18 months, GM regained control, taking advantage of internal conflicts within the UAW-CIO, the Roosevelt recession (during which 25% of UAW-CIO members were laid off, and even more simply stopped paying dues), so the four Pontiac leaders stayed fired
January 17, 1938–UAW-CIO signed the letter with GM agreeing that company could discipline leaders of “unauthorized strikes”–Walter Reuther supported the signing of this letter
In 1938, GM centralized labor relations as Sloan created the Industrial Relations Department to regulate local negotiations and to develop long-range personnel policies–in this way, GM moved to take power away from foremen, and to move negotiations over shop issues off the floor
In 1938, GM also opened five new production facilities, including one in South Gate, CA, a suburb of “union-free” Los Angeles
March, 1938–UAW-GM Agreement–a new contract with GM, which Walter Reuther called “a wretched surrender to the corporation”–included in this contract were clauses which:
1. Reduced the number of committeemen so that each represented 400 workers
2. Reduced from four to two the number of hours which a committeeman could spend on grievances
3. Prohibited stewards from collective union dues on GM property
4.Allowed Homer Martin to exclude other UAW-CIO officers from meetings with management–allowed GM to basically pick and choose which UAW-CIO officer it wished to deal with, even though the NLRB provided that workers could be represented by representatives of their own choosing
January, 1939–factional struggle inside the UAW-CIO reaches a peak and Homer Martin is displaced by the officers of the CIO, and is replaced by R.J. Thomas as UAW-CIO President–George Addes continues as Secretary-Treasurer–
May, 1939–Walter Reuther becomes the head of the General Motors Department of the UAW-CIO–in GM, only 6% of all production workers were paying dues and in Flint, only 6,000 out of 42,000 workers were paying dues–in view of the union’s low membership, GM basically withdrew recognition of the UAW-CIO–Reuther began to rebuild the union, using a 3-point program:
1. A 30-hour work week with a guaranteed annual wage
2. A complete recognition of the steward system
3. Joint control over production standards
Reuther called it “power under control” and hoped to end wildcat strikes and to reestablish bargaining relationship with GM–with the internal conflict continuing inside the UAW-CIO, GM petitioned the NLRB for an election, claiming that it could not tell which union–if any!–represented its workers–Reuther shrewdly refused to agree to such an election and mobilized a work stoppage by the skilled trades, who were building the tools and dies for the 1940 models
July 5, 1939–work stoppage of 7,000 workers, closing many GM facilities–a demonstration of 12,000 workers surrounded GM headquarters–eventually, the factionalism led to 435 stoppages between 1937-1939
April, 1940–NLRB holds an election in 55 GM facilities–UAW-CIO gets 68% of 134,000 votes to represent 200,000 GM workers–while Reuther still wanted to build a steward system in GM, the impending war made a nationwide strike impossible
William Knudsen left GM to join the FDR administration and was replaced as President of GM by Charles “Engine Charlie” Wilson, who understood “responsible collective bargaining” with “responsible leadership”
1940 GM-UAW Agreement was the first real national contract, and allowed:
1. Exclusive representation for UAW-CIO
2. Right to collect dues on GM property by stewards, but stewards could not represent the workers
3. Company-wide wage standardization
4. No change in the committeeman structure, which continued a 1/250 ratio, although the committeemen were now given the “right” to move around the shop–Reuther desperately wanted a one steward/supervisor structure to “overthrow the small-time dictatorship of the foremen”–Alfred P. Sloan responded that any attack on the foremen was “a direct assault on basic management prerogatives,” so he insisted on a strong Management Rights clause
This demand was supported by Article 78–production standards represented GM’s world view of its power–Sloan insisted that all contract issue would now be resolved out of Detroit–”management by policy”
5. All grievances could now be arbitrated, and an umpire system, similar to the one used in the men’s clothing industry, was implemented--Sidney Hillman advised Reuther in this procedure–eventually, the selection of the umpires put Reuther in the middle between GM management and more militant rank-and-file members–also, many local managers and foremen simply ignored the contract, so the UAW-CIO was forced to look to higher management to pull local managers back into line
Umpires were called “contractual activists,” and often added new clauses to the contract, rather than simply interpreting the clauses
1941–Umpire George Taylor awarded for the first time, back pay in a discharge case–revoked GM’s policy of never paying a worker for “not working”–also allowed suspensions to replace discharges–in both areas, the umpire invaded GM’s management authority
Umpires’ decisions also strengthened seniority claims on promotions
Umpire Harry Shulman’s decision in 1944 (see handout) established a work-then-grieve procedure, directly attacking sit down strike movement (see handout)–also changes the position of the steward/committeeman (see Widick handout)
Umpires also invoked “the higher duty” of committeemen, with greater penalties, to prevent work stoppages–as part of “power under control,” Reuther centralized the GM Department and endorsed arbitration, moving power off the shop floor
GM continued to try to exclude issues, like line speed, discipline and piece work from the control of the umpires
World War II–increased pressure on UAW-CIO not to interrupt production–stoppages were called “unpatriotic”–note war issues in the Shulman award
March 27, 1946–Walter Reuther elected president of the UAW-CIO, with George Addes continuing as Secretary-Treasurer
1946--National UAW-GM Strike–issue raised by UAW leadership included “open the books” and a proposal that workers get wage increase but GM would not raise the price of automobiles–rejected by GM as “interference in the business”–part of post-war strike campaign by major unions
1946 national elections–brought conservative Republican majority to Congress, including new congressmen Richard Nixon, John F. Kennedy and Joseph McCarthy, who denounced the CIO, and the UAW, as “communist organizations”
1946-47–strike by UAW Local 248 at Allis-Chalmers, in Milwaukee–company wanted to eliminate the steward system, as GM had done–as strike dragged into its eighth month, the Wisconsin Labor Relations Board scheduled a certification election for January 26, 1947–Reuther intervened and met with the company, and was accused by local union officers of trying to agree with company on stopping shop-floor militant unionism– while the UAW-CIO won this election, with a slight majority, congressmen Kennedy and Nixon scheduled hearings in Milwaukee for the House Un-American Activities Committee to “investigate” elected Local 248 leaders
April 24, 1947–CIO proposes massive work stoppage and demonstration, starting at 2 p.m., to show opposition to proposed Taft-Hartley legislation–this would be a “political strike” which the UAW-CIO had often pulled in the past–GM notified Reuther that any worker who left, even a few minutes early, would be disciplined–on April 22, Reuther met with the UAW-CIO Executive Board and refused to support a strategy to threaten GM with a “massive and concerted response” if any workers were disciplined on April 24
Reuther:”No board member, no matter how righteous he may feel about the cause, has the right to shut down a General Motors Plant as a counter measure of the company’s discipline.” (UAW-IEB Minutes)
Describe John Anderson episode
On April 25, GM fired fifteen local presidents and suspended more than 400 others, sending a wave of both fear and resistance throughout the GM membership–Reuther recognized that the grievance procedure would be futile, so on May 8, 1947, he agreed to send a letter to GM agreeing that April 24, 1947, was in fact an illegal work stoppage and promising that the UAW-CIO would never again call such a clearly political strike–in exchange, GM modified the penalties on their “hostages”
Passage of Taft-Hartley Act and Walter Reuther campaign for presidency of UAW create a politically conservative force, diminishing the union’s bargaining power
TREATY OF DETROIT–changed labor relations in the U.S. after 1948
April 20, 1948–Walter Reuther shot in his home
June, 1948–UAW-GM National Agreement–Sloan claimed that he had planned a major change in labor relations in 1940 but was unable to propose it until after WWII, so GM’s offer was an Annual Improvement Factor (AIF) of 2%, which was a “credit” to workers for increased productivity, plus a quarterly cost-of-living, as part of a two-year agreement–GM stated that it wanted to “pay for predictability,” moving toward long-term agreements at a time when one-year contracts were the standard
The union had propose substantial changes to Article 63(b), the seniority provision–GM gave the UAW a 55-page brief defending management rights on this single clause–called “the monumental NO” by UAW-CIO negotiator Art Johnstone, temporary head of the GM Department of the UAW-CIO–company negotiator Harry Anderson remarked that GM “had conceded no ground whatsoever on fundamental principle matters which would have the tendency of watering down management’s responsibility to manage the business.”
GM was proactive on production controls, and GM executives were hired away to other auto firms to spread the “GM way”–GM began to increase line speed, creating more productivity this way rather than by the introduction of new technology
Reuther dismissed Saul Wallen, the UAW-GM Umpire, because Wallen had supported GM for disciplining shop leaders for “talking back” to their foremen
May, 1949–the famous speed-up strike by UAW-CIO Local 600 at the Ford River Rouge plant–workers had voted to strike over production standards but Reuther felt such a strike would disrupt national negotiations over the pension issue–when B Building walked out, Ford fired fourteen committeemen held responsible, then 62,000 workers closed the whole facility in protest of the discipline–Ford executives complained that wildcat activity undermined national negotiations, so the dispute was submitted to Umpire Harry Shulman for resolution
1950 UAW-GM National Agreement–for the first time, a five-year agreement, which included a pension, company-paid health insurance and the union shop–created a private welfare system for G.M. workers, blocking the union’s political campaign for national health insurance, and putting enough money on the table so that issues of control were no longer important to the UAW–Reuther called this contract “the most significant development in labor relations since the mass production industries were organized.”
1952–in spite of the contract, GM agrees to an economic re-opener in view of heavy inflation related to the war in Korea
1955 UAW-GM National agreement–included provision for the Guaranteed Annual Wage (GAW), even though GM wanted to offer stock ownership instead–GM had allowed workers to “borrow” from a fund in times of unemployment–GM had regained absolute control over “production standards, work schedules and job assignments that most corporate officials felt they had lost during the union drives of the 1930s–created an increased level of wildcat strikes
Reuther stated:” We will not go the bargaining table as just a routine matter of another bargaining session. We are going there knowing that this is a crusade–a crusade to gear economic abundance to human needs. We plan to give management a little bit of the vision that we have.” (Statement to UAW Convention, March 27, 1955)
UAW, now part of the merged AFL-CIO, found that protests had shifted to the grievance procedure, so that by 1958 negotiations, more than 11,000 unresolved grievances existed–in addition, in 1958, it was the most severe recession since 1938, and there were more than 300,000 unemployed auto workers and nearly 900,000 unsold cars
1958 UAW-GM National Agreement–”no social pioneering” –when the UAW was unable to reach agreement, it allowed the contracts to expire in May, 1958, while the workers kept working–it was almost like a return to pre-1936, as more than 90% of autoworkers voluntarily paid dues, committeemen processed grievances and the auto companies did not try to decertify the UAW
Lemuel Boulware of General Electric had established new management bargaining techniques, which the auto companies followed–a symptom of country-wide anti-unionism, which continues to 1999
Negotiations at Chrysler were most important, as that company decided to eliminate steward system and crack down on wildcat strikes, although Reuther feared that the company would go out of business–begins a pattern of “concession bargaining” by companies which were, or claimed to be, in financial distress
Bargaining becomes more narrow and routine, focusing on economic issue and on job security issues, but the causes of control slipped away.
Recommended reading:
Nelson Lichtenstein. Walter Reuther: The Most Dangerous Man in America
Wyndham Mortimer. Organize: My Life as a Union Man
Henry Kraus. The Many and the Few
Heroes of Untold Story
