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Employees at Volkswagen’s Chattanooga, Tenn., manufacturing plant rejected union representation last Friday in an election conducted by the National Labor Relations Board. Fifty-three percent of the 1,338 employees who voted rejected representation by the UAW. The vote concludes what may be just the first phase of an organizing campaign that began in 2011.
UAW officials suggested on Friday evening that the union is considering a legal challenge to the election. UAW President Bob King said he was “outraged” by statements made by Tennessee Republican politicians in the days before the election. US Senator Bob Corker was quoted earlier last week as saying that he had been “assured” by Volkswagen officials that if employees voted against the UAW, the company would soon announce its decision to select Chattanooga, rather than another VW facility in Mexico, as the site for a new production line for its new mid-size SUV. Other Tennessee Republicans also spoke out against the UAW in the days before the vote. King implied that such comments amounted to unlawful threats under federal labor law.
The UAW’s indication that it may challenge the election raises novel issues under federal labor law. VW management promptly repudiated Corker’s statement and had earlier signed an agreement with the UAW to remain neutral during the election campaign. Federal labor law provides that unlawful threats and promises made by third parties during an election campaign can be attributed to either an employer or a union under traditional principles of agency law. In addition to convincing the NLRB that the statement should be considered an unlawful threat (not a sure thing), the UAW would have to prove that Sen. Corker was acting on behalf of the company. This seems implausible, given VW’s publicly-stated positions. Moreover, Corker’s statements may well be immune from legal challenge under the US Constitution’s “Speech or Debate” clause, which shields lawmakers from litigation or even having to defend themselves, so long as they were engaged in “legislative activity.”
The UAW’s defeat is a significant setback for its efforts to reverse its falling membership numbers by organizing employees working at auto plants owned by foreign manufacturers. The organizing campaign has been closely watched, in part because of VW’s decision to enter into an unprecedented pre-election “neutrality agreement” with the UAW. Among other terms, the agreement required VW to permit UAW officials to enter the company’s facility and campaign openly in favor of the union, a benefit that was not extended to a group of employees that opposed unionization.
VW’s decision to enter into a neutrality agreement with the UAW has been criticized by many in the business community as well as by employee rights advocates who point to labor law provisions that protect the right of employees to oppose unionization. The company’s stated rationale is that a UAW victory would facilitate VW’s ability to establish a “works council,” a form of corporate governance common in Germany and other European countries. VW argued, with explicit support from the UAW, that U.S. labor law prevents the establishment of a works council unless the employees are represented by a traditional labor union.
A provision of the Labor Management Relations Act makes it an unfair labor practice for an employer “to dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it.” Some argue that the typical interactions between an employer and a works council would violate this prohibition, because a traditional works council would be viewed as a labor organization under U.S. law. Other experts dispute this characterization. A labor law reform measure known as the TEAM Act was passed by Congress in 1997. Vetoed by President Clinton because of strong union opposition, it would have clarified this matter by expanding the ability of non-union employers to engage in various sorts of quality improvement and employee involvement initiatives without triggering the statute’s prohibitions.
Federal labor law requires the union to file an objection to the election within seven days. Objections are investigated initially by regional officials at the NLRB, and can lead to a hearing on whether the conduct at issue is serious enough to justify annulling the results of the election and requiring a revote.
Thomas Gies is an AEI adjunct scholar and a founding member of Crowell & Moring’s Labor & Employment Law Group.
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