Ford Buyout Drains Auto Workers Union

Almost half of the hourly workers at Ford Motor Company have accepted buyout or early retirement offers. This means the United Auto Workers union is losing close to 40,000 members, which could significantly weaken the union.

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The Ford Motor Company lost on average more than $25 million a day in the first nine months of this year - 25 million a day. The automaker hopes that workers taking early retirement and buyouts will help turn the company around. Thirty-eight thousand Ford workers have accepted the company's buyout offer. That's good news for Ford, not so good for the United Auto Workers Union.

Detroit Public Radio's Celeste Headlee reports.

CELESTE HEADLEE: Ford had intended to lose 25-30,000 workers through its buyout packages. Instead, nearly 40,000 employees are choosing to leave the company. That's nearly half of Ford unionized workers. And that represents a serious blow for the United Auto Workers Union.

Mr. JIM HENDRICKS (Fisher & Phillips): They're hemorrhaging, literally hemorrhaging membership.

HEADLEE: Jim Hendricks is a partner with the law firm Fisher & Phillips, that represents management in labor cases. He says the new Ford buyouts could signal the demise of the UAW.

Mr. HENDRICKS: If you go back 20 years, they had I think 1.5 million people. I believe this - the latest shedding of workers with Ford will probably drop them under half a million members. When you start dropping under a half million members, your clout has shrunk drastically.

HEADLEE: But not everyone agrees with Hendricks's dire forecast. Harry Katz is the dean of Cornell University's School of Industrial and Labor Relations.

Mr. HARRY KATZ (Cornell University): If the union was irrelevant, the workers wouldn't have been offered buyouts. Ford would have laid them off and closed the plants without going through this exercise. The fact that Ford, General Motors and others have used buyouts is a testament to the strength of the UAW.

HEADLEE: Unionized workers at Ford were offered eight different voluntary buyout packages. Employees could receive $35-140,000, depending on seniority, and they may need every dime of those packages, because finding another job could prove difficult.

Michael Moore is the CEO of RCI, a national staffing corporation that's trying to place Detroit's autoworkers in other positions. He says some companies are hesitant to hire former members of the UAW.

Mr. MICHAEL MOORE (RCI Solutions and Performance Staffing): They're almost turning away from making advances to people in the state of Michigan or in Detroit because they are unionized, and because of what that may mean to their organization if they bring them in.

HEADLEE: Attorney Jim Hendricks thinks UAW members have a reputation for being overly demanding.

Mr. HENDRICKS: They were bullies in the past. It was walk all over the employer. It's because they won't take a strike, we'll get everything we want. Who's going to hire somebody like that?

HEADLEE: Federal law clearly prohibits employers from discriminating against an applicant because of previous union membership. And UAW leaders say their workers don't deserve the bad rap.

Ed Honsinger, Jr. is the president of UAW Local 845, representing employees at Ford's Sheldon Road Plant in Plymouth, Michigan. He says those who think UAW members are to blame for Ford's troubles are focused on the wrong group of people.

Mr. ED HONSINGER JR. (President, UAW Local 845): We come to work every day. We do our jobs, build a quality product. And if the company isn't selling the product because American consumers don't want them, that falls on the shoulders of the company.

HEADLEE: Still, the UAW can't survive as it relies on the shrinking ranks of union workers at Ford and other domestic automakers. This summer, the union decided to spend $60 million to organize and recruit more members. And Harry Katz of Cornell University says the UAW will probably have to continue expanding outside of the auto industry.

Mr. KATZ: Their future of the union, it will depend on how well the UAW can organize among the transplants and those companies that are expanding employment in auto, and whether the UAW can transform itself into a broader union. And it's still an open question.

HEADLEE: UAW members who accepted buyout packages will begin leaving Ford in January. What Ford is calling the separations will be complete by September of next year.

For NPR News, I'm Celeste Headlee in Detroit.

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