Union Concessions

alfadriver wrote: So you had an easy job that you didn't like- one that everyone has to put up with the same crap. You didn't keep the job for what reason? They didn't pay you enough? You could have all day to dream about projects that you could do with the money they were paying you....

...and if it wasn't for the union, he could have saved the company several minutes worth of work...and if there were more like him they could have cut an hour or so off of the car's production time, reduced the employee count for that line, made the line more profitable, sold more cars and had a whole new line with additional employees added. The problem is all the union sees is a zero sum game that they have to win and not that by improving the system, they make it possible to compete better with the foreign manufacturers and therefore expand.

I hope they eventually realize that and stop hamstringing the companies they work for. Remember, Japan has unions and they have made some of the finest quality products the world has seen...however their unions believe in thinking and improving and moving people to where they best perform, not preserving a "job" so to speak.

Mikey52_1 wrote: The SOX that Hess talked about is Sarbanes-Oxley, a law that mandates lots of nits to be picked concerning records-keeping. About 5 (?) years old by now. Huge amounts of time spent doing nothing more than verifying that records have been taken. And mandating it. I'd've thought the records themselves would provide evidence they were taken, but Nooo!. SOX says you need to verify with a separate record that the record was noted.

Gee, what non union industry caused that law?

Perhaps some greedy company that wanted to make a quick buck by falsifying records? And who wanted reform? Wall Street- so that they would not be duped via falsified accounting again. The only people who REALLY care are the IRS and the stock holders.

It may not be a well written law- and CAN BE modified.

GregTivo wrote:

alfadriver wrote: So you had an easy job that you didn't like- one that everyone has to put up with the same crap. You didn't keep the job for what reason? They didn't pay you enough? You could have all day to dream about projects that you could do with the money they were paying you....

...and if it wasn't for the union, he could have saved the company several minutes worth of work...and if there were more like him they could have cut an hour or so off of the car's production time, reduced the employee count for that line, made the line more profitable, sold more cars and had a whole new line with additional employees added. The problem is all the union sees is a zero sum game that they have to win and not that by improving the system, they make it possible to compete better with the foreign manufacturers and therefore expand. I hope they eventually realize that and stop hamstringing the companies they work for. Remember, Japan has unions and they have made some of the finest quality products the world has seen...however their unions believe in thinking and improving and moving people to where they best perform, not preserving a "job" so to speak.

Two things-

I agree that it would be nice to reduce labor hours, but the management were dumb enough to agree to garunteed jobs, so it didn't much matter that the job was done with fewer work- they guy would be paid anyway. I agree that this is bad, and has been fixed within the past two years (if you have not been paying attention).

Second- labor ISN'T the high cost in cars like you all think it is. If it were, GM would spend more money making cars than Toyota does, which is not the case (again, read 2007 annual reports from each company).

Finest products? If you say so....

I'm not majorly pro-union. I fully agree that they have some rather shoddy business practices. But I also appreciate what unions have brought to both the workplace and the economic background of the US.

We are a consumer society. If not for the ability to turn stuff X into Y and selling that for a net profit, we would not be able to sustain ourselves. Banking and services will not do that.

alfadriver wrote:

GregTivo wrote:

alfadriver wrote: So you had an easy job that you didn't like- one that everyone has to put up with the same crap. You didn't keep the job for what reason? They didn't pay you enough? You could have all day to dream about projects that you could do with the money they were paying you....

...and if it wasn't for the union, he could have saved the company several minutes worth of work...and if there were more like him they could have cut an hour or so off of the car's production time, reduced the employee count for that line, made the line more profitable, sold more cars and had a whole new line with additional employees added. The problem is all the union sees is a zero sum game that they have to win and not that by improving the system, they make it possible to compete better with the foreign manufacturers and therefore expand. I hope they eventually realize that and stop hamstringing the companies they work for. Remember, Japan has unions and they have made some of the finest quality products the world has seen...however their unions believe in thinking and improving and moving people to where they best perform, not preserving a "job" so to speak.

Two things- I agree that it would be nice to reduce labor hours, but the management were dumb enough to agree to garunteed jobs, so it didn't much matter that the job was done with fewer work- they guy would be paid anyway. I agree that this is bad, and has been fixed within the past two years (if you have not been paying attention). Second- labor ISN'T the high cost in cars like you all think it is. If it were, GM would spend more money making cars than Toyota does, which is not the case (again, read 2007 annual reports from each company). Finest products? If you say so.... I'm not majorly pro-union. I fully agree that they have some rather shoddy business practices. But I also appreciate what unions have brought to both the workplace and the economic background of the US. We are a consumer society. If not for the ability to turn stuff X into Y and selling that for a net profit, we would not be able to sustain ourselves. Banking and services will not do that.

That which is not the only problem doesn't mean it isn't a problem, which you agree with..atleast partially.

And healthcare costs are a seperate issue and pretty much across the board issues in union and non-union, but the ability to compete does depend on innovation and Boosts post was an example of how innovation and cost reduction were stifled by the union (and dumb management as you say).

...and banking and services won't sustain us, which is why we should get used to consuming less and creating more...but that's a topic for another post.

alfadriver wrote:

Mikey52_1 wrote: The SOX that Hess talked about is Sarbanes-Oxley, a law that mandates lots of nits to be picked concerning records-keeping. About 5 (?) years old by now. Huge amounts of time spent doing nothing more than verifying that records have been taken. And mandating it. I'd've thought the records themselves would provide evidence they were taken, but Nooo!. SOX says you need to verify with a separate record that the record was noted.

Gee, what non union industry caused that law? Perhaps some greedy company that wanted to make a quick buck by falsifying records? And who wanted reform? Wall Street- so that they would not be duped via falsified accounting again. The only people who REALLY care are the IRS and the stock holders. It may not be a well written law- and CAN BE modified.

Just remember, companies with armies of accountants don't mind SOX. It companies where the owner does the accounting that get the most hassle.

alfadriver wrote:

racerdave600 wrote: We produce among other things, safety products for the mining and oil industry. In many ways, the US is the hardest country we have to do business in, and in most ways, they are about a century behind some other countries like South Africa and Australia in technology, especially mining. According to one guy that works for us, formerly with the US govt. body that controls mining, no one there really wants to make a decision of any kind and take responsibility. They put off as much as possible as long as possible so nothing ever gets done. Then they complain that they need more funding as the reason nothing is getting done. We basically developed a product on the request of the govt., and as of now, have the only working model in the world, and the US govt. is dragging it's feet about approving it. It passes test after test, and nothing. This is just one reason we do most of our business now outside of the US. They make is as difficult as possible on us, although not as much as the mines themselves, and yes, other countries have approached us about relocating with VERY attractive incentives.

*Maybe*, just maybe, we should fund those departments? What you are missing is that the mining industry has been very much against government intervention for all 234 years the US has been a country. And thanks to that, the mining and drilling industry and the eco industry just butt heads.

You need to go back and read this again. The government asked us to develop this product, the mines also want it, but everything that goes into a mine has to be government approved. What we've produced far exceeds everything they've asked for. They are now dragging their feet about approval, and yes, they are super funded as a government entity. No one said don't fund them, what I was saying is that they need to get off their fat, lazy butts and do their job. And quit whining about money.

We're already in countries that are far tougher to get approval, and more difficult to work in. The problem is the way our government runs, don't be fooled to think they are some magical organization without faults. The biggest problem I have found every time we have to deal with them is that they simply don't want to work, and in many cases, simply incompetent.

GregTivo wrote: Just remember, companies with armies of accountants don't mind SOX. It companies where the owner does the accounting that get the most hassle.

No, Greg, actually SOX has pushed major corporations to go private, doing their own accounting. That is, no longer publicly traded. SOX was passed as a response to corporations flat out lying in their numbers. That is, it basically says: "You can't lie to the street." This has been twisted around by the outsourcing and bean counting industries to the point where a 10 minute code change in a report extract that has nothing to do with anything important takes 100 hours to "properly" document and literally months to implement. Faced with this total BS burden, major corporations said "screw it, we're going private. SOX that."

racinginc215 wrote: berkeleying morons is what most you are.

You can leave if you feel you are not among like minded...or like-intelligenced people. No one begged you to post here. I personally wont miss you around here with an attitude like that.

having worked in a non-unionized assembly plant, and having a father and a F.I.L who are/were UAW employees, I can say that I want nothing to do with a Union. If nothing else, I want to be able to be assembling orders, and take the trash away from my workstation, and clean the dust off the light over my table, and use a forklift to move the empty pallets out of the way when I need to...all without catching an earful from a manager. I guess I just cant sit idle, waiting for my turn to work.

And continuous improvement: 5S/Kaizen/6-sigma are (a few of the big) reasons for foreign prduction industries becoming so profitable. Empower every employee with the RESPONSIBILITY and ABILITY to make every process better - treat employees like an asset rather than a liability - then you will prosper.

GregTivo wrote: I hope they eventually realize that and stop hamstringing the companies they work for. Remember, Japan has unions and they have made some of the finest quality products the world has seen...however their unions believe in thinking and improving and moving people to where they best perform, not preserving a "job" so to speak.

I work for a Japanese owned American company. Although our non-union plant during the downturn turned a profit (very small but still in the black.) Our parent did not. They all took a pay cut, worked extra hours without charging the company and did all as a union. They did it to help the company succeed. No long drawn out negotiations, no back door concessions.

My anti-union comments are reserved for current American unions. I just wanted to clarify.

1988RedT2 wrote: How else but with a union is a no-count college student with no experience going to make 4 times the minimum wage?

Thank you for illustrating the point so succintly (albeit unwittingly). Do the words unsustainable lifestyle mean anything to you?

alfadriver wrote: We are a consumer society. If not for the ability to turn stuff X into Y and selling that for a net profit, we would not be able to sustain ourselves. Banking and services will not do that.

You consistently seem to equate production-based jobs with unions. They are not equivalent, or even directly causally related.

Duke wrote:

1988RedT2 wrote: How else but with a union is a no-count college student with no experience going to make 4 times the minimum wage?

Thank you for illustrating the point so succintly (albeit unwittingly).

Unwittingly?! Glad to have you on the side of "Unions: What are they good for? Absolutely nothin'!" But the story of my firsthand experience with unions was fully intended to illustrate the phenomenon of union pay in excess of the market value of at least some union workers.

Unwittingly? Sheesh!

By the way, you spelled "succinctly" wrong.

Sorry, I guess my irony flow meter needs to be cleaned, or something.

You consistently seem to equate production-based jobs with unions. They are not equivalent, or even directly causally related.

The problem is the biggest industries, they might as well be mutually inclusive.

Almost all significant production outside of food in the US is either union, or overseas.

My problem with unions is my problem with politicians. A union's job #1 is -not- to actually do the job they are contracted to, its to 'keep' or 'get more' jobs for itself. Even if it means protecting crap employees, even criminal in the case of teacher's unions.

Therefore, a labor union management's job priority is not actual labor. Ever.

The subject of his thread being a guy's pay got cut in half. We don't know how he performed, how he was hired, what job he did, etc. On the face of it, that seems unfair. I'd be upset too if someone cut my pay in half and I lived in a portion of the country with 10+% unemployment.

We're all seeing layoffs happen. It's not good for any us. A rising tide raises all boats, the inverse is also true. We're all watching salaries shrink. We're all watching our once great manufacturing base be whittled down. If WW2 happened today, how would we make all those tanks?

All of us are making less money but CEO's. CEO pay is currently 40x what the average worker makes. This disparate compensation is bad of us all. It can't be maintained.

When the CEO of a unionized company takes a 50% pay cut first...that will be a great day. Then this same CEO will have a leg to stand on when he/she forces his workers to take the same 50% pay cut. Until that day comes it sounds elitist to me to blame unions for what is obviously a corporate wide problem. Mismanagement. Whether it's paying under-utilized workers too much or paying over-rated and incompetent management too much.

If you're going to lay blame, spread it out accurately. Don't just single out the little guy or collection of little guys. They didn't decide that Volts are a good car to hang all of your companies future success on.

When the union keeps a guy who drinks on the job in a job, or a guy who leaves work on the clock in a job, or a guy who intentionally performs poorly because he knows the union has his back in a job, or any of the other twenty dozen similar stories weve all heard and in most cases seen first hand - I BLAME THE UNION FOR STEALING FROM THE COMPANY THAT IS FORCED TO EMPLOY HIM!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Explain how its any other way....please....I BEG YOU.

I agree there is rampant mis-management in Detroit and through the rest of blue collar corporate America, but seriously, if we are talking about Unions, please help me understand how this is good for the mfg base here in the states.

4cylndrfury wrote: When the union keeps a guy who drinks on the job in a job, or a guy who leaves work on the clock in a job, or a guy who intentionally performs poorly because he knows the union has his back in a job, or any of the other twenty dozen similar stories weve all heard and in most cases seen first hand - I BLAME THE UNION FOR STEALING FROM THE COMPANY THAT IS FORCED TO EMPLOY HIM!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Explain how its any other way....please....I BEG YOU. I agree there is rampant mis-management in Detroit and through the rest of blue collar corporate America, but seriously, if we are talking about Unions, please help me understand how this is good for the mfg base here in the states.

IT'S ALL MISMANAG...oh wait...Sorry. Got my caps lock key stuck. See you have the same problem. Just tap the key on the far left between tab and shift. There ya go. Now, let's have a civil discussion.

It's all mismanagement. Keeping poorly performing workers on the job is the same mismanagment as paying your CEO too much. It's misuse of resources. Whether those resources are funds or man hours.

Unions are to blame for working to keep poorly performing workers in place. Management, at whatever level, is to blame for paying themselves too much. Those were my only points. I'm not taking up for either side in this debate. By not addressing this problem in a fair and truthful manner we are doing ourselves, and each side, a disservice.

What I am advocating is an equal view. Both the unions and corporate leaders are making mistakes here. I've heard a lot of folks blame the unions, exclusively. Saying any situation is 100% one side's fault is almost never true.

So, for example. Mr. CEO tells Mr Lineworker that he has to take a 50% pay cut. Btw - corporate profits are through the roof in most industries right now. Mr. Lineworker is unhappy for obvious reasons. Mr. CEO is now making 80x what Mr. Lineworker is making as before the pay cut CEO was only making 40x the Lineworker's salary. Let's reverse that. Would you say that making 20x the average worker's salary is enough? Let's put that into real numbers.

LW = Lineworker. CEO= explanatory

~ LW yearly salary was 28/hr: 28x2080 = 58,240 (2050 is man hours in a year)

~ CEO yearly salary is 40 x 58240 = 2,329,600

~ LW takes half pay cut = 29,120.

~ CEO yearly pay = 2,329.600 (still, no pay cut for him.)

~ If CEO took half pay cut along with LW (solidarity in the face of corporate mismanagement potentially caused by incompetent leadership...er...adversity!). Yearly pay = 1,164,800.

Whoa. I think a million dollar pay day is still pretty good. But hey, let's blame the unions and give the leadership team a pass! Just like at Circuit City, it was the teenager working the cellphone counter who ultimately caused the company to go out of business. It had nothing to do with the fact that the leadership team drove the company into the ground for the last 8 years.

Now, some light reading about the effect income disparity has on our great nation. (Let's really flounder up this thread)

Income Inequality, and Its Cost

The Executive summary:

• Raises health costs
• Increases corruption
• Increasing inequality in incomes.
• An interesting quote: "Professor Pressman relates those results to economic behavior in corporate America. "If a C.E.O.'s salary is going through the roof and workers are getting pay cuts, what will happen?" he said. "Workers can't outright reject the offer — they need to work — but they can reject it by working less hard and not caring about the quality of what they are producing. Then the whole efficiency of the firm is affected."
• Latest data does not predict that "as rich get richer we all benefit." The opposite is proving true per research.

The problem with equating the mismanagement of a corporate body with the mismanagement of a union is that there are laws severly restricting how a corporation operates that they must abide by first. Even more restriction if the company is publicly held. Unions do not have an equivalent layer of restrictions to parallel these, nor are unions accountable to anywhere near the scale of people.

and, as a long distant manager from Circuit City, we had a severe defecit of middle management for too many years even before Best Buy and the internets raised their ugly heads. The beginning of the end was around DIVX. thats when the smart executives distinguished themselves from the dumb ones backing DIVX by splitting off CARMAX as an entity of its own within 2 years.

Was DIVX mismanagement or a bad gamble? Depends on who you ask and their political proclivities, apparently.

Dr. Hess wrote: No, Greg, actually SOX has pushed major corporations to go private, doing their own accounting. That is, no longer publicly traded.

Ok.. I'll bite.. Define "major" and tell me what company?

madmallard wrote: My problem with unions is my problem with politicians. A union's job #1 is -not- to actually do the job they are contracted to, its to 'keep' or 'get more' jobs for itself.

They have to protect their dues base... Less jobs, less dues..

madmallard wrote: The problem with equating the mismanagement of a corporate body with the mismanagement of a union is that there are laws severly restricting how a corporation operates that they must abide by first. Even more restriction if the company is publicly held. Unions do not have an equivalent layer of restrictions to parallel these, nor are unions accountable to anywhere near the scale of people. (Cut off DIVX discussion as it's not pertinent while very interesting. I live in Richmond. Was very close the team who ran the numbers on the first round of layoffs. Am now married to one of the former directors of HR. The Carmax guys were very, very smart.)

Legal boundaries do not have a bearing on good vs. bad management. The government is not telling a union to defend a crap worker. The government is not telling a corporation to run itself poorly and take ill advised risks with shareholder investments.

Again, blaming the union for being the sole reason a company goes under is over simplifying and self-serving to those who like to blame the worker. The worker is not the guy saying the Volt is a great car and will save GM. They're just building them.

Hence my example about Circuit City. The teenager selling cellphones didn't decide to invest milllions into DIVX or stop selling appliances. Why blame him? He might have helped the company go under by giving poor customer service but he surely wasn't involved in more strategic decisions.

Crashing a company is a team effort. The suits need to make good decisions. The workers need to work and improve efficiency. Talk about over simplifying! That's me over simplifying right there.

Datsun1500 wrote: If the CEO makes 40 times the lineman, become a CEO. There is nothing holding you back from doing that. The CEO did not wake up one day as a CEO. It takes effort and sacrifice. We all have the same opportunity in this country. Some go with it, others don't. It's not fair to just bitch because someone else made it happen for himself.

No one is bitching about not being a CEO. A worker was rightfully complaining when his pay was cut in half. I would complain just as any one of us would. It's not the right way to treat someone who's worked for you for even 6 months. Also keep in mind, workers in manufacturing jobs tend to have more tenure than workers in other industries.

"Within the private sector, workers in manufacturing had the highest median tenure among the major industries (6.1 years)." Employee Tenure in 2010

So this guy most likely had his pay cut after working for 6+ years. Not knowing any other details such as worker performance, average pay in the geographic area, etc I'd say that's a pretty bum deal.

I think he has a right to be upset. He agreed to work that job, forgoing other opportunities, for that pay rate. After an unspecified length of time that corporation changed the deal, by 50%. What if the contracted provider of steel for those cars raised prices to that automanufacturer by 50%? Do you think they would meekly accept the new terms? Sheeeeit.

So the why do you expect a worker to accept a 50% pay cut without complaint when no one else would? Because he's a Union member? That logic breaks down pretty fast.

Let's get to your main point. Economic mobility. The American dream of being able to be whatever you want to be via hard work and sacrifice.

The Brookings institute wrote a good article on it.

America Needs More Economic Mobility

Turns out that there are quite a few factors determining your final resting place when you try to mobilize up the economic ladder.

"Kids from families in the bottom 20 percent of the income distribution are nearly five times as likely to wind up in the bottom 20 percent as kids from families in the top 20 percent. Similarly, children from other advanced countries are less likely to be stuck at the bottom of the income distribution than children in the U.S."

That report is written with kid gloves. They're trying to be very positive so it should be an easier read for some.

My points being, the guy quoted at the beginning of this thread has a right to complain as he was treated unfairly. He was sold a bill of good which suddenly changed midstream. I'd be ticked off too.

Also, becoming a CEO is attainable for anyone. Just like winning the lottery. It can happen. Your chances are much greater for becoming a CEO if you already come from money than if you're dirt poor. Currently, economic mobility in the U.S. is at a very low point.

The job market is just that, a market, right? Salaries should be driven by what the market should bear. So, if the market outside that particular company can bear his original hourly wage (competition and desire to get the best ppl for the job...), then he should be able to find another such job where he can make his original wage.

Obviously it sucks that his income was cut in half, and yes it isn't fair if the execs don't take the same cut. But, do we have any data to see if they in fact did take a cut, or are we just speculating here?

I will agree with the kids being from the bottom 20% tend to stay there. In the mid-70s when my father had his two artificial hips and a medical discharge from the navy.. we found ourselves at the mercy (heh) of social security. My father brought in a fixed income as long as he did not try to work. Any work he or my mom did.. was taken out of the SS payments we got. To add to this, everytime we had a regieme change in DC.. we would get cut off from SS while they re-evaluated.

I remember when we went 9 months with no income. We lived on food stamps and sold off everything but the house and were about to sell the car when the first cheque came in.

While I did manage to score a complete college education through the VA.. it has been a HARD road to climb up out of the hole I started in. My sis, sad to say, has never made it out of that 20%

While I do own a business on the side (with no work for over 2 years now thanks to the economy.. glad I have no overhead) the work I do as a stage hand has no upward mobility. Yes, I get raises every year or so.. but there is no where to go but down. I work hard and take every call I am physically able to.. but in the end, I make the same hourly wage as somebody who hides when the hard work comes in. Thankfully those people are getting weeded out as the call stewards know who those people are and slowly divert work from them.

Akerson makes $9 mil a year. cited.

Wagner made $14 mil as he rode GM into the ground in 2008. cited. Arguably Wagner's salary, along with many other executives, was grossly inflated. Potentially the Union salaries are inflated as well. I'd argue CEO salaries are far fatter and more deserving of trimming than some average guy trying to get by in Michigan. Keep in mind, Wagner and his cronies had a private elevator installed so they wouldn't have to spend more time than necessary with the rank and file of GM. Cited. See quote from Rattner as to why he fired Wagner.

Also, there is the onus of leadership. Shouldn't a leader slash his own salary before asking his workers to tighten their belt first? I'd say he should. After all, he will financially benefit first if the company achieves success. Far sooner than the average worker.

Wagner made this while GM lost $38 mil that same year. GM compensation v profit for 2008

But hey, it's all the union's fault. That guy who makes $15 an hour, after being offered the job at $28/hr, should shut up. Why complain? He can just find another job in Michigan which has 10+% unemployment. Heck, his CEO is only making $9 mil a year. That's barely enough to keep his yacht in dry dock. You can't even make payments on a house at the beach on that salary! At least not a decent house. Who wants a beach house with one bathroom and no pool?!

I will say this.. I do know a friend who has her own video production company. When the economy fell through the floor.. she did quite a bit of work for no profit. It didn't cost her anything, but she didn't make any money either.. but she kept her employees working