Late last summer, the labor relations director of one of the nation's major corporations wondered whether management in the auto industry was up to the task of the 1982 negotiations with the United Auto Workers union. This week the answer appears to be a resounding "yes" and "no."
"Up to now the creativity at the bargaining table has been on the UAW side," he said at the time. "Now it has to come from the companies or else we'll all be had, and that worries the hell out of me."
In the past few weeks, General Motors and the Ford Motor Co. have demonstrated a contrast in bargaining styles with the UAW that graphically illustrates the crossroads faced by labor relations in the United States today.
General Motors, the dominant automaker in the United States, went to the bargaining table in January with a hard-line demand that the union reopen its contract and give up major benefits or lose their jobs. The negotiations failed when it became apparent the union's rank and file was balking at the price GM was asking them to pay.
Since then, the company has been shutting down plants and laying off workers in apparent response to the negotiating failure, raising the possibility of a strike this September when the current contract expires.
"It's reasonably clear that GM blew it," one of the nation's top labor relations experts said after the negotiations failure. "The unions don't know how to handle the concessions, and the company didn't know how to handle it. That's the problem of American management dealing at arms length with labor."
Ford, however, chose a much different approach to this year's negotiations--an approach that could have a major influence on future collective bargaining in manufacturing.
Instead of seeking major cutbacks in existing benefits, Ford focused its attention on future stability. The result is a 31-month freeze in basic wage and benefit payments and a delay in cost-of-living payments.
In exchange for this, the company offered its UAW members a two-year commitment not to close plants solely to purchase cheaper parts outside the company and a guaranteed income program for senior workers. Ford also offered a profit-sharing program when and if the company returns to profitability and set up a lifetime employment experiment at two plants.
Ford's shift away from confrontation appears to coincide with the arrival of Peter Pestillo in 1980 as the company's vice president for labor relations. The 44-year-old Pestillo has earned a reputation for bringing change and innovation to the bargaining table during previous stints at General Electric and B. F. Goodrich.
It was Pestillo, backed by the economic desperation of the auto industry, who took a major step toward removing Ford's arms-length relationship with the UAW. More important to the nation's business community, the Ford settlement was seen as a step toward a Japanese-style system of labor-management cooperation.
Pestillo himself used Japan as an example in describing the agreement with the UAW. In a television appearance this week, he noted that in Japan "labor relations are driven by their personal system, not their legal system." And he added, "I would urge upon some of my colleagues in management a little more imagination."
Whatever the eventual economic fate of the Ford Motor Co., the agreement reached with the UAW may well send a signal to labor and management in other industries. That signal already seems to have reached at least one Ford factory worker who sized up the agreement this way: "For a change they agreed we do exist . . . they're paying more attention to the worker."