Unions Plan Merger

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Unions Plan Merger

United States 1995

Synopsis

The three largest industrial unions in North America announced their intent to merge in July 1995. The United Auto Workers (UAW), the United Steelworkers (USW), and the International Association of Machinists (IAM) pledged to unite their roughly two million members by the year 2000. In a Unity Statement the three unions explained that they could jointly "better win a secure and prosperous future for working men and women in the global economy of the twenty-first century." By July 1999 the merger plans as announced in 1995 were called off.

Timeline

1976: United States celebrates its bicentennial.
1980: In protest of the Soviet invasion of Afghanistan, President Carter keeps U.S. athletes out of the Moscow Olympics. Earlier, at the Winter Games in Lake Placid, New York, the U.S. hockey team scored a historic—and, in the view of many, a symbolic—victory over the Soviets.
1986: Seven astronauts die in the explosion of the U.S. Space Shuttle Challenger on 28 January.
1991: The United States and other allies in the UN force commence the war against Iraq on 15 January. By 3 April the war is over, a resounding victory for the Allied force.
1993: Muslim extremists carry out a bombing at the World Trade Center in New York City on 26 February, killing six and injuring thousands.
1995: The Aum Shinrikyo cult carries out a nerve-gas attack in a Tokyo subway, killing eight people and injuring thousands more.
1995: Bombing of the Alfred P. Murrah Federal Building in Oklahoma City, Oklahoma, kills 168 people. Authorities arrest Timothy McVeigh and Terry Nichols.
1995: Yugoslav forces step up their offensives in Bosnia and Croatia and conduct campaigns of "ethnic cleansing" to rid areas of non-Serb elements. By December, however, a Bosnia peace treaty will be signed.
1995: After a lengthy and highly publicized trial charged with racial animosity, a Los Angeles jury takes just four hours to declare O. J. Simpson not guilty of the murders of Nicole Brown and Ronald Goldman. In a 1997 civil trial, he will be found guilty and fined $33 million.
1995: A Jewish extremist assassinates Israeli Prime Minister Yitzhak Rabin. In elections the following May, Benjamin Netanyahu becomes the new Israeli leader.
1998: In the midst of the Monica Lewinsky scandal, terrorists affiliated with Saudi millionaire and Muslim extremist Osama bin Laden bomb U.S. embassies in Kenya and Tanzania, killing hundreds of people. President Clinton orders air strikes on terrorist camps in Afghanistan and an alleged chemical-weapons factory in the Sudan, but the action—which many observers dismiss as a mere tactic to take attention off the scandal—is ineffective and wins limited support.
2001: On the morning of 11 September, terrorists hijack four jets, two of which ram the twin towers of the World Trade Center in New York City. A third plane slams into the Pentagon in Washington, D.C., and a fourth crashes in an empty field in Pennsylvania. The towers catch fire and collapse before an audience of millions on live television. The death toll is approximately 3,000.

Event and Its Context

Background on Union Mergers

Union mergers are not new. Samuel Gompers, founder and first president of the American Federation of Labor (AFL), promoted union mergers to conserve resources and to eliminate jurisdictional disputes. Mergers reduce costly duplication of expenses, provide larger strike funds, increase collective bargaining power, and heighten organizing ability. Larger unions also have greater resources for political action. Diminished in a merger are the local history and culture of small unions.

Union membership reached its peak in the United States in 1979 and began to decline thereafter. Membership decreased by more than four million between 1979 and 1995. Some of the areas that were particularly hard hit were the primary metals, automobiles, and aerospace equipment manufacturing, which were represented by the three unions: United Auto Workers (UAW), United Steel Workers (USW), and the International Association of Machinists (IAM).

The fortieth anniversary of the merger between the AFL and the Congress of Industrial Organizations (CIO) occurred in 1995. The AFL-CIO, a federation of autonomous labor unions, had a constitution that encouraged mergers. From the time of the AFL-CIO merger until 1995 there were 133 mergers among unions, although not all of the mergers were within the AFLCIO. Between 1975 and 1995, half of the mergers were between AFL-CIO members and 35 percent of the mergers were between AFL-CIO affiliates and independents. The rest were between independents.

When unions that are essentially equal in size unite to form a new entity, it is described as amalgamation. When a small union merges with a large union, as is the most common form of merger, it is called absorption. If the unions each retain their own identity within the merger, it is described as an affiliation.

After January 1985, the IAM was involved in four mergers, the UAW in two, and the USW in three. All these mergers were with small unions. There is no information readily available on how many mergers were started but never completed. However, experts believe that far more mergers are begun than are completed. Information surfaces on failed mergers if the proposal makes it as far as a convention and the members reject it. Such was the case with a proposed megamerger between the National Education Association (NEA) and the American Federation of Teachers (AFT) that had been discussed intermittently for 30 years before a merger agreement was finally taken to the membership in 1998 and voted down. At the beginning of the twenty-first century, state and local groups continued to negotiate a merger.

International Association of Machinists

To understand what is involved in a merger of the proportions proposed in 1995, one has to look first at the individual unions. The IAM, with a0membership over 700,000, started in 1888 when 19 machinists met in a locomotive pit in Atlanta, Georgia, and voted to form a trade union. In 1895 the IAM joined the AFL and moved its headquarters to Chicago. In 1936 aerospace workers joined IAM and the membership grew to 130,000. By 1995 IAM represented workers in auto and auto parts, wood and paper, electronics, construction, and general manufacturing industries, although most of the membership came from the defense and aerospace industry. About 40,000 IAM members were Canadian.

The organization of the IAM was somewhat different from that of both the UAW and USW. In the IAM much of the power and authority was decentralized, held in the local and district lodges, a structure that traces back to its origin as a craft union. The local lodges kept 50 percent of the dues, and 2.5 percent went into a strike fund. The International (called the Grand Lodge) elected officers by a membership referendum. In 1995 George Kourpias was president of the union, but he was due to retire before the merger would be completed.

United Auto Workers

In 1995 the UAW also had a membership of over 700,000 including 4,000 Canadians. Both the CIO and the UAW were formed in 1935. The UAW was chartered originally with the AFL but soon changed affiliation to the CIO. A Canadian regional office opened in 1937. The UAW had significant success in organizing and bargaining in the auto industry in the 1930s and 1940s. After recruiting aerospace membership throughout the 1930s and 1940s, the UAW added an aerospace department in 1943.

Walter Reuther was elected president of the UAW in 1946. He led the UAW to become a member of the AFL-CIO when the two groups merged in 1955, but because of disagreements over social issues, organizing unorganized workers, and international labor and foreign policies, he also led the UAW to withdraw from the AFL-CIO in 1968. In 1981 the UAW rejoined the labor federation.

Although most UAW members worked in the auto, auto parts, and truck industries, there was a considerable membership in the agricultural implement, aerospace, and defense industries. In 1986 the majority of the Canadian members formed their own union, the Canadian Auto Workers (CAW).

The political structure of the UAW was centralized, with significant authority given to the international and regional levels. The local share of the UAW dues was 38 percent; 30 percent went to a strike fund. Every three years the union elected its president in a vote of delegates at an international convention. Stephen Yokich became UAW president in 1995.

United Steelworkers

The United Steelworkers grew out of a 1936 CIO group, the Steel Workers Organizing Committee (SWOC). When most of the basic steelworkers were organized by the SWOC in 1942, they changed the name to United Steelworkers. By 1995 the union had a membership of over 600,000, partly accrued in mergers of industries in the production and fabrication of other metals. About 170,000 of the members were Canadian.

The USW had a centralized structure much like that of the UAW, except that the members elected the international officers by referendum. The local share of the dues was 44 percent; the strike fund received 7 percent. In 1995 George Becker was president of the USW.

Ten Merger Issues

A megamerger such as the one as proposed by the IAM, UAW, and USW has the obvious advantage of scale in bargaining and political action, but there are at least 10 issues that can interfere and take time to resolve, if they can be resolved at all. The issues are: 1) The method of electing national officers: IAM and USW elected by a secret ballot referendum, and the UAW elected by a vote of delegates at a convention. 2) Members of the executive board and election procedures: The UAW and USW had similar structures for their executive board, but IAM was different; the selection process was different in all three unions. 3) The distribution of decision-making power: The UAW and USW had a centralized system, but IAM was more regional; the power granted to the union president was also different in each of the unions. 4) The process by which members and officers exercise their rights of appeal of the actions of the national union, a right assured by the Labor-Management Reporting and Disclosure Act (LMRDA), was different in the UAW than in both the IAM and the USW: the UAW had a unique public review board made up of distinguished academics; the IAM and USW involved delegates to the national convention in the appeal process. 5) The rights of retirees were different in each of the three unions: Retirees had full voting rights only in the UAW; IAM retirees had some voting rights, and UAW retirees had none. 6) The dues structure was different in each of the three unions: Although the amount of dues collected was similar, the local share and the strike fund share were very different. 7) The compensation for international officers was different in all three unions: The IAM president received the most at about $130,000 per year, and the USW president received just over $100,000. 8) The net assets of the three unions were different: the UAW had about five times the assets of either the IAM or UAW at over $950 million, compared to about $190 million for each of the other two. 9) The headquarters and education centers were different for each of the three unions: Although it was conceivable that all three locations could be used to some degree, to do so would cut into the economy produced by a merger. 10) Who will become president of the merged entity? This and the name given to a newly formed union introduced the issues of union loyalty, history, and culture.

Aftermath of the Merger Announcement

At the time that the intent to merge was announced, the unions formed three committees to initiate the process. These included an international president's committee to study all issues related to the merger, a finance committee of the secretary-treasurers of the three unions to examine the financial aspects, and a constitution committee composed of vice presidents and other necessary staff. In 1996 the unions added a 54-member general membership advisory committee. In spite of these efforts, the unions were unable to complete the merger. On 25 June 1999 the unions' leaders announced that the merger plan had failed. The differences in the issues were too great to be reconciled.

Key Players

Becker, George (1928-): Becker, a second-generation steel-worker, rose through the ranks to become president of the United Steelworkers in 1993. He was elected for a second term in 1997. Becker had been a vice president of the union for two terms before being elected president. He grew up across the street from a steel mill in Illinois.

Gompers, Samuel (1850-1924): Gompers was born in London, England, but immigrated to the United States when he was 13 years old. Gompers was a cigar maker and became active in the Cigarmaker's Union. He then became involved in the Federation of Trades and Labor Unions and was chairman of it when its name was changed to the American Federation of Labor (AFL) in 1886. Gompers supported union mergers.

Kourpias, George J. (1932-): Kourpias served as an International Association of Machinists (IAM) district president, a Grand Lodge representative, and a national vice president before he was elected president of IAM in 1989. He served as president of IAM until 1997. Kourpias was also elected to the AFL-CIO executive council in 1989.

Yokich, Stephen P. (1935-2002): Yokich was a third-generation UAW member. He was elected president of the UAW in 1995. He was well respected in the UAW for his skill in collective bargaining.

See also: AFL, CIO Merge

Bibliography

Books

Katz, Harry C., and Hurd, Richard W. Rekindling the Movement, Labor's Quest for Relevance in the 21st Century. Ithaca, NY: Cornell University Press, 2001.

Periodicals

Clark, Paul F., and Lois S. Gray. "Assessing the Proposed IA], UAW, and USW Merger: Critical Issues and Potential Outcomes." Journal of Labor Research 21, no. 1 (winter 2000): 65-81.

"Union Merger Called Off?" Cleveland Plain Dealer, 25June 1999.

Verespej, Michael A. "Megaunions: Mega-headaches?"Industry Week 244, no. 16 (4 September 1995): 71-73.

Williamson, Lisa.0"Union Mergers: 1985-94 Update."Monthly Labor Review (February 1995): 18-24.