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York University
Administrative Studies
ADMS 2600
Christa Wilkin

Trade Unions in the European automobile industry ADMS 2600 Group – 7 By: Paul Sohor, Cory Fender, Yukun Li, Sameer Musaad November 24, 2013 The European economic status (as the rest of the world) is currently in a recession.Amajor problem with a recession is the ability for businesses to create and maintain jobs for the lower-middle class. The European auto industry is no different and auto workers are forced to suffer the consequences of the existing capitalist mindset. Before trade unions were introduced, companies would hire a lot of unskilled and semi-skilled workers. They would mistreat workers, underpay and even fire them without any warnings or reasons. After a period of time, a group of workers decided that employees were being treated unfairly and the employers were taking advantage of the workers.Atrade union is an organization of workers who have come together to achieve common goals. There are both positives and negatives to trade unions, which will all be discussed in further detail in the upcoming paragraphs. According to the article “European trade unions oversee auto industry restructuring” (Rippert, 2013), car sales have been steadily declining. This is causing all the auto giants to cut roughly ten-thousand jobs thus making a drastic change in living standards and an unhealthy economy. On July 14, 2003, a trade union in eastern Germany demanded that they receive the same amount of hours worked per week as workers in the west. When their demands were not met, they opted to strike, which led to the closure of a BMW and other company’s production lines. Customarily, when unions tend to strike it is automatically perceived that everyone is on board with the strike, but that is not the case this time around. Even some union members were appalled by the walkouts in a region that badly needs investment and where many companies are barely surviving. The public reaction was overwhelmingly negative, a sign that ordinary Germans have come to see unions not as defenders of the common man but as obstacles to urgently needed change.” (Ewing, 2003).Although the trade union had the right intentions of trying to get the workers more hours, they did not take into consideration if the workers wanted to strike or not and how the strike might affect workers in the end-result. In Europe, workers cannot defend themselves through trade unions because conflicts are resolved in union headquarters. The European trade union agrees that plant closures, reduced working hours and wage cuts are necessary to make the European auto industry competitive again, leaving union workers helpless and soon to be unemployed. In accordance to the peer reviewed journal ``Varieties of employment relations: continuity and change in the global auto and banking industries`` more jobs are being terminated due to off shoring production and employers finding clauses in pay systems to lower salary and employment conditions. Unfortunately the trade unions are unfairly refusing any employee apprehension and siding with the auto giants thus causing workers to compete against each other to see who will work for the lowest wages. “Recently in Europe, the labor trouble at Ford, which aims to shutter two other European factories, shows the resistance automakers face to their efforts to stanch losses in the region.” (Rosemain, 2013) Due to the economic situation in Europe now, most car makers loss money there because of their plants in Europe. For example, Fiat CEO Sergio Marchionne estimates car makers’collective losses in the region last year at €5 billion ($6.5 billion). GM saw a $1.8 billion deficit in Europe last year, bringing it's cumulative losses since 1999 to $18 billion. Ford expects to lose $2 billion in Europe in 2013, up from $1.75 billion last year. (Article: Europe's Carmakers Want to Shrink. Unions Stand in the Way,2013) Automakers in western Europe, which has a long history of worker protections, can’t simply fire employees or close plants when business sours.(Rosemain, 2013). Workers in France must be extensively consulted beforehand. The process can take years and often results in political pressure to delay any job curbs. German labor law grants union representatives half of the he total seats on companies’supervisory boards, giving them considerable power to slow job cuts (Article: Europe's Carmakers Want to Shrink. Unions Stand in the Way,2013). The union’s job is to protect employees from anywhere of their work.AtAulnay-sous-Bois, north of Paris, Peugeot is clashing with workers over plans to close a plant where it makes the Citroen C3 compact. The CGT union has succeeded in temporarily blocking the shutdown and the factory has been virtually idle since Jan. 16, when the CGT occupied part of the facility, demanding that the company offer more severance pay to laid-off workers. The automobile factory shutdown in Europe now is most likely what happened in the U.S. after the Obama administration rescued GM and Chrysler in 2008 with an $80 billion bailout. For kind of reason, the European trade union can follow what U.S. Did unions can make an agreement to automobile industries to prevent such a fast job cutting. The agreement can be based on the U.S. Model, which is to reduce wages for new workers and eliminate traditional pensions and retiree health care. The European automobile industry can successfully slow down the labor issues by doing this kind of solution. In Europe, there has not been a week where there has not been a mass job layoff in the auto industry. BMW has put together a plan to cut 1 billion euro. Their distribution and production extend beyond their national boundaries as this also affects the world economy. For example, if jobs are dismissed and production is reduced at a BMW headquarters in Germany, issues may arise at the BMW establishment in Toronto, Ontario. Until capitalism is ousted from the auto market, people will continue to be pushed out of work so owners can benefit more profit. In a different scenario, an article released onApril 1, 2011, showed how trade unions in South Korea are fighting for fair treatment towards subcontracted workers and even to the extent of helping subcontracted workers become regular workers. “For the last ten years, the South Korean trade unions and labour movement have attempted to organize precarious workers, convert precarious workers to regular workers, abolish discriminatory working cond
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