The United Auto Workers Strike: Are State Tort Claims a Remedy for the Big Three?

by Audrey Rotman, Associate Member, University of Cincinnati Law Review Vol. 92

I. Introduction

News of the Screen Actors Guild and American Federation of Television and Radio Artists’ (the “SAG-AFTRA”) picketing against the movie studios, and the Teamster’s strike opposing UPS have dominated the cycle this past quarter.¹ United Auto Workers’ (the “UAW”) initiated another union strike where automotive workers are looking to renegotiate their contracts with the “Big Three” — Ford, General Motors, and Stellantis (Chrysler).² The last time that the UAW took to striking on a large scale was during the 2008 financial recession — a much different economic climate for labor unions.³ However, this is the first time in history that the UAW is striking the Big Three simultaneously. With the economic climate much different than in 2008, the union’s collective bargaining power is much stronger.⁴ Despite the National Labor Relations Board (the “NLRB”) guaranteeing the right for unions to strike, the Supreme Court’s decision in Glacier Northwest, Inc. vs. International Brotherhood of Teamsters Local Union No. 174 calls into question the tort remedies employers might have against unions for their striking actions in causing “imminent danger.”⁵

This article will discuss the legal remedies that unions, employers, and the government have when negotiation talks break down, as well as why some unions never strike. Part II will provide background on historical and current labor union protections. Part III will discuss what legal options the UAW, the Big Three, and the government have in coming to a resolution, including the impact of the Supreme Court’s ruling in Glacier.

II. Background

The 1935 National Labor Relations Act (the “NLRA”), or the Wagner Act, provided unions the “right…to engage in other concerted activities for the purpose of collective bargaining…”⁶ It also established the NLRB, which oversees the unionization of workers and unfair labor practices.⁷ Strikes that are lawful are a protected right for all workers under the NLRA.⁸ Striking is viewed as a negotiation tactic like arbitration or mediation. The government has more power in overriding some industry strikes than others, due to a century old legislative act—The Railway Labor Act.⁹

A. Railway Labor Act

The Railway Labor Act (the “RLA”) regulates labor negotiations between unions and employers. If negotiations fail between management and unions in the rail (and later added airline provision) industry, Congress has the ability to step in and impose a contract for both sides.¹⁰ Rather than using striking as a negotiation tactic, the RLA relies on required arbitration and mediation to solve disputes.¹¹ The RLA will allow airline and railroad unions to strike only after these remedies fail and the government does not step in to compel arbitration.¹² However, this rarely happens because of the potential economic upheaval a shutdown will have on the transportation sector with Congress almost inevitably stepping in.¹³

Since its passing almost 100 years ago, the RLA has been extremely successful and steadfast, with the last major airline strike in 1998 by Northwest Airlines pilots.¹⁴ The court in Goodin v. Clinchfield Railroad Company held that the RLA was constitutional because it is not a punishment for specific people.¹⁵ This past August 2023, American Airlines flight attendants voted to strike and picketed at several airports but did not cause disruptions to travel. Strikes rarely happen in the airline industry because they require approval from the National Mediation Board and a thirty-day cooling off period.¹⁶ Therefore, while the flight attendants picketed in protest, a major strike was not approved, and air travel continued as usual.

B. National Labor Rights Act Protected Unions

The RLA does not extend to unions outside of the railroad and airline industries. Any union covered by the NLRA has the right to strike for: (1) economic reasons, like higher wages, shorter hours, or better working conditions and (2) unfair labor practices.¹⁷ Economic strikers cannot be discharged by their employer but can be replaced. Unfair labor strikers cannot be discharged or replaced and are entitled to job security.¹⁸ This means the UAW strikers cannot be fired, but they can be replaced, a calculated risk to take.

The Labor Management Relations Act—the Taft-Hartley Act—amended the NLRA in 1947. The Taft-Hartley Act further restricted the power of activities of labor unions.¹⁹ By further defining the restrictions on union actions, like second strikes, “closed shop,” and strikes by federal employees, the Taft-Hartley Act limited the right to strike.²⁰

III. Discussion

With the right to strike guaranteed to the UAW under the NLRA—and the expiration of its contracts leading to striking as a form of negotiation—the UAW has taken to a more strategic striking plan. As with any negotiation, the two sides must find middle ground, but the timeline of that is not easily defined. Still, the UAW, the Big Three, and outside parties all have rights and tactical options to prolong or end striking negotiations.

A. The Rights of United Auto Workers

The UAW is lawfully exercising its right to strike as it demands pay raises to reflect an inflation adjusted cost of living, the return of the pension system, and forty hours of pay for thirty-two hours of work in its new contracts.²¹ The UAW members pay into a strike fund as part of their union membership to prepare for events like this. This fund supplies a modest income to striking workers to make striking a bit easier financially. At the beginning of the strike, the fund stood at $825 million. As the UAW moves forward with its strike, the union is paying striking members $500 a week from the fund and covering health insurance premiums, if needed.²² By selectively choosing plants to strike, the limited scope is intended to stretch the strike fund.²³ Striking employees might be eligible for unemployment, depending on the state, although currently it is limited to New York and New Jersey.²⁴

As this is the first time in history that the union is striking the Big Three at the same time, the industry is not limited from experiencing widespread impacts—reaching both suppliers and consumers.²⁵ As the strike expands to distribution centers, vehicle repairs might see the brunt of the impacts first. While a car shortage is not expected immediately, the long-term supply if the strikes continue could affect prices, as well as market share by rival companies.²⁶ With globalization of cars, consumers will have other options to turn to the likes of Toyota, Tesla, and Honda. If consumers turn to these other companies, American-based companies will suffer the impact for years to come.²⁷

B. The Rights of the Big Three Auto Makers

Employers are not allowed to retaliate against striking workers. However, they are allowed to hire permanent replacements, but only if employers offer the vacated position to strikers before proceeding with hiring.²⁸ This is why labor strikes are more common and more successful when the labor market is strong, and employees are not threatened by others willing to work without union protections.²⁹ However, as discussed below, the recent ruling in Glacier might give employers more power than previous strikes in seeking tort remedies.³⁰

Employers are also allowed to conduct plant lockouts, in which they do not allow workers into facilities during ongoing strikes and contract negotiations.³¹ This is not a breach of contract as the union is currently working under expired contracts, nullifying the “no strike, no lockout clause” in the contracts.³² In the early stages, this option does not seem likely as the Big Three wants to continue producing vehicles amid the end of shortages post-pandemic and supply chain shortages.³³ As of late September, General Motors had offered a twenty percent wage increase over the course of the contract and cost of living adjustments for more senior workers.³⁴ The UAW is still demanding a forty percent wage increase over four years, a thirty-two hour work week, a restored cost of living adjustment, and the reestablishment of the pension system for all workers.³⁵ While the companies state that the union demands are not financially possible, General Motors, Ford, and Stellantis have reported record earnings this past year, which would imply there is a potential cash flow that is available to provide higher compensation and benefits.³⁶

C. Legal and Political Remedies

President Biden has the ability to send influential parties to the negotiation table, but does not have authority under the NLRA to put an end to striking like they have and do under the RLA.³⁷ In fact, President Biden announced within the first week of strikes that he would be sending the acting Secretary of Labor — Julie Su — to Detroit to help facilitate negotiations.³⁸ On Tuesday, September 26, President Biden himself joined the picket line in Detroit—the “most significant display of union solidarity every by a sitting president.”³⁹ However, this is partly a political move by the president who relies on union voters for his reelection campaign and does not signify that President Biden is actually at the negotiation table himself to arbitrate.⁴⁰

One option for President Biden could be to take action like President Roosevelt did during the 1902 coal strikes, serving as a neutral arbitrator.⁴¹ Prior to 1902, Presidents typically sided with employers, but President Roosevelt’s meeting “marked the turn of the U.S. Government from strikebreaker to peacemaker in industrial disputes.”⁴² However, both sides would have to agree this, or presidential intervention essentially becomes compelled arbitration and defeats the idea of a free economic system. While it did appear that Ford was making progress with the UAW, that has backtracked, with strikes expanded in early October against the Big Three.⁴³ Only when strikes are prolonged to the extent they affect the people significantly, like the 1902 coal strikes, does the government have a role in stabilizing the economy in a free market system. This situation does not appear to be at that point; in the 1902 coal strikes, people were preparing for a winter without heat, which threatened human lives.⁴⁴

Under the recent decision in Glacier , the Supreme Court’s ruling has opened the door to whether any damage done by unions while on strike during contract renegotiation counts as sabotage and thus allows employers to sue unions.⁴⁵ The 2023 Supreme Court opinion held that Teamster’s strike against Glacier Northwest, a concrete company, presented “risk of harm to Glacier’s equipment” and held that the driver’s actions of abandoning filled concrete trucks during the strike were not protected.⁴⁶ The court’s 8-1 opinion was rooted in a state tort claim, holding that the NLRA does not preempt the tort claim if unions don’t take reasonable precaution to avoid damage.⁴⁷

This has now arguably opened to door to employers holding unions liable for any economic damages stemming from strikes.⁴⁸ While “the NLRA protects the right to strike…this right is not absolute.”⁴⁹ It is accepted that strikers who do not take “reasonable precautions to protect their employer’s property from foreseeable, aggravated, and imminent danger due to the sudden cessation of work” are not shielded by the NLRA.⁵⁰ In this case, the knowledge by the union that concrete was highly perishable was enough to know that the risk of harm “was both foreseeable and serious.”⁵¹ Additionally, “the Union’s failure to take even minimal precautions” shows the failure to take reasonable precautions.⁵² This narrow interpretation of the NLRA does not provide clarification on reasonable precautions outside of perishable goods, the line on that has yet to be drawn. In fact, in Justice Brown Jackson’s dissent, she cited the threat of economic harm as “a feature, not a bug, of the NLRA” and further criticized the majority for failing to “heed Congress’s intent with respect to the Board’s primary role in adjudicating labor disputes.”⁵³

Applying this to the UAW strike at hand, the Big Three were projected to lose $5 billion if the UAW strikes at its full capacity for ten full days.⁵⁴ Auto workers would stand to lose $859 million, and manufacturers would lose an upwards of $989 million.⁵⁵ If this tort were to extend to pure economic loss, the UAW could be liable for this economic loss if Glacier is interpreted literally. By purposefully keeping the Big Three on their toes and not disclosing which factory workers would strike, the unclear line established by the majority in Glacier, as well as overstepping the NLRB, would give the Big Three a chance in state court to fight this on tort law. It would be hard to argue there is imminent danger created by not assembling cars, but there might be an imminent danger to the Michigan economy, like in the 2019 six-week strike against GM sent the economy into a downturn. While a court would have to stretch the imminent danger ruling to cover an even broader set of facts, the ruling itself is a step back in the right to strike for many unions and has chilling effects for many industries.⁵⁶ Only after the strikes end could the Big Three evaluate if they wanted to pursue further legal action.

A final option for the Big Three and the UAW is negotiations on their terms, even if it might bring disruptions to the industry. Traditionally, under the NLRA and the NLRB, unions view strikes as a form of negotiation, just like arbitration and mediation. This bargaining strategy is meant to hurt employers and is rooted in the Industrial Revolution as mass labor grew to change corporate policies.⁵⁷ The UAW, founded in 1935, boasts over 400,000 active members with over 1,750 contracts with 1,050 employers.⁵⁸ When those contracts are set to expire, renegotiation efforts start to determine new pay and benefits for union members.⁵⁹ When the unions and employers cannot come to an agreement and the contracts expire, striking can start as a negotiation technique.⁶⁰ With the concessions the UAW made during the 2007-2008 financial recession to keep the automakers afloat, this fight over wage increases and pensions does not seem like one the UAW is going to concede on quickly and easily.⁶¹ As of September 25, 2023, the strike expanded to thirty-eight distribution centers for General Motors and Stellantis.⁶² However, the UAW did not pursue further strikes at Ford, as the company is “serious about reaching a deal,” demonstrating how strikes end in this day and age — by the two sides coming to an agreement and taking the necessary steps to demonstrate their commitment to union demands.⁶³

IV. Conclusion

As the UAW and Big Three continue to negotiate a new contract for the union workers, the UAW continues to expand the strike against more plants and distribution centers and General Motors, Stellantis, and Ford are starting to lay off and furlough workers. With a total estimated loss of $3.9 billion from the first strike week, both the Big Three, for car prices and inflation, and the UAW, for strike fund preservation, are keen to find a solution through traditional negotiation methods, especially if the effects will soon start to be felt by consumers, who may explore other auto makers if prices start to rise.⁶⁴

Cover Photo by USADAgov on Openverse

Audrey Rotman

Audrey Rotman graduated from Furman University in 2020 with a degree in German Studies and Communication Studies. Prior to law school, she worked in project management and local journalism. Audrey is interested in exploring legal issues pertaining to labor and employment and healthcare

References

1
Molly Cook Escobar & Christine Zhang, A Summer of Strikes, N.Y. Times (Sept. 15, 2023), https://www.nytimes.com/interactive/2023/09/03/business/economy/strikes-union-sag-uaw.html.
2
Id.
3
Emily Stewart & Ellen Loans, Everything You Need to Know About the UAW Strike to Look Cool at Parties, VOX (Sept. 22, 2023), https://www.vox.com/2023/9/15/23875044/uaw-strike-news-contract-demands-wentzville-toledo-wayne.
4
Jeanne Whalen, Jeff Stein & Lauren Kaori Gurley, UAW Poised to Strike Against All Big Three Automakers for the First Time in History, Wash. Post (Sept. 14, 2023), https://www.washingtonpost.com/business/2023/09/14/uaw-strike-update.
5
National Labor Relations Act, 29 U.S.C. §§ 151-169; Erwin Chemerinsky & Catherine Fisk, Opinion: Employers Can Now Sue Unions Over Strikes. Here’s How that Will Intimidate Workers, L.A. Times (June 1, 2023), https://www.latimes.com/opinion/story/2023-06-01/supreme-court-ruling-erodes-the-right-to-strike-by-empowering-employers-to-sue-unions.
6
Id.
7
About NLRB: 1935 Passage of the Wagner Act, N.L.R.B., https://www.nlrb.gov/about-nlrb/who-we-are/our-history/1935-passage-of-the-wagner-act (last visited Sept. 24, 2023).
8
Annie Nova, Termination Risks, Collective Unemployment: a look at Workers’ Rights Amid a ‘Summer of Strikes,’ CNBC (Aug. 6, 2023), https://www.cnbc.com/2023/08/06/whats-at-stake-for-workers-and-their-rights-amid-summer-of-strikes.html.
9
Federal Railroad Administration Office of Rail Policy and Development, Railway Labor Act Overview, U.S. Dept. of Transp., https://railroads.dot.gov/sites/fra.dot.gov/files/fra_net/1647/Railway%20Labor%20Act%20Overview.pdf (last visited Sept. 24, 2023).
10
Chris Isidore, How an Arcane 96-Year-Old Law Stopped the Rail Strike,CNN (Dec. 2, 2022), https://www.cnn.com/2022/12/02/business/railway-labor-act-freight-railroad-strike/index.html.
11
Id.
12
Id.
13
Id.
14
Chris Isidore, Why You Don’t Have to Worry About a US Airline Strike Disrupting Your Summer Travel Plans, CNN (May 2, 2023), https://www.cnn.com/2023/05/02/business/airline-strike-threat/index.html.
15
Goodin v. Clinchfield R. Co., 125 F. Supp. 441, 451-52 (E.D. Tenn. 1954).
16
AP, American Airlines Flight Attendants Take Key Step Toward Possible Strike, CBS (Aug. 20, 2023), https://www.cbsnews.com/news/american-airlines-flight-attendants-strike-authorization-vote/.
17
The Right to Strike, N.L.R.B., https://www.nlrb.gov/strikes (last visited Sept. 24, 2023).
18
Id.
19
About NLRB: 1947 Taft-Hartley Substantive Provisions, N.L.R.B.,https://www.nlrb.gov/about-nlrb/who-we-are/our-history/1947-taft-hartley-substantive-provisions (last visited Sept. 24, 2023).
20
Id.
21
Tom Krisher, Mike Householder & John Sewer, Workers Strike at All 3 Detroit Automakers, a New Tactic to Squeeze Companies for Better Pay, Associated Press (Sept. 15, 2023), https://apnews.com/article/auto-uaw-workers-strike-gm-ford-stellantis-7ce3ca9d94b911250d07556b7af376c7.
22
FAQ on Strikes and UAW Strike Assistance, UAW, https://uaw.org/strike-faq-2/ (last visited Sept. 24, 2023).
23
Krisher, supra note 21.
24
Nova, supra note 8.
25
Camila Domonoske, How the UAW Strikes Could Impact Car Shoppers, NPR (Sept. 23, 2023), https://www.npr.org/2023/09/23/1200614584/uaw-strike-big-3-shawn-fain-ford-gm-stellantis-car-prices-repairs-spare-parts.
26
Id.
27
Id.
28
Nova, supra note 8.
29
Id.
30
E. Tammy Kim, The Supreme Court’s Damper on the Right to Strike, The New Yorker (June 8, 2023), https://www.newyorker.com/news/daily-comment/the-supreme-courts-damper-on-the-right-to-strike.
31
Michael Wayland, Everything You Need to Know About UAW’s Targeted Strike Plans — and Possible Lockouts, CNBC (Sept. 14, 2023), https://www.cnbc.com/2023/09/14/uaw-strikes-everything-you-need-to-know.html.
32
Id.
33
Id.
34
Neal E. Boudette, U.A.W. Goes on Strike Against Detroit’s Big 3 Automakers, N.Y. Times (Sept. 14, 2023), https://www.nytimes.com/2023/09/14/business/uaw-strike-plan.html.
35
Id.
36
Id.
37
CNN, Here’s Why Biden Can’t Do Much to Prevent an Auto Strike, CBS Detroit (Sept. 7, 2023), https://www.cbsnews.com/detroit/news/heres-why-biden-cant-do-much-to-prevent-an-auto-strike/.
38
Amy B. Wang, White House Says Labor Officials Won’t ‘Intervene’ in Strike During Detroit Trip, Wash. Post (Sept. 24, 2023), https://www.washingtonpost.com/business/2023/09/15/uaw-strike-detroit-automakers/#link-HR5S7PUPMFD6TCCIUDC5SFM7JI.
39
Andrew Zhanb, Nick Niedzwiadek & Sam Stein, Biden to Join the Picket Line in UAW Strike, Politico (Sept. 22, 2023), https://www.politico.com/news/2023/09/22/biden-to-join-the-picket-line-in-uaw-strike-00117749.
40
Id.
41
Jonathan Grossman, The Coal Strike of 1902 – Turning Point in U.S. Policy, Monthly Lab. Rev. 98, 21 (1975).
42
Id.
43
Neal E. Boudette, U.A.W. Expands Strikes at Ford and G.M., N.Y. Times (Sept. 29, 2023), https://www.nytimes.com/2023/09/29/business/economy/uaw-strike.html.
44
Grossman, supra note 40.
45
E. Tammy Kim, supra note 30.
46
Glacier Nw., Inc. vs. Int’l Bhd. of Teamsters Local Union No. 174, 143 S. Ct. 1404, 1408-09 (2023).
47
Id. at 1414.
48
Chemerinsky, supra note 5.
49
Glacier, 143 S. Ct. at 1413.
50
Id.
51
Id.
52
Id. at 1413-14.
53
Chemerinsky, supra note 47.
54
10-Day UAW Strike Against Big Three Could Cause Economic Losses Exceeding $5 Billion, Anderson Econ. Grp., https://www.andersoneconomicgroup.com/10-day-uaw-strike-against-big-three-could-cause-economic-losses-exceeding-5-billion/ (last visited Sept. 24, 2023).
55
Id.
56
Ian Millhiser, The Supreme Court Deals Another Blow to Labor Unions, Vox (June 1, 2023), https://www.vox.com/scotus/2023/6/1/23745372/supreme-court-unions-labor-strike-glacier-northwest-teamsters-amy-coney-barrett.
57
The Early Labor Movement, PBS,https://www.pbs.org/opb/historydetectives/feature/the-early-labor-movement/ (last visited Sept. 24, 2023).
58
Who We Are, UAW, https://uaw.org/about/ (last visited Sept. 24, 2023).
59
Chris Isidore & Vanessa Yurkevich, Haven’t Been Paying Attention to the UAW Strike? What You Need to Know, CNN (Sept. 18, 2023), https://www.cnn.com/2023/09/14/business/deadline-uaw-strike-negotiations/index.html.
60
Id.
61
Danielle Kaye, Why the UAW Is Fighting So Hard for These 4 Key Demands in the Auto Strike, NPR (Sept. 20, 2023), https://www.npr.org/2023/09/20/1200357955/uaw-big-3-strike-auto-shawn-fain.
62
Michael Wayland, UAW Targets 38 Facilities at GM and Stellantis for Expanded Strikes, Skips Ford, CNBC (Sept. 22, 2023), https://www.cnbc.com/2023/09/22/uaw-strike-expands-to-38-more-facilities-at-gm-and-stellantis.html.
63
Id.
64
David Shepardson, GM, Ford Furlough Another 500 Workers Due to UAW Strike, Reuters (Oct. 2, 2023), https://www.reuters.com/business/autos-transportation/gm-furloughs-another-160-workers-due-uaw-strike-2023-10-02/.