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Assembly of a new vehicle at Volkswagen's Chattanooga plant is now more likely after the United Auto Workers backed off Monday on its appeal of the factory's union vote, an expert says.
"Now, VW can plan," said Karl Brauer, a Kelley Blue Book senior analyst, adding that the company couldn't figure production costs on a new sport utility vehicle with uncertainty over the factory's union or nonunion status.
The UAW abruptly pulled its appeal for a revote, saying just an hour before a National Labor Relations Board hearing was to begin in Chattanooga that the agency has a "historically dysfunctional and complex process" that could drag on for months or years.
In February, VW workers voted by a 53 percent to 47 percent margin against unionizing the plant, but the UAW had contended that third-party groups and Republican politicians interfered with and tainted the decision.
Close to 40 people, many of them lawyers, were inside the Hamilton County Courthouse's Commission Room Monday morning for the appeal hearing. NLRB administrative law judge Melissa Olivero walked into the room and never sat down as she took less than a minute to say the labor relations board would issue an order accepting the election results.
Later, state, city and federal officials, and even the UAW, said it's time to put the appeal in the rear-view mirror and focus on plant expansion -- a move that could add hundreds of new jobs and hundreds of millions of dollars in new investment in Chattanooga.
"We look forward to sitting down with the company to discuss VW's growth in Tennessee," said Clint Brewer, a state Department of Economic and Community Development spokesman. The department late last year had offered VW nearly $300 million in incentives if the company put the SUV in Chattanooga and added more than 1,000 jobs.
U.S. Sen. Bob Corker, R-Tenn., said in a statement from Moldova in Eastern Europe, where he's traveling on Senate business, that it's time for VW, the state and city to re-engage and "move forward with bringing additional jobs to Chattanooga."
Chattanooga Mayor Andy Berke called on Tennessee Gov. Bill Haslam to "immediately" put state incentives back on the table.
"We cannot afford to sit on the sidelines and watch this opportunity go elsewhere," Berke said.
Haslam said the UAW move should "help things move along in Chattanooga."
"I look forward now to the chance to sit down with Volkswagen and have a face-to-face conversation and see if we can get another vehicle to be built in Chattanooga," Haslam said. "They haven't come back to us for sure and said, 'We want to build a car there,' so anything else is just speculation."
Still, Brauer said it could be weeks before a decision is announced about the site of SUV production.
"VW knows they need that type of vehicle if they're going to be successful in this country," he said.
UAW Regional Director Gary Casteel said the union will focus on "advocating for Volkswagen to create more jobs in Tennessee." Casteel said VW and the UAW will continue to have discussions, and the union will continue to work with and talk to its supporters.
But a neutrality agreement between the UAW and VW signed before the election said that, unless otherwise agreed to by the parties, the union is to discontinue organizing activities at the plant for a year from the February election. Also, the agreement said the United Auto Workers shall not make another election request at the factory for a year.
One exception to the agreement is that if another union tried to organize plant employees, then the UAW would be released from its obligation to cease organizing efforts.
Chattanooga labor lawyer Dan Gilmore said he didn't think union leaders believed when they signed the agreement that future restrictions on organizing would be relevant. The UAW had said before the election it had a majority of workers' signatures on authorization cards supporting the union.
Mike Burton, a VW plant worker who helped lead the plant's anti-UAW forces, said there are different groups talking about a potential micro union consisting of workers just at the VW factory that makes the Passat sedan, but he declined to speak further on the issue.
Concerning the UAW dropping the appeal, Burton said workers spoke in February and the revote request "has been a waste of time and expense to everybody. It's a shame it went through this process."
Maury Nicely of the local anti-UAW group Southern Momentum said he believed the union realized its appeal for a revote wouldn't be approved.
"I think they realized that there was no meat on the bone," he said.
Nicely said the UAW's withdrawal is "a vindication of public officials." He said that what remains to be seen is if the UAW and VW are embarking on "another course of action" as it relates to organizing the plant.
UAW President Bob King said in a statement the union met a major goal with its election objections.
"The UAW's objections informed the public about the unprecedented interference by anti-labor politicians and third parties who want to prevent workers from exercising their democratic right to choose union representation," he said.
King said outdated federal laws governing the labor relations board never contemplated "the level of extreme intimidation and interference that occurred in Chattanooga." Even if the NLRB ordered a new election nothing would stop politicians and anti-union organizations from interfering again, he said.
However, attorney Glenn Taubman of the National Right to Work Foundation in Virginia, which represented some VW employees who were UAW opponents, said he was gratified by the upholding of the vote.
"It was one of the most wonderful trips in my professional life to come to Chattanooga and see employees get freedom, to see their voice get respected," he said.
Taubman called the UAW appeal "a charade in which they were more interested in trying to drag their political opponents through the mud than actually represent employees."
John Raudabaugh, a former NLRB member appointed by then-President George H.W. Bush, said he was "shocked" by the quick resolution of the case. Still, he said, he's confident the United Auto Workers and VW have a plan moving forward.
VW plant officials have said they want a works council, a panel of employees who take up day-to-day issues such as safety and training that the company has at nearly all of its plants. But the company said a union was needed to set up the works council under U.S. labor law.
Looking ahead, the UAW said a congressional inquiry into the Haslam administration's "incentives threat to Volkswagen" provides the best opportunity for additional scrutiny. The union will ask Congress to examine the use of federal funds in the state's incentives threat.
A leaked document showing the state last year offered VW about $300 million in incentives said it was contingent on VW discussions about setting up the works council being concluded to the "satisfaction" of the state. Haslam has said the incentives were never tied to the outcome of the VW vote.
Contact Mike Pare at email@example.com or 423-757-6318.