Share this story
Close X
Switch to Desktop Site

Chrysler's missing board member

In stepping down from Chrysler's board of directors until current US-Canadian bargaining disputes are settled, United Automobile Workers union president Douglas Fraser is taking the only realistic course open to him. It would be unfortunate, however, if Mr. Fraser's leave of absence were to become permanent, with the union eventually losing its seat on the board of the nation's No. 3 automaker.

Mr. Fraser's personal dilemma is considerable. As a board member, he is privy to detailed financial information not hitherto known to the union. It was surely the inside knowledge of Chrysler's still precarious economic position that led UAW leaders to recommend rank-and-file approval of the tentative labor contract last September, before it was subsequently rejected by the membership. Yet it is this very collaboration that has fueled a growing nationalist sentiment among many of Chrysler's Canadian workers who question whether staying within the US-based UAW is in their best interests. It was precisely to avoid such conflicts that Mr. Fraser stepped off the board at this time.

About these ads

Putting a labor official on Chrysler's board was a long overdue step at fostering the union-management cooperation that will be essential if the US is to regain its industrial primacy. However, Chrysler president Lee Iacocca argues that Mr. Fraser sits on the board as an individual - not a union representative. That suggests that the company may not offer a board slot to the union when Mr. Fraser steps down from his UAW post next May. Mr. Fraser, for his part, maintains that he sits on the board as a union representative.

However the current bargaining dispute is settled, it would still seem to be in the best interest of all parties involved for the union to retain a board seat. Mr. Fraser, who excused himself from board meetings whenever labor matters came up for review, has obviously learned much about the management side of Chrysler. Presumably management has also learned something about the concerns of labor.

Perhaps what is needed in the US is an arrangement along the lines of the West German system, whereby corporations have two-tier boards. Union representatives sit on the corporate boards, which are essentially advisory bodies. Actual managerial decisions are left to an executive board from which union members are usually excluded. Such a system would be logical in the US, since most firms already have executive committees which tend to be the actual power base within the corporate structure. Further, in some industries, such as chemicals, there is already close union-executive collaboration in managing pension programs.

Mr. Fraser's dual-role experiment as a corporate board member and union president has been a step in the right direction. It is to be hoped it will be preserved. Meantime other industries, such as steel, where union-management communication has too often been strained, should follow suit.

Follow Stories Like This
Get the Monitor stories you care about delivered to your inbox.