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Tesla and unions

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Tesla, Inc. is an American electric car manufacturer which employs over 140,000 workers across its global operations as of January 2024,[1] almost none of which are unionized. Tesla CEO Elon Musk has commented negatively on trade unions in relation to Tesla. Despite allegations of high injury rates, long hours, and below-industry pay, efforts to unionize the workforce have been largely unsuccessful. There are active labor disputes with Tesla in the United States, Germany and Sweden.

Close up of brick wall with attached plastic container. Inside are English/German language brochures. The IG Metall trade union brochures in German and English say "Eure Gewerkschaft Tesla bei Tesla" and "Your trade union at Tesla". Behind them is a larger colorful (mostly red) magazine titled "metall: Dein Magazin" with the IG Metall logo.
IG Metall brochures in English and German for Tesla employees near Giga Berlin

Tesla is the only major American auto manufacturer not represented by a labor union in the United States. None of the unionization efforts in Fremont Factory and Gigafactory New York have been successful. In late 2023, United Auto Workers announced renewed efforts to unionize.

In Germany, Gigafactory Berlin-Brandenburg's non-union status and lower wages compared to industry standards weakens the structural power of the automotive union IG Metall. Gigafactory Berlin-Brandenburg and Tesla Automation have works councils, with no union collective agreement coverage. Tesla Automation signed a remuneration-related works agreement with the works council, while refusing a comparable collective agreement with IG Metall.

TM Sweden mechanics affiliated with IF Metall went on a historic strike on October 27, 2023, which expanded when other Swedish, Danish and Norwegian unions joined by initiating their own solidarity strikes. This is the longest strike in Sweden since the 1938 Saltsjöbaden Agreement.

United States

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Tesla is the only major American auto manufacturer not represented by a union in the United States.[2] None of the unionization efforts since 2017 have been successful. These efforts were led by United Auto Workers (UAW) in Fremont Factory in 2017,[3] United Steelworkers and International Brotherhood of Electrical Workers in Gigafactory New York (Giga New York) in 2018,[4] and Workers United in Giga New York in 2023.[5] Several months later, UAW announced renewed nation-wide organizing efforts.[6]

Employer opposition to unions is common in the United States. In cases where there is illegal interference such as unfair labor practices, the National Labor Relations Act, which codifies worker rights – is not enforceable by civil law, such as penalties.[7] Employees in a workplace can form a union if a majority sign union cards or vote in a supervised election. Despite overall low union density, recent organizing successes have renewed public interest.[6][8] According to labor sociologist Joshua Mayor, unionization efforts sometimes fail not because workers are against unions, but because workers do not believe they can win.[9] Presidential candidate Donald Trump stated that he supported Musk's policies of union-busting during an interview with Musk. The United Auto Workers later filed federal labor charges against Trump and Musk.[10][11][12]

Fremont Factory

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Tesla acquired the formerly unionized NUMMI plant in Fremont, California in 2010, which became the Tesla Fremont Factory.[13][14] As of 2024, Tesla employs 70,000 workers across the United States, of which 20,000 work in the Fremont Factory.[6]

United Auto Workers (UAW) president Dennis Williams expressed their interest in unionizing the factory in May 2016, shortly after Tesla announced increased local annual production targets of 500,000 vehicles by 2018, which would have placed it in the top ten sellers of new vehicles within the US.[15] In the fall of 2016, Jose Moran, a Fremont Factory employee, contacted UAW, going public with a "Fair Future at Tesla" campaign in February 2017, citing high injury rates, long hours and below industry pay as motivations.[3][16] In October 2017, Tesla fired Richard Ortiz, who was involved with the organizing campaign, which the National Labor Relations Board (NLRB) later ruled to be illegal retaliation.[17]

Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare.

Elon Musk, tweet from May 21, 2018[18]

CEO Elon Musk published a tweet in May 2018,[18] that implied workers would lose stocks if they formed a union. Three years later, the NLRB ordered Musk to delete that tweet, and reinstate former employee Ortiz with full back pay.[19][20] Additionally Tesla would have to put up a notice in all of its US factories addressing the unlawful tweet.[21]

Tesla appealed the NLRB's rulings to the United States Court of Appeals for the Fifth Circuit, which in 2023 initially upheld the NLRB order.[22] In a published response, Ortiz stated "I look forward to returning to work at Tesla and working with my co-workers to finish the job of forming a union".[22] In a 2024 rehearing, the court reversed its decision, holding Musk's tweets to be constitutionally protected speech and that the NLRB must reconsider its order to reinstate the Ortiz.[23]

Five years after the initial tweet, Musk invited UAW, via another tweet, to hold a union election at their convenience without retaliation.[24] UAW president Ray Curry responded that if Tesla was serious about supporting organizing, Tesla would acknowledge they broke the law when they fired Ortiz and Musk published the unlawful tweet.[25]

 
UAW members picketing at General Motors in Michigan during the 2023 strike against the "Big Three"

A CNBC report in 2022 found that Tesla paid public relations firm MikeWorldWide to monitor a Tesla employee Facebook group and to monitor Tesla union organizers on social media from 2017 to 2018. MikeWorldWide monitored social network discussions regarding alleged unfair labor practices at Tesla and a sexual harassment lawsuit. Former and current Tesla employees told CNBC that they believed the company continued to monitor its workers on social media as of 2022.[26]

UAW won 30 to 160% salary increases at the "Big Three" in late 2023.[8] The new UAW president Shawn Fain attributed previous unionizing failures to internal corruption, "coziness" with management and bad collective agreements.[6] UAW subsequently launched organizing drives at 13 non-union auto manufacturers, including Tesla,[6] with a combined organizing budget of US$40 million through 2026.[9] In contrast, in 2017 UAW had spent $422,000 on Tesla alone.[27]

Giga New York

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Tesla Workers United going public at Giga New York with Valentine's themed signs

In December 2018, 300 workers at the solar panel factory at Giga New York in Buffalo, New York, announced a unionization drive with the support of United Steelworkers (USW) and International Brotherhood of Electrical Workers unions.[4] USW filed a complaint with the NLRB the following June, alleging that Tesla illegally surveilled workers and fired six in retaliation,[28] but the case was withdrawn in August.[29]

Workers tasked with labeling data for Tesla Autopilot at Giga New York in Buffalo announced a unionization effort with Workers United on February 14, 2023.[5] Workers United previously led the first successful union drive at Starbucks, also in Buffalo, six miles away.[30][31] A day after the announcement, Workers United filed charges with the NLRB against Tesla for firing 37 workers (including one organizing committee member) in alleged retaliation for union activity and to allegedly discourage union organizing.[32][33] In November, the NLRB dismissed the retaliatory firing charge, but found merit in the other charges around workplace surveillance and captive audience meetings.[34]

Following allegations raised by Workers United, the NLRB regional director in Buffalo, New York filed a complaint with the national board in April 2024 alleging that Tesla had illegally implemented company policies to prevent workers at its Buffalo plant from unionizing, for example by implementing an acceptable use policy that restricted workplace organizing.[35]

Germany

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Tesla is one of the few auto manufacturers in Germany that has not signed any individual company collective agreements nor is a member of the Employer Association in the Metal and Electronics Industry [de] as of 2024. The Metal and Electronics Industry refers to the network of companies that negotiate with IG Metall in each region.[36]

German labor representation has a dual structure of trade unions and works councils. Trade unions like IG Metall negotiate collective agreements with individual employers and regional collective agreements with employers associations (e.g textile or chemical industries). Works councils are made up of elected employees in the workplace. They negotiate works agreements and have various co-determination, participation and information rights. In theory works councils do not overlap with collective bargaining regarding wage adjustments. While formally separate structures, many works council members are de-facto union representatives. Unions are financed by dues which are typically 1% of a member's salary. The more union members and the higher their salaries (due to collective agreements or not), the more financial resources a unions has.[37]

Tesla poses a structural challenge to IG Metall in the automotive sector, because electric vehicle production requires 30 percent fewer workers than traditional internal combustion-engine vehicles.[38] IG Metall membership (2005–2021) has declined by 9%, while the automotive labor market has grown, especially in companies without regional collective agreements.[39] The overall trend of vehicle electrification and a non-union Tesla weakens IG Metall's bargaining power in the broader German automotive sector due to lower union density.[38]

Tesla Automation

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Tesla acquired Grohmann Engineering (now Tesla Automation) in January 2017, inheriting the existing works council. IG Metall and the works council chair Uwe Herzig said that wages at Grohmann Engineering in April, post-acquisition, were 25–30 percent below the equivalent of the regional collective agreements in the metal industry.[40] In October, management and the works council concluded a works agreement that brought employee wages in line with regional collective agreements without explicitly signing a union collective agreement. IG Metall pushed for formal ratification, while acknowledging that there had been a "very good negotiation result". It credited the threat of strikes with pressuring Tesla to sign the works agreements.[41]

Giga Berlin

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IG Metall office at the train station adjacent to Giga Berlin

According to IG Metall, in October 2021, Tesla was offering employees at the new Gigafactory Berlin-Brandenburg (Giga Berlin), wages 20 percent below the equivalent collective agreements provided at other automotive facilities in Germany.[42][43]

Seven non-union employees of Giga Berlin initiated the works council election [de] process in November 2021. Any employee is eligible to run as a works council candidate if they have at least six months tenure. Tesla eventually planned to hire 12,000 employees in total. In the first six months, Tesla hired 1,800 employees, mostly middle-management personnel. IG Metall expressed concern about the future works council being dominated by management, because only those with six months tenure would be eligible to run.[44][45] In March 2022, employees elected their first works council. Nearly half voted for the manager-friendly "Gigavoice" slate.[46]

IG Metall called for an investigation in January 2023, after workers reported they were being made to work longer hours, with less resting time between shifts. IG Metall also stated that workers were being forced to sign non-disclosure agreements and therefore were afraid of retribution if they openly discussed their working conditions.[47][48]

Giga Berlin's initial workforce of 1,800 employees doubled quickly enough to trigger a rule requiring another works council election two years after the first one, instead of the usual four years.[44] The second works council election was scheduled initially for March 18–20, 2024. IG Metall petitioned the Frankfurt (Oder) Labor Court [de] to file a preliminary injunction against the electoral board's proposed timeline. The original timeline set a deadline to submit candidate nominations lists by February 15. Given that Tesla factory production was suspended earlier for a month until February 11, due to supply chain disruptions by the Houthi militia in the Red Sea, this would have left each candidate list with only several work days to collect the mandatory 50 signatures from co-workers.[49] The Frankfurt (Oder) Labor Court granted IG Metall's petition, however the electoral board and Tesla appealed to the Berlin-Brandenburg State Labor Court [de], which overruled the lower court, keeping the original election timeline.[50]

The election concluded on March 20, with 234 candidates from nine lists.[50] With 39% of the vote the "IG Metall Tesla Workers GFBB" list won the plurality of seats, with 16 out of 39, making them a large opposition. The remaining 23 seats were split among four non-union affiliated lists; 15 seats for "Giga United", 5 seats for "One Team", 2 seats for "Giga Fair" and 1 seat for "Giga für Alle" (Giga for all).[51] Michaela Schmitz, the current works council chair, is vocally anti-union. During the final days of the works council election campaign, Schmitz ended a rally speech with "We do not need a union!" (German: Was wir nicht brauchen, ist eine Gewerkschaft!).[52] On April 4, Schmitz was re-elected by the works council for a second term as chair. Schmitz comes from the "Giga United" list , which is composed mostly of managers.[53] In total, 8,917 Tesla workers voted,[51] out of 12,500 who were eligible.[53]

Sweden

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Mechanics affiliated with IF Metall, a Swedish trade union, initiated a strike on October 27, 2023, against TM Sweden, a Tesla vehicle service subsidiary, over the company's refusal to sign a collective agreement.[54] The ongoing strike is the longest ever in Sweden within the past 80 years. Strikes are very rare under the "Swedish model" of social partnership, which was codified in the 1938 Saltsjöbaden Agreement that remains in effect to this day.[55]

TM Sweden employs 130 mechanics in Sweden. About half of whom are IF Metal members.[55] The strike, initially affecting mechanics at ten workshops servicing Tesla vehicles, later expanded to include other facilities servicing various car brands. While workers continued with regular tasks, they refrained from servicing Tesla vehicles during the strike.[56] Strikebreakers arrived at Tesla service centers, prompting concerns among the strikers about their impact on the labor dispute.[57][55] Strikers were banned from the company premises. According to union leader Gabriel Kuhn, Tesla contacted individual strikers after family members shared news of the strikes on social media, which discouraged non-union participation in the strike.[55] The Swedish National Mediation Office [sv] statistics showed that one-third of the 130 mechanics participated in the original Sweden strikes.[58] Non-union members and even some IF Metal union members did not participate in the strikes.[55]

Other Swedish trade unions joined in a month later in November,[59] through sympathy (solidarity) strikes, which are legal in Sweden.[60] The Swedish Transport Workers' Union (Swedish: Svenska Transportarbetareförbundet) blocked the loading and unloading of Tesla cars,[61][62][63] while dockworker, electrician and postal unions halted services to Tesla.[59] Elon Musk has reportedly instructed TM Sweden not to sign any collective agreements.[64] The Swedish Union for Service and Communications Employees (Swedish: Service- och Kommunikationsfacket) expanded the strike by halting maintenance and installation of Tesla charging stations.[58] Over the next few months, solidarity strikes for the Swedish campaign expanded to other Nordic countries, with port workers of United Federation of Danish Workers (Danish: Fagligt Fælles Forbund),[65] United Federation of Trade Unions (Norwegian: Fellesforbundet)[66] and Finnish Transport Workers' Union (Finnish: Auto- ja Kuljetusalan Työntekijäliitto) joining the strike.[67] Tesla maneuvered around the union blockade by moving vehicles by land instead of sea, and sold 1% more cars in 2024 than in 2023.[68]

The strike led to the pension fund PensionDanmark [da] divesting its Tesla shares in protest. In response to the escalations, Tesla posted a job opening for a Swedish government affairs specialist with "significant experience with Nordic legislative and regulatory advocacy", presumably to help with lobbying efforts.[69] In September 2024, a foreign delegation of Ford Germany works council members and IG Metall deputies joined the Tesla service center picket line in Malmö, Sweden as the strike continued.[70]

See also

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References

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  65. ^ Conley, Julia (December 5, 2023). "Danish Dockworkers Dial Up Pro-Union Pressure on Tesla With Solidarity Strike". Common Dreams. Archived from the original on December 7, 2023. Retrieved December 7, 2023.
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