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German 'Team Concept'

By Harry Kelber, LaborTalk, 19 May 1998

The introduction of the "team concept" by an increasing number of U.S. corporations has had mixed reviews within the labor movement. Some unions, like the United Auto Workers and the Communications Workers, favor the use of production teams as still another way of promoting labor-management cooperation. It also gives their members an opportunity to employ their know-how in a creative manner, without the traditional authoritarian job supervision.

But there is also skepticism, even outright hostility, about the value of these work-enhancement teams. Their purpose is to increase production, not to expand a worker's control over his or her job, according to most labor activists. They say it is part of a corporate strategy to wean workers away from reliance on their union.

In view of the Chrysler-Daimler-Benz merger, American workers may be interested to know how the labor-management relationship is played out in Germany. By federal law, major corporations are required to give union representatives the same number of seats as the employers on their board of directors. This legal requirement is known as "co- determination." At Daimler-Benz, there were, until recently, 20 directors, half of them union appointees.

While the chairman of the board is a person identified with the owners, the vice-chairman is customarily a union member and long-time company worker. Among the issues the entire board discusses are corporate strategy, acquisitions and mergers,the budget, sales, profits and, when necessary, plant closings and layoffs. Company managers do not have a seat on the board; in fact, many of them must get the approval of union board members before they are hired or promoted.(Can you imagine any American company agreeing to that?)

Under co-determination,union representatives are given a clear, detailed picture of the company's operations and future plans, and they can express their views on all company issues, especially those that directly concern their members. The goal of the board is to arrive at a consensus on company policies and actions.

The labor-management collaboration does not mean that German unions have surrendered their independent economic power. On the contrary, I.G. Metall, the largest industrial union in the world with 2.7 million members, has fought hard and successfully to establish the 35-hour workweek. It also does some tough but fair bargaining in behalf of the more than 300,000 Daimler-Benz workers it represents.

At Daimler-Benz and other major corporations, there are works councils whose function is to iron out problems that occur on the shop floor, including grievances over work schedules, shift assignments, job allocations, overtime,vacations and related issues.

Germany's employers long ago concluded that treating their workers fairly and recognizing their important contribution to the profitability of the company makes for good business practice. A harmonious atmosphere in the workplace, they have learned, increases worker loyalty and is also reflected by improvements in productivity and quality control.

It would be encouraging if American companies that favor labor-management team programs would accept the principle of co-determination. Or does their idea of cooperation stop at the production line?