The only truly effective tool a union has is the threat of strike. The job of a union is to give workers equal bargaining power with large companies. The workers all agree that if they are treated unfairly, they will stop any productivity at their employer by refusing to work. Rather than being able to replace any workers who don’t agree to unfair terms of employment and scaring the others into silence, employers are faced with the decision of either replacing an entire workforce or agreeing to fair wages and working conditions.
The wording of GM’s deal with the federal government for $13.4 billion in aid effectively removes the United Auto Workers union’s ability to strike. According to The Detroit News, a provision in the contract between the U.S. Treasury and GM states that if a strike should occur, GM would automatically be considered in default on the loan. If GM defaults on the loan, the U.S. Treasury Department could break apart the company and sell off its assets to recoup the billions of dollars lent.
UAW president Ron Gettelfinger fought alongside the leaders of the Big Three to try and secure government funds to help keep American automakers in business.