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...transferability company-specific of worker voice across national boundaries. This issue is the focus of this case study of Magna International, a leading member of a small group of transnational automotive parts manufacturing firms that are central to the contemporary restructuring of the international automotive industry. The paper compares the transformation of worker representation at Magna in Canada and Mexico. In crossing international borders, the Magna industrial relations model has taken on national and local features of the host country. However, the underlying industrial relations structure is one which has elicited a successful reconfiguration and containment of much, although by no means all, of the adversarialism inherent in labour-management relations. This reconfiguration has aligned worker representation to an essentially unitarist project oriented to management's productivity goals. More than merely suppressing independent unions, Magna has constructed a coherent, management-dominated model of worker representation in both Canada and Mexico. The paper concludes with an assessment of the implications of this model for independent unionism.
L'EMERGENCE DE la production internationale dans le contexte d'affaiblir la reglementation des droits syndicaux et d'augmenter la dominance patronale dans les relations industrielles souleve des questions importantes a l'egard de la nature et de l'avenir de la representation ouvriere. Une question fondamentale est le caractere transferable des modeles precis de la voix des travailleurs a travers les frontieres nationales. Elle represente le theme principal de cette etude de cas de Magna International, membre preponderant d'un petit groupe d'entreprises manufacturieres internationales des pieces d'automobile; essentiel a la restructuration contemporaine de l'industrie automobile internationale. Cet article fait la comparaison de la transformation de la representation ouvriere a Magna au Canada et au Mexique. A travers les frontieres internationales, le modele des relations industrielles de Magna avait pris les caracteristiques nationales et locales du pays d'origine. Toutefois, la structure fondamentale des relations industrielles est celle qui avait declenche une reconfiguration reussie et un confinement de la plupart, mais en aucune facon la totalite, du caractere adversaire inherent dans les relations ouvrieres patronales. Cette reconfiguration a aligne la representation ouvriere a un projet essentiellement unitariste axe sur les objectifs patronaux de production. Bien plus que de supprimer les syndicats independants, Magna a construit un modele coherent avec dominance patronale de la representation ouvriere au Canada et au Mexique. Cet article se termine avec une evaluation des implications de ce modele pour le syndicalisme independant.
A SMALL GROUP OF LARGE TRANSNATIONAL automotive parts manufacturers have enjoyed significant growth since the early 1980s, in important part as a result of the liberalization of global trading rules and the restructuring of the automobile industry. (1) Over the same period many states have retreated from the labour market regulations and social welfare provisions that underpinned the post-World War II Fordist systems of production and union-based models of worker representation. This retreat by the state has created a space for these rapidly expanding parts manufacturers to experiment with new models of work organization and non-union forms of worker representation. While unions are in decline, and some companies are reverting to the pre-World War II unitarist model of human resources based on market power, this is an incomplete analysis of the changes taking place. Katz and Darbishire have shown how the decline of unions is related to patterns of workplace practices that to varying degrees diverge from national models of industrial relations. (2) Others have analysed the non-deterministic dialectic between transnational corporate regulation of labour and local regulatory systems. (3) Far from convergence to a single work organization or human resources model as suggested by Womack, Jones and Ross, (4) these works indicate a rich diversity of outcomes shaped as much by the differing strategies of individual companies as the constraints imposed by different systems of national state regulation. Our analysis rests on a variety of sources. Particularly important, however, are interviews with Magna personnel. The nature of these interviews, and details on the methodology that guided them, are outlined in the Appendix.
The emergence of these new firms as global manufacturers operating in a context of weakened state regulation raise important questions about the nature of worker representation being adopted and the exportability of company-specific models of worker representation across national boundaries. To what extent are these models of worker representation a challenge to traditional forms of worker representation based on independent unions? To what extent are these corporate models "path dependent" expressions of home country industrial relations and to what extent are they modified by the institutional and cultural milieux of host countries? These questions will be explored through a case study of one of these emerging parts manufacturers, Magna International.
Elsewhere we have discussed how the organization of work at Magna's Canadian operations has been built on and reinforced the fragmentation and weakening of the remaining vestiges of class-oriented industrial action and politics. (5) In what follows we compare the transformation of worker representation under Magna's model of labour-management relations in Canada and Mexico. The first section of the paper focusses on Magna's Canadian operations. The second half of the paper examines the transfer of this model to one of Magna's production facilities in Mexico. Based on this comparative analysis of the Magna model of worker representation in the two countries, the paper concludes with an assessment of the implications of the Magna model for independent unions.
Changing Models of Worker Representation in Canada
Within the highly competitive automotive parts manufacturing industry, Magna International is a Canadian success story. Magna began as a small tool and die shop just outside of Toronto in 1957. It was typical of many small Canadian job shops supplying local assembly plants. But unlike other Canadian small job shops it grew. In 2005, it was the third largest auto parts supplier in the world behind only the Bosch Group and the Denso Corporation. It is now the largest employer of automobile workers in Canada. It operates over 200 plants worldwide with over 84,000 employees. Annual sales exceeded $22 billion in 2006. Magna expects sales to reach $50 billion within the next ten years. In 1999, Magna was named the world's top auto parts company by Forbes magazine. (6)
Magna's success is based on two sets of factors, q-he first was the changing production strategy of major auto assemblers in the early 1980s and the shift to contracting out large components of the vehicle production process to independent parts manufacturers. By diversifying its production and design capacities Magna was able to capture a significant portion of this business and join the ranks of large tier-one suppliers. (7) The second factor was the erosion of the Fordist model of labour market regulation in Canada during the 1970s and 1980s. This allowed Magna to employ labour at a much lower cost than was the case for established vehicle assemblers and to reorganize work on an almost exclusively non-union basis. (8)
In Canada after World War II, particularly in manufacturing, many large companies moved to models of worker representation based on unions selected by workers in secret ballots administered by the state. This was especially true in the vehicle assembly and automotive parts sectors. This approach to worker representation was one component of the postwar compromise with segments of the working class. In exchange for union recognition, major wage and benefit increases, due process in grievance and arbitration procedures, and seniority-based rights, workers conceded management's right to organize production and accepted fundamental limits on their ability to mobilize and resist while collective agreements were in effect. (9) Strikes during contracts were banned and compulsory binding arbitration became the norm for resolving disputes over contract interpretation. The 'management's rights' sections of collective agreements and the legal limits on strike action generally made it more difficult for workers to resist management around crucial labour process issues such as work loads and job design. Legally, unions were vested with collective bargaining rights and union leaders with obligations to act "responsibly" and manage dissent, substituting for workers' more direct collective control over bargaining.
At the heart of this model of worker representation was the collective agreement, a set of codified rights negotiated by unions on behalf of their membership. Within the automobile industry the collective agreements negotiated by the UAW in the 1950s, and by the caw since 1985, are generally viewed as the gold standard in terms of wages, benefits and security provisions. This model of labour representation spread from the vehicle assembly operations to a number of key automotive parts suppliers during the 1960s. However, by the 1980s, this model was under attack as new entrants and increased global competition eroded the market power of unionized companies and changing state policies legitimated more aggressive strategies by employers. Management at unionized vehicle assembly companies began pursuing alternatives to the workplace compromise that had generated sustained profits and relatively high wages for nearly three decades. Management experimented with team based production and alternative models of human resource management. (10) Many of these changes, introduced under the guise of following the Japanese, including teams, Total Quality Management, kaizen, and just-in-time production, became the vehicles for effort intensification. (11) Companies such as General Motors, Ford and Chrysler sought to soften the adversarial nature of labour relations by offering limited forms of joint decision making with the goal of engaging unions and labour in the corporate mission. In this they had at best limited success. (12) A more successful strategy for reducing costs was to contract out work to independent parts firms with a freer hand in how work was organized and better access to low cost labour. It was this strategy that led to the rapid growth of Magna.
In designing its workplaces, Magna looked not to the unionized firms that dominated the automobile industry in the 1970s, but rather to nineteenth-century models of paternalism and earlier twentieth-century models of welfare capitalism. The latter emerged as an alternative to the growing popularity of union models of worker representation in the us at the beginning of the twentieth-century. Inherently anti-state, individualistic, defensive of managerial rights, and opposed to unions and collective bargaining, welfare capitalism elicited consent by offering workers some protection from the insecurity of urban-industrial society through progressive employment and compensation programs. These benefits were available as long as workers remained employed by the firm. The effect was to loosen worker attachment to collectivist and class forms of social cohesion and replace them with cross-class cohesion at the level of the firm--what Jacoby calls "modern manors." Within these "modern manors" social relations were paternalistic and labour representation underdeveloped. Where mechanisms were introduced to give workers a voice in how their workplaces operated they were relatively powerless and largely symbolic. The result was a model of work organization that "was controlling yet consensual, coldly efficient yet cozily humane." (13) Welfare capitalism went largely underground between the 1930s and the 1950s, but it has since reemerged and been transformed through modern human resource management policies. It remains anti-union but now relies more heavily on worker consent compared to the earlier control versions. (14)
If at Magna nineteenth-century paternalism and early twentieth-century welfare capitalism are the foundation of how work is organized, a sophisticated model of worker representation is what sustains the approach in the context of early twenty-first century social relations. The Magna model of work organization is clearly distinguished from the adversarialism of postwar labour-management relations in most unionized industrial workplaces and from the traditional paternalism of welfare capitalist labour-management relations in such firms as Dofasco (15) and Imperial Oil in Canada, and Eastman Kodak and Sears in the us. (16) A key difference is that in these more traditional forms of managerial paternalism and welfarism there was not a deeply significant ethos of labour and management as partners, in the sense that management depended on workers as much as workers depended on management. For example, the success of Dofasco has rested as much on its willingness to match the wages and benefits won by USWA Local 1005 at nearby Stelco as on any transformation of the labour and management relationship. At Magna, in contrast, worker-manager interdependence is portrayed as a central basis of firm and workplace competitiveness. In the more traditional form of paternalistic welfare capitalism, management paternalism was guided by a certain sense of noblesse oblige, the obligatory benevolence of management. This is largely absent 'from the Magna model, which is based more on pragmatic than on ethical reciprocal obligations between labour and management. Also largely absent at Magna is a traditional culture of the class-based superiority of management in the shopfloor hierarchy of status. In its place is a seemingly "egalitarian ethos" in day-to-day encounters and relations between managers and workers.
At Magna, worker representation at the workplace has been transformed with a strong emphasis on corporate culture, extensive communication with employees, management-directed work teams, contingent pay and benefits, individualized career development and union-substituting industrial relations mechanisms. Under the Canadian Fordist regimes, workers in unionized workplaces generally looked for security in more union collectivist terms: the ability...
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