Mercedes-Benz faces crucial test as Alabama workers vote on whether to unionize

Alabama is front and center this week as the United Auto Workers looks to build on recent victories in the South, a region long hostile to organized labor.

More than 5,000 Mercedes-Benz workers began voting Monday at a manufacturing factory in Vance as well as at a battery plant in nearby Woodstock. The balloting, which continues through Friday morning, comes on the heels of an overwhelming win at a Volkswagen plant in Tennessee after two failed attempts since 2014.  

"It is potentially a milestone event. What the UAW stands to gain is an acceleration of momentum for organizing the other 11 nonunion automakers," Harley Shaiken, professor emeritus at the University of California, Berkeley, told CBS MoneyWatch. 

The UAW has vowed to commit $40 million through 2026 to widen its reach to additional auto and electric vehicle workers, including in Southern states, where BMW, Honda, Hyundai, Kia and Nissan also have operations.  

Southern strategy

The UAW has been on a roll since winning major concessions last fall from the the Big Three automakers in Detroit. 

In Chattanooga, Tennessee, VW workers last month voted to join the union, the first Southern autoworkers outside of of the Big Three to do so. The UAW also reached an agreement with truck and bus manufacturer Daimler Truck, averting a potential strike by more than 7,000 workers in North Carolina.

But the outcome of this week's election is far from clear. 

The corporate opposition to the UAW is far stronger from Mercedes-Benz than the union faced in Tennessee, with the National Labor Relations Board investigating six unfair labor practice charges filed by the UAW against the company since March. 

Mercedes-Benz is accused of disciplining workers for discussing a union, firing union supporters and forcing employees to attend captive audience meetings while making "statements suggesting that union activity is futile," the NLRB said.

"Volkswagen was lukewarm, Mercedes is red-hot opposed," said Shaiken, who noted that the latter had hired a large consulting firm and is coordinating with local political leaders to fight the UAW. 

Alabama Gov. Kay Ivey, for instance, said the state's model for economic success is "under attack" by out-of-state special interests. The Republican warned in January that the state's status as a national leader in automotive manufacturing — and the 50,000 jobs that came with it — is being jeopardized by the UAW. 

Mercedes-Benz said it looks forward to all its workers having a chance to cast a secret ballot "as well as having access to the information necessary to make an informed choice" on unionization. 

"We believe open and direct communication with our team members is the best path forward to ensure continued success," Mercedes-Benz stated in an email.

In addition, Mercedes-Benz denied interfering or retaliating against employees, and dismissed allegations lodged against it as being without merit. 

"This is not how I treat my family"

"Mercedes claims that we're a family, one team, one fight. But over the years I've learned on thing: This is not how I treat my family," Brett Garrard, a 20-year employee, told the AP. Workers are unhappy with wages that have not kept pace with inflation, insurance costs, irregular work shifts and the feeling of being disposable in a plant assembling luxury vehicles, relayed Garrad, 50. "Yes, we're Southern autoworkers, but we deserve autoworker pay." 

Other Mercedes workers are more skeptical of the UAW. Melissa Howell, 56, plans to vote against the union, saying she was wary of the UAW due to the bribery and embezzlement scandal that resulted in two former UAW presidents serving time in prison. After treating workers poorly for a few years and bolstering the UAW's case, the company recently began improving conditions, said Howell, who has worked at the Vance plant for 19 years.

Mercedes now offers a starting hourly wage of $23.50 for full-time production workers with pay peaking at about $34 after four years, according to a state training website. Some workers said the company recently hiked wages to hinder the union's efforts. 

A loss in Alabama would be a blow but not a lethal one to the UAW's campaign to unionize in the South, according to Shaiken. "They'll get up, dust off their clothes and go on to the next candidate," said the labor economist. It took the UAW three tries to notch its recent victory at a Volkswagen plant in Chattanooga, he noted. "That could happen at Mercedes-Benz."

— The Associated Press contributed to this report.

Kate Gibson

Kate Gibson is a reporter for CBS MoneyWatch in New York.