LATE last year was crunch time at Kaiser Aluminum & Chemical
Corporation. Its cavernous Trentwood Works - 60 roofed acres in
Trentwood, Wash., built to fabricate aluminum for World War II
aircraft - was in trouble.
The problem: a downturn in defense/aerospace business coupled
with industry overcapacity in beverage-can sheet, which accounts
for two-thirds of the plant's output. With Aluminum Company of
America (Alcoa) closing a plant in Indiana, and another rival
slashing two-thirds of its work force at a Chicago-area unit,
something had to change fast at Trentwood.
So instead of imposing a fix from the top, as in previous
downturns, Kaiser managers decided to bring the unionized work
force into the decisionmaking room. The move puts Kaiser among the
growing ranks of American companies that want to replace combative
labor-management relations with mutual trust and shared
In seminars for all employees, managers described market
conditions and the plant's strengths and weaknesses, handing out
quiz sheets to make sure ideas stuck.
Then the United Steelworkers union and management formed a
"survival committee" and agreed to work together to cut $50
million in annual expenses, half by layoffs of both union and
salaried employees. By March of this year, the two sides had agreed
on steps to meet the goals, including more-flexible job duties
proposed by the United Steelworkers. The parties also agreed to
continue the process of collaborative change. This marks a contrast
with the old game, in which the union and top executives fought to
divide up the economic pie.
This new game is about building trust and common goals so both
sides can prosper. American industry can offset high labor costs by
making every worker more productive and innovative. "This new,
so-called high-performance format - it looks like it works," says
Anthony Carnevale, chairman of the federal government's National
Commission on Employment Policy.
The statement may not sound startling. But it implies that many
managers need to scrap an "I'm the boss" style and maybe even the
view that unions are a hindrance to company performance.
Mr. Carnevale, who is completing a study of 400 United States
companies, says his research suggests that "if you have a union
and you work successfully with them, you have a competitive
advantage over a company that doesn't have a union."
"If the workers have a voice, ... it's an advantage," he
With union membership at a low point - only 11 percent of the
nonfarm private-sector work force versus 35 percent in the 1950s -
many business leaders would prefer that "voice" to come without
The Clinton administration formed the Commission on the Future
of Worker Management Relations, also known as the Dunlop
Commission, in part to sort out this issue. Current labor law
prohibits "company unions" created by management to block genuine
trade unions. Many observers say the law should be loosened to
allow for new forms of labor-management cooperation. But others say
a retreat from real trade unions will leave workers with no strong
The AFL-CIO this year embraced the concept of "full and equal
labor-management partnerships," but rejected initiatives led by
Whatever form worker empowerment takes, it appears to be a trend
that will continue. As nations with lower labor costs
industrialize, many experts say American manufacturers can only
succeed by raising worker productivity and quality.
Lynn Williams, former president of the United Steelworkers
union, praises recent collective-bargaining agreements in the
steel, automobile, and telecommunications industries as "precisely
what America needs. …