(Bloomberg) -- In recent months, the United Auto Workers reached an agreement with Rivian Automotive Inc. that would make it easier to unionize the company’s workforce — contingent on the electric-vehicle maker ever reaching profitability.
Under Rivian and the UAW’s confidential pact, the automaker would adopt a neutral stance toward efforts to organize workers at its Illinois factory where its vehicles are made, according to people familiar with the matter. The neutrality commitment will only take effect once the company reaches certain criteria including profitability metrics, said the people, who didn’t elaborate on what those metrics were and spoke on condition of anonymity to describe the private terms.
The previously unreported neutrality commitment could help pave the way for the UAW to organize workers at Rivian, a longtime target in the union’s uphill struggle to unionize the EV industry. But that opening could still be far off: Rivian has never posted a quarterly adjusted profit. That goal has been elusive as the company struggled with supply-chain snags and a broader slowdown in EV demand.Rivian did not provide a comment. The UAW declined to comment. By securing a pledge from Rivian that the automaker wouldn’t oppose a unionization effort by its workers, the deal could prove particularly important for the UAW under President-elect Donald Trump’s incoming administration, which is expected to be less friendly to unions than President Joe Biden’s.Unions often mount pressure campaigns to convince companies to adopt "labor peace" or “neutrality agreements” to circumvent the variety of legal and illegal ways companies can dissuade workers from organizing. The accords can restrict both union-busting tactics by management, and disruptive or embarrassing protests by organizers.“When there are neutrality agreements, workers are much more likely to choose union representation because workers feel safer in making the decision,’’ said Sharon Block, executive director of the Center for Labor and a Just Economy at Harvard Law School, who served in Biden’s White House. “Neutrality just communicates to the employees ‘make the decision you want to make, and we’re going to abide by the law.’”
Such private agreements can also help companies get unions’ support — or avoid their opposition — as they seek government funding or approvals. But they can be hard to enforce if the two sides come to disagree on how their terms should be interpreted, or whether each other are in compliance.
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--With assistance from Kara Carlson, Ari Natter and Kiel Porter.
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