Collective Bargaining Over Profit-Sharing: The Automobile Union's Effort to Extend its Frontier of Control

Abstract

THE recent demand of the United Automobile Workers that its 1958 contract with the Big Three and other motorcar manufacturers include provision for participation by the union and its members in the net profits of the corporations' raises complex issues of almost self-evident importance. They are issues of concern to businessmen, to economists, to trade-union leaders, and to the consuming public. Among them are managerial prerogatives and management's conception of appropriate subjects for collective bargaining versus expansion of area of control by an imDortant segment of labor; the impact of the profit-sharing proposal upon the pattern of employer-worker arrangements in other industries;2 the feasibility and economic implications of hitching part of total employee remuneration to profits and the question of what level of wages and supplementary benefits is most conducive to maximum output and the health of the economy as a whole; the effect upon business incentives and investment of a predetermined allocation of part of the profits that traditionally have been regarded as a reward for suc-