Monumental labor battles in the 1930s—led by autoworkers, steelworkers, miners, truck drivers, longshore workers and others—resulted in the building of the Congress of Industrial Organizations (CIO).
The birth of industrial unionism was a watershed in U.S. history that led to significant gains for working people. The right to organize, , the right to strike, the eight-hour day, the minimum wage, social security, unemployment insurance, Medicare and all of the gains associated with Roosevelt’s New Deal were a direct result of this militant labor upsurge.
When working people organize and fight for their rights, that’s good for labor, but it’s a major threat to corporate profits. Since one of the most effective tools for advancing workers’ rights is a strong, independent labor union, corporations have always done everything they could to impede and derail union organization. One of their most insidious schemes was the “company union”.
Also called “yellow unions” and “employee representation plans”, the idea behind the company union was simple. The bosses would create an organization that looked like a union but was totally controlled by the company. A few small concessions might be offered—a token wage increase or a discount at the company store—as an incentive to join the fake union. These minor inducements were referred to by more conscious workers as “sucker bait”. The goal was to trick workers into thinking that they already had a union and so be less favorably disposed when genuine, independent union organizers came calling. Far better, the bosses reasoned, to offer their employees a nickel if it would undercut the workers’ ability to organize and be in a position to demand ten times more. Known union militants were blacklisted from both the companies and from the company unions.
One of the earliest company unions was set up by John D Rockefeller, Jr. in 1915 at the Colorado Fuel and Iron Company. The move followed the infamous
Ludlow Massacre, where striking miners and their families were attacked by the National Guard and private thugs at the company’s behest. Nineteen were killed, including four women and eleven children.
As public outrage flared and federal intervention was threatened, Rockefeller launched a company union, calling it his Employee Representation Plan. The battered mine workers reluctantly accepted the plan. From there, the scheme spread to the Pueblo Steelworks and then to a number of industries throughout the U.S. and Canada. By 1928, some 1.6 million workers were corralled into company unions. Meanwhile, recruitment to real unions stalled.
The company union movement reached its zenith in 1934, covering close to three million workers—more than the total represented by real labor unions. Then things changed dramatically. Historic labor battles in Minneapolis, San Francisco and Toledo took on the corporate colossus and won! The militancy spread and the industrial union movement grew. The dramatic unfolding of these heroic battles should be studied by every schoolchild. By 1935, the National Labor Relations (Wagner) Act was passed. Among other things, the Act outlawed company unions, saying employers could no longer “dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it”.
Think about that. The momentum and power of the 1930s labor movement was such that they managed not only to win battles and build independent unions in the face of everything the corporations threw at them, they also succeeded in forcing a recalcitrant government to outlaw company unions altogether. The power of the labor movement forced the government to recognize these duplicitous entities for what they were.
What about today? Company unions are still illegal, but their cousin, the
company party, lives on.
Unions, it is said, are economic organizations, while political parties are, well, political. This false dichotomy has been used by labor misleaders to argue that working people ought not look to their own organizations to fight for political power, but should instead rely on “friendly” parties that specialize in politics. This leaves working people without a horse in the race, completely reliant on one or another party that’s owned and controlled by big business, Wall Street and the one percent.