By Nora Eckert
DETROIT, Oct 14 (Reuters) - United Auto Workers President Shawn Fain’s re-election last week was a breeze. His second term leading the 400,000-member labor group might not be as easy.
Fain became a labor-movement celebrity in 2023, when he took over the UAW and won record contracts after staging multi-week strikes against General Motors, Ford Motor and Chrysler-parent Stellantis.
His next four-year term presents tough challenges. The Detroit Three will be focused on cutting costs in the
next round of contract talks, labor experts said. Fain also is the subject of a federal investigation centered on allegations of nepotism, and he has had an increasingly frayed relationship with the federal monitor overseeing UAW activities.
On Tuesday, the federal monitor posted official election results, confirming Fain had won.
DETROIT AUTOMAKERS IN COST-CUTTING MODE
Faced with higher costs from President Donald Trump's tariffs and elevated commodity prices, the Detroit automakers want to cut labor costs to compete with low-cost Chinese automakers grabbing market share in Europe, Latin America and other regions.
“Contract negotiations with the Big Three in 2028 will be much tougher,” said John Logan, a labor professor at San Francisco State University.
Fain has rejected the idea that Chinese competition will prevent the auto companies from paying for better labor deals than they did in 2023.
“We're not going to stand for China driving a race to the bottom in America," he told Reuters in an interview on Friday. “These companies make massive profits," he said of Detroit.
FALLOUT WITH THE FEDERAL MONITOR
Fain started his union career working as an electrician at plants owned by Chrysler before the merger that created Stellantis. In the latest round of voting, he sailed to victory in every region represented by the UAW. But the months leading up to the election were marked by turmoil.
Since summer, tensions have escalated between Fain and Neil Barofsky, a New York attorney the US government appointed to oversee the UAW. The Department of Justice has launched an investigation into allegations that Fain took actions to benefit his fiancée and retaliated against top union officers.
Monitoring of the union is scheduled to end in early 2027, six years after it began. But the monitor could extend the oversight period if it decides that union reforms are insufficient.
Fain told Reuters he believes the union is on track to have the monitorship end, and he was proud of the reforms his team made.
Fain said the tensions began after the union called for a ceasefire in Gaza in December 2023. In a July livestream to members, Fain said Barofsky disagreed with the union’s stance, and the two had a heated discussion about it.
Shortly after that dispute, Fain said Barofsky opened an investigation into whether the union president retaliated against a union official.
“I’m not a conspiracy theorist, but I’m also not a freaking idiot,” Fain said in the July livestream, describing the timing of the monitor’s investigation following the intense call.
A spokesperson for Jenner & Block LLP, the law firm that employs Barofsky, said in a June statement that Barofsky has "acted with the highest levels of professionalism, integrity, and respect in his roles in public service, private practice, and as a DOJ-appointed monitor.”
In the interview with Reuters last week, Fain said he wants to move on from the public dispute and that he was confident the federal investigation would clear him of any suspicion of wrongdoing.
(Reporting by Nora Eckert; Editing by Mike Colias and David Gregorio)
