- STRIKES & LABOR DISPUTES
- MAJOR CONTRACT SETTLEMENTS & NEGOTIATIONS
- ADMINISTRATIVE & COURT DECISIONS
- LEGISLATION & POLITICS
- EMPLOYEE FREE CHOICE ACT
- Employees at Carney Hospital in Boston voted in favor of unionization with the Service Employees International Union. In a National Labor Relations Board (“NLRB”) conducted election involving 500 workers, the vote in favor of the union was 191 to 50 among service and maintenance workers, 74 to 20 among technical workers, and 34 to 8 among office clerical workers.
- In a close election that was conducted from June 1 to June 19, home care workers in Fresno County, Calif., voted to retain the incumbent union, the United Healthcare Workers-West (“UHW”), an affiliate of the Service Employees International Union (“SEIU”), rather than switch to the National Union of Healthcare Workers (“NUHW”), a new union formed by ousted leaders of UHW. However, on June 22, the NUHW announced that it planned to file a legal challenge to the election with the Public Employment Relations Board, alleging that the SEIU engaged in voter intimidation, illegal threats, and ballot manipulation. The NUHW demanded that the election be re-run and that SEIU be sanctioned for violations of labor law. The election was the first major battle between the SEIU and the NUHW.
- Leaders from Catholic hospitals, the U.S. Conference of Catholic Bishops, and several major U.S. labor unions announced a set of nonbinding guidelines aimed to create a “fair process” for workers in Catholic health care institutions to decide whether or not to form a union. These guidelines come after decades of difficult relations and negotiations between unions and Catholic hospitals over the issue of unionization. The guidelines outline key principles and procedures to ensure that workers can make informed decisions without undue influence from either side.
B. Strikes & Labor Disputes
- In Minnesota, Teamsters, Local 638 has threatened to go on strike if bankrupt Star Tribune Holdings Corp. is allowed to reject its collective bargaining agreement and withdraw from a pension plan over which the parties have become deadlocked. Local 638, consisting of 190 drivers, mechanics, and foremen, argued that it had already made significant contributions to Star Tribune. For example, Local 638 has made concessions of $3.9 million, including slashed salaries and reduction in the union work force.
- On June 3 and June 8, two New Jersey hospitals hired temporary workers to replace nurses and other hospital workers currently on strike. The Englewood Hospital and Medical Center and Bayonne Medical Center issued a statement on June 10, saying they had informed Health Professionals and Allied Employees (“HPAE”) that if a contract is not ratified, the employers will have to make further payments for contract nurses and that union-represented nurses would no longer be eligible for health benefits paid by the medical center. According to the hospitals, the nurses have demanded additional staffing and a 9 percent wage increase, plus annual step increases. The hospitals have rejected HPAE’s demands.
- On June 15, represented by United Auto Workers 218, Bell Helicopter Textron Inc. workers began a strike after rejecting the company’s “best and final” contract offer. The contract covering 2,500 production and maintenance workers at eight plants in Texas expired after members voted 1,170 to 680 against a company offer that would have increased employee health care costs and allowed outsourcing of several janitor positions.
C. Major Contract Settlements & Negotiations
- Members of the United Auto Workers voted to accept dramatic concessionary modifications to the 2007 labor contract with General Motors Corp. as part of the company’s bankruptcy restructuring. The modifications included the changes demanded by the Presidential Task Force on the Auto Industry as essential to securing more federal loans that GM needs to stay in business. According to the UAW, the agreement was necessary to “give GM a chance to survive the worldwide collapse of industry sales….” The modification will not cut base pay, health care, or pension benefits, but hourly workers will have less overtime, shorter breaks, fewer holidays, and will lose perks such as tuition assistance, performance bonuses, and cost-of-living expenses. GM will also discontinue payment for unused vacation leave. The modifications will affect approximately 54,000 workers.
- Members of the United Auto Workers voted to ratify a 40-month master contract with Mack Trucks Inc. that clears the way for court approval of a voluntary employees’ beneficiary association (“VEBA”) for funding retiree health care. The contract, effective June 1, increased pension benefits of both early supplement and life payments under the defined benefit plan in the third year of the contract. The VEBA is now subject to approval in the U.S. District Court for the Eastern District of Pennsylvania. If approved, Mack Truck would fund the VEBA with $525 million in cash to be paid over a five-year period in equal installments. The union covers 1,700 workers.
- In Louisville, Ky;, members of the International Union of Electric Workers – Communications Workers of America voted 1,141 to 497 to ratify an agreement with General Electric Co’s (“GE”) Consumer and Industrial Appliance Park. The contract modifies the existing four-year contract and provides for an immediate salary freeze, as well as lower entry wage rate for new hires in exchange for job security provisions. The agreement will not affect employee benefits.
- Members of the Southwest Airline Pilots Association narrowly rejected a proposed five-year contract with the Dallas-headquartered center. The pilots union and the airline had been in negotiations for a new contract for years. The rejected contract would have included 2 percent wage increases for 2007, 2008, and 2009 that would be paid retroactively. Salary increases in the future would have been based on the airline’s profitability. According to the union, unlike most contract negotiations, salary was not the top priority for the union. Rather, scheduling practices dealing with quality of life were at the heart of the negotiations. The union represents more than 5,900 pilots of Southwest Airlines.
- An agreement was reached between Berkeley Bowl and the United Food and Commercial Workers, Local 5 that set terms for a card-check procedure through which the employer would recognize the union as the bargaining representative of employees at the company’s new Berkeley, Calif. grocery store if a majority of employees sign valid union authorization cards. The agreement would also apply to the new store. The president of Union 5 indicated that the point of the agreement was to avoid the NLRB. If UFCW organizes the new store, which opened on June 4, Local 5 would represent 400 workers. Under the terms of the agreement, no union campaign activity will be allowed until the store has been open for 90 days.
- Members of the Boston Newspaper Guild Local 31245 voted to reject concessions proposed by Boston Globe management and The New York Times, the newspaper’s owner. In March, The New York Times said that it would have to close the Boston Globe if the unions did not agree to provide the company with $20 million of savings. The owner called for half the cost savings from Guild-represented workers and the other half in savings from the other unions representing Boston Globe workers. On June 8, soon after the Guild’s announcement, The New York Times said it will reduce wages by 23 percent in order to secure the $10 million in costs savings needed from the Guild.
- Ending a year-long negotiation process between the Screen Actors Guild (“SAG”) and the Alliance of Motion Picture and Television Procedures (AMPTP), a new television/theatrical contract covering approximately 120,000 was ratified on June 9. The two-year agreement from June 10, 2009 to June 30, 2011 provides more than $105 million in wages, increased pension contributions, and establishes a template for SAG coverage of new media formats. The agreement calls for a 3 percent wage increase, a 3.5 percent wage increase one year after ratification, and an increase of .5 percent in pension contributions. Overall, 78 percent of members voted to approve the contract, against the wishes of SAG president Alan Rosenberg, who believed the agreement to be “devastatingly unsatisfactory.”
- Members of the Washington-Baltimore Newspaper Guild, Local 32035 of the Communications Workers of America, ratified a two-year contract with the Washington Post covering approximately 1,000 employees that provides lump-sum payments in both years, introduces different pension benefits for newly hired workers, and begins the integration of Web-based employees into the bargaining unit. The contract also gives the employer greater flexibility during layoffs by allowing up to 25 percent of employees in a section targeted for layoffs regardless of their seniority. The remaining 75 percent would be laid off by seniority.
- A two-week lockout of 700 union-represented nurses by Englewood Hospital and Medical Center in Englewood, N.J. ended June 16 with the ratification of a three-year contract that includes overall wage increases of 4 percent over that period. The agreement, which runs for three years starting on June 1, 2009, was approved by 85 percent of the members of Health Professionals and Allied Employees (“HPAE”), Local 5004 who voted. The accord provides for across-the-board wage increases of 1 percent on September 1, 2009 and September 1, 2010, and 2 percent on June 1, 2011. Furthermore, unit members, who earn an average of $75,000 per year after 10 years, will also receive step increases averaging between 1 percent and 1.5 percent, depending on seniority.
- Due to financial difficulties, YRC Worldwide announced on June 24 that it will begin negotiations with the Teamsters to modify the terms of its labor contract. According to YRC Worldwide, the talks will focus on finding ways to reduce YRC Worldwide’s cost structure and “preserve operating capital going forward.”
- Canadian Auto Workers members at Bombardier Aerospace’s facility in Downsview, Ontario, ratified a three-year collective bargaining agreement with the employer that provides wage increases, pension improvements, and retirement incentives for 3,000 workers. Overall, 84 percent of the workers voted for the new agreement.
- Smithfield Packing Co. and United Food and Commercial Workers, Local 1208 reached a tentative agreement on a first contract for employees at the company’s meatpacking facility in Tar Heel, N.C. Approximately 5,000 workers are eligible to vote on the proposed contract. On December 12, 2008, employees voted to unionize with the United Food and Commercial Workers.
- The Department of Human Resources and Skills Development Canada reported that major collective bargaining agreements reached in Canada during April resulted in an average base rate wage increases of 2.6 percent, down from the 2.9 percent reported in both February and March. However, the mark is still higher than the 2.5 percent year-to-date average and the 2.4 percent average for the first quarter of 2009. For 2008 as a whole, the rate was 3.3 percent.
- Collective bargaining data for all settlements reported from January 1 to June 1 showed that the average first-year wage increase was 2.8 percent. This is down from the 3.5 percent rate reported in the same period of 2008. When construction and state/local government agreements were excluded, the all-settlements average increase was 3 percent, compared to 3.6 percent in 2008. The average increase for manufacturing was 2.1 percent, the same as in 2008. Excluding construction, the non-manufacturing average increase was 3.3 percent, down from 4.2 percent in 2008. When lump-sum payments are factored into wage calculations, the all-settlements average first-year increase in 2009 was 3.1 percent, compared with 3.8 percent in 2008.
D. Administrative & Court Decisions
- The U.S. Court of Appeals for the Sixth Circuit upheld an $820,000 jury verdict for a former United Food and Commercial Workers business agent on his claim of wrongful discharge in violation of the union’s just-cause policy. Local 951 represents thousands of grocery store workers in Michigan. The union hired Ardingo in 1990 as a business agent under a just-case employment policy that allows termination for failure to meet standards for employment performance or termination to further the needs of the union. After rumors circulated that Ardingo planned to run against the union president in the next election, the union reassigned Ardingo and forbade him from contacting any members in the union. Eventually, citing financial hardship, the union terminated him. He sued, claming wrongful discharge in violation of the just-cause policy. Finding that Ardingo’s wrongful discharge claim is not preempted by the Labor Management Reporting and Disclosure Act, the Court upheld the jury verdict of $177,000 in back pay and $642,000 in front pay. Ardingo v. Local 951 United Food & Commercial Workers
- The NLRB ordered that a new election be held for nurses at Community Medical Center in Toms River, N.J., to determine whether they want to be represented by the New York State Nurses Association. The NLRB adopted an administrative law judge’s findings that Community, a 600-bed hospital with nearly 800 registered nurses, violated the National Labor Relations Act (“NLRA”) by barring union representatives from a hospital-owned parking garage and by promising to implement a “shared governance” plan to discourage the nurses from voting for the union. Cmty. Med. Ctr.
- The U.S. Court of Appeals ruled that the NLRB has the authority to issue decisions and orders. The court held that the board’s delegation of all its powers to a three-member panel was a valid action. Furthermore, the NLRB did not lose its authority when the board dropped to two members in 2007. President Obama has announced his intention to nominate two labor attorneys to fill two of the NLRB vacancies, but has not yet sent nominations to the Senate. Meanwhile, the two current board members (Chairman Wilma B. Liebman and Member Peter C. Schaumber) are continuing to issue decisions and orders. Snell Island SNF LLC, d/b/a Shore Acres Rehab. & Nursing Ctr. v. NLRB
- The U.S. Court of Appeals for the Second Circuit held that a New York health clinic unlawfully terminated five employees who joined a union picket line even though picketing was considered an unfair labor practice under the NLRA. Although the court recognized that American Federal of State, County and Municipal Employees violated the NLRA by picketing without giving the required 10-day advance notice, individual employees could not be terminated for participating in the picketing. Since the text of the NLRA only shows intention of punishing the union and not the employees for violation of picketing procedure, the court held that employees cannot be punished for engaging in peaceful picketing. Civil Serv. Employees Ass’n Local 1000 v. NLRB
E. Legislation & Politics
- Republicans in both chambers of Congress introduced a bill that would allow employers to fire union organizers working within a nonunion company who are suspected of attempting to organize the contractor’s workforce from within. Senator Jim DeMint (South Carolina) introduced the Truth in Employment Act of 2009, which he said seeks to “protect employees and employers from harassment and disruptive actions by union ‘salts’ who threaten jobs and business success.” According to DeMint, the legislation would amend the NLRA to protect the employer from being required to hire any person who is seeking a job in order to promote interests unrelated to those of the employer.
- Oregon lawmakers passed a bill prohibiting employers from disciplining or retaliating against workers who refuse to attend employer-sponsored meetings aimed at communicating the employer’s position on political matters. Here, “political matters” includes campaigns for legislation or candidates for political office, and the decision to join, not join, support, or not support any lawful political or constituent group, including labor organizations. Any aggrieved employee would be able to bring a civil action to enforce the measure, and a court could award injunctive relief, reinstatement, back pay, treble damages, and/or attorney costs.
- A coalition of labor and grassroots organizations announced an $82 million campaign to help enact legislation to overhaul the nation’s health care system. The money will be spent on television and radio advertising. The coalition includes the Health Care for America Now campaign, the AFL-CIO and Change to Win labor federations, MoveOn.org, and Democracy for America. The campaign involves more than 1,000 organizations representing more than 30 million members.
F. Employee Free Choice Act
- Arkansas Attorney General Dustin McDaniel rejected a proposal amendment to the state constitution that sought to require secret-ballot representation elections. McDaniel stated that the measure’s language was “vague to the point that a reasonable voter would not perceive the issues it is apparently designed to raise.” The measure was filed by Save Our Secret Ballot, which acknowledges that the measure was proposed in response to the proposed federal Employee Free Choice Act.
- Senator Tom Harkin (D. IA) reiterated his intention to push for a cloture vote on the proposed Employee Free Choice Act if an acceptable version is not offered in Congress. Harkin remarked, “if senators refuse to compromise on the original bill, I will demand an up-and-down vote…. We’re going to have a vote one way or the other.” Harkin also remarked that any alternative bill must include three core principles: provide workers the ability to choose between majority sign-up and secret ballot elections; require unionized workers to receive a first contract “date certain;” and require meaningful penalties for labor law violations.
- More than 300 business leaders from 12 states visited with several senators to urge them not to support any alternative to the proposed Employee Free Choice Act. As part of the U.S. Chamber of Commerce’s third “Workforce Freedom Airlift,” participants from Arkansas, California, Colorado, Indiana, Louisiana, Maine, Nebraska, North Dakota, Pennsylvania, South Dakota, Virginia, and Wisconsin met with either senators from their states or with Senate staff. The participants met directly with Dianne Feinstein (D. CA), Evan Bayh (D. IN), Tim Johnson (D. SD), and Richard Lugar (R. IN). The group urged that the act would effectively strip workers of a private vote in union-organizing elections.
- A new coalition named The Business Leaders for a Fair Economy wrote a letter to Congress urging the support of the Employee Free Choice Act. The group contains more than 1,000 small employers and businesses leaders. The group aim is to “counter the myths and misunderstanding that unions are bad for business.”
- Supporters of the proposed Employee Free Choice Act continue to search behind the scenes in an attempt to persuade 12 Democratic senators who have not committed to support the legislation in its current form. The group of wavering Democratic senators include Michael Bennet (D. CO), Thomas Carper (D. DE), Kent Conrad (D. ND), Dianne Feinstein (D. CA), Mary Landrieu (D. LA), Blanche Lincoln (D.AR), Ben Nelson (D. NE), Mark Pryor (D. AR), Mark Udall (D. CO), Arlen Specter (D. PA), Mark Warner (D. VA), and Jim Webb (D. VA). Some of these senators have indicated that they may support a compromise bill. For example, Sen. Feinstein has suggested a “mail-in option” where workers could mail in their authorization cards, while Sen. Carper has reservations about the card check provisions, indicating that a secret ballot method is the fairest way to avoid undue influence or persuasion.
- National Mediation Board (“NMB”) member Linda A. Puchala was sworn in as a chairman on May 26. Puchala has served on NMB’s staff since 1999, most recently as associate director of alternative dispute resolution services. NMB administers the Railway Labor Act, which governs labor relations in the aviation and rail industries.
- The general executive board of Workers United, an affiliate of the Service Employees International Union, unanimously voted on June 1 for Bruce Raynor to become the union’s president. The union was formed in March by former members of UNITE HERE, the union from which Raynor resigned as general president in late May after the union had suspended him. At the time, Raynor indicated that he did not resign out of “my own volition but because I have been forced out of office by the same people that ruined the merger of our two unions.” In the past few months, UNITE HERE has been in the process of a split of the two unions formed to merge it in 2004.
- The International Executive Board of the United Steelworkers has appointed Stan Johnson, a director of one of the union’s districts, to the position of secretary-treasurer. He will replace James English, who retired after a 41-year career.
- Negotiations to unify the AFL-CIO, Change to Win, and the National Education Association (“NEA”) into a single organization are progressing following the latest meeting of the National Labor Coordinating Committee. The committee, which includes presidents of large unions and the leaders of the AFL-CIO, Change to Win, and the NEA, are discussing proposals on structures of the organization.
- Greg Junemann, president of the International Federation of Professional and Technical Engineers, announced he is seeking the position of secretary-treasurer of the AFL-CIO. Richard L. Trumka, who has held the secretary-treasurer position for 14 years, is running to succeed AFL-CIO President John Sweeney, who plans to retire when his term expires in September. Junemann indicated that his main objective would be to bring financial stability by streamlining AFL-CIO’s operations and bringing its finances in line with its central mission and affiliated unions’ priorities.
- The White House announced that President Obama intends to nominate (NMB) Member Harry Hoglander to a new term on the three-member panel. A Democrat, Hoglander has served on the board since 2002. NMB administers the Railway Labor Act, which governs labor relations in the aviation and rail industries.
- President Obama nominated George H. Cohen to serve as director of the Federal Mediation and Conciliation Service. Cohen has served as an appellate court attorney with the NLRB, and is a member of the mediation panel of the U.S. Circuit Court of Appeals for the D.C. Circuit.
If you have questions about items that appeared in this bulletin, or would like to learn more about any of these topics, please contact William Miossi at (202) 282-5708 or (312) 558-6109, or one of the other Labor & Employment Relations partners listed here:
Attorney advertising materials.
If you wish to be removed from Winston & Strawn LLP mailing lists, you may also e-mail us at firstname.lastname@example.org or write us at Winston & Strawn LLP, Attention: Business Development Clerk, 35 West Wacker Drive, Chicago, IL 60601.
These materials have been prepared by Winston & Strawn LLP for informational purposes only and are not legal advice. Receipt of this information does not create an attorney-client relationship. No reproduction or redistribution without written permission of Winston & Strawn LLP.
Along with this briefing, a library of all the Winston & Strawn LLP briefings published to date can be accessed by visiting the Publications Library section of Winston & Strawn's Web site (www.winston.com).
Copyright © 2009