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In This Issue

1. ORGANIZING
   
   
2. STRIKES & LABOR DISPUTES
   
   
3. MAJOR CONTRACT SETTLEMENTS & NEGOTIATIONS
   
   
4. ADMINISTRATIVE & COURT DECISIONS
   
   
5. LEGISLATION & POLITICS
   
   
6. CRIME & CORRUPTION
   
   
7. AFL-CIO Convention
   
   
8. MISCELLANEOUS
   
   

A. Organizing

• Gallup poll results reveal that for the first time since the 1930s, the majority of Americans disapprove of unions and believe they harm the U.S. economy. Last year, 59% of Americans approved of unions, as compared to 48% in 2009. Most Americans, however, (66%) believe workers benefit from unions, while just 28% believe membership is detrimental to workers. Gallup noted that the survey was conducted in August in the midst of the continuing economic recession and aftermath of major federal interventions on behalf of automakers GM and Chrysler.
  

• Teamsters Canada, an affiliate of the International Teamsters, has launched an effort to organize Federal Express’ Canadian employees. The Teamsters represent 14,000 Canadian courier industry workers, including some Canadian UPS employees, but have yet to organize FedEx employees in either the U.S. or Canada.
  

• Illinois locals of the SEIU and American Federation of State, County and Municipal Employees are working to organize approximately 3,000 caregivers who provide home-based support services for developmentally disabled individuals and are compensated through a state-sponsored program. The proposed unit would consist of both parents and guardians performing personal care for disabled family members as well as professional caregivers. Several disability advocacy groups have questioned whether union involvement would complicate the state-run program and reduce its effectiveness. The organizing drive began after Illinois Governor Pat Quinn signed an executive order permitting collective bargaining by individual providers of home-based support services.
  

• The NLRB dismissed a petition to decertify the UAW as the representative of 483 dealers at the Trump Plaza Hotel and Casino in Atlantic City, NJ because of the one year post-election recognition period which has not yet passed. Although dealers at the casino approved UAW representation in March 2007, Trump Plaza has neither recognized the union nor bargained and has appealed a Board order finding against Trump on an unfair labor practice complaint. Dealers at three other Atlantic City casinos voted for UAW representation in 2007, though the parties have not settled a first contract.
  

• Employees at Boeing’s Charleston, SC manufacturing facility voted to decertify District 751 of the IAM as their representative in an NLRB sponsored election. IAM was certified as the representative of approximately 260 plant workers in 2007.
  

• The NLRB dismissed objections to a 2008 decertification election in a unit of 310 registered nurses at Scripps Memorial Hospital in Encinitas, CA, where a majority voted to oust the California Nurses Association.
  

• The California workforce is increasing at a faster rate than the U.S. as a whole and now has about 17% of the nation’s union members according to a UCLA Institute for Research on Labor and Employment. Unionization has increased in California from 16.1% for July 2006 through June 2007 to 18.3% for the same period of 2008-2009. The nation’s unionized workforce, however, only increased from 12.1% in 2007 to 12.4% in 2008. The study attributed the increase to older workers over age 55 joining unions in greater numbers.
  

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B. Strikes & Labor Disputes

• Hundreds of Chicago and San Francisco hotel workers represented by UNITE HERE participated in sit-ins resulting in nearly 300 arrests after contracts covering approximately 16,500 workers and 69 hotels expired in August.  Negotiations between UNITE HERE and many of the cities’ largest hotel employers have stalled as the hotels seek decreased wages and staffing levels and increased health care payments.  UNITE HERE is also in negotiations with several Atlantic City, NJ hotels at which unit employees continue to work under an extended agreement following expiration of their collective bargaining agreement.
  

• United Food and Commercial Workers members voted overwhelmingly in favor of allowing the union to call a strike against approximately 225 Fry’s, Safeway and Kroger supermarkets located throughout Arizona after negotiations over a new contract yielded little progress.  The parties remain at a standstill with regard to the amount wages will be increased, health insurance premium contributions by employees and the amount pension contributions would be increased.
  

• Members of the Truck Drivers Union, a Teamsters affiliate, continue to strike against Aunt Millie’s Bakeries in five Michigan cities.  Eight employees walked off the job after disputes regarding wages and implementation of job duties and classifications could not be resolved.
  

• Teamsters members ratified a first contract, ending a two-week strike against Amerijet International.  The four-year agreement covers 60 pilots.  Negotiations began in 2004.
  

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C. Major Contract Settlements & Negotiations

• United Steelworker represented employees rejected an offer from ArcelorMittal to reopen its Georgetown, SC mill in exchange for accepting a reduced work week of 32 hours and a $3.65 per hour pay cut.  The mill was shut down in July due to lack of orders and resulted in the temporary layoff of 245 employees.
  

• The United Steelworkers ratified contracts and reenacted tentative agreements with several major tire manufacturers.  USW members ratified a four-year master contract with Goodyear Tire covering 10,300 workers at seven Goodyear plants that protects against closure at six of the company’s plants for the duration of the contract and provides for minimum staffing levels.  The contract did not include an across the board wage increase but continued to include a cost of living adjustment provision.  The defined benefit pension plan is improved for longer-term employees, while newer employees will receive participate in a defined contribution pension plan, with a company match.  Weekly health insurance premiums were also increased.  The USW also ratified a three-year master contract with BF Goodrich.  Under the contract, there is no across the board wage increase, but the COLA provision will continue, providing for an increase of up to $.50/hour.  As part of the agreement, BF Goodrich agrees not to close any of its plants during the term of the agreement, except in extreme circumstances.  Last, the USW reached a tentative agreement with Bridgestone Americas Tire Operations that would cover 3,000 employees at six facilities.  Details are being withheld pending ratification. 
  

• Brotherhood of Locomotive Engineers and Trainmen representing employees ratified a five-year contract with CSX Transportation covering 5,000 locomotive engineers.  Wages will increase a total of 16% over the length of the contract and performance-based bonuses are increased as well.  Health and welfare benefits remain subject to the parties reaching agreement on a national contract.
  

• IAM members at Mercury Maine’s - a division of Brunswick Co. - Fond du Lac, WI manufacturing facility accepted a seven-year concessionary contract covering 850 workers that was rejected earlier after the company agreed not to move jobs to a nonunion facility in Oklahoma.  The terms provide for a seven-year wage freeze for incumbent employees, a 30% pay cut for new hires and laid-off union members called back to work and increases health care costs. 
  

• Members of two SEIU locals ratified contracts with Stanford University and its affiliated health care facilities.  SEIU Local 2007 members approved a five-year contract providing for a 12.5% wage increase over the term and automatic step increases in pay.  Groundskeepers, however, took a 9% pay cut over the first two years.  The contract also created a jointly funded apprenticeship program facilitating lateral career moves.  SEIU United Health Care Workers-West members agreed to a two-year contract with Stanford Hospital and Clinics and Lucile Packard Children’s Hospital covering approximately 1,450 workers.  The contract includes a 4% wage increase and medical benefits equal to non-represented employees providing no monthly premium costs.  Paid bereavement leave and extended sick leave are also included. 
  

• Communications Workers of America ratified a three-year contract with AT&T West Region covering 22,000 core wireline workers in California, Nevada and Hawaii.  The contract is similar to other agreements reached this year with AT&T and includes a 8.75% wage increase over the term, a cost-of-living adjustment in the third year and increases pension benefits 6% over the term while creating employee health care premium contributions.  AT&T has now reached agreements with two of the six units covering approximately 125,000 workers with whom negotiations began early this year. 
  

• United Steelworker members ratified two nearly identical contracts covering 850 employees at Evraz's Rocky Mountain Steel mills near Pueblo, CO.  The five-year contracts provide for modest wage increases, a $1,500 signing bonus, health care premiums fully paid by the company, increased retiree benefits under the defined pension plan and institute random drug testing. 

• The Society of Professional Engineering Employees in Aerospace is recommending that its Wichita, KS members ratify a three-year contract proposed by Spirit AeroSystems.  While the unit had twice rejected ratification and voted to strike, the company sweetened the offer, which includes a 3% bonus in 2010 and minimum increases of 1% in 2011 and 2012, plus any market-driven increases. 

• Teamsters members at Republic Airways ratified a contract providing for a 10% wage reduction in order to avoid jobs being outsourced and clearing the way for Republic to purchase Frontier Airlines out of bankruptcy.  The pay cut was imposed by the bankruptcy judge handling Frontier’s Chapter 11 filing.  The new agreement, however, provides for a 3% pay increases in 2011 and 4% in 2012.

• The Southwest Airlines Pilots’ Assoc. reached a tentative agreement on a five-year contract covering 5,900 pilots.  The proposal includes 2% retroactive wage increases for 2007 and 2008, a variable profit-based raise in 2009 and 2010 and a 2% raise in 2011.  The contract also provides beneficial terms regarding the pilot’s scheduling programs and increases the company’s 401(k) matching contribution.  Ratification votes will be held throughout October. 

• Members of the Chicago Newspaper Guild voted against pay and benefit cuts and work rules changes proposed by the bankrupt Sun-Times Media Group, publisher of the Chicago Sun-Times, in an effort to clear the way for a prospective buyer.  The company has been seeking a buyer since it filed for Chapter 11 in March 2009.

• USW members voted to accept concessions in order to return to work at Gerdau Macsteel’s steel plant in Jackson, MI.  The plant had been idle since January and had laid off over 210 USW members.  The agreement provides for a moratorium on Sunday premium pay, weekly overtime computation rather than daily and allows for greater flexibility in work assignments. The changes will last until all work crews are up and running or for six months, whichever comes first. 

• The International Union of Electronic Workers-Communications Workers of America reached an agreement with General Motors that will require GM to commit $467 million to provide health care coverage to all non-UAW pre-age 65 union retirees and dependants beginning January 1, 2010.  The agreement provides high-deductible health insurance, which will not be available for Medicare-eligible retirees upon reaching 65.  The IUE-CWA also reached a pension agreement with GM under which GM will pay the full difference in Delphi employee pensions not covered by the Pension Benefit Guaranty Corporation, which became a trustee of Delphi’s pension plans in July. 

• BNA reports that settlements reported YTD in 2009 have resulted in an average first-year wage increase of 2.5%, as compared to the average 3.7% increase at this point in 2008.  Factoring in lump-sum payments, the average increase was 2.8% (4% in 2008).   Removing construction and state and local government contracts results in an average increase of 2.8% (3.6% in 2008).  Factoring lump-sum payments, this average increase rises to 3.3% (4.1% in 2008).  Manufacturing agreements averaged a 1.8% increase (2.5% in 2008) while construction settlements increased wages 1.6% (5.2% in 2008).  State and local government contracts showed an average increase of 2.3% (3.2% in 2008).

• Major collective bargaining agreements reached in Canada during July produced average base rate wage increase of 1.6%, which is down from the average increases generated in recent months and from the 2.4% increase experienced in all of 2009.  Private sector contracts saw increases of 1.8% (2.6% in 2008) largely due to agreements with Air Canada that covered a significant number of employees and included a wage freeze. Public sector agreements produced annual wages increases of 2.0% (3.5% in 2008) largely stemming from major agreements reached with the city of Toronto.  The largest increases were seen in construction (3.5%), followed by information and culture (2.7%), manufacturing (2.5%), public administration (2.1%), wholesale and retail trade (1.9%)  and entertainment and hospitality (1.7%). 

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D. Administrative & Court Decisions

• The NLRB ruled that Starbucks baristas working in a Milwaukee, WI Hilton hotel cannot be accreted to an existing bargaining unit of hotel employees represented by UNITE HERE because the baristas have a separate identity from the other hotel workers and, thus, constitute a separate bargaining unit.  The Board’s ruling overturned a NLRB regional director’s determination that the baristas were part of the existing bargaining unit, emphasizing that although the baristas were employed by the hotel, they had virtually no interaction with the hotel’s other employees and no common management or supervision.  Milwaukee City Ctr. LLC, 354 NLRB No. 77.

• The NLRB has determined that the Regal Health and Rehab Center in Oak Lawn, IL committed various unfair labor practices and has ordered the nursing home to recognize and bargain with the SEIU.  After many of the company’s nurses signed union authorization cards in late 2007, the company attempted to alter their job responsibilities to give them supervisory roles, interrogated nurses about their union views, threatened them with reprisals, fired three nurses for their union activities and offered rewards to certain employees if they would spy on their co-workers. The Board summarily adopted the ALJ’s decision that each of the foregoing constituted unfair labor practices and ordered Regal Health to cease and desist from similar conduct, recognize and bargain with SEIU, offer reinstatement to the terminated nurses and compensate them with backpay and post notice of the Board’s order.  Regal Health & Regab Ctr. Inc., 354 NLRB No. 71, 8/28/09.

• The Eighth Circuit determined that under the terms of its collective bargaining agreement, the United Steelworkers was not obligated to pay back wages for part of the time a reinstated member was out of work even though the USW failed to file a timely grievance on her behalf.  The court determined that the language of the agreement provided that the member could not assert claims against the union in the arbitration of a grievance against the employer and overturned the arbitrator’s decision that USW, rather than the employer, was responsible for the member’s back pay stemming from her wrongful termination. Turner v. United Steelworkers of Am., Local 812, 8th Cir., No. 08-3116. 

• A jury awarded nearly $300,000 to Ajax Construction and D.F.M. Industries, two nonunion steel erector subcontractors, in their federal lawsuit against a Massachusetts local of the Bridge, Structural, and Ornamental Iron Workers after finding that the Local violated federal law by threatening and coercing contractors to cease doing business with the nonunion subcontractors.  The plaintiffs’ claims that the Iron Workers’ Market Recovery Program violates federal antitrust laws remains pending after the district court judge severed the two claims.  The program offers employers a subsidy to offset higher union wages if those employers are willing to enter into a collective bargaining agreement with the union.  American Steel Erectors Inc. v. Local Union No. 7, D. Mass., No. 04-CV-12536. 

• The Third Circuit determined that International Union of Operating Engineers Local No. 66 is obligated to indemnify Pittsburgh Mack Sale & Service for withdrawal liability to a pension plan under the terms of two collective bargaining agreements between the parties.  The contracts provided that the company would contribute $1.65 per hour worked by certain employees to an ERISA pension fund and that the union would hold the company harmless for any liability to the fund in excess of its specified contribution.  When Pittsburgh Mack agreed to sell most of its assets to Allentown Mack in 2005 the fund claimed that Pittsburgh Mack owed more than $400,000 in withdrawal liability.  The lawsuit began after the union refused to indemnify the company. The Third Circuit overruled the district court’s dismissal of Pittsburgh Mack’s claim, finding that no public policy clearly prohibited enforcement of a private contract pertaining to an ERISA fund that ensures funding and protection of employee benefits.  Pittsburgh Mack Sales & Service, Inc., v. Int. union of Operating Engineers Local Union No. 66, 3d. Cir., No. 07-3938. 

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E. Legislation & Politics

• Massachusetts Governor Deval Patrick has asked Hyatt Hotels’ President and CEO to reconsider the company’s decision to fire 98 nonunion housekeeping employees at three Boston area hotels and replace them with low-wage workers from a contracting company and stated that he will direct all state employees not to use Hyatt when traveling or for other purposes while on state business if the workers are not rehired.   Hyatt stated it replaced the housekeepers due to economic challenges caused by significant drops in revenues.  The former Hyatt housekeepers earned about $15 per hour whereas the contract employees receive $8 per hour with no benefits.  The National Employment Lawyers Association already has canceled a national meeting scheduled to take place at the Hyatt Regency Boston. 

• The U.S. Department of Labor, Employee Benefits Security Administration, proposed a prohibited transaction exemption which, if approved, would allow the General Motors Co., the successor company to General Motors Corp., to transfer certain assets to its voluntary employees’ beneficiary association plan to provide for post-retirement health benefits.  Such a transfer is currently prohibited by ERISA provisions prohibiting certain plans from holding large percentages of plan assets in the form of employer securities.  The proposal was spurred by negotiations between GM and UAW seeking a way to address the company’s legacy costs and retiree health obligations.

• Chicago UNITE HERE members picketed local hotels lobbying for passage of a city ordinance that would require their employers, travel agents and online reservation services to inform consumers about ongoing labor disputes.  The picketing and lobbying efforts are being pursued in an attempt by UNITE HERE to gain leverage in stalled negotiations with the hotels over agreements that would cover approximately 30 hotels and 6,000 hospitality workers whose contracts expired at the end of August.  The proposed ordinance has won backing of the Chicago City Council Finance Committee and will be considered in full on October 8.  UNITE HERE campaigned for the same ordinance four years ago but the measure was ultimately defeated in part due to concerns as to the measure’s legality.   

• Sen. Tom Harkin (D-Iowa), lauded by many union leaders as a strong worker advocate, was chosen to succeed Ted Kennedy as chairman of the Senate Health, Education, Labor and Pensions Committee.  While Harkin recently stated that the committee will focus on education issues for the remainder of the year, he also intends to continue to press for Senate floor consideration of the Employee Free Choice Act which seeks to make it easier for unions to organize workers.   

• For the third time in three years, California Governor Arnold Schwarzenegger vetoed a bill, backed by the United Farm Workers, that would allow agricultural employees to choose a collective bargaining representative by submitting a petition to the state Agricultural Labor Relations Board, along with representation cards signed by more than 50 percent of current employees.  Schwarzenegger supported his decision on the ground that he could not get behind the bill’s alteration of the secret ballot process.   

• The U.S. Department of Labor, Office of Labor-Management Standards, proposes to extend its information collection pertaining to the older version of the Form LM-30, a financial disclosure report filed by union officers and employees, through 2011.  In 2007, the DOL published a final rule requiring union officers and employees to report loans or payments they receive from companies doing business with the union whose employees their union represents or is seeking to represent.  This rule narrowed some exceptions to the disclosure requirements contained on the previous Form LM-30 and eliminated a provision excusing union official from reporting some matters because the DOL could get the information by demanding a special report.  The AFL-CIO filed a lawsuit in January claiming that the rules are arbitrary and capricious. 

• AFL-CIO President Richard Trumka warned Democratic lawmakers that the labor movement will challenge those who fail to support a public option in a health reform bill, which the union has deemed a necessary component of reform. 

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F. Crime & Corruption

• According to a complaint filed by a former NFL Players Association director of human services,  the U.S. Department of Labor is investigating alleged collusion between the union and team owners.  The complaint claims that former NFLPA president, Troy Vincent, and other officials secretly gave NFL owners confidential information as negotiations over a disfavored collective bargaining agreement approached as a means to garner external support for Vincent.  The complaint also claims that Vincent benefited from favors and gifts in return for influence of the NFLPA and that several player representatives also participated in clandestine meetings with management.  Neither the NFLPA nor the DOL commented on the allegations.

• Two former board members of Amalgamated Transit Union Local 1181, Nick Maddalone and Paul Maddalone, pled guilty in the Southern District of New York  to charges of extorting cash through economic means from New York City school bus company owners and face maximum prison sentences of up to 20 years.  The brothers are the fourth and fifth Local 1181 officials to be convicted in a series of cases stemming from an ongoing investigation by the FBI, DOL, and NYC Police Department into corruption at the local, which represents 15,000 school bus drivers and escorts employed by companies serving the NYC Education Department.  Prosecutors allege that the local has been influenced and controlled by the Genovese Mafia family since the 1970s.  United States v. Maddalone, S.D.N.Y., No. 09-CR-550.

• Former American Federation of Government Employees Local 1304, Don Padgett, was sentenced to a prison term of 21 months as a result of his participation in a scheme to fraudulently obtain union funds for his own use.  Padgett pled guilty and, in addition to the prison sentence, was ordered to pay restitution of $185,042.  United States v. Padgett, S.D. Ill., No. 3:09-CR-30024.

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G. AFL-CIO Convention

The AFL-CIO held its quadrennial convention before more than 1,000 union delegates in Pittsburgh on September 13-17.  Notable developments:

Leadership: 

• Former AFL-CIO Secretary-Treasurer Richard Trumka was elected to succeed John Sweeney as Federation President, Liz Shuler was named Secretary-Treasurer, and Arlene Holt Baker was re-elected as Executive Vice President.    

Legislative Efforts: 

• Delegates approved a wide-ranging resolution seeking continued support for passage of the Employee Free Choice Act and large-scale organizing efforts once the bill is enacted. AFSCME pledged $500,000 to a fund for a media campaign promoting the EFCA and USW stated it will seek approval of an additional $500,000 donation.  Delegates also reached out to their congressional representatives calling for support of the EFCA.

• The federation also called for raises in the federal minimum wage, strengthening the Family and Medical Leave Act and passage of the Health Families Act, which would provide employees with paid sick leave. 

• Financial market regulation and reform was also promoted and demonstrated by the federation’s recent collaboration with Americans for Financial Reform, a group of national and state organizations seeking greater regulation of financial markets.

• In addition, delegates passed a resolution calling for the labor movement to pressure local, state and federal governments to put more than seven million unemployed workers back to work by rebuilding the manufacturing sector through a series of Works Progress Administration jobs, tax credits, and tuition-free training programs. 

Speakers: 

• President Obama pledged to fight for a public option as part of any health care overhaul and passage of the EFCA.  Obama also committed to helping jump-start American manufacturing  and promote job creation in clean energy and other industries that cannot be outsourced.  Following Obama’s speech, Trumka stated that the union federation would quickly undertake campaigns to hold insurance companies accountable and counter the messages being spread by opponents of health care reform.

• Senator Arlen Specter announced that a group of senators had reached a compromise on the EFCA that he believed would secured enough votes to move the bill to the senate floor.  The compromise would not contain card check recognition but provides for quick certification of elections, tough penalties on employers that break the law, and binding arbitration on last, best offers.  Specter stated it would be impossible to pass a version of the Act that did not maintain secret ballot election. 

Membership: 

• UNITE HERE President John Wilhelm announced that the union’s 265,000 membership would be rejoining the AFL-CIO and pledged to bring other unions with them.

• The AFL-CIO announced that its average membership during the last two years was 8.4 million members.  This total does not include Canadian members, associate members, for which affiliates pay a reduced monthly per capita tax, or members of its Working America affiliate.  The federation claimed to have increased its membership by approximately 300,000 members when accounting for the numbers lost when six large affiliates left to form Change to Win.

Federation Cooperation: 

• Unity of the labor movement was a major topic of discussion as delegates called for all unions to decrease inter-union organizing competition and refrain from raiding each others’ members largely in response to the SEIU’s efforts to get involved with the internal affairs of UNITE HERE.

• Similarly, Workers United members called on Trumka to help end the ongoing dispute with UNITE HERE as UH prepares to reaffiliate with the AFL-CIO. 

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H. Miscellaneous

• The National Air Traffic Controllers Association has elected Paul M. Rinaldi as its new president.  Mr. Rinaldi has served as NATCA’s executive vice president since 2006 and will begin his three-year term on October 17.

• Delegates to the California Nurses Association/National Nurses Organizing Committee convention unanimously voted to join National Nurses United, a new registered nurses union with 150,000 members.  The NNU’s founding convention will take place in December and will combine the membership of CAN/NNOC, the United American Nurses, and the Massachusetts Nurses Association, each of which will hold its own national convention to ratify the pending unification. 

• The Carpenters and Joiners of America has disaffiliated from the Change to Win federation in an amicable separation.  The Carpenters joined CTW in 2005 in an effort to rebuild the labor movement but stopped making its per capita payments to the federation in November 2008.

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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:

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