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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. MISCELLANEOUS
   
   
8. UPCOMING EVENTS
   
   
9. RECENT PUBLICATIONS

1. ORGANIZING

• The Transport Workers Union of America filed a petition with the National Mediation Board (NMB) seeking a representation election among 650 unrepresented flight attendants at Virgin America. According to the union, “[a]n overwhelming majority” of employees of the San Francisco-based airline are seeking union representation. The union vote will occur in mid-December.

• Maintenance and production workers at two R.J. Reynolds Tobacco facilities in North Carolina voted for the third time in less than seven years against joint representation by the International Association of Machinists and the Bakery, Confectionery Tobacco Workers and Grain Millers. Previous representation elections were held in 2005 and 2006. The latest, NRB-supervised vote came out 686-556 against representation.

• The AFL-CIO issued an organizing committee charter to the National Taxi Workers Alliance (NTWA). Through this charter, the NTWA, which includes 15,000 drivers in New York and a smaller number in Philadelphia, became the labor federation’s 57th affiliated labor organization. The charter was the first the AFL-CIO issued for a national organizing committee since the United Farm Workers received one in the 1970s.

• A bargaining unit of more than 900 beef plant workers at JBS Packerland Inc. in Plainwell, Mich., voted for representation by the United Food and Commercial Workers (UFCW). In the NLRB-supervised election, workers at the JBS slaughterhouse and production facility voted 641-160 for representation by UFCW Local 951. They join 28,000 other JBS workers represented by the UFCW.

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2. STRIKES & LABOR DISPUTES

• On October 10, 840 members of Machinists Local Lodge 778 went on strike at a Honeywell Federal Manufacturing & Technologies LLC plant in Kansas City. Honeywell operates the federally owned plant, which makes non-nuclear components for nuclear weapons. The day before the strike, the machinists rejected a contract offer that included pay raises over the next six years and a $2,000 ratification bonus but imposed a new two-tier pay scale for employees hired after the start of 2012. Union representatives have accused Honeywell of bargaining in bad faith. The strike is ongoing as of the date of this alert.

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3. MAJOR CONTRACT SETTLEMENTS &
   NEGOTIATIONS

• Members of the UAW ratified a four-year collective bargaining agreement with Ford Motor Co., covering nearly 41,000 workers. The contract maintains the pattern set in September by the agreement between the UAW and General Motors Co., but provides larger bonuses for workers at the more profitable Ford. Under the new contract, traditional senior workers hired before a 2007 national contract will forgo raises, while tier two entry-level workers hired after the 2007 contract will receive wage increases. All workers will receive ratification bonuses, annual profit-sharing, “inflation protection” bonuses in lieu of cost-of-living adjustments, and “competitive” bonuses, which in total guarantee workers at least $15,700 in lump-sum payments during the contract term. Attrition incentives will provide $50,000 to $100,000 for eligible workers to retire by March 31, 2012. Ford will add 5,750 new U.S. jobs, in addition to the 6,250 new jobs the company had announced earlier, and will invest $16 billion to produce new models and to upgrade vehicles and components. Workers with at least one year of service will receive a $6,000 signing bonus, while workers with less than one year of service will receive a $5,000 signing bonus. Sixty-three percent of production workers and 65 percent of skilled trades workers voted in favor of the agreement.

• Members of the United Auto Workers (UAW) ratified a four-year contract with Chrysler Group LLC—Chrysler’s first contract since its government bailout and bankruptcy filing in 2009. The contract, which covers 26,000 workers, follows the pattern of the other two Detroit Three companies’ recent contracts, although with lower bonuses. Under the new contract, Chrysler will add 2,100 new jobs—on top of 2,500 added previously—and will invest more than $4.5 billion to retool and upgrade its U.S. facilities. All workers will receive at least $3,750 in lump-sum payments and expanded health care benefits. In addition, lower-paid entry-level works will receive increased hourly base wages, while traditional workers will forgo wage increases. Although the overall vote ratified the contract by 55 percent, the skilled trades workers voted to reject it. However, because the UAW International Executive Board (IEB) investigated and found that the reasons behind the rejection were predominantly economic objections, not reasons unique to skilled trades members, the IEB declared the agreement ratified.

• The Transport Workers Union reached a tentative four-year labor agreement with American Airlines. The agreement, which covers more than 11,000 fleet service and ground service workers, would increase wages and provide other enhancements including additional holidays, sick time, and vacation. The tentative contract includes a 6 percent signing bonus, an immediate 3 percent base salary increase, and three additional 2 percent wages increases. By the end of the contract, a typical fleet service clerk would earn more than $23 an hour and a crew chief would earn more than $25 an hour. The contract also doubles the number of paid holidays form five to ten and increases holiday pay from time and one-half to double time. The union is not making a recommendation on the tentative agreement.

• Members of the United Steelworks ratified a two-year first contract at Bonus Car Wash in Santa Monica, Calif., which became the first unionized car wash in the United States. In addition, workers at the currently closed Marina Car wash in Venice, Calif., negotiated and ratified a contract that will apply if that car wash reopens. The two contracts resulted from the efforts of the Community Labor Environment Action Network (CLEAN) Carwash campaign, a coalition of community, environmental, and labor groups led by the Steelworks with assistance from the AFL-CIO. In August, Sikder Inc. and M. Sikder Holdings Inc., the owners of the two carwashes, voluntarily recognized the Steelworkers after a third party verified that a majority of the workers had signed union authorization cards. The Bonus Car Wash contract provides a 2 percent increase for 30 employees, most of whom were previously making the California minimum wage of $8 an hour. The contract requires the employer to assign work hours fairly, protects workers from unjust firings without cause, and provides a detailed grievance and arbitration procedure. In addition, the contract provides protections for immigrant workers.

• The Chicago Regional Council of Carpenters and Local 727 of the International Brotherhood of Teamsters (IBT) reached a settlement with the State of Illinois, resolving a long-running dispute between the state and carpenters, decorators, and electricians working in Chicago convention venues. The dispute stemmed from a controversial law, passed in May 2010, that imposed changes on thousands of convention and trade show workers. On March 31, 2011, a U.S. district court judge ruled that portions of the law conflicted with the National Labor Relations Act. The new settlement preserves labor changes demanded by the state and includes an “exhibitor’s bill of rights,” giving trade show exhibitors greater freedom to manage their own booths without triggering union work rules. However, it provides new opportunities to union-represented workers displaced through the work rule changes. Also, it requires unions and the municipal corporation that owns and operates the convention centers to withdraw litigation seeking to void the enacting legislation, and requires the state to seek passage of alternate legislation that does not conflict with the NLRA.

• Flight attendants represented by the United Steelworkers ratified a new five-year contract with Pinnacle Airlines. The contract, which covers 871 flight attendants represented by USW Local 772, includes significant wage increases. Flight pay will now range from $17 per hour to $33.77 per hour, based on longevity, with per diems ranging from $1.65 an hour to $1.85 per hour. The contract also includes changes regarding new equipment, scheduling, hours of service, and filing of petitions. It further provides for increases in the maximum amount of medical leave, a two-hour meal break credit, a 32 percent cap on health insurance premiums, increases in moving expenses, and a performance bonus program.

• Members of the International Longshore and Warehouse Union (ILWU) ratified a one-year contract with the Pacific Northwest Grain Elevator Operators. Covering 4,000 workers at six grain export terminals in Oregon and Washington, the contract maintains workers’ fully employer-paid health care premiums and defined benefit pension plan. As well, the contract provides for a 3.1 percent wage increase for “registered” grain handlers and a 4 percent increase for “nonregistered” grain handlers. Although the employers and the ILWU usually negotiate three-year agreements, the new contract is only for one year due to ongoing disputes with an additional employer. That employer, EGT LLC, declined to agree to the multiemployer agreement for its employees in Longview, Wash., where violence broke out in September and a federal judge issued a preliminary injunction against the union.

• Members of Local 32BJ of the Service Employees International Union (SEIU) voted unanimously to ratify an agreement with the Washington Service Contractors Association, which represents the Washington-Baltimore metropolitan area’s major commercial cleaning companies including Red Coats, American Building Maintenance, and Building Maintenance Services. The union had recommended ratification of the new agreement, which will increase wages 16 percent over four years for 12,000 commercial building cleaning services workers. In addition, the agreement maintains health care benefits and expands paid leave. Under the contract, the union and employers agreed to work toward a settlement during the contract term to expand health care coverage for part-time employees, who compose two-third of the workers covered by the contract.

• Members of Service Employees International Union (SEIU) Local 32BJ ratified a set of separate but similar agreements with building services contractors in Pittsburgh. The agreements cover 1,200 commercial building cleaners employed by members of a bargaining coalition including ABM Janitorial Services, GCA Services Group Inc., Humber Group, ISS Facility Services Inc., Platinum Maintenance, Quality Building Maintenance, St. Moritz Building Services Inc., and ServiceMaster. The four-year contracts provide for wage increases of 2 to 3 percent over term for workers earning higher wages within Pittsburgh proper, and increases of up to 6 percent for lower-wage workers in suburban areas. Workers with family health coverage will continue to receive it at a slightly reduced cost and many low-wage suburban workers will obtain health coverage for the first time. The union had recommended ratification but did not release a vote count.

• Local 32BJ of the SEIU reached a tentative contract settlement with Building Operators Labor Relations, the bargaining agent for major Philadelphia commercial business owners, managers, and cleaning companies. The contract covers 2,650 building service workers and provides for an average pay increase of nearly 7 percent over its four-year term; hourly starting pay for bargaining unit members would increase from the current $16.41 to $17.54 in 2015. The contract also provides for a $600 first-year bonus and retains the existing 401(k) plan and employer-paid health coverage for all workers. Union leadership recommended that members ratify the agreement, which was reached shortly before the midnight strike deadline after almost six weeks of negotiations.

• Members of UAW Local 578 passed a new five-year contract with defense contractor Oshkosh Corp. in Oshkosh, Wis., after rejecting two previous contract offers. The new contract, which covers 3,100 employees and passed with a vote of 77 percent in favor, includes an 8.5 percent wage increase over five years, but requires workers to contribute more for their health insurance. The contract passed after the company agreed to remove language that would have let it use temporary workers starting in 2013.

• The Aircraft Mechanics Fraternal Association reached a tentative agreement on a five-year contract with Alaska Airlines. Covering the carrier’s 626 aircraft maintenance technicians, the proposed contract would provide annual pay raises, job protection provisions, and a “shared commitment” to work on minimizing health care cost increases. In an unusual occurrence, the two sides reached agreement before the current contract’s amendable date of October 17.

• A BNA analysis of 2011 collective bargaining data through October 17 showed that the average first-year wage increase for this period was 1.4 percent, compared with 1.7 percent in the comparable period of 2010. The median first-year wage increase for settlements reported to date in 2011 was 1 percent and the weighted average was 1.2 percent, compared with 1.6 percent and 1.6 percent, respectively, in 2010. When lump-sum payments were factored into wage calculations, the all-settlements average first-year increase to date in 2011 was 1.7 percent; the comparable period in 2010 reported a 2 percent increase.

• On October 6, President Obama appointed a Presidential Emergency Board (PEB) to investigate an ongoing collective bargaining dispute between two coalitions of unions representing freight railroad workers and an employer group negotiating on behalf of the carriers. The Railway Labor Act allows the president to establish a PEB if parties cannot reach a tentative agreement after mediation guided by the National Mediation Board. After the 11 unions bargaining with the railroads all declined a proffer of binding arbitration from the NMB, and following a 30-day cooling-off period, the unions would have been free to strike and the railroads free to lock workers out had Obama not appointed the PEB by October 7. Once appointed, the PEB has 30 days to hold hearings, investigate the dispute, and deliver a report with recommendations on how to settle the contract. The parties may then choose to accept the PEB’s recommendations or negotiate their own settlement.

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4. ADMINISTRATIVE & COURT DECISIONS

• The U.S. Court of Appeals for the First Circuit ruled that the U.S. Postal Service did not necessarily commit an unfair labor practice when it declined to provide the National Postal Mailhandlers Union with 22 employees’ psychological aptitude test scores, which the union requested in order to investigate a bargaining unit dispute. But the court also held that notices informing employment applicants that personal information would remain confidential under the Privacy Act but could be disclosed “as required by law” did not remove all expectations of privacy. Denying an enforcement petition from the National Labor Relations Board (NLRB or Board), the court remanded and directed the Board to sufficiently balance the union’s interest in the information with the employees’ legitimate and substantial privacy interest in their test scores. NLRB v. USPS.

• A federal judge for the Central District of California denied the request of the Painters and Allied Trades District Council 36 for a preliminary injunction blocking implementation of a San Clemente, Calif., ban on targeting residential picketing. The judge found that the challenged law was a “time, place, and manner” restriction of the sort the U.S. Supreme Court has upheld, because it was narrowly tailored, served a significant government interest, and left open ample alternative channels of communication. As a result, the ban did not violate the protesters’ First Amendment rights. However, the judge made clear that union members could continue to protest as long as they did not position themselves only in front of a one particular residence, which the law prohibits. Painters and Allied Trades Dist. Council 36 v. San Clemente.

• The Washington Court of Appeals ruled that an arbitrator violated the state’s “well-defined, explicit, and dominant” public policy against race discrimination by reducing the discipline imposed on a Port of Seattle worker who was fired for hanging a noose in the workplace after a “falling out” with a black coworker. The Port decided that the employee engaged in “gross misconduct” in violation of its “zero tolerance” anti-harassment policy and fired him. However, upon union grievance, the arbitrator reduced the discipline to a 20-day suspension and ordered reinstatement with lost pay and benefits. The appeals court affirmed the lower court’s order vacating the arbitration award based on a finding that the public interest in the finality of arbitration awards under union contracts must yield to a countervailing strong public policy against race discrimination, found in a state law, that requires employers to take affirmative steps to eliminate and prevent racial harassment. Int’l Union of Operating Engineers Local 286 v. Port of Seattle.

• A federal district court denied the State of Arizona’s motion to dismiss an NLRB lawsuit alleging that a state constitutional amendment guaranteeing a right to vote by secret ballot on issues of union representation is preempted by federal labor law. The amendment passed in December 2010, alongside similar amendments in South Carolina, South Dakota, and Utah. The NLRB filed the Arizona lawsuit on May 6, 2011, asserting that all four states’ amendments are preempted. The court rejected the state’s argument that the NLRB lacked standing to challenge the amendment, because it found that if the state law is preempted by the NLRA, the Board’s exclusive authority to protect employee rights guaranteed by the Act has already been compromised by the amendment’s creation of a “parallel enforcement mechanism.” In addition, the court rejected Arizona’s argument for dismissal based on lack of subject matter jurisdiction, finding that although the NLRA does not expressly authorize a lawsuit challenging a state law, the U.S. Supreme Court has recognized the NLRB’s authority to seek traditional remedies not spelled out in the Act. NLRB v. Arizona.

• An arbitrator found that a 2007 merger agreement between the United Transportation Union (UTU) and the Sheet Metal Workers was enforceable. Several UTU leaders have resisted the merger since shortly after the agreement was signed, arguing that former union leaders had misrepresented the effect of the merger on provisions in the UTU constitution regarding craft autonomy and general committee autonomy. An arbitrator found, however, that the merger was “properly approved,” and that the UTU had not borne its burden of proof regarding alleged misrepresentations. The arbitrator thus found that the merger should be implemented “on the earliest possible date” and directed the union presidents to meet to discuss implementation. In re Sheet Metal Workers Int’l Ass’n and United Transp. Union.

• In a 2-1 decision, the Board held that, following a confrontation over disputed layoff procedures, a New York hotel acted lawfully when it terminated three employees who grabbed and pushed a manager, but acted unlawfully when it disciplined 10 other workers who participated in the encounter. In 2004, the New York Hotel & Motel Trades Council was certified to represent hotel employees. However, by November 2008 the hotel and union still had not negotiated a contract. The employer then announced that declining business required reduction in staff expenses and proposed an across-the-board cut in hours. The union sponsored a rally, which led to the confrontation at issue. Although an administrative law judge had found that all 13 employees involved lost the NLRA’s protection, the Board found that only those who deliberately touched the manager acted outside the Act’s bounds. In dissent, Member Hayes found that the actions of every employee who participated in the encounter “went well beyond what should be expected or tolerated in the workplace, and accordingly, what the Act should protect.” LaGuardia Assocs. LLP d/b/a Crowne Plaza LaGuardia.

• A federal district court in Washington assessed $250,000 in compensatory damages against two International Longshore and Warehouse Workers Union locals for violating a temporary restraining order and preliminary injunction entered to halt violent protests at a Washington port facility. The judge held the unions in contempt for violating the orders, entered in response to the NLRB’s request for injunctions to prevent the locals from continuing to violate the rights of employees and neutral employers. Finding that the unions engaged in a “litany of strike line misconduct” including vandalism and property damage, even after the court issued injunctions, the judge found that the award was appropriate for damages caused during the demonstrations. Ahearn v. Int’l Longshore & Warehouse Union Local 21.

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5. LEGISLATION & POLITICS

• U.S. House of Representatives Oversight and Government Reform Committee Chairman Darrell Issa, R.-Calif., denounced NLRB Acting General Counsel Lafe F. Solomon for “continuously obstruct[ing]” the panel’s ongoing investigation of the NLRB’s unfair labor practice complaint against Boeing Co. In a letter to Solomon, Rep. Issa accused him of withholding documents sought in an August 5 subpoena, and of making misrepresentations to the panel. In particular, Rep. Issa charged that NLRB officials released Boeing-related documents in response to a private organization’s FOIA request, but had not yet turned those documents over to the committee. Rep. Issa requested the Solomon make six agency officials, including the agency’s special counsel for congressional and intergovernmental affairs, available for committee interviews next month to aid in “understanding the extent of the NLRB’s continued obstruction” of the panel’s investigation.

• Sen. John Thune, R-S.D., introduced legislation (S. 1666) that would prohibit the NLRB from implementing the final rule it promulgated in August requiring employers to post notice regarding how to establish a union. According to Sen. Thune, the rule, currently set to take effect January 31, 2012, is “another example of a federal overreach” and part of “the NLRB’s ‘pro-big labor’ agenda.” The bill was referred to the Senate Health, Education, Labor, and Pensions Committee. Rep. Ben Quayle, R.-Ariz., introduced companion legislation (H.R. 2833) in the House of Representatives.

• Rep. John Kline, R.-Minn., introduced the Workplace Democracy and Fairness Act (H.R. 3094), which would mandate that no union election be held in fewer than 35 days and would restrict which employees could vote in a union election. The proposed bill would also restrict how a union may contact prospective members and would require a two-week waiting period between the filing of a petition and the first hearing on the matter. Rep. Kline introduced the bill in response to the NLRB’s proposed rule, introduced in June, that would allow electronic petition filing, require parties to hold a pre-election hearing within seven days of filing a petition, require employers to provide worker email addresses and telephone numbers to union organizers, and postpone certain challenges until after the election, among other changes.

• The AFL-CIO, the International Association of Machinists, and the United Steelworkers rallied with lawmakers against pending free trade agreements with Korea, Colombia, and Panama. The labor organizations challenged the administration’s claims that the trade agreements would result in net job gains, claiming instead that 159,000 jobs would be lost because of the agreement with Korea alone. In addition, union leaders objected to recent violence against trade unionists in Colombia.

• The DOL’s Office of Labor-Management Standards promulgated a final rule concerning the financial disclosure reports that union officers and employees must file. Published in the Federal Register on October 26, the rule modifies Form LM-30, the Labor Organization Officer and Employee Report, an annual financial disclosure form that must be filed by union officials and union employees who receive payments from or have financial arrangements with union-represented employers or businesses with employees that the union is seeking to represent. The form’s purpose is to disclose publicly possible conflicts between the personal financial interests of union officials and union employees and their duty to the union and its members. Although the final rule expands reporting requirements for some high-level union employers, it generally restores the reporting requirements that were in place prior to a 2007 revision that required more extensive reporting (including by union stewards and union members who receive pay under no-docking agreements).

• The NLRB postponed the effective date for its final rule requiring employers to post notice of employees’ right to unionize. The rule had been set to take effect on November 14 but will now take effect January 31, 2012. The postponement came after a federal judge requested more time to consider arguments challenging the rule in litigation brought by the National Federation of Independent Business and the National Association of Manufacturers. The NLRB said that the delay was “to allow for enhanced education and outreach,” particularly to small and medium-sized businesses.

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6. CRIME & CORRUPTION

• Anthony Fazio Sr., Anthony Fazio Jr., and John Fazio Jr., current and former officers of a New York City local of the United Food and Commercial Workers (UFCW), were indicted and arrested on charges of racketeering, extortion, money laundering, and witness tampering, in violation of the Racketeer Influences and Corrupt Organizations Act and other federal laws. Anthony Fazio Sr. and Anthony Fazio Jr. have each served as president, and John Fazio as secretary-treasurer, of UFCW Local 348, which represents 12,000 New York City workers in various industries. The indictment alleges that between 1995 and 2011, utilizing the threat of labor disruptions, the Fazios collectively extorted funds from 12 different employers, including as much as $25,000 per year from at least one employer. The indictment also alleges that John Fazio embezzled and stole funds from the local’s health and benefits plan.

• The BlueGreen Alliance Inc., a coalition of labor unions and environmental groups; including the United Steelworkers and the Sierra Club, agreed to pay a $6,000 fine to the Federal Election Commission (FEC) for reporting violations that occurred last year. The Alliance neglected to report spending almost $95,000 for mailings shortly before the U.S. Senate primary in Arkansas in May 2010, advocating the defeat of Sen. Blanche Lincoln (D.) and the election of a challenger, Bill Halter. The Alliance, which reported its own violations to the FEC, should have reported those expenditures under FEC rules requiring disclosure of independent campaign expenditures by political action committees and other organizations and individuals.

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7. MISCELLANEOUS

• AFL-CIO President Richard Trumka announced organized labor’s enthusiastic support for the “Occupy Wall Street” movement and declared that it will provide logistical and legal support to the campaign. The grassroots movement first emerged in New York, before spreading to other cities, and protests issues of unemployment and economic justice. Speaking during the Chicago-Kent College of Law’s Labor Leader Lecture on October 6, Trumka acknowledged that the movement’s message is somewhat unfocused, but nonetheless identified three critical themes, which he said policymakers must address: repaying the taxpayer-funded bailout through corporate investments that create jobs and stimulate the economy; halting foreclosures and forgiving consumer debt; and ending the speculative Wall Street activity that punishes “Main Street” (e.g., through a financial transaction tax).

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8. UPCOMING EVENTS

• November 2-5, 2011
  Winston & Strawn to Speak and Sponsor ABA's 5th Annual Labor and Employment Law Conference
  Speaking Engagement

• November 9, 2011
  Winston Presents Employment Law Update 2011 in Chicago
  Speaking Engagement

• December 7, 2011
  Joan Fife to Speak at 23rd Annual All Hands Meeting
  Speaking Engagement

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9. RECENT PUBLICATIONS

• Supreme Court to Decide Several Cases Affecting Labor & Employment in 2011-2012 Term.
  Briefing

• Second Circuit Joins Five Other Circuits in Ruling Company Stock Investments in 401(k) Plans Are Presumptively Prudent.
  Briefing

• California Employment Law Legislative Update.
  Briefing

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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: