Employee Free Choice Act: 2 Simple Rules

To help companies prepare for the Employee Free Choice Act I started doing a series of interviews with our former union organizer consultants. We’ll be posting some of these interviews over the next few months and they are wide-ranging discussions that offer a lot of insightful tips for managers and company leaders.

This week I did an interview with one of our newer former union folks from the grocery and retail industry. While she laid out a series of tips for managers on how they should respond to the proposed Employee Free Choice Act, we covered one of my favorites. Instead of worrying about what form the law will take, focus on what you can control: the employee relations environment you create.

As she laid out some of her tips on creating a great work environment I was reminded again about how you could boil down the best action plans into two simple rules:

1. Be Predictable: Communicate clearly and be consistent. Most employee relations problems come out of situations where an employee is surprised or feels “sneak-attacked” by their leader. This doesn’t mean that every situation must be lined out in a company policy manual (or a union contract). It also doesn’t meant that you have to ignore performance and treat everyone exactly the same (another union notion that has crushed many companies). However, you must deal with situations in a clear and predictable way to build trust and loyalty with your people.
2. Follow the Golden Rule: This one will sound trite, but it is a cliche because it is true. If you just treat people with respect and take some time to care for them as a fellow human being, it will do wonders for your work environment – not to mention your own work life.

As you think about your own Employee Free Choice Act action plan, remember to focus your energy on what you can control (your own work environment) and make sure you are teaching leaders to remember these 2 simple rules.

INK: July 9, 2009

Labor Relations INK

Download a PDF of this issue with links here.

In This Issue:

• Insight from Phil Wilson
• A Disturbance In The Force
• UAW vs. UAW
• A Peek Behind ObamaCare
• and more…

Labor Relations Insight from Phil Wilson

NLRB: Employee Free Choice Act Ace in the Hole?

Is the Employee Free Choice Act still alive? Al Franken is now officially seated and the 60-vote caucus needed to overcome a filibuster on the Free Choice Act is in place. But just when unions should be rejoicing in the streets, it’s getting fashionable to write Employee Free Choice Act obituaries, like the one this morning in the New York Times. I think companies should keep a very close eye on the NLRB, because the news of EFCA’s death is greatly exaggerated – but I’m getting ahead of myself. Read the rest of the article here

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EFCA Update

Even with healthcare and cap & trade legislation consuming a great deal of attention, there is plenty of action in the EFCA arena. The democrat/Big Labor camp is happy to have Franken declared the winner in the Minnesota senate race, providing the 60th vote required to break cloture. On the pro-business side, several democratic senators still have not confirmed wholehearted support for the current version of the bill, while the SEIU seems to be fighting against themselves in a recent California episode by ignoring employees wishes on the basis of signatures alone! The pro-business lobby is continuing to keep the battle in the public eye, most recently with a television campaign targeting Senator Nelson in Nebraska.

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Watch the video on YouTube at this link: http://www.youtube.com/v/FlPeYML-nEQ&hl=en&fs=1&

There is new ammunition on the intellectual front against the EFCA. An attorney who has negotiated over 100 first contracts made a great argument that it wasn’t possible to “fix” the mandatory arbitration provision of the bill to make it non-destructive to businesses. Recent data also demonstrate that non-right-to-work states are shedding jobs to right-to-work states. The Mackinac Center For Public Policy in Michigan put together this very graphic interactive dashboard of statistics comparisons of non-right-to-work states vs. right-to-work states and Michigan.

In another very interesting twist, the healthcare debate has suddenly become a possible sop to Big Labor. As Congress grapples with how to pay for a public insurance program, one of the proposals involves taxing the health benefits of companies that provide such benefits via private insurance. A exemption is being considered for unionized companies. Here’s the apparent trade-off: if unions can no longer use health benefits as a bargaining or organizing tool (due to government healthcare making it a non-issue), then the unions could still use the “tax-free benefits” loophole as the replacement bargaining chip.

It could be an interesting summer!

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FREE! EFCA Strategy Review & Vulnernability Audit

This has quickly become one of our most popular programs, in light of upcoming labor law changes. It is more important than ever to assess both the internal and external factors that contribute to your company’s vulnerability to union penetration, and formulate action plans to shore up any uncovered weaknesses.

• What are the most likely labor law changes, and how will they impact my vulnerabilities?

• What are the six strategies I can implement to strengthen my defense against union encroachment?

• When do I talk to my employees about unions? What do I say about unions?

CLICK HERE to schedule your free 30-minutes consultation with Phil Wilson, LRI’s President and General Counsel.

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A Disturbance In The Force

Andy Stern, head of the Service Employees International Union, has now been likened to “the Darth Vader of the labor movement,” as union presidents and representatives from across the country are taking UNITE-HERE’s side in the raging fight between the SEIU and the besieged union. Going against legal counsel, the AFL-CIO officially came out against SEIU’s “raiding of organized workers.” Over 15 international unions, including AFSCME and the Laborers, have committed both moral and monetary support to UNITE-HERE. As one former pro-Stern supporter put it, “the American labor movement declared war on Andy Stern.”

Labor insiders believe that the schism, and the attempts by the SEIU to dominate the American labor movement, have placed the nail in the coffin of the Change To Win labor federation. It is expected that many of the unions that originally broke away from the AFL-CIO to form Change To Win may return to the fold, without the SEIU.

Meanwhile, the battle between SEIU (including the newly-created Workers United) and UNITE-HERE continues at high tempo, with no sign of resolve.

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UAW vs. UAW

In an ironic twist, the UAW now finds itself in a position to negotiate against itself by virtue of the recent shuffling of ownership of Chrysler and GM. The UAW is both the employer and the employee of Chrysler and GM, and is both the competitor and the employee of Ford.

The recent deal between Chrysler and GM and the UAW include the agreement not to strike until 2015. Ford is now asking the same concession of the UAW. The UAW finds itself in a conflicted situation, and Ford, who effectively evaded government intervention (bailout money) finds itself in a possible competitive disadvantage.

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Only In A Union

The State of Michigan agreed with the United Auto Workers (which represents state employees in MI) for several furlough days in an effort to balance the budget. The Detroit Local of the UAW (Local 6000) filed a complaint to block the move, saying that the international overstepped its jurisdiction. Apparently, when the state attempted to bargain with the Local, the Local was not willing to grant any concessions. The state then sent a letter to the UAW international VP, who agreed to an amount of furloughed days. The local countered, saying the UAW international move was a violation of its constitution.

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AFL-CIO Extreme Make-Over

The International Association of Machinists and Aerospace Workers (IAM) organized a conference last month that included 23 labor leaders. The objective of the meeting was to consider changes to the AFL-CIO intended to revitalize the labor coalition. “We focused on systemic changes that would strengthen the labor federation’s finances and increase its clout,” said IAM president Tom Buffenbarger.

With the current head of the AFL-CIO, John Sweeney, set to retire in September, a more aggressive leadership coupled with an overhaul of agenda and operational functions could bring the labor organization back to the public square in a powerful way. If the rival Change To Win federation disbands, and an EFCA-type bill passes soon, we could have a legitimate 800-pound gorilla on our hands.

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Valiant Attempt

In a move to eradicate Depression Era-legislation enacted to bolster unions, Representative Connie Mack (R-FL) proposed a repeal of the Davis-Bacon Act, which would eliminate minimum compensation provisions for construction workers on public works projects. Proponents of the repeal believe that such a move would encourage more job growth for federal construction projects. “Instead of pandering to big labor,” Mack said, “Congress should be fostering a competitive environment for businesses to be able to hire more people for more jobs.”

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A Peek Behind ObamaCare

Peeling back the layers of the healthcare reform onion, you will find several key “partners” on the administration’s healthcare reform team: ACORN, the SEIU, AFSCME, and the AFL-CIO. Having given the American auto industry over to unions (the UAW) and the government, are we sure that doing the same with the 14% of the GDP known as the American healthcare system is an intelligent choice?

The healthcare industry had better pay close attention, as the “unintended” consequences of a government plan are being forshadowed in the auto, and to some extent the banking, industries.

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Typical Non-Representation

The AFSCME recently announced its endorsement of Albuquerque Mayor Martin Chavez for reelection. Not so fast, says the Albuquerque local! In typical fashion, the membership of the large union that represents city workers was never polled, or in any other fashion asked who they endorsed. The union made its decision based strictly on its own agenda, rather than the wishes of its constituency.

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Transform Your Workplace!

A step-by-step guide on how to dramatically improve employee engagement at your company. Includes checklists, action-planning guides and more.

• How to determine your company’s internal and external vulnerability – and why you have to deal with both kinds of vulnerability.

• Critical training for your first-line supervisors, and how you can turn them into a key to your employee engagement strategy.

CLICK HERE to find out more about The Next 52 Weeks: One Year To Transform Your Work Environment by Phillip B. Wilson

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Southern California In The Crosshairs

The Inland Empire consists of portions of Riverside and San Bernardino counties in southern California, home to almost 2,900 warehouses of at least 50,000 square feet each, which employ nearly 113,000 people. These warehouses, operated by some of the largest retailers in the world, handle much of the container cargo that moves through the ports of Los Angeles and Long Beach, the busiest trade gateway in the United States. And they are under siege.

The Change To Win federation, along with Warehouse Workers United, is squaring off with American businesses in a concerted effort to organize this compact region of workers. “There needs to be a general union movement. We expect to have a long-term campaign there,” said Tom Woodruff, organizing director of Change to Win.

“If we are concerned, we are concerned about efforts in Washington that would change the rules for union organization,” said Rob Green, vice president for government and political affairs at the National Retail Federation, speaking of the EFCA. Green suggests that if the organizing movement gains traction, many of the large retailers may move their warehouses to other parts of the country where costs would be lower.

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Steelworkers Get The Boot

A small sawmill in Larder Lake, Ontario, voted to decertify the United Steelworkers of America. The union had represented them since a 2006 vote, and the employees still had 3 months left on the one contract the union had negotiated, when 75% of them voted to decertify the union.

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SEIU vs. BOA

The campaign against Ken Lewis, CEO of Bank Of America, is one to keep an eye on. Will the embattled CEO cave to SEIU pressure to save his job?

The quandary stems from a) BOA acceptance of TARP funds, b) Big Labor deftly using the “economic crisis” and a friendly administration in Washington as leverage to pressure businesses, and c) Ken Lewis’ refusal to sit down with SEIU to pave the way for easier organizing of BOA employees.

**********

Labor Relations INK is published semi-monthly and
is edited by Labor Relations Institute, Inc. Feel
free to pass this newsletter on to anyone you
think might enjoy it. New subscribers can sign up
by visiting:

http://lrionline.com/free-stuff/newsletter-signup/

If you use content from this newsletter please
attribute it to Labor Relations Institute and
include our website address: www.LRIonline.com

Contributing editors for this issue: Phillip Wilson, Greg Kittinger

You are receiving this email because you
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NLRB: Employee Free Choice Act Ace in the Hole?

Is the Employee Free Choice Act still alive? Al Franken is now officially seated and the 60-vote caucus needed to overcome a filibuster on the Free Choice Act is in place. But just when unions should be rejoicing in the streets, it’s getting fashionable to write Employee Free Choice Act obituaries, like the one this morning in the New York Times. I think companies should keep a very close eye on the NLRB, because the news of EFCA’s death is greatly exaggerated – but I’m getting ahead of myself.

The “EFCA is dead” narrative goes like this. Unions have once again snatched defeat from the jaws of victory. Unable to overcome their petty internal squabbles, the labor movement is splitting at the seams. The major unions are split in half and talk of reuniting is evaporating in the summer heat. Unions are raiding each other like never before, including the very public divorce of United Healthcare Workers West from the SEIU, and the swan dive into an empty swimming pool jointly performed by UNITE-HERE’s dynamic duo Raynor and Wilhelm.

The narrative continues that Andy “Darth” Stern and his SEIU are most to blame for all this infighting. So-labeled from his “brothers” inside the labor movement, Leo Gerard of the Steelworkers said in the Times interview, “Every division in the labor movement seems to have Andy Stern’s fingerprints on it.” Especially as the SEIU start gobbling up big chunks of imploding unions like UNITE-HERE, there is a real fear that Andy Stern has decided to unilaterally implement his vision of the labor movement and the rest of the movement be damned.

All this dis-unity is being blamed for the problems with EFCA. Moderate Democrats are looking for the exits and it is clear that EFCA as it is currently proposed has nowhere near the 60 votes needed for passage. Instead Tom Harkin and Arlen Specter are negotiating a derivative version of the current bill, one that they hope will get the other votes they need. The most likely provisions of the “derivative” version of EFCA are the following:

1. Quick Elections (14-21 days) instead of card-check;
2. Interest arbitration (baseball arbitration) as a remedy for bad faith bargaining;
3. Union access to employees (getting a voter list earlier in the process, possible access to employer property); and
4. Increased penalties

So let’s assume for a minute that unions can’t get 60 senators to support EFCA or an acceptable derivative version. What then? Well, the most likely compromises do not require ANY action from the Senate, not when unions are about to be hand-delivered the NLRB.

Wilma Liebman has made no bones about her support for reforming the nation’s labor laws generally, and she welcomes the debate on the Employee Free Choice Act specifically. Once she has a Board majority she will have the full power to implement massive labor law reform without the need for a single Senate vote.

Consider, for example, the vote period. The current 42-day vote window that unions complain about so wildly is completely Board created. The statute says nothing other than the Board will conduct an election. It could just as easily be 7-days or 14-days or 21-days after the petition is filed. The time limit is just a target, but the Board does a great job of meeting the 42-day target today and there is no reason to believe that they couldn’t meet a quicker target. So if unions can’t get a compromise on card-check, no problem. Just get the Board to shrink the vote window down to 7 or 14 days, which is effectively the same thing.

Another modification to “card-check” is the “postcard-check” proposal floated by Diane Feinstein. It simply says that instead of secret ballot elections held at the employer’s premises, there will be mail ballot elections where employees mail their ballots to the NLRB. Again, mail ballots are allowed and used under the current statute and there is nothing in the law that prevents the Board from changing its current practice and requiring mail ballots for all elections. It doesn’t take too much imagination to look at these ballots as authorization cards and realize that organizers will just show up at people’s homes to “encourage” them to vote the right way – the same way they “encourage” employees to sign a union card today. Bam – you’ve got card check.

What about interest arbitration? This one is a little trickier, but I still believe an activist Board could easily take a crack at this as well. Under current law there is something called a Gissel bargaining order. That is a Board created (and Supreme Court approved) order for a company and union to bargain in good faith, even in cases where the union failed to be certified in an NLRB-supervised election. The basic premise is that the Board is given authority under Section 10(c) to “take such affirmative action … as will effectuate the policies of this Act.” The idea behind a Gissel order is that the employer can be required to bargain – even if a union technically isn’t certified and the majority representative – where the Board concludes that the employer’s actions make a fair election impossible. The Gissel order is a way to force the parties into a situation they would have been in had the employer been operating in good faith.

Why couldn’t an additional remedy for bad-faith bargaining include an order for the parties to submit their dispute to binding, baseball-style arbitration? There is nothing in the Act that prohibits this remedy. Employers would certainly argue that this is overstepping the bounds of the Act (the same as they would if an arbitration provision were included in the Free Choice Act), but if it is constitutional in the one case it is probably constitutional as a Board remedy. After all, the only thing the Free Choice Act does is amend the National Labor Relations Act – if the mandatory arbitration provision of EFCA is constitutional, then the remedy under the current statute almost certainly is constitutional too.

Union access? This is also well within the Board’s power today. Unionized companies are already forced to provide union access at reasonable times and places, so the statute clearly allows such a provision. Many companies in the retail, healthcare and gaming sectors already have organizers on their property during union campaigns. It is easy to envision the Board trying to create some structure around the way employee meetings are held during election campaigns, including perhaps the requirement for equal time and equal access.

And granting the access to employee homes using the “Excelsior” list is also Board created. While today the list is only handed over after the filing of a petition, there is nothing that prevents the Board from requiring the list to be handed over much sooner (perhaps at the 30% point of support, maybe even sooner than that).

Finally, the fines against the employers. There is nothing in the Act that prohibits the Board from issuing fines – the remedy power is vague and says the Board can “take such affirmative action” as will effectuate the purposes of the Act. Most people would be surprised to learn that the Board already has the ability to fine persons who “willfully resist, prevent, impede, or interfere with any member of the Board or any of its agents or agencies.” That certainly could be interpreted more broadly to include egregious unfair labor practice activity. The current fine is $5,000 (and imprisonment of up to one year) but it is not clear whether that could be interpreted as $5,000 per incident. Not quite as good as a $20,000 fine per incident, but it’s a start.

Understand that I’m not arguing that each of these expansions of Board power would fly through without incident (and I’m the first to admit that the idea of adding fines or imposing mandatory arbitration as remedies would face a tough legal challenge). But the fact remains that nearly everything unions hope to accomplish with the Employee Free Choice Act can be accomplished without one single change to the current statute.

Board imposed changes won’t be permanent (but then again, neither is a legislative change – after all EFCA is an attempt to re-write the current statute) but they can at least start the ball rolling. They also might make legislative change that much easier down the road. But in the end the Employee Free Choice Act – or at least its key provisions – appear far from dead. Not when you have the NLRB as your ace in the hole.

Employee Free Choice Act: The Teamsters Want You!

The Employee Free Choice Act may be stalled, but that’s not stopping the Teamsters. On Monday they posted an “all hands on deck” memo seeking 1,000 new organizers to help them deal with the “deluge” of organizing requests they expect after EFCA passes.

Now that Al Franken will be seated as the 60th Senator in the Democratic caucus next week, it is likely we will see a major push by labor’s supporters to pass some sort of EFCA-derivative legislation in the next several weeks. Senator Harkin has threatened to call for a vote on something (either the current version of EFCA or “the son of EFCA”) right after the 4th of July recess.

Many companies have been sitting on the fence, waiting to see what the actual law is going to provide. Others are preparing for the worst while hoping for the best. Either way, events are likely to happen rapidly over the next month. Don’t expect a long debate on this legislation… whatever debate is going to happen has been happening between Senator Harkin and Specter. When they put this thing up for a vote – whatever form it finally takes – it will happen quckly. So stay tuned.

INK: June 25, 2009

Labor Relations INK

Download a PDF of this issue with links here.

In This Issue:

• EFCA Update
• Union Intimidation Up Close & Personal
• RAISE, Not RESPECT
• PLUS June Scoreboard, Only In A Union, and more…

EFCA Update

A bit of detective work uncovered another fraud perpetrated by Big Labor in attempting to persuade members of Congress that a new coalition of businesses supported the Employee Free Choice Act. Even though their website gives no list of names, the group attempted to claim 1000 members. We checked our LRI Database and discovered that the chairman is CEO of a life insurance company whose members are represented by OPEIU Local 277. Of course he would want all his competition unionized! Rick Berman, of the Center for Union Facts, dug behind the scenes to uncover the hoax. “Business Leaders for a Fair Economy is a front group for a few financial companies who stand to profit from forced unionization,” said Rick Berman. “Although they claim to be a ‘coalition of 1,000 businesses,’ it publicly turns out to actually be a hodge-podge of fewer than 200 non-profits, union consultants, and businesses that don’t even exist.”

As it becomes clear that Big Labor is desperate to keep the forced arbitration provision in the bill to protect unions’ failing pensions, they are once again attempting to frame the debate by ignoring the fact that the system is not broken, and focusing the discussion on a “working arbitration system.” Read our refutation to such a system on our blog.

Another prominent Democrat, Florida State Senator Rick Dantzler, has come out against the EFCA, another state business group (225 small businesses in Colorado) have come out supporting the bill, and Senator Mark Pryor of Arkansas is dancing around attempting to find a way to support a “proposal both business and labor could support.”

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FREE! EFCA Strategy Review & Vulnernability Audit

This has quickly become one of our most popular programs, in light of upcoming labor law changes. It is more important than ever to assess both the internal and external factors that contribute to your company’s vulnerability to union penetration, and formulate action plans to shore up any uncovered weaknesses.

• What are the most likely labor law changes, and how will they impact my vulnerabilities?
• What are the six strategies I can implement to strengthen my defense against union encroachment?
• When do I talk to my employees about unions? What do I say about unions?

CLICK HERE to schedule your free 30-minutes consultation with Phil Wilson, LRI’s President and General Counsel.

**********

Has SEIU Overreached?

Both sides are claiming victory in the recent Fresno battle between the SEIU and the breakaway National Union of Healthcare Workers. In the election for home healthcare workers asked to select a union to represent them, SEIU ultimately took the vote tally by a slim margin while the NUHW is challenging the election, claiming that SEIU engaged in tactics both unethical and illegal. The cost to SEIU was 1000 field workers tied up on the ground, and an estimated $10 Million or more spent on the campaign, only to emerge with a shallow victory and a tarnished reputation.

For a look at the detailed parallel with the U.S. quagmire in Vietnam, read this article. SEIU is in for a long, hard season of bitter conflict, as it continues to tangle with NUHW and UNITE-HERE, while attempting to lobby for the Employee Free Choice Act.

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Only In A Union

Shawn Clark, who was business manager of Somerville, NJ-based Local 455 of the International Brotherhood of Carpenters and Joiners, claims that all $85,000 that he spent on entertainment, $65,000 of it in go-go bars, was legitimate business expense. Clark was expelled from the New Jersey Regional Council of Carpenters and fined $50,000, but still intends to plead not guilty to embezzlement charges.

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Union Intimidation Up Close & Personal

One of the Big Labor arguments attempting to frame the debate for the Employee Free Choice Act is an accusation that employers intimidate their employees during union organizing campaigns. Unfortunately for the unions, most evidence of intimidation points to unions and their members as the perpetrators of acts of violence and intimidation. This short collection of videos provides a glimpse into the reality of union intimidation, from the perspective of former union organizers who engaged in the practice, FBI bribery footage, and the experiences of employees selected as targets.

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Healthcare Tug-of-War

The nurses at Shasta Regional Medical Center in Redding, CA, recently came to the conclusion that they didn’t need a union, and decertified the United Public Employees of California, which had represented them for twelve years. “We said, ‘You know what? Why bother?’ ” said Sue Washburn, the SRMC nurse who led the decertification effort.

Across the country in Boston, the states largest hospital group signed an agreement with the SEIU that restricted management’s ability to communicate about unions to their employees, leading to a recent win for SEIU at Caritas Carney Hospital in Dorchester. Although some hospitals or hospital management groups are pressured into signing such agreements, other will choose to fight back, and may find themselves targets of SEIU corporate campaigns. According to union officials, there are organizing campaigns targeting every hospital in Boston.

One labor consultant , Jeff Toner of Kennebunk, ME, describes such campaigns: “Corporate campaigns can target executive compensation, they can picket the homes of board members,” Toner said. “They make it as uncomfortable as possible for executives, and they cast aspersion on a hospital’s standard of care to the patient community.”

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Political Activism The New SEIU Export

The Service Employees International Union has announced it is establishing a huge member activist campaign across Canada. According to the union, members will use the political action program to mount campaigns and speak with politicians, to insure that SEIU-identified issues will remain on the agendas of politicians “at election time and every day in between.”

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SCORE BOARD

Who are the winners (and losers) of the labor movement? Don’t guess, just check the LRI Scoreboard

View this month’s scoreboard (archives also located here).

Download a PDF of this month’s scoreboard.

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Employee Relations Tip Of The Month

Recognize those who volunteer in their community with a community service award.

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RAISE, Not RESPECT

Two laws intended to amend the National Labor Relations Act are headed to Congress.

The Rewarding Achievement and Incentivizing Successful Employees Act (RAISE) would permit employers to pay unionized employers incentive wages outside the normal limits imposed by collective bargaining, giving management a way of rewarding those workers who show themselves to be more productive. This is good.

The Re-Empowerment of Skilled and Professional Employees and Construction Tradeworkers Act (RESPECT) would reclassify management supervisors to make it impossible for them to legally engage in the kind of shop-floor activities that are a normal and essential aspect of their jobs, forcing companies to have to hire more workers to compensate, and depriving those companies of the expertise of their seasoned veterans. This is bad.

Lobby while you can!

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Raynor Accused of “Creative” Financing

According to UNITE-HERE sources, Bruce Raynor, the ousted co-president of the union, illegally transferred over $12 million dollars out of the union’s coffers and into the tills of union locals loyal to him, and to a consulting group with SEIU ties. Allegedly, those funds were then used to finance the succession of most of those locals from UNITE-HERE into a new union, which then affiliated itself with the SEIU.

John Wilhelm, the UNITE-HERE leader, has accused Raynor and Stern of orchestrating the split in order for SEIU to be able to encroach upon UNITE-HERE’s prime organizing turf, gaming and hotel industries.

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Bargaining Chip?

Senator Jim DeMint (R-SC) and Representative Steve King (R-IA) have introduced the Truth in Employment Act of 2009 in both houses of Congress. The bill seeks to protect employers from union “salts,” people who secure jobs for the express purpose of fomenting unrest in the company leading to union organizing efforts.

Salting is an age-old union tactic, and similar legislation has been presented several times during the recent decade, to no avail. One might wonder if it will be used as a bargaining chip in the EFCA-derivative debate.

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Your Union Dollars At Work

In Atlantic City, you can get a good glimpse of union dues hard at work. While the UAW is negotiating contracts for employees at Bally’s and Caesars, they are engaged in a “multi-million” advertising campaign trying to pressure the casinos.

Tired of taking it on the chin in the public arena, Harrah’s Entertainment has struck back with a radio spot of their own. “We have had more than 50 bargaining sessions with the UAW. … We’d like to agree on a contract that is reasonable, economically feasible and one that allows us to remain competitive in these difficult times.” Harrah’s says more ads are coming, although their spending won’t quite reach the level of the UAW media campaign.

With the union pouring millions into media, and the casinos having to fight back to protect their reputation, it’s a good time to be in the advertising business in Atlantic City. Casino employees, however, are seeing their pay raises frittered away. Good thing they voted in a union.

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Bank Of America’s Turn In Crosshairs

I’m sure Bank of America must be reeling. First, they loan $80 million to the SEIU for the construction of a new headquarters building. In return, Stern and company viciously attack the bank, staging protests outside Bank of America offices, called for the resignation of bank CEO Ken Lewis, and demanding improvements in wages, bargaining rights, and health care benefits for Bank of America workers through public campaigns and in testimony before Congress. Then, another union that is in the middle of a ferocious battle with the SEIU, files charges with the National Labor Relations Board against the SEIU and the bank, charging that the loans are illegal.

SEIU officials claim the charges are baseless, while Bank of American claims they are “being inserted into the middle of a dispute between two unions.”

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Branson Highlights Tough Reality

Said Richard Branson, head of Virgin Atlantic, about his company’s relationship with Boeing, “If people in Seattle build our planes and deliver them on time and, to be frank, don’t go on strike, then we’ll continue to work with Boeing. If we have our airline completely messed up, with tremendous damage done to our own work force, then we’ll go to Embraer or Airbus.”

The machinists union better pay attention. Their recent strike began the rumblings of the possible gutting of the aerospace industry in the northwest, and by year’s end we may see the fallout. Boeing has already indicated that without proper concessions from the machinists, they will establish a new 787 assembly line elsewhere.

Other industries would do well to take notice. The government does not have the wherewithal to add Boeing to the “General Motors”-style bailout program.

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UAW Attempts to Shaft Wisconsin Children

While business executives are being excoriated in the media for using private jets, the UAW is attempting to keep afloat a posh UAW-owned golf resort that has lost $25 million over the last 5 years. The union is trying to secure $3 million in tax relief from township officials, seeking to rob the school districts of much-needed funding to keep alive the elegant union leadership getaway.

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Labor Relations INK is published semi-monthly and
is edited by Labor Relations Institute, Inc. Feel
free to pass this newsletter on to anyone you
think might enjoy it. New subscribers can sign up
by visiting:

http://lrionline.com/free-stuff/newsletter-signup/

If you use content from this newsletter please
attribute it to Labor Relations Institute and
include our website address: www.LRIonline.com

Contributing editors for this issue: Phillip Wilson, Greg Kittinger

You are receiving this email because you
subscribed to receive our labor relations
newsletters and updates. You can manage your email
preferences by clicking the link at the bottom of
any of our email communications.

NOTE: if you are using Internet Explorer v. 6, read the text version,
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Employee Free Choice Act: Is Interest Arbitration a Good Thing?

The Employee Free Choice Act’s mandatory arbitration provision has received way too little attention in the arguments over EFCA. This week Thomas Kochan posted a spirited defense of interest arbitration on the Center for “American Progress” blog in his attempt to add some context. While I disagree with much of what he says, it certainly gets the discussion focused on the “how would this whole arbitration thing work” question. He identifies 6 points of a solid arbitration system, and recommends that they be used as the framework for interest arbitration under the Free Choice Act (which is a backhanded way of pointing out one of the many glaring weaknesses of EFCA: that it provides exactly no guidance on how this arbitration system might work… but I digress).

Kochan’s main argument is that the experience of using arbitration in the public sector and in Canada proves that it will work here. I have a few thoughts. First, the public sector experience is not equivalent, because you are not really dealing with a competitive market (this is also why union density is so much higher in the public sector). Further, it is not true to say that these public sector arbitration agreements do not result in unsustainable contracts. Many communities now outsource what used to be “public sector” jobs because of these increased costs.

Also, the idea that these arbitrators will only be able to deal with “mandatory” subjects and not management rights is ridiculous – wages, hours and working conditions deals in almost every way with the way the company chooses to run its business. Every word of a contract is an a restriction on these rights – and putting that decision in the hands of government appointed arbitrators (even if it is 1 neutral and 2 non-neutrals) is dangerous. Kochan says he is not aware of an example where interest arbitration has increased costs. Just look at the recent Wal-Mart case in Canada – the arbitrator imposed a huge 30% wage increase and wiped out that Tire and Lube unit based on costs.

And his last point is the most telling – the imposed agreements will mirror other agreements. That is exactly what unions want. In the short run this arrangement “levels the playing field” so all companies have a similar “industry” agreement (just like the UAW had with the auto companies). In the long run it is disastrous, and is the reason heavily unionized sectors of our economy are going bye-bye. Companies must have the ability to negotiate an agreement that best fits their business, and union members should have the opportunity to either accept or reject those terms. Putting the negotiations into the hands of arbitrators (whether qualified or not, they still don’t have “skin in the game”) is dangerous.

Kochan argues the “urgent need” for some type of arbitration framework based on the fact that first contracts are only achieved in 55% of cases. But does this statistic mean that there is a compelling need for mandatory arbitration? Lots of negotiations fail for all kinds of reasons.  Negotiations between companies and vendors fail. Negotiations between tenants and landlords fail. Negotiations between prospective car buyers and car dealers fail. Negotiations between spouses fail. Does this mean that the government should be called in to settle these negotiations without the agreement of both parties? I don’t think so.

Labor negotiations fail for a lot of reasons, and infrequently does it have anything to do with employer misconduct. Often these negotiations fail because of the union. Unions often promise employees the moon to get them to join, and when those promises don’t come true employees get upset. This forces the union to attempt to get what it promised, no matter how outrageous. The employer rejects these proposals and the union is put in a bad spot. Sometimes they convince employees that they need to be patient and wait for a future contract. Sometimes they just quit. But just because no contract is entered does not mean that the process doesn’t work.

Where bargaining fails due to employer misconduct there should be a penalty. But in cases where the parties bargain in good faith and fail to reach an agreement the government should not step in and force a contract on the parties.

INK: June 11, 2009

Labor Relations INK

Download a PDF of this issue with links here.

In This Issue:

• Insight from Phil Wilson
• EFCA Update
• Internicine Battle Rages On
• Organizing Campaign Moves To Public Square
• and more…

Labor Relations Insight from Phil Wilson

Baby Boomers the Secret Key to Engagement?

A recent study by Boston College’s Sloan Center on Aging & Work, researchers found that employee engagement among younger workers has dropped significantly during this recent economic downturn. That’s not really surprising – as I discuss in my book The Next 52 Weeks, job security is one of the keys to job satisfaction.

What is surprising is that the engagement of older workers has hardly budged during this economic downturn. Read the rest of the article here…

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EFCA Update

Big Labor ratcheted up their pressure tactics, finding a creative point of leverage to intimidate fund managers on Wall Street from speaking out against the Employee Free Choice Act. In a questionnaire, managers were asked such questions as, “Has your company made any public statements in support or opposition to EFCA?” The implied threat is that unions will move their pension monies out of these fund managers’ hands, which is basically an illegal act of coercion. Read a letter sent by one Teamsters local to their fund managers.

We’ve already written about the stacking of the National Labor Relations Board with pro-labor appointments. Meet Craig Becker in this 6 minute video to get a sense for the radical pro-union flavor these appointments will bring to the board.

Some are wondering if the 3-way conflagration between the SEIU, UNITE-HERE, and the fledgling breakaway union Workers United will hamper the efforts of Big Labor to push the EFCA forward. Not likely, but it does make for high entertainment value (see story below)!

Investors Business Daily, meanwhile, points us to a fascinating National Bureau of Economic Research study that concludes that companies typically lose 10% of their stock value after being unionized. The study found the average loss per company was $40,500 in 1998 dollars for each worker eligible to vote.

Another group of business leaders, this time an Hispanic organization in Colorado, has weighed in to lobby their senator to oppose the bill, and another Wall Street Journal editorial points to additional problems caused by binding arbitration provisions in the EFCA: union leaders will be harder to hold accountable, and it will be even harder than it is now to get rid of a union once it is in place

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FREE! EFCA Strategy Review & Vulnernability Audit

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• When do I talk to my employees about unions? What do I say about unions?

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Internecine Battle Rages On

You will not find better soap opera on TV. As UNITE HERE begins to crumble with the recent leadership split, one former co-leader (Bruce Raynor) charges the other with tactics “more reminiscent of the Sopranos than anything I’ve ever seen in my trade union career,” then resigns, while the other side charges Raynor with using internal resources to organize a breakaway faction intending to join the Service Employees International Union, and claims to have been planning to boot him anyway. Meanwhile, it appears John Wilhelm (the surviving head of UNITE-HERE) is attempting to use the affair to combat his arch enemy, Andy Stern and the SEIU, by planting stories in the media accusing Stern of directing the entire affair as a way to sabotage Wilhelm’s union.

As the drama unfolds, Raynor and his new Workers United union are pleading to SEIU for financial assistance, claiming they are running a deficit of $300,000 a month. Raynor is also besmirching the reputation of Amalgamated Bank, whose holding company is his former union, claiming that UNITE-HERE is in “total chaos.”

SEIU continues with its own troubles. As its largest local seceded to become a separate union (the NUHW), other SEIU officials have either been indicted for fraudulent activity (we’ve covered in detail over the past year), or have resigned in disgust at SEIU practices.

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Follow The Money, Or Lack Thereof!

We’ve  reported before some of the troubles that union pension plans are having, and why this is one of the driving factors in the desperate push for the EFCA by Big Labor. Some have done the math, and calculated that the enactment of some EFCA-type bill would put upwards of $637,500,000 per year into union coffers, equating to over $35 billion in the next 10 years for Big Labor to meddle in politics and the continued degradation of Americas businesses. Additionally, the poor state of union pension funds could be turned around as fresh dues payers/pensioners pay in for the benefits of already retired workers.

Pension funds are a big issue. A recent report indicated almost half of the nation’s 20 largest unions have pension funds that federal law classifies as “endangered” or in “critical” condition due to being underfunded. In a vile travesty of moral failure, union officer pension funds remain in top shape despite this erosion of employee funds. One researcher, Diana Furchtgott-Roth, lamented, “Unions attract members by telling them they will look after them and that these plans are fully funded but they are not. Yet they are fully funding their own officer pensions. What we have are new members joining up so they can guarantee that the officers will have a secure retirement. In some cases they are giving up existing 401k pensions that do better than these underfund Ponzi schemes. The membership dues are not being used to build up assets they are being used to fund the officer’s retirements and to cover current retirees.”

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Only In A Union

Shortly after members of IBEW Local 459 went on strike near Reading, Pennsylvania, specialized electrical equipment belonging to the Pennsylvania Electric Company was vandalized, creating a minor emergency and initiating the response of crisis repair crews. The company was forced to increase security measures, and contacted the Federal Bureau of Investigation and Homeland Security to apprise them of the situation.

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Pro-Company Workers Take Action

A chain of grocery stores in Arizona has been fighting a long-running battle with the United Food & Commercial Workers, including the filing of a defamation lawsuit, and defending Unfair Labor Practice charges before the National Labor Relations Board. In a recent development, fed-up Bashas employees joined the fray and began a series of protests outside the UFCW Local 99’s Phoenix offices.

The group hopes other employees will join in the grassroots effort to protect their company against deceitful UFCW organizing and corporate campaign tactics.

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Internal Finger Pointing, Ad Naseum

Tom Buffenbarger, president of the International Association of Machinists and Aerospace Workers and a member of the AFL-CIO’s finance committee, stated that the AFL-CIO has used “creative accounting” to mask its dismal financial position.

The largest U.S. labor organization in the country has seen its assets decline to a negative $2.3 million as of June 30, 2008, from a $66 million surplus on July 1, 2000. “If we are not careful, insolvency may be right around the corner,” Buffenbarger’s report said.

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Organizing Campaign Moves to the Public Square

Typical scenario:

• Union wants national company to allow the organization of its employees via card check rather than secret ballot.
• Company says no.
• Labor federation begins corporate campaign against company to bring public pressure to bear.

Recently, Change To Win played this well-worn card in a 9-city “protest” against CVS Pharmacy, claiming that the company was selling products past their expiration dates. CVS is a constant target of both the SEIU and UFCW, both members of Change To Win. Change To Win denies the allegation, but an employment lawyer familiar with corporate campaigns said, “I’d be amazed if this is purely a coincidence.”

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SEIU vs. NUHW

As SEIU continues to battle the newly formed National Union of Healthcare Workers, companies currently represented by SEIU are being dragged into the fray. In the latest episode, employees of a Kaiser Permanente facility in Stockton, CA, picketed on behalf of the NUHW. Kaiser claimed neutrality, but protesters disputed the claim. “We strongly disagree that Kaiser is neutral in this. We are forced to pay dues – $72.90 a month – to SEIU, a union that is not working in the best interest of the worker. We’re here to make sure everybody knows about it,” said one protester, Robert Nevarez. Protesters want the opportunity to oust SEIU in favor of NUHW, but is claiming Kaiser is working to prevent the action because SEIU won’t push for raising wages.

Across the state in Fresno, the SEIU is working to quash a move by Fresno home health care workers to elect out of SEIU and into NUHW. At a rally held on Sunday May 31, SEIU-UHW Trustee Dave Regan told SEIU staff to “administer an old-school ass-whipping” to NUHW supporters. “In other words, what we gotta do here, my old-school friends, is we have to administer an old-school ass-whipping over the next two weeks,” he said. “I know everybody knows what that means. We gotta give a butt-whipping they will never forget,” he added. “We gotta put them in the ground and bury them.” Watch the video here.

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Transform Your Workplace!

A step-by-step guide on how to dramatically improve employee engagement at your company. Includes checklists, action-planning guides and more.

• How to determine your company’s internal and external vulnerability – and why you have to deal with both kinds of vulnerability.

• Critical training for your first-line supervisors, and how you can turn them into a key to your employee engagement strategy.

CLICK HERE to find out more about The Next 52 Weeks: One Year To Transform Your Work Environment by Phillip B. Wilson

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UAW Tanks General Motors

If you’re still wondering exactly how much GM’s high labor costs played into its demise as a viable auto manufacturer, read this quick report. Robert Dewar, author of a recent book about the auto industry debacle, in a recent visit to China shared compelling data to back his claim.

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Danger In The Shadows

In another example of the many back-channel means that Big Labor supporters are looking to reward their union funding sources, New York state legislators recently tried to slide two new labor-friendly bills quietly past the public. One bill would force employers to pay up to 50% of a union’s lost dues if “extreme provocation” led to a strike, and the second makes it easier for unions to block public employers from imposing new rules. The legislation would lead to illegal strikes by public employees.

The Mayor of New York City got wind of the ruse. “Rather than rewarding illegal behavior, our Legislature should make sure that these potentially life-threatening events never happen again,” a spokesman for the mayor’s legislative office said.

On the opposite side of the country, Oregon is attempting to become the first state to pass an employer gag law that would severely restrict what employers could say to their employees during union organizing campaigns. Washington state just defeated such an attempt, and despite the bills dubious legality, Oregon legislators seem bent on pressing the matter home.

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Win for Right-To-Work

A field-tech with Verizon, located in Tampa, FL, was part of a team assembled to work in California, but was sent home by the CWA because she was not a member of the IBEW in her home state, a right-to-work state. When she applied for a similar second work team headed to that state, she was again denied. The National Right to Work Foundation assisted the employee in a filing a suit against the company and both unions for discrimination based on union membership, in which she won compensation for lost time, and an agreement that the unions will post notices that such discrimination is illegal.

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Baby Boomers the Secret Key to Engagement?

A recent study by Boston College’s Sloan Center on Aging & Work, researchers found that employee engagement among younger workers has dropped significantly during this recent economic downturn. That’s not really surprising – as I discuss in my book The Next 52 Weeks, job security is one of the keys to job satisfaction.

What is surprising is that the engagement of older workers has hardly budged during this economic downturn. The research team suggests that the reason for this difference probably lies in the greater experience of Baby Boomers – they have been through many downturns and know that there is light at the end of the tunnel. Due to their seniority and experience, it is probably also true that they are the least likely to lose their jobs in a layoff.

Younger workers – especially those Generation Y employees who have recently entered the job market (and in many companies are more likely to be laid off I might add) don’t have the same experience. These younger workers are more disengaged. Generation X workers fall somewhere in the middle (perhaps because they were working during the “Internet Bubble” and have at least that experience under their belts). You can view the whole study here.

This research has some interesting implications for people planning their employee engagement and Employee Free Choice Act communications. First, it makes sense to think about how to communicate to each of these three “cohort” groups or segments. It is really important to think about your messaging based on your audience. The message – and even the communication channel – may change based on the group you are trying to reach.

Younger workers are more likely to pay attention to things like websites, text messages and social networking platforms (like blogs, twitter feeds, facebook pages, etc.). Video content for Generation Y (and probably Generation X as well) should be bite-sized (think YouTube video clips). They are probably most interested in whether or not they are going to have a job. They may be motivated by the idea that this is an opportunity for them to pick up new skills.

Baby Boomers are more likely to digest information using more traditional channels (paper newsletters, meetings, longer form videos). They will be most concerned about how the downturn is going to impact their retirement nest egg. Many have lengthened their horizon for work and are hoping to ride the market up for a while before they leave. In addition to layoffs, these delayed retirements can also be a demotivator to Generation X employees who saw a potential promotion in their immediate future. This is another issue that must me managed.

One can read too much into “age-cohort” research, but it is powerful. If you have any interest in this subject I recommend taking a look at a book called Generations: The History of America’s Future, 1584 to 2069 (you can view it on Amazon here). This book is an exhaustive study (and I mean exhaustive – I’ll admit I skimmed a lot of the dense descriptions of each generation) of how the “frame” of your age cohorts has a major impact on world events. They go so far as to say that this historical understanding can also predict major events that will happen in future generations. It is a fascinating idea.

Whatever your belief about the predictive power of age-cohorts, there is no doubt that your “frame of reference” (I call this the prism which focuses – and distorts – how you view things happening around you) will dramatically impact how you feel about an event. Whether that frame is based on age, or based on other factors, it plays an important role in your response.

Today we recommend that our survey clients (you can get my free 54-page employee satisfaction survey guide here) segment their data based on the responses received and then divide work groups by levels of engagement. It is very important to action plan and communicate based on these frames. For example, people who are loyal and engaged in the organization are typically concerned about very different issues than employees who are “checked out” and disengaged.

Often the best strategy is to focus efforts on the groups who are neither engaged or disengaged if you want to really move the needle on employee engagement overall. As you plan your engagement strategy – and especially as you map out your Employee Free Choice Act communications – keep these frames in mind.

You should think about how you might alter your basic message and your delivery platform based on the relative engagement of these different groups. In addition, remember that union organizers will focus on your most disengaged groups. While the high-leverage employee engagement strategy is to focus on those who are “on the fence,” you should also think about how organizers might go after the least engaged of your workers. As I always say the very best “union avoidance” strategy is not really a union avoidance strategy at all – just create a great place to work and unions (not to mention your competitors) won’t have a chance.

IBD: Employee Free Choice Act Alive and Well

The Employee Free Choice Act is still alive and well according to an editorial in today’s Investor’s Business Daily. Here’s the key point they make about the “morphing” card-check bill:

But it hasn’t stopped Big Labor. Card check remains its top goal, and instead of dropping a bad idea, it’s switching tactics.

Card-check supporters have begun a new lobbying effort that targets a few wavering senators including Democrats Dianne Feinstein, Arlen Specter and Mark Pryor. The idea is to put the squeeze on Congress instead of taking the case to voters.

It may be one reason why card check has morphed into new incarnations, the latest a “compromise” bill from Feinstein. She has proposed a mail-in card-check format, which still amounts to a denial of secret ballot. Curiously, Feinstein backed away from her own compromise Thursday, raising questions as to whether she was being manipulated and wanted out.

While the exact provisions of the derivative bill are still squishy (God forbid it includes mail ballot elections – the last one we were involved in had about a 20% participation rate…) there is little doubt that something is coming this summer.

Employers Support Employee Free Choice Act?

Today the AFL-CIO announced its latest PR blitz in favor of the so-called Employee Free Choice Act. They claim that over 1,000 employers support the Employee Free Choice Act and have launched a website to state the case called Fair Economy Now. I know you’ll find it shocking, but the Chairman of this front group is CEO of American Income Life Insurance Company whose employees – according to a quick LRI Online search – turns out are represented by OPEIU Local 277. It’s easy to see why once you’re stuck with a union why you’d want to make sure everyone else was too – but I wonder how many non-union employers are on the list of 1,000 Employee Free Choice Act Supporters? I’m guessing not many.