Based on the reading of Chapters 7, 8 and 9 and information in case studies 8-2 and 9-2 of the book The Labor Relations Process, 11 Ed. by Holley, Ross and Wolters, document how well the current labor relations system deals with the type of issues that are found in the workplace?

Case 8-2 The Outsourced work

Rocket Motor Corporation (RMC) entered into a project labor agreement with 17 local building trades’ unions concerning a building remodeling project at one of the company’s manufacturing plants. As part of the project labor agreement, the unions agreed not to engage in any strikes, slowdowns or other work stoppages and not to honor the picket lines established by any other labor organization at the job site. RMC agreed as part of the project labor agreement to hire contractors and subcon- tractors who would employ individuals to perform con- struction work from each specified type of trade, represented by the 17 unions with terms and conditions of employment equal to the terms specified in any applicable union contract covering the type of work to be performed. The project labor agreement called for final and binding arbitration to resolve any disputes arising from the interpretation or application of the terms of the project labor agreement.

Bolton Engineering (BE) was one contractor hired by Rocket Motor Corporation to help remodel the company’s paint facilities at the work site. As part of the contract entered into between RMC and BE, a pledge to adhere to the project labor agreement previously signed by RMC and the 17 unions was included. BE employed only a few supervisory employees of its own at the work site and relied upon unionized sub- contractors to complete most of the assigned job site tasks. However, a significant portion of the metal fabrication work was subcontracted to two nonunion subcontractors whose employees performed the work off-site. All of the metal fabricated parts built off-site were eventually to be installed on the job site by union labor.

Local 82 of the Steel Fabricators Union (SFU) learned that BE was using nonunion labor at off-site facilities to perform metal fabrication work that could have been performed on-site by union members represented by the SFU. The prevailing wage for a steel fabricator under current area labor agreements covering SFU members was $20.73 per hour, whereas the off- site nonunion workers were paid $14.00 per hour to perform the steel fabrication work. Local 82 leaders believed that BE was in violation of the project labor agreement by subcontracting steel fabrication work to nonunion subcontractors who were paying their employees substantially less than the prevailing wage rate called for under Local 82’s current contract. Failing to resolve the issue voluntarily with BE, Local 82, SFU filed a grievance, which eventually went to final and binding arbitration. The union sought damages from BE in the amount of $1.6 million, the amount of the difference between the wages paid nonunion employees who performed the steel fabrication work off-site and what Local 82 members would have received had the work been performed by them on the worksite.

Questions:

1. Is BE bound by the terms of the project labor agreement, which it did not directly sign, including the duty to submit this labor dispute to final and binding arbitration for resolution?

2. Was the project labor agreement meant to apply only to work performed on the job site as BE con- tends, or could the terms of the project labor agreement also be applied to off-site work as the Union contends?

3. Is it legitimate for a labor organization to negotiate a work preservation clause that seeks to encourage contractors to perform work on the job site using union labor by imposing an economic incentive not to outsource the work elsewhere to lower-paid employees? 4. What, if any, legitimate business interest of an employer is served by agreeing to a so-called work preservation agreement with one or more unions?

Case 9-2: Legitimate Picketing? Or Illegal Secondary Boycott?

The construction union had signed a “master agreement” with most of the contractors in the area. How- ever, a few contractors remained nonunion and offered significantly lower pay and benefits to their workers. The union decided to publicize these lower wages in order to put economic pressure on these contractors and to “shame” the companies into accepting the master agreement—or to at least offer similar pay and benefits. Thus, the union was engaged in a primary labor dispute with these nonunion subcontractors who refused to compensate workers according to area labor standards. The union decided to start with the House of Cards Construction (HCC).

To publicize the primary labor dispute with HCC, the union on eight occasions set up a banner and engaged in handbilling near the Caring Hearts Hospital, where the contractor was working as part of a building expansion. The union erected a banner that was 4 feet high and 16 feet long on a public sidewalk facing the street within 100 feet of the main hospital entrance. Twice the union also put a 15-foot high “inflatable rat” on a flatbed truck (with the name of the contractor across the rat’s stomach) and parked the truck next to the banner on a city street. The union was not the bargaining representative of any employees at the hospital. The banner read “Shame on House of Cards Construction” in large letters, with the words “Labor Dispute” in smaller letters on each side. At each display two or three union representatives held up the banner in a fixed position but did not move it during the display period. The union representatives also gave out handbills to anyone who approached them and asked about the demonstration. Union mem- bers also passed out leaflets with the heading, “HCC: Rat Employer” asking people to complain to hospital administrators about their use of nonunion construction labor. The handbill read, in part, “Shame on House of Cards Construction for Desecration of the American Way of Life” and included a drawing of a rat gnawing on an American flag. The handbill went on to state that the union had a dispute with HCC and other nonunion contractors based on their failure to respect area labor standards. The leaflet criticized the hospital for hiring HCC to perform a particular work project. Union members holding the banner and passing out the handbills did not chant, yell, or march back and forth. At no time was anyone prevented from entering the hospital.

House of Cards Construction filed an unfair labor practice charge with the NLRB alleging a violation of Section 8 (b)(4)(ii)(B) of the Labor Management Relations Act (LMRA). HCC argued that the union’s action of placing individuals at or near the entrances to the hospital was illegal picketing and thus should be barred. Showing the inflatable rat and displaying a ban- ner was the equivalent of picketing, and the display and holding of leaflets directed at pedestrians and motorists approaching the hospital was illegal picketing. Further,

the conduct was confrontational and constituted illegal secondary activity because the union was attempting to coercive the neutral hospital to not do business with a particular firm.

HCC further argued that the information on the banner and leaflets was “deceptive,” “dangerous,” and “disturbing,” It was deceptive in that the information did not state that the union had no dispute with the Caring Hearts Hospital. Rather it was intended to mis- lead the public into thinking that the union had a labor dispute with the hospital regarding its treatment of hospital employees. The initials “HCC” and “CHH” are similar and easily confused by the public. This deception could have a negative economic impact on the hospital and should be prohibited. It was dangerous because ill patients might think that hospital employees are striking, and these patients might suffer from stay- ing home and forgoing treatment. Finally, the inflatable rat would be “disturbing” to patients when they looked out their hospital windows. Courts have upheld limits on picketing near customer entrances, especially where quiet and tranquility are necessary, as at a courthouse or library; a hospital certainly falls into this category. See Carpenters & Joiners Union v. Ritters Cafe, 315 U.S. 722 (1942); Kulish v. Policemen’s Benevolent Associa-tion, 84 LRRM 2143 (1973); Cox v. Louisiana, 37 U.S. 536 (1965).

The union’s defense argued that Section 8 (b)(4) of the LMRA is not intended to prohibit the display of banners during a labor dispute. The union cited the U.S. Supreme Court’s decision in DeBartolo Corp. v. Florida Gulf Coast Bldg. Trades Council, 485 U.S. 568 (1988), which upheld the use of handbilling and instructed the NLRB to be careful in applying the stat- utory language of Section 8 (b)(4) so as not to unduly restrict the lawful exercise of free speech. The union argued that holding up a banner, giving out handbills, and even using an inflatable rat to publicize an ongoing labor dispute is not threatening. Nor are these activities as intrusive as actual picketing (with moving crowds of picketers carrying wooden signs). The union noted that it did not block any entrance and it knew of no patients who decided not to seek treatment as the result of its banner. The union clearly stated that its dispute was with HCC and it merely used creative means to publicize its dispute. Finally, with major construction activ- ity going on as a new wing is added to the hospital, all is not serene and quiet on hospital property. The union was not boisterous and did not add significantly to the noise of the construction.

Questions:

1.Which was the primary employer? The secondary employer?

2.The union distinguishes between displaying a stationary banner and picketing (where union members move about carrying wooden signs.) Analyze this argument.

3.What actions would you recommend the secondary employer involved in this case take to minimize any adverse consequences of the union’s handling of the union’s handbilling and banner activity?

4.Does the union’s handbilling, giant rat, and banner activity represent an unfair labor practice violation under the LMRA? Why or why not? If so, what would be an appropriate remedy?

Answer rating: 100% (QA)

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