INK February 16, 2012

In this issue:

– Union Bailout Update – Can You Guess What’s Next From the NLRB? – Panic in Indiana – NYC Maids Soon On Par With Cops  – Hippie Spring – SEIU Watch, Sticky Fingers and more…   Union Bailout Update A motion to dismiss an NLRB injunction was filed in federal court two weeks ago that could prove to be the first real test of the constitutionality of President Obama’s “recess without a recess” appointments to the NLRB. The new five-member Board requested its first 10(j) injunction on Jan. 25 against Renaissance Equity, the owner of a Brooklyn apartment complex.   Renaissance locked out its unionized employees 15 months ago after SEIU 32BJ rejected the company’s request for drastic wage and benefit cuts.  The Board’s injunction would force Renaissance to bring back locked out employees at 2010 pay and benefit levels. The company’s motion to dismiss that injunction argues that the Board “lacks the statutorily required quorum of three members necessary to authorize the filing of the petition” as the Senate was not technically in recess when the president appointed Sharon Block, Richard Griffin and Terence Flynn on Jan. 3. Meanwhile, on Capitol Hill, in an exercise Democrats called “a waste of time” and Republicans called “instructive,” the House Education and Workforce Committee held but another hearing on the labor board, this time to examine how the legal uncertainty surrounding the “recess” appointments impacts the American economy. Former Democratic board member Dennis Devaney testified that the Board will “again be faced with redoing or revisiting decisions. Such a development will once again undercut confidence in the fairness and due process of Board decision-making.” In June of 2010, the Supreme Court invalidated over 400 decisions made by a two-member Board in 2008 and 2009. But there is a major difference between the current Board and the Liebman-Schaumber Board of 2008-09. At that time the party lines were evenly split. Additionally members Liebman and Schaumber enjoyed a pretty collegial working relationship (although if your comparison point is the current Board, that’s not saying much). Thus the decisions made in 2008-09 were relatively non-controversial. The current Board is not constrained by either party lines or collegiality. One expects their decisions, like the ones in 2011, to continue to push the envelope as Chairman Pearce keeps his “eyes on the prize” for Big Labor. And that means even bigger headaches for employers. Stefan Marculewicz, a former regional Board attorney, testified that, “NLRB doctrine becomes part of the fabric of labor relations in our economy quickly as employers seek to comply with the law.”   He added, “if such doctrine is annulled in its entirety, as is possible here, its effects will be difficult and costly to remove.” Marculewicz expressed greatest concern for small businesses that will automatically adopt potentially invalid Board rulings because they do not have the resources to challenge them. In another exercise of Congressional tilting at windmills, Rep. Sandy Adams (R-FL) has introduced the Keeping Employees’ Emails and Phones (KEEP) Secure Act (H.R. 3991) that would add the following provision to the end of Section 9(c) of the NLRA: “In no circumstances shall the Board require an employer to provide to the Board or to a labor organization the telephone number or email address of any employee.’’  The much broader Workforce Democracy and Fairness Act (H.R. 3094), stalled and presumed dead in the Democrat controlled Senate, would allow employees to decide in writing which one form of personal contact information would be provided by the employer to a petitioning union. And finally, in what seemed a calculated thumb in the eye to the business community, the White House made two announcements on Monday; the nomination of Flynn, Griffin and Block to full appointments to the Board that would extend their terms to the end of 2016; and a planned campaign stop by the President at the now infamous Boeing Dreamliner plant in Everett, Washington this Friday.  The IAM local that represents Everett plant employees sought the Board charges that suspended production at a new second Dreamliner facility in South Carolina for most of last year. Those two stinging announcements from the White House came just days after the President released his $3.8 trillion budget proposal (that even most fellow Democrats can’t find the guts to support) which is chock full of union giveaways and was delivered last week with a heaping helping of class-conscious union-speak by President Obama.  Ironically, Obama plans to speak at the Everett plant on the importance of manufacturing jobs (except in Right to Work states) and increasing “American exports”.  (Presumably not the export of American jobs to escape an Administration hell-bent on resurrecting the Labor Movement through regulatory fiat.) ********** Can You Guess What’s Next From the NLRB?  The last Board decision of 2011 was on the surface unremarkable and easily overlooked in the outrage over Obama’s Board appointments on Jan. 3.  However according to Lexology, there are powerful clues buried in 2 Sisters Food Group on what to expect from the NLRB in the coming year.  (Spoiler alert: things can get much scarier than just elections in ten days.) The 2 Sisters decision itself was a no-brainer – the company was found to have illegally terminated a leader of the unionization effort.  A finding of illegal termination is generally enough alone to overturn a close election.  However the bulk of what Members Becker and Pearce wrote on 2 Sisters considered issues that had no bearing on their decision to overturn.  And according to Lexology, both the inclusion of these extraneous issues in the UFCW’s complaint and the Board’s unwarranted attention to them serve as ominous signs for 2012. Becker (in what would be his parting shot as a Board member) first cited what he found problematic with the company’s out-dated employee handbook, specifically a rule that would discipline an employee for the “inability or unwillingness to work harmoniously with other employees.”  This was found by Becker to be an unfair labor practice because “it was sufficiently imprecise that it could encompass any disagreement or conflict among employees, including those related to discussions and interactions protected by Section 7, and that employees could reasonably construe the rule to prohibit such activity.”  Yes, you read that right, it would now appear against the law to require an employee get along well with others unless an employer is painfully specific about when and under what circumstances a cooperative attitude is required.  Becker’s opinion also reasserts the threat that, under a wildly union-biased Board, an innocuous common phrase in an obsolete company handbook could be subverted by a union into a ULP of convenience. But it gets much worse.  The UFCW also objected in its complaint to the employer holding mandatory captive audience meetings and boldly requested the law be immediately changed before a second election.  While the Board did not give in to that request (yet) Member Becker seized the opportunity to write three pages on the subject, again with no bearing on the Board’s decision in the case. Becker wrote this of the 59-year-old rule that has stood unchallenged through six previous Democrat administrations:

Board-supervised elections have been called the ‘crown jewel of the Board’s accomplishments’ under the Act . . .By continuing to permit employers to require that employees attend campaign meetings as a condition of continued employment, the Board does not simply tarnish that jewel, it fractures it.  I would not continue down this long but fundamentally misguided path.

The union also asked that a new election be held off company property, a request the Board also denied, but only after reasserting for five pages the Regional Director’s power to make that decision without ever mentioning the common sense long-standing rationale behind worksite elections:

While the existing empirical work on this subject is not definitive, it is persuasive and creates concern that holding representation elections on premises controlled by one party without the consent of all other parties is inconsistent with the Board’s obligation to insure that no party gains last minute advantage over the other.

********** Panic in Indiana Oh to be a fly on the wall in an Indiana union hall! Fox News is reporting that Indiana union locals are in a mad scramble to persuade as many members as possible to willingly pay for union representation after Right to Work legislation kicks in and grants workers the power and the freedom to withhold their union dues. “We’re gonna push them pretty hard and let them know this is what our services provide,” said Brett Voorhies, legislative director for the United Steelworkers District 7, which has 35,000 active members in steel mills along the Lake Michigan shore.  It’s interesting that USW members need a “pretty hard” reminder of the value of their USW representation, especially after the avalanche of union propaganda triggered by the introduction of RtW legislation in the state over a year ago.  Then again, just last year alone USW members in Indiana brought Board charges against their locals for poor representation an astonishing 24 times.  It should thus come as no surprise that the president of USW Local 1999 told Fox she expects her local to lose “30 to 50 percent” of its dues paying members as the new law creeps into effect. According to a message from the president of SEIU Local 73, the state’s new Right to Work law only applies to collective bargaining agreements signed after March 14, 2012. So until their current CBAs expire, unionized Hoosiers are still out of luck.  In the same letter local president Christine Boardman laments how difficult the new law will make it for unions to collect dues, inadvertently calling to mind all the charities, service providers and other organizations that somehow survive and even thrive on contributions not deducted straight out of their members’ paychecks.  A quick LM-2 review shows President Boardman’s local spent a whopping $1.6 million in 2010 on officers’ compensation for a local of only 22,000 members.  (We also assume President Boardman drives the union local’s $38K automobile.) ********** NYC Maids Soon On Par With Cops The New York Times is reporting that a tentatively approved labor contract covering 30,000 members of the New York Hotel and Motel Trade Council will boost the pay of hotel maids in NYC to nearly $60K/yr with full medical and pension benefits by 2018.  The contract raises wages by 29% over the next seven years. In comparison, the last contract negotiated to cover NYC police called for 4% annual raises for the next four years.  Under that contract, the base pay of a rookie police officer with two years on the job is only about $2,000 more than that of a hotel housekeeper with the same years of service. Already approved by the Hotel Association of New York City, it is expected union member will ratify the contract proposal on Monday, unless aliens show up early for the Mayan New Year. ********** Teamsters Strike Halts Ohio Blood Drives The Red Cross of Northern Ohio was forced to cancel its single biggest blood drive of the year this week when (coincidentally) Teamsters Local 507 took 250 blood collection workers out on strike on Tuesday.   The Red Cross has been in negotiations with the union since August and talks with a federal mediator broke down last week. The union has rejected the identical offer accepted by 14 other collection worker locals around the country.  That offer includes the same healthcare benefits package the Red Cross offers all its non-union employees. A spokesperson for the Red Cross said negotiations stalled only on the healthcare issue although the union is now making claims of short staffing that they say threatens the safety of the blood supply.  (If the safety of the blood supply has truly been at risk one must wonder why the Teamsters are only now first alerting the rest of us!) The strike poses no immediate threat to the area’s blood supply although the Red Cross says it’s impossible to predict when a scaled-back collection schedule will cause problems for northern Ohio hospitals and their patients. ********** Study Claims Nurses Strikes Kill Patients A study published by the National Bureau of Economic Research claims in-hospital mortality jumps 19.4% during a nurses’ strike.  According to the study, “Hospitals functioning during nurses’ strikes do so at a lower quality of patient care.”  The study also shows no better outcome when hospitals hire replacement workers.  While the authors of the study are pushing a different agenda, it is worth noting that hospitals were excluded from collective bargaining laws for three decades out of fear that nurses’ strikes would negatively impact patient care. ********** Teamsters Authorize Twinkie Strike  In a maneuver that would surely kill off the Twinkie if taken any further, an undisclosed number of Teamsters have voted “9 to 1” to authorize a strike against Hostess should a bankruptcy judge allow the company to abandon current collective bargaining agreements.  The company has said it needs out from under prohibitively expensive union pension plans and onerous union work rules in order to emerge from bankruptcy. The union has refused to budge since September on allowing Hostess to pull out of several Teamsters’ multi-employer pension plans that transfer the cost of retirements from companies driven out of business onto the backs of those “Teamsterized” companies that are still managing to survive.  Hostess has repeatedly said it is willing to assume the cost of all of its own employees’ retirements as promised but they need out of the legacy plans to survive. Hostess is now well over a billion dollars in debt to upside-down IBT and Bakery union pension funds. “This vote shows that, while our Hostess members are willing to take significant steps to save the company, they can only go so far,” said Dennis Raymond, director of the Teamsters Bakery and Laundry Conference.  Apparently allowing the company to shoulder only its own legacy costs, and perhaps expecting union members to both drive and unload their trucks and stock those trucks with both Hostess products and Wonder Bread in order to save their own jobs is a bridge too far for Hostess Teamsters, or at least those made aware of last week’s strike vote. ********** Another Union Risks Jobs for Pension Plan Bailout Like their union brothers and sisters at Hostess, UNITE HERE Local 54 in Atlantic City is apparently willing to risk their members’ livelihood to force another critically under-funded union pension plan onto the back of a struggling employer. The union is asking groups to cancel conventions booked at the Tropicana Casino and Resort because the casino’s new owners, who bailed out the failing enterprise last year, intend to stop payment into the union’s National Pension Fund.  “There are lots of good choices in Atlantic City,” Local 54 president Bob McDevitt said. “Right now, Tropicana is not one of them. They are not good corporate citizens, and we are addressing that with their customers.” The casino declared an impasse in contract talks last month and said it will unilaterally implement its final offer, which includes payments of $1.77 per hour into employee 401Ks or directly in cash and an end to contributions to a union plan thought underfunded by at least $1.4 billion.  According to Tropicana president Tony Rodio the casino’s final offer is otherwise “identical” to agreements reached between the union and six of the seven other Boardwalk casinos it represents.  Rodio also contends continued participation in the union pension fund exposes the casino to “significant future liability”. “This type of response from the Unite-HERE leadership could have a devastating effect on our employees if convention groups go elsewhere,” Rodio said. “They’re taking away overnight stays, which hurts housekeepers and room attendants, taking away people being on the casino floor and not getting drinks from beverage servers, or eating at the restaurants. They’re hurting the Tropicana, but they’re also hurting themselves.” Atlantic City’s 11 casinos have all been hammered hard by the recession and growing competition from casinos in neighboring states.  Since 2006, the city’s casinos and resorts have seen their combined revenue shrink by 40% or $1.9 billion and it is widely believed that a labor dispute of any kind is the last thing the struggling local economy needs. ********** Hippie Spring UAW president and eternal flower child Bob King used the 75^th anniversary of the Flint sit-down strike to veer his union back towards its socialist roots last week, calling on all UAW members in an impassioned speech to take “direct action” (union parlance for breaking the law) against the evil 1%, starting with, oddly enough, General Electric stockholders. “It will take direct action. It will take us being willing to face arrest. It will take us being willing to be part of marches and demonstrations,” King told a crowd of 500 cheering UAW retirees many of whom may need assistance getting back up if they  do indeed dare to attempt a sit-down protest.  King announced the UAW is joining with SEIU, Occupy Wall Street and other class warfare crusaders to create a new “movement for social justice” that will employ the tactics of the civil rights movement to fight “corporate greed” and attacks on (big) labor. King said his union would immediately begin training members “and anybody who cares about justice” (but not free enterprise!) in “nonviolent direct action.” The new movement’s first mission will be to demonstrate at the GE shareholders meeting in Detroit on April 25 for reasons not yet apparent. According to the Detroit News, King’s veins were bulging and his voice grew hoarse from shouting at the crowd.  “It is morally wrong — it is absolutely wrong — that they (GE) make billions and billions and billions of dollars and pay not a single penny in taxes.  Enough is enough. We’re the 99 percent who want 100 percent fairness for everyone.” (And our full UAW retirements)  A spokesman for GE reported that the corporation paid over a billion dollars in federal, state and local taxes last year. Ironically, just two days before King’s calls for anarchy (not to mention support for the re-election of President Obama) UAW member Terry Bowman testified before the House Oversight Committee in favor of national Right to Work legislation so he and other conservative auto workers would no longer be forced, as a condition of employment, to financially support leftist political agendas they find abhorrent.  The UAW declined to comment on Bowman’s testimony. ********** New Union Partners Disagree on FAA Compromise The CWA, parent union of the Flight Attendants union, and the Transportation Workers Union announced a new “partnership” last week that is supposed to combine their forces as needed to bargain tough contracts and lobby lawmakers on transportation issues.  However the two unions already appear to be on opposite sides of the primary transportation issue of the moment, the FAA funding compromise that recently passed both the House and Senate by wide margins. The TWU has said they can “live within” the compromise that retains last year’s “voter majority” rule change while setting a new higher 55% threshold for a union’s show of interest.  The compromise also allows the two top vote getters, including the company, to run off after a three-way election without a majority winner.  Currently only the two unions fight it out in a run-off election with “no union” taken off the ballot. The CWA has blasted the compromise bill and declared political war on Senate and House members who voted for it, taking out full-page newspaper ads to attack supporters of the compromise.  No word yet on the CWA’s reaction to President Obama signing the bill into law this week. ********** New Searchable CBA Database Launched The Institute for Research on Labor and Employment at UC Berkeley has launched an extensive on-line library of labor contracts easily searchable by state, union or occupations covered.  The Institute has gathered contracts from sources across the Web and processed them in to a searchable PDF format and also offers mobile/Smartphone access to the library.  Currently the vast majority of contracts available are from the public sector, however the Institute continues to actively solicit additional contracts.  Well worth a moment to check out this new and growing resource! ********** SEIU Watch – Andy’s .01% Sugar Daddy Last year after suddenly stepping down from the presidency of SEIU, Andy Stern, the most famous (and infamous) labor “leader” since the first Jimmy Hoffa, stepped right back up into a board of directors spot with SIGA Technologies.  And within six months Stern pocketed 35,000 stock options from the pharmaceutical manufacturer (at the time worth a cool half million) plus $116K for his valuable input at SIGA board meetings. SIGA is owned by Ron Perelman, the world’s 64^th richest person with a net worth of $12 billion that places him in the top 1% of the top 1% on the Greedy Capitalist Index of Evil.  Perelman, among many many other things, owns his own helicopter, a nice chunk of Manhattan, 57 acres in the Hamptons and part of an island in the Bahamas called “The Billionaire Boys Club.” At the time it struck most Andy watchers as odd how quickly the iconic class warrior transformed himself into a run of the mill capitalist evildoer, especially as SEIU and SIGA seemed to share no past history that might explain Stern’s sudden interest in legal pharmaceuticals. Then last month Perelman donated enough pocket change to create the Ronald O. Perelman Senior Fellowship at Columbia’s School of Business apparently just for its first visiting scholar, Senior Fellow Andrew L. Stern. This latest chapter in the Stern-Perelman bromance caused an SEIU attack site to finally connect the dots to a backroom deal Stern cut with Perelman in 2006 that pulled the plug on an SEIU organizing drive against AlliedBarton, the billionaire’s security company, leaving outspoken union supporters to fend for themselves when their union organizers literally disappeared overnight. Certainly we are 100% in favor of union zealots blossoming into champions of free enterprise, but never, ever, by selling out the rank and file. ********** Sticky Fingers Current charges or sentences of embezzling union officials:

http://www.nlpc.org/union-corruption-update ********** Labor Relations INK is published semi-weekly and is edited by LRI Consulting Services, Inc. If you use content from this newsletter please attribute it to LRI Consulting Services and include our website address: www.LRIonline.com Contributing editors for this issue: Phillip Wilson, Greg Kittinger, Nancy Jowske and Shaun Fanning