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1 Trends in Labor Preemption & Labor Peace AgreementsPRESENTED BY GALE LAROCHE, VICE PRESIDENT HUMAN RESOURCESWAYNE COUNTY AIRPORT AUTHORITYWhat is a Labor Peace Agreement? The AFL-CIO created the term Labor Peace Agreement, to describe a neutrality agreement. A labor peace agreement is an agreement between the employer and the union in which the employer agrees not to resist the union s organizing attempts. Labor peace agreements vary from employer to employer, but typically contain some or all of the following terms: Waives rights under the law regarding employer s right to free speech Allow access to the employer s premises by unions Waives secret ballot elections Allows card checks for recognition Employer agrees not to make any negative comments about the union Employer agrees to provide employees with the address and phone number of the union organizer Prohibits employees from striking or engaging in other types of interference with business operationsWhat is a Labor Peace Agreement?

2 (Continued) Some municipal governments have required labor peace agreements as a condition for private businesses to bid on public contracts, zoning variances, building permits, etc. in response to union political pressure These types of agreements are also known as labor harmony agreements, neutrality agreements, project labor agreements Impact on airports hotels, concessionaires, airline catering, and construction projects A compromise to avoid potential labor unrest and/or negative public attention in lieu of granting labor unions significant organizing rightsUniteHereVideoPros Proponents of labor peace agreements state that labor peace agreements allow employees to exercise their right to unionize without intimidation or coercion from employers; prevents undue delays in unionization; ensures a just democratic process; and promotes labor peace between employers and employees Promoters of labor peace agreements also state that they serve to reduce turnover and supplies employees with equitable wages and benefits Reduces operational risk due to labor disruption Ensure uninterrupted delivery of services and remove risks to predictable cash-flow from non-airline operations Provides an alternative dispute resolution procedure Ensures contractors that they have access to an immediate pool of qualified workersCons Cost overruns Negative impact on competition Delays in work completion Potential negative impact on minority suppliers Vendor not chosen based on merit Otherwise qualified non-union vendors may choose not to solicit work under such an agreement Limitation on vendor speech Potentially limits volume of qualified applicants Potentially increases risk of such bargaining disputes to more vendorsLabor

3 Harmony Agreement -Long Beach, CAWhy do organizations agree to labor peace agreements? Economic disadvantage if strike or labor disruption occurs Pro-union regions such as San Francisco, Chicago, or New York Politics Public relations and economic strain of corporate/negative campaign Opportunity cost of dealing with perpetual pressure on organization Economics Tactical understanding of the difficulty or organizing certain vendorsLabor Peace Ordinances in the is this topic important to airports?IN THE NEWS AIRPORT CHALLENGES Union Wants Greater Job Protection at O Hare A major expansion of the Los Angeles International Airport requires neutrality by employers and recognition of unions when a majority of workers sign cards asking for recognition The most significant trends in the last few years have been the number of airports requiring Labor Peace Agreements with unions in order to bid on new business UNITE HERE protests that OTG should obtain a labor peace agreement in compliance with the Port Authority s Airport Concessions Labor Peace Policy 2007 Pittsburgh International Airport construction project gets pledge of labor peace In 2000, the San Francisco Airport Commission required all of its contractors and subcontractors to sign a document recognizing union s right to organize employees through a card check upon challenge.

4 The court ruled that the provision was over-broad and not project specific (UC paper) Unions lobby City Council for a labor peace ordinance when awarding concession contracts No labor peace at Sacramento Airport Unite Here works with ATL on smooth workforce transition (commitment to labor harmony) Oakland Airport Workers Strike! Chicago O HareLos Angeles International AirportHMS HostJohn F. Kennedy International AirportMiami International AirportPittsburgh International AirportSan Francisco AirportChicago Midway AirportSacramento AirportAtlanta Hartsfield-Jackson International Airport (HMSHost, Delaware North, and The ParadiesShops)Oakland Airport (HMS Host)IN THE NEWS ACI-NA In 2011, Monica Hargrove moderated a panel session at the Airport Concessions Conference concerning labor and economic issues. Panel members were Dr. Bruce Seaman Associate Professor at the Andrew Young School of Policy Studies, Georgia State University; Mr.

5 Eric Smith of the law firm Schnader, Harrison, Segal, and BhavTibrewal, an analyst at Unite Here. Concession agreement provisions contained in ACRP Report 54 Resource Manual for airports mentions that Certain airport operators include concession employee-related clauses, such as labor peace, living wage, and worker retention. Section of ACRP Report 54 specifically addresses labor peace agreementsACI-NA 2011 Airport Concessions Conference Report 54 states, in part, that under federal law, airport operators cannot require union recognition as a condition to do business with the airport, however, airport operators do have a legitimate, legally permissible interest in assuring continuous operations of its concessions this interest is the basis for adopting labor peace or harmony provisions in the Example of Labor Peace Language To comply with the Labor Peace Card Check Rule, Contractor shall, among other actions: (a) Enter into a Labor Peace/Card Check Agreement with any Labor Organization which requests such an agreement and which has registered with the Airport Director or his/her designee, within thirty (30) days after the Labor Peace/Card Check Agreement has been requested.

6 (b) Not less than thirty (30) days prior to the modification of this Agreement, Contractor shall provide notice by mail to any Labor Organization or federation of labor organizations which have registered with the Director or his/her designee ( registered labor organization ), that Contractor is seeking to modify or extend this Agreement; (c) Upon issuing any request for proposals, invitations to bid, or similar notice, or in any event not less than thirty (30) days prior to entering into any Subcontract, Contractor shall provide notice to all registered Labor Organizations that Contractor is seeking to enter into such Subcontract; and (d) Contractor shall include in any subcontract with a Subcontractor performing services pursuant to any covered Contract, a provision requiring the Subcontractor to comply with the requirements of the Labor/Peace/Card Check Rule. If Airport Director determines that Contractor shall have violated the Labor/Peace/Card Check Rule, Airport Director shall have the option to terminate this Agreement, in additional exercising all other remedies available to him/her.

7 UNITEHERE! Risk Assessment Low Risk/Regulated AirportsAssetsProtected byLos AngelesLabor Harmony & RetentionNew York (JFK) (LGA)Labor Harmony & RetentionSan FranciscoLabor Harmony & RetentionMiamiLabor HarmonySeattleLabor Harmony & RetentionPhoenixRetentionNewarkLabor Harmony & RetentionSanJoseLabor Harmony & RetentionOntarioLabor Harmony & RetentionUNITEHERE! Risk Assessment Moderate/High RiskAssets Protected byAtlantaLabor HarmonyFt. LauderdaleLabor HarmonyChicago O'HareUnregulatedDallas Ft. WorthUnregulatedDenverUnregulatedDetroit UnregulatedMinneapolisUnregulatedCharlot teUnregulatedHoustonUnregulatedBostonUnr egulatedWash. DullesUnregulatedSalt Lake CityUnregulatedSan DiegoUnregulatedAustinUnregulatedWashing ton NationalUnregulatedChicago MidwayUnregulatedSacramentoUnregulatedJo hn WayneUnregulatedWhat are Airports Doing with Retention Agreements In a survey conducted in 2012 (and re-verified a few months ago) of 37 airports, we found the following: 24 had noexisting employee retention policy 8 airports requestedthat new concessionaires interview existing employees 1 airport requiresnew concessionaires to interview existing employees (Detroit) None require existing employee right of first refusal 2 airports requirea trial period for existing employees 2 airports requirelabor harmony or peace agreementsWhat do the Courts say?

8 Lawful, unlawful, and Somewhere in Between! Milestones (Project Labor/Peace Agreements) 1938 -First PLA created for work on the Shasta Dam in California 1959 -San Diego Building Trades Council v. Garman, (359 236, 79 , 3 775) Prohibits the regulation of activities that the National Labor Relations Act arguably protects or prohibits 1976 Lodge 76, International Association of Machinists & Aerospace Workers, AFL-CIO v. Wisconsin Employment Relations Commission(427 132) to regulate conduct that Congress intended to be free play of economic forces 1986 Wisconsin Department of Industry v. Gould(475 282) The state refused to do business with employers who violated the NLRA, the court held that this was a case where the state agency attempted compel conformity with the NLRA 1987 Building & Construction Trades Council v. Associated Builders & Contractors, (507 218, 227) Supreme Court upholds a PLA entered into by the Massachusetts Water Resources Authority for a clean up of the Boston HarborMilestones (Project Labor/Peace Agreements) 2002 Building and Construction Trades Department v.

9 Allbaugh(295 28, Cir. 2002) a challenge to President George W. Bush s ban on federal agencies requiring PLAs for federally funded projects (Exec. Order No. 13,302 66 Fed. Reg. 11225 Feb. 17, 2001); the court found that the challenged executive order constituted proprietary action and that the Exec. Order did not address the use of PLAs on projects unrelated to those in which the government has a propriety interest so the Exec. Order establishes no condition that could be categorized as regulatory 2005 Metro. Milwaukee Association of Commerce v. Milwaukee County, (431 277, 280 7thCir. 2005) the court held that a Milwaukee ordinance requiring city contractors to reach labor peace agreements with unions to be regulatory as the ordinance would have a spillover effect on private contracts, also the city passed up easy alternative to achieve the same desired effect without the spillover Supreme Court RulingChamber of Commerce v.

10 Brown, 128 S. Ct. 2408 (2008) 2008 Chamber of Commerce v. Brown (128 S. Ct. 2408) -The Supreme Court considered whether the NLRA preempted a California statute that prohibited: Recipients of more than $10,000 in state grant funds in any year, or Employers that receive more than $10,000 in program funds in any year from using the funds to assist, promote, or deter union organizing The Brown court, ruling 7-2, found that while the NLRA contains no express preemption provision, preemption is necessary to implement federal labor policy where Congress intended particular conduct to be unregulated because it is left to be controlled by the free play of economic forces, and that the statute failed because California was indirectly regulat[ing] [labor speech and organization] by imposing spending restrictions on the use of the fundsIn Conclusion Unions are fighting to stay alive, and one of the ways they do this is to reconfigure the rules under which they have been allowed to organize In doing so, attention has turned to state and local government policies The NLRA has broad preemption authority; however, labor peace ordinances are a means for state and local governments to give unions an organizing advantage Labor peace ordinances have been identified in various jurisdictions in 11 states; Louisiana, Georgia, and Tennessee have all banned labor peace ordinances All labor peace ordinances have one basic purpose to make it easier to organize employees Specifically tailored labor peace agreements are alternatives to traditional union organizing efforts.