AGC's Human Resource and Labor News - May 19, 2009 / Issue No. 2-09 (Print All Articles)

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DHS to Focus on Prosecuting Employers Who Hire Illegal Workers

On April 30, 2009, the Department of Homeland Security (DHS) announced a shift in its workforce enforcement priorities from the prosecution of illegal aliens working in the United States to the prosecution of employers who knowingly hire them.  According to a fact sheet distributed by DHS, only 135 of 6,000 arrests related to worksite enforcement in 2008 were employers.  As a result, DHS issued new guidelines to Immigration and Customs Enforcement (ICE) with instructions to immediately "focus its resources in the worksite enforcement program on the criminal prosecution of employers who knowingly hire illegal workers in order to target the root cause of illegal immigration." 

On April 30, 2009, the Department of Homeland Security (DHS) announced a shift in its workforce enforcement priorities from the prosecution of illegal aliens working in the United States to the prosecution of employers who knowingly hire them.  According to a fact sheet distributed by DHS, only 135 of 6,000 arrests related to worksite enforcement in 2008 were employers.  As a result, DHS issued new guidelines to Immigration and Customs Enforcement (ICE) with instructions to immediately "focus its resources in the worksite enforcement program on the criminal prosecution of employers who knowingly hire illegal workers in order to target the root cause of illegal immigration."

Employers - defined in this context as hiring managers, management, owners, CEOs, supervisors, and other occupational titles - can expect ICE offices to use their full authority when executing investigations such as the use of confidential sources, cooperating witnesses, and undercover agents.  At critical infrastructure and national security sites, employee interviews may also be conducted.  In addition to these direct investigative methods, employers who are suspected to be in violation of immigration laws may receive a Notice of Inspection (NOI), which ultimately results in an administrative audit of I-9 forms.

Civil fines will be administered when sufficient evidence is not available to support a criminal prosecution case.  DHS reports that, in the mid 1990's, "employers received notices of intent to fine (NIFs) totaling $26 million."  Also, federal contractors in violation of immigration laws face possible debarment, eliminating the company's opportunity to secure work on federal contracts.  DHS hopes that inserting new language into federal contracts requiring contractors and subcontractors to use the E-Verify system to verify the employment eligibility of those working on projects issued on or after June 30, 2009, will help to limit the number of fraudulent workers working on federally awarded projects. 

Unlike before, when the arrests of illegal employees was a sign that a particular company might be under investigation, ICE has been given a directive to follow through on the prosecution of targeted employers prior to arresting employees at a given worksite and employers need to be prepared. Employers should be proactive in reviewing their employment practices to ensure compliance with immigration laws.  Best practices include conducting regular internal audits of I-9 records,  training hiring managers on the proper way to review and record verification documents on the new version of Form I-9 (which all employers are now required to use), and establishing or reinforcing a policy addressing how managers and supervisors should respond if they become aware of facts indicating that workers are unauthorized.  

Although general contractors are typically not liable for the immigration violations of their subcontractors under current federal law unless the contractor had knowledge of the violation or acted with reckless disregard, AGC advises contractors to consider adopting clauses in contracts with subcontractors and staffing companies by which the latter (a) certifies that it is in compliance with immigration laws and will maintain compliance, (b) agrees to conduct annual self-audits of its I-9 records, and (c) agrees to indemnify the contractor if it is found liable for employing an unauthorized worker provided by a subcontractor.  In cases of particular concern and where appropriate, the contractor may also want to contractually require the subcontractor or staffing company to enroll in E-Verify.  AGC further recommends that employers consult with an employment immigration attorney licensed in the project state to help craft appropriate contract language, train staff, and provide other counsel as needed.   

Q&A information sheets on the new Form I-9 for all employers and on E-Verify for federal contractors and subcontractors can be found on the U.S. Citizenship and Immigration Services (USCIS) Web site and the AGC Web site. 

A presentation and Q&A session entitled "Immigration Compliance for the Construction Industry" will be conducted by David Whitlock of the law firm Littler Mendelson at AGC's 2009 HR Professionals Conference in Atlanta, GA, October 27-29.  Mark your calendars and stay tuned for more details.  For additional information on immigration compliance, visit the online AGC bookstore.


New I-9 Form Now in Effect

On April 3, 2009, employers were required to begin using a new I-9 form to verify the employment eligibility of newly hired employees and employees with expiring employment authorizations, according to the Department of Homeland Security's U.S. Citizenship and Immigration Services (USCIS).  The new form is available for downloading on the USCIS Web site.

On April 3, 2009, employers were required to begin using a new I-9 form to verify the employment eligibility of newly hired employees and employees with expiring employment authorizations, according to the Department of Homeland Security's U.S. Citizenship and Immigration Services (USCIS).  The new form is available for downloading on the USCIS Web site.

Originally scheduled for implementation on February 2, 2009, USCIS delayed the requirement for employers to use the new form until at least April 3, 2009.  The delay was in response to a request from the new Administration to allow time to further review the implications of the interim rule. 

With the new form, employers are no longer permitted to accept expired documents for verification purposes and should become familiar with the new list of acceptable documents.

Click here for more information on the changes.


Federal Contractor E-Verify Rule Suspended to June 30

The federal government has agreed to even further delay implementation of the E-Verify rule for federal contractors.  Contracts and solicitations issued prior to June 30, 2009, will not contain the mandate.  Click here for the Federal Register notice.

The federal government has agreed to even further delay implementation of the E-Verify rule for federal contractors.  Contracts and solicitations issued prior to June 30, 2009, will not contain the mandate.  Click here for the Federal Register notice.

The Federal Acquisition Regulation (FAR) Council issued the final rule on November 14, 2008, requiring contracting officers to mandate contractor use of E-Verify in solicitations issued and contracts awarded after January 15, 2009.  In response to a legal challenge to the rule, the government agreed to suspend the rule until February 20 and again until May 21.  The plaintiffs in the lawsuit requested the extension after President Obama's Chief of Staff Rahm Emanuel issued a memorandum directing federal agencies to consider extending by 60 days the effective dates of all regulations already issued but not yet in effect, in order to allow the new Administration a chance to review any "questions of law and policy raised."

Click here for a list of Frequently Asked Questions (FAQ's) for Federal Contractors & E-Verify. Visit the AGC Web site for critical components of the final rule.

For more information, contact Marco Giamberardino at (703) 837-5325 or giamberm@agc.org.


Construction Executive Salaries Rose 4.6% in 2008, Expected to Rise Further in 2009

Construction executive salaries increased an average of 4.6 percent in 2008, according to the latest Contractor Compensation Quarterly published by PAS, Inc.  Although last year's increase was not as significant as the 5.4 percent increases reported in 2006 and 2007, buying power for those executives who received raises still rose in 2008, as the inflation rate remained unchanged at zero percent.

Construction executive salaries increased an average of 4.6 percent in 2008, according to the latest Contractor Compensation Quarterly published by PAS, Inc.  Although last year's increase was not as significant as the 5.4 percent increases reported in 2006 and 2007, buying power for those executives who received raises still rose in 2008, as the inflation rate remained unchanged at zero percent.

Anticipated increases reported to PAS indicate that construction executives given raises in 2009 will receive an average increase of 4.35 percent, which equates to an overall average of 3.7 percent when companies anticipating increases of zero percent are taken into account.  Based on past practices, however, PAS projects that increases will actually average 4.0 to 4.7 percent by the end of the year.  These increases are substantially higher than the 3.1 percent average increase across all U.S. industries forecasted by WorldatWork. 

The following table shows the average base salary for benchmark positions in construction paid in 2008 and anticipated in 2009, as reported by PAS: 

Position

2008

2009

Board Chairperson

$283,000

$285,000

Senior VP

  169,000

  170,000

VP of Operations

  142,000

  142,000

VP of Estimating

  128,000

  130,000

General Superintendent

  110,000

  112,000

PAS's complete Executive Compensation Survey for Contractors report - which also covers fringe  benefit information and breaks data down by type of construction, geographic location, company revenue, and other characteristics - is  available for purchase from PAS.  For more information, go to  www.pas1.com, or call 1-800-553-4655 and ask about the AGC-member discount

Jeff Robinson, president of PAS, Inc., will co-present "Maintaining a Strong Compensation Plan During Tough Times" at AGC's HR Professionals Conference in Atlanta, GA, October 27-29, 2009.  Mark your calendars and stay tuned for more details.


Increased Unemployment Taxes Probable for Employers

In addition to the many employer mandates enacted by the American Recovery and Reinvestment Act of 2009 (ARRA), new efforts to assist the nation's unemployed have been introduced, potentially causing an increase in state-mandated unemployment taxes for employers.  Because employers are seemingly no longer responsible for former workers, many employers may not have realized the affect of this initiative on their respective companies.

In addition to the many employer mandates enacted by the American Recovery and Reinvestment Act of 2009 (ARRA), new efforts to assist the nation's unemployed have been introduced, potentially causing an increase in state-mandated unemployment taxes for employers.  Because employers are seemingly no longer responsible for former workers, many employers may not have realized the affect of this initiative on their respective companies.

The ARRA continues the Emergency Unemployment Compensation (EUC) program, which extends the number of weeks from 20 to 33 that an unemployed individual may collect unemployment benefits.  In addition, unemployment benefits during that time period will increase by $25 per week, while federal income tax payments will temporarily be suspended for those receiving the benefits.  The final aspect of the initiative offers the opportunity for states to receive a portion of the allotted $7 billion in modernization grants if they agree to comply with specific reforms.  Such reforms include qualifying an individual for unemployment benefits if the individual quit work for a "compelling family reason" including the illness or disability of a member of the individual's immediate family (as defined by the Department of Labor), the need to accompany one's spouse who has to relocate for his/her job, or specific verifiable situations of domestic violence.

Some states have refused to accept the grant for fear that implementing these new qualifiers will dramatically increase the number of unemployment compensation recipients, leading to a faster depletion of the state's unemployment reserves.  As reserves are depleted, states will ultimately be forced to increase the unemployment taxes charged to employers to keep the fund afloat.  In addition, the amount of unemployment taxes paid by each employer is calculated based on the number of existing unemployment claims brought forth and awarded against the company, which will also increase taxes for employers as more individuals qualify for the benefit.

Additional information on unemployment insurance is available from the DOL's Employment & Training Administration.

For key directives issued to states from the Department of Labor (DOL), see the DOL's Q&A document for state workforce agencies.  To find out if your state has accepted a modernization grant, contact your state's unemployment insurance program.


Short-Term Changes for Health Coverage Certificates and Transit Benefits

The American Recovery and Reinvestment Act of 2009 (ARRA), generally known as the economic stimulus package, will temporarily require employers to disregard breaks in healthcare coverage lasting more than 63 days when issuing certificates of creditable healthcare coverage.  The act also temporarily increases pre-tax transportation benefits though December 2010.

The American Recovery and Reinvestment Act of 2009 (ARRA), generally known as the economic stimulus package, will temporarily require employers to disregard breaks in healthcare coverage lasting more than 63 days when issuing certificates of creditable healthcare coverage.  The act also temporarily increases pre-tax transportation benefits though December 2010.

Under the Health Insurance Portability and Accountability Act (HIPAA), employers with group health plans or their plan administrators, must provide certificates of creditable coverage to employees and their qualifying dependents when group health coverage ends, disregarding any gaps in coverage of less than 63 days.  Effective February 17, 2009, the date the economic stimulus package was signed into law, employers must now disregard any breaks in coverage, including those of more than 63 days, for employees and their qualifying dependents that lost coverage between September 1, 2008, and February 17, 2009.  Employers who do not administer certificates of creditable coverage in-house should work with health plan providers or third-party administrators to send revised certificates to qualifying current and former employees as well as their qualifying dependents as soon as possible.

Pre-tax transportation benefits have also been temporarily adjusted by the economic stimulus package.  The monthly limit for pre-tax transportation benefits, such as transit passes and/or vanpooling benefits under Code Section 132(f) of the Internal Revenue Service Code was temporarily increased from $120 per month to $230 beginning on March 1, 2009.  This temporary increase will continue through December 2010.  Because the increase cannot be implemented automatically, employers who offer this benefit must require employees who wish to take advantage of the temporary increase to submit new election forms.  The adjustment cannot be made retroactively, which forces many employers to push the start date to April 1, 2009.  The limit for qualified parking expenses remains at $230 per month.

For other employer-related changes brought on by the American Recovery and Reinvestment Act of 2009, including changes related to the Consolidated Omnibus Budget Reconciliation Act (COBRA), immigration, payroll processing and executive compensation, read AGC's article Employer Adjustments Required by Economic Stimulus Package.

For complete information on the economic stimulus package and its impact on the construction industry, visit www.agc.org/stimulus.


CLRC Issues Reports on Costs of CBA Terms and Conditions and on Labor Rate Trends and Outlook

The cost of construction-industry collective bargaining agreement (CBA) terms and conditions as a percentage of wages and fringes was unchanged in 2008 at 6.4 percent, according to the Construction Labor Research Council's (CLRC) latest Cost of Terms and Conditions in Collective Bargaining Agreements report.  The dollar cost of these items increased, as the cost of many contract terms is directly related to wage rates, which increased.

The cost of construction-industry collective bargaining agreement (CBA) terms and conditions as a percentage of wages and fringes was unchanged in 2008 at 6.4 percent, according to the Construction Labor Research Council's (CLRC) latest Cost of Terms and Conditions in Collective Bargaining Agreements report.  The dollar cost of these items increased, as the cost of many contract terms is directly related to wage rates, which increased.

Costs vary significantly across individual CBAs, from 4 to 10 percent, with a few even higher, and most dollar costs falling between $1.50 and $4.00.  Regional variation is moderate, CLRC reported, but craft variation is significant.  "The all-crafts average is reduced because Carpenters and Laborers, the crafts with the greatest number of workers, have among the lowest prevalence of most of the items adding to contract costs," noted CLRC.

The largest portion of costs is attributable to overtime payments, CLRC found, with an average cost of $1.29.  Other items with relatively high costs include show-up pay and time paid but not worked (e.g., coffee breaks, clean-up time).

CLRC also recently released its latest Construction Labor Rate Trends and Outlook report.  Wage and fringe rates set in CBAs negotiated in 2008 or earlier will rise 4.4 percent per year in 2009 and in 2010, as they did in 2008.  This equates to a dollar amount of $2.13 in 2009 and $2.27 in 2010.

"Before this period of stability," CLRC reported, "rates of increase had been moving upward."  Longer-term trends in escalation have not changed much, however.  For the five-year period ending January 1, 2009, wage and fringe rates increased 22.9 percent, or just over 4 percent per year.  Differences between regions and between crafts have narrowed, CLRC said.  The average wage-plus-fringe rate for all construction crafts is now $46.65.

Bargaining activity will be heavier than usual this year, as the number of contracts due to expire in 2009 is higher than in most recent years, according to CLRC. Negotiations are expected to cover about 375,000 workers this year.  Bargaining will be spread throughout the country but will be lightest in the western regions.  CLRC is expected to release its first report on year-to-date settlements for 2009 in mid-June.  AGC will send the report to the AGC Union Contractors e-Forum when released.  To join the Union Contractors e-Forum, send a request including your complete contact information to Crystal Yates at yatesc@agc.org.

Many CLRC reports, including a report on 2008 settlements, are also posted on the Labor & HR Topical Resources page of AGC's Web site at www.agc.org/labor/topicalresources.  Select the category "Collective Bargaining" from the first pull-down menu and the subcategory "Collective Bargaining Agreement Data" from the second.  The AGC Web site also features a searchable database of collectively bargained wage and fringe rates at www.agc.org/cbrates.

Chapters bargaining this year are reminded to send settlement information to CLRC promptly upon settlement of negotiations.  Information can be sent by fax to (202) 347-8442, by e-mail to clrc@clrc.biz, or by mail to 1750 New York Ave., NW, Washington, DC  20006.


Obligation to Make Local Fund Contributions on General Presidents Maintenance Agreement Projects Turns on Whether Contractor Signed Local Agreements

The U.S. Court of Appeals for the Sixth Circuit (KY, MI, OH, TN) has issued two opinions in recent months addressing whether contractors signatory to the General President's Project Maintenance Agreement (GPPMA) were liable for contributions to certain local funds.

The U.S. Court of Appeals for the Sixth Circuit (KY, MI, OH, TN) has issued two opinions in recent months addressing whether contractors signatory to the General President's Project Maintenance Agreement (GPPMA) were liable for contributions to certain local funds.

In Mechanical Contractors' Association Industry Promotion Fund v. GEM Industrial, Inc., the court found that the contractor was liable for contributions to the funds.  GEM Industrial was signatory to two local agreements with Pipefitters Local 636, one negotiated by the Metropolitan Detroit Plumbing and Mechanical Contractors Association and one negotiated by the Association of Service and Mechanical Contractors of Southeastern Michigan.  The Metropolitan Detroit agreement provides that the employer will make certain contributions either to the signatory association's industry fund or, at its election, to the Pipefitters Local 636 Insurance Fund instead.  The Southeastern Michigan agreement provides that the employer will contribute a certain amount to the signatory association's industry fund.

GEM and the United Association (the international union with which Pipefitters 636 is affiliated) were also signatory to the GPPMA.  GEM was hired to perform maintenance work on a power plant covered by the GPPMA.  The GPPMA states that signatory contractors are not required to become signatory to a local collective bargaining agreement.  It further states, "Only bona fide fringe benefits which accrue to the direct benefit of the individual craft employee are required...Construction industry promotional funds are not applicable under terms of this agreement."

GEM conceded that there was no express waiver of the contribution requirements set forth in the local agreements, but argued that the terms of a national agreement like the GPPMA supersede the terms of a local CBA if the two conflict.  The court rejected the argument.  Extrinsic evidence of contract parties' intent should only be considered when the contract language is ambitious, the court explained, but the language of the local agreements here is "entirely clear" that a contractor such as GEM must contribute the agreed-upon sum to the industry fund.  The court further found that there is no conflict between local and national agreements here because the GPPMA states only that fund contributions are not required; it does not say that they are not permitted.  "GEM cannot use a separate, non-conflicting contract to attempt to evade its obligations under the first contract," the court said.  A party cannot unilaterally relieve itself of contractual obligations simply by entering into a separate contract with a separate entity.  Moreover, GEM is unable to show that the parties intended for the GPPMA to supersede.  Even assuming that the labor parties to the local and national agreements are the same, the GPPMA's language does not indicate that it was intended to override or supersede other agreements between the parties.  Had the national agreement stated that it supersedes other agreements between the parties or had GEM not been a signatory to the local agreements, indicated the court, the result might be different.

The court faced the latter situation in the second case, Joint Administrative Committee of the Plumbing and Pipefitting Industry in the Detroit Area v. Washington Group Int'l, Inc., and found that the contractor was not liable for contributions.  Washington Group had been signatory to the GPPMA for over twenty years but was not signatory to the local agreements involved.  One of the local agreements required contractors to either contribute to the industry fund or to make like-kind contributions to the local apprenticeship fund.  The other local agreement required contributions to the industry fund or to the local insurance fund.  When Washington Group failed to make payments to the industry funds or to make like-kind contributions to the benefit funds above the normal benefit-fund payment obligations, the funds and their administrator sued.

The fact that the local agreements give the contractor a choice between making contributions to the industry fund or to the insurance or apprenticeship funds "has no bearing on the responsibility of a contractor that did not sign the agreements," said the court.  If Washington Group has any liability in this case, it cannot arise from the local agreements alone.  But it cannot arise from the national agreement either, the court found, because the GPPMA expressly disclaims any obligation for contractor contributions to the industry funds.  In addition, the GPPMA provides that the administration and interpretation of the GPPMA lie exclusively with the General Presidents' Committee on Contract Maintenance. The committee has addressed this question twice before and twice concluded that a local agreement may not require a contractor to make like-kind benefit fund contributions in lieu of industry fund contributions.  The court observed that Washington Group signed the national agreement with the expectation that the committee would resolve any disputes over the meaning of the contractual language, and the court found the committee's interpretation is reasonable and deserving of respect.  Finally, the court noted that a different result might be warranted if the national agreement did not limit the obligation to pay locally negotiated benefits to bona fide fringe benefits that accrue to the direct benefit of the individual employee or if the governing authority interpreted the contract language differently.


Supreme Court Clarifies Enforceability of Arbitration Clauses in Collective Bargaining Agreements

The U.S. Supreme Court has held that a collective bargaining agreement that "clearly and unmistakably" requires union members to arbitrate claims under the Age Discrimination in Employment Act (ADEA) is enforceable as a matter of federal law.  The case is 14 Penn Plaza LLC v. Pyett, 129 S.Ct. 1456 (April 1, 2009).

The U.S. Supreme Court has held that a collective bargaining agreement that "clearly and unmistakably" requires union members to arbitrate claims under the Age Discrimination in Employment Act (ADEA) is enforceable as a matter of federal law.  The case is 14 Penn Plaza LLC v. Pyett, 129 S.Ct. 1456 (April 1, 2009). 

The case arose after longstanding employees in an office building were reassigned from positions as night watchmen to lower-paying and otherwise less desirable positions as night porters and light duty cleaners.  At the employees' request, their union filed grievances under the grievance provision of the applicable collective bargaining agreement (CBA).  The grievances challenged the reassignments on various grounds, including age discrimination.  The grievance proceeded to arbitration, but the union withdrew the age discrimination claims before the arbitrator issued a decision.  The employees then filed an age discrimination claim with the Equal Employment Opportunity Commission, which found no violation and issued the employees a right-to-sue letter.  The employees then filed suit against the employer in federal district court, alleging that their reassignment violated the ADEA and state and local age discrimination laws.  The employer filed a motion to compel arbitration, arguing that the employees must arbitrate their age discrimination claims in accordance with the CBA.

The district court and later the circuit court disagreed with the employer, finding that a mandatory arbitration clause in a CBA is unenforceable to the extent that it requires employees to waive the right to pursue federal statutory claims in court.  The Supreme Court reversed those decisions and decided in favor of the employer.

In its 1974 decision in Alexander v. Gardner-Denver, the Supreme Court held that an employee could litigate his Title VII race discrimination claim even after he took his grievance to final arbitration under a CBA.  However, in its 1991 decision in Gilmer v. Interstate/Johnson Lane Corp., the Court held that an employee's ADEA claims were subject to compulsory arbitration under the terms of his individual employment contract.  Seven years later, in Wright v. Universal Maritime Service Corp., the Court indicated that the two earlier cases could be reconciled by maintaining that the right to sue in federal court cannot be waived in union-negotiated CBAs even if they can be waived in individually executed contracts.  Whether or not Gardner-Denver's seemingly absolute prohibition of union waiver survives Gilmer, said the Court in Wright, Gardner-Denver at least stands for the proposition that the right to a federal judicial forum will be protected against a "less-than-explicit union waiver in a CBA."

The Court has now confirmed as law what it suggested in Wright, that an employee can be compelled to arbitrate an ADEA claim under a union-negotiated arbitration clause provided that the clause "clearly and unmistakably" waives such statutory claims.  In the present case, the CBA's grievance and arbitration provision expressly covered statutory claims, specifically including ADEA claims.  Such a provision must be honored unless the statute itself prohibits such waivers, said the Court, and the ADEA does not include such a prohibition.  The Gardner-Denver decision and its progeny do not apply here, where the CBA's "arbitration provision expressly covers both statutory and contractual discrimination claims."

The Court refused to address the employees' argument that the CBA operates as a substantive waiver of their ADEA rights because it not only precludes a federal lawsuit but also allows the union to block arbitration of ADEA claims.  The Court acknowledged that a substantive waiver of federally protected civil rights is unenforceable, but it concluded that the Court could not resolve the question here because the issue was not properly briefed or presented earlier in the case proceedings.

In response to this decision, collective bargaining chapters and contractors should review their CBAs to see whether grievance and dispute resolution provisions expressly cover statutory employment claims.  If the provisions do not, the parties may wish to propose more explicit language in collective bargaining negotiations.


NLRB Finds Laborers Unlawfully Threatened to Picket Job with Nonunion Contractor

The National Labor Relations Board has held that Laborers Local 79 violated the National Labor Relations Act when it threatened a real estate developer that it would picket and "shut down" the developer's job site unless demolition work was performed by a union contractor.

The National Labor Relations Board has held that Laborers Local 79 violated the National Labor Relations Act when it threatened a real estate developer that it would picket and "shut down" the developer's job site unless demolition work was performed by a union contractor.

The developer, JMH Development, purchased an old warehouse in Brooklyn for conversion into apartments and retail stores.  JMH originally hired a general contractor that subcontracted demolition work to a union contractor.  However, it became dissatisfied with the performance of those contractors and eventually hired open-shop contractor Northeast Interiors to complete demolition.  Local 79 put pressure on JMH and one of the project investors to fire Northeast and hire a union contractor.  The union's tactics included threats to picket the job site where Northeast was working.  The union had no labor dispute directly with JMH or the investor, only with Northeast.

While a union generally has the right to picket an employer with which it has a direct dispute (a primary employer), the Act prohibits unions from pressuring secondary employers to "cease doing business" with the primary employer.  In the 1950 Moore Dry Dock case, the Board established standards for determining if picketing at a common situs (where employees of a primary employer and employees of a secondary employer work on the same premises) is lawful.  The picketing is considered to be lawful primary picketing if it is:

  1. Limited to times when the employees of the primary employer are working on the premises.
  2. Limited to times when the primary employer is carrying on its normal business there.
  3. Confined to places reasonably close to where the employees of the primary employer are working.
  4. Conducted so that the picket signs, the banners, and the conduct of the pickets indicate clearly that the dispute is with the primary employer and not with the secondary employer.

The Board has held that common situs picketing may be unlawful even if these standards are met where the union's statements or actions otherwise indicate that the picketing has an unlawful objective.  The Board has also held that a union's mere failure to provide assurances that threatened picketing would meet the Moore Dry Dock standards can itself establish a violation of the Act.  However, two circuit courts have rejected the Board's position on this.

In the present case, the Board found that Local 79 made unqualified threats to picket without providing assurances that the picketing would meet the Moore Dry Dock standards.  Even if that is insufficient to find a violation of the Act, the Board found a violation in this case based on direct evidence of Local 79's unlawful secondary objective, including statements by union agents to JMH that Local 79 would picket "unless" demolition work was performed by a union contractor instead of Northeast.

Local 79, Laborers Int'l Union of N. America, AFL-CIO, 354 NLRB No. 14 (April 30, 2009).


Hot Topics in Construction Labor Law Covered at AGC's Annual Symposium

The AGC Labor and Employment Law Council - a network of labor lawyers who represent AGC members and chapters - held its 25th Annual Construction Labor Law Symposium on April 24 in Washington, D.C.

The AGC Labor and Employment Law Council - a network of labor lawyers who represent AGC members and chapters - held its 25th Annual Construction Labor Law Symposium on April 24 in Washington, D.C. 

Occupational Safety and Health Review Commission Commissioner Horace “Topper” Thompson III (left), AGC of Alaska Assistant Executive Director Ralph "Monty" Montgomery (center), and National Labor Relations Board Member Peter Schaumber (right) 

Attorneys and chapter labor relations managers from across the country attended, while council members and guest speakers provided presentations on various developments in construction labor and employment law, including:

  • Union Organizing in a Post-Employee Free Choice Act World
  • Bargaining Units and Voter Eligibility in Construction
  • Dual Shop in the Current Labor Environment
  • The New Executive Orders and How They May Affect the Construction Industry
  • Immigration Law Compliance:  What Labor and Employment Lawyers Need to Know
  • Primer on Sec. 8(e) Construction-Industry Proviso
  • RICO as a Sword and a Shield
  • ADA and FMLA Update

Guest speakers included Peter Schaumber, member of the National Labor Relations Board, and Hal Coxson of Ogletree Governmental Affairs.  Member Schaumber provided his perspectives on issues currently facing the Board and on the direction that the Board is likely to take in the new Administration.  Mr. Coxson, who served as the speaker for the newly named Charles E. Murphy Keynote Address, provided his view on what to expect from the new Administration and Congress on labor and employment issues.  The address is named in memory of "Chuck" Murphy, a long-time member and past chairman of the Council who passed away last year.

Presentation handouts will be posted on the Labor & HR Topical Resources page of AGC's Web site, integrated into their respective topic areas, in the coming weeks.

Make sure that your in-house and outside labor and employment lawyers are Council members, so that they will stay on the cutting edge of construction labor and employment developments.  For information about Council membership, click here or contact Denise Gold at goldd@agc.org or (703) 837-5326.

AGC CEO Steve Sandherr (center) discusses labor relations with Bob Gasperow (left), executive director of the Construction Labor Research Council, and Bill Cowen (right), solicitor of the NLRB, at a reception for symposium registrants, government officials, and other guests.

Attorney Hal Coxson presents Charles E. Murphy Keynote Address beside portrait of Mr. Murphy.

NLRB Member Peter Schaumber addresses symposium attendees.


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