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Something is Bothering California Union Leaders and Lobbyists

Something is bothering union leaders and lobbyists in California. A few unreconstructed troglodytes in the hinterlands still haven’t received the memo explaining how unions will lead the state in its evolution to a more Progressive society, under the firm but benevolent hand of government authority.

The typical political, business, and community leader in California today holds fast to the hope that if he feeds the crocodile enough, the crocodile will eat him last. The Establishment often discusses the challenges facing the state’s future without mentioning union political power and the vigorous ideological visions of union leadership.

But a few stubborn fanatics have declined to leave for Texas and instead stick around to harp on outdated, embarrassing notions such as “fiscal responsibility,” “limited government,” “free markets,” and “constitutional doctrines.” These insidious rebels are constantly figuring out clever ways to subvert and circumvent the Left.

Here are some recent critical reports about these people from union officials and union sympathizers. Many of these reports contain inaccuracies about strategies and logistics of the resistance, but the reports are valuable in showing the nature of the resistance.

This Week in the War on Workers: Fending Off the ALEC of the Construction Industry in California – Daily Kos – August 24, 2013

  • “The Associated Builders and Contractors, AKA the ALEC of the construction industry, doesn’t like this so much. So it’s been turning its attention to charter cities, which can make their own laws, trying to get cities to adopt charters and to eliminate the prevailing wage.”
  • “This push employs some ridiculous myths, like the claim that cities can save 20 percent on their construction costs by eliminating the prevailing wage.”
  • “As with most of the ABC’s efforts, it’s important to understand that these are low-road contractors.”
  • “Defenders of the prevailing wage have been doing a good job fighting off city by city attacks, but ABC is relentless, bringing up and helping to fund the same charters in city after city.”

CEO Comes Out Swinging in Favor of SB7, Prevailing Wages, and the Race to the Top – We Party Patriots – August 22, 2013

  • “In recent years, anti-union groups have supported ballot initiatives throughout the state that would designate cities as charter cities specifically to avoid paying prevailing wages on public works projects.”
  • “a subject that has been trumpeted by anti-prevailing wage crusaders time and again: alleged savings associated with gutting wages.”
  • “SB7 is a response to lobbying attempts by contractor associations who wish to change California law for the worse.”

CEOs and Business Leaders for Prevailing Wage – Modesto Bee (op-ed) – August 19, 2013

  • “some Charter Cities have exempted prevailing wages in a shortsighted effort to save money, but the true costs outweigh any perceived benefit.”
  • “out-of-state lobby groups have recently mounted an effort — city by city — to encourage local leaders and politicians to place charters on the ballot in order to eliminate prevailing wage.”
  • “They promise savings of as much as 30 percent on projects.”
  • “The lobbyists making these arguments either don’t know what they are talking about, or they are being deliberately misleading.”
  • “The idea for SB7 didn’t appear out of the blue. It was a logical response to lobby groups trying to convince more cities to make the mistake of eliminating prevailing wage.”

Just What is a ‘Prevailing Wage?’ – Pomerado News (op-ed) – August 24, 2013

  • “Don’t count on the support of most contractors, or developers, or anti-worker politicians for a living wage.”
  • “‘It costs too much, it’s taxpayers’ money,’ they scream.”
  • “Of course, detractors trot out examples of someone being paid an exorbitant rate for a menial job, but those incidences are few.”
  • “With the exception of San Diego, whose original charter dates from the 1800s, the rest of these cities adopted charters relatively recently, for the most part, to avoid paying prevailing wages.” (Note: San Diego has maintained a policy of no government-mandated wage rates for construction contractors since 1980 – see the July 30, 2013 www.UnionWatch.org article After 33 Years, San Diego Submits to State Prevailing Wage Law.)

Prevailing Wage: Moving Forward in California, Backward in Other States – From the President, State Building and Construction Trades Council of California – July 2013

  • “Here is some of what the Building Trades are doing. The hallmark bill for 2013 is Senate Bill 7, to make charter cities eligible for state funding for public works projects only if they pay prevailing wage. Charter cities may choose to exempt themselves from prevailing wage, and some do. This measure would provide a strong financial incentive for those cities to stop shortchanging working men and women with substandard wages.”
  • “Speaking of charter cities, Senate Bill 311 requires that charter city conversion elections be held in a statewide general election, where voter participation is highest, in order to protect workers from the tactic of passing conversion measures in lower turnout municipal elections.”
  • “We are also protecting prevailing wage with Senate Bill 776, to prevent anti-union contractors from defining sham labor compliance committees as a fringe benefit, which can then be deducted from workers’ wages as a portion of the prevailing wage. The Associated Builders and Contractors, the anti-union group, have been using these deductions to fund themselves for their relentless drive to destroy construction unions.”
  • Assembly Bill 26 requires that contractors that do work in refineries carry a workforce that has been trained and graduated in state-approved construction apprenticeship programs, and requires those workers be paid the prevailing wage for construction workers in the area.” (A push to require prevailing wage on private projects! Note: see Senate Bill 54 for the current manifestation of this proposal. It will knock the Steelworkers union out of California refineries as well as non-union industrial contractors – see the August 26, 2013 Los Angeles Times article Two Unions Wage Turf Battle Over Oil Refinery Workers: A state bill would help the State Building & Construction Trades Council of California grab control of thousands of United Steelworkers jobs.)
  • “California’s working people have fought together with a tenacious resolve and unity in recent election cycles to elect forward-looking individuals to our Legislature and statewide offices…When we compare these worthy actions with the sad developments in many other states, we see the clear benefits of our unity and activism…”

Governor Jerry Brown signed Senate Bill 776 into law today (August 27, 2013), cutting off funding to the one independent labor compliance investigative program among several dozen union-affiliated labor-management cooperation committees operating in the state. Will these bills finally allow the “forward-looking individuals” aligned with unions in state and local government to advance their agenda unimpeded?


Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at www.laborissuessolutions.com. Follow him on Twitter at @DaytonPubPolicy.

California’s Unionized Construction Workforce: Surprisingly Low Rates…and Dropping

On January 23, 2013, the U.S. Department of Labor’s Bureau of Labor Statistics issued its annual Economic News Release: Union Members Summary. It announced that the overall union membership rate – the percent of wage and salary workers who were members of a union – dropped from 11.8 percent in 2011 to 11.3 percent in 2012. The rate of union workers in the private workforce was 6.6 percent in 2012, while the rate of union workers in the government workforce was 35.9 percent.  In 2012 there were more public employee union members (7.3 million) that private industry union members (7.0 million).

In the United States, 13.2 percent of construction workers belonged to a union in 2012 (with 13.7 percent represented by a union). This percentage has been declining since the late 1960s. It dropped from 14.0 percent in 2011.

A similar decline in union membership and representation is seen in the California construction workforce. In the 1960s, the construction workforce in California was overwhelmingly unionized, with official statistics indicating a unionization rate that exceeded 100% (because of statistical anomalies). But the percentage started dropping precipitously after that, as indicated by the establishment of various chapters of the non-union Associated Builders and Contractors in California in the mid-1970s.

The low percentages of unionization in the California construction industry and their decline through 2012 may be surprising to people who see significant political power for construction unions on the state and local levels of government. Here are statistics for California from 1983 to 2012 and for the San Francisco Bay Area and Los Angeles area from 1986 to 2012. 

California

Year

# of Workers

Union Members

Percentage that are Union Members

Covered by Union Agreement

Percentage Covered by Union Agreement

1983

398,031

156,189

39.2

164,233

41.3

2000

738,760

176,288

23.9

183,577

24.8

2006

1,007,227

175,828

17.5

181,604

18.0

2007

1,082,631

178,624

16.5

184,031

17.0

2008

923,815

186,994

20.2

196,386

21.3

2009

734,894

129,251

17.6

132,541

18.0

2010

707,158

110,716

15.7

116,498

16.5

2011

686,035

115,619

16.9

124,965

18.2

2012

746,875

119,015

15.9

122,449

16.4

Los Angeles-Long Beach-Riverside Metropolitan Area

Year

# of Workers

Union Members

Percentage that are Union Members

Covered by Union Agreement

Percentage Covered by Union Agreement

1986

272,836

64,392

23.6

71,653

26.3

2000

334,521

61,972

18.5

66,668

19.9

2006

499,943

79,090

15.8

81,972

16.4

2007

516,433

71,980

13.9

75,143

14.6

2008

458,099

74,017

16.2

76,700

16.7

2009

383,252

75,975

19.8

78,226

20.4

2010

356,387

56,549

15.9

58,651

16.5

2011

350,176

56,955

16.3

60,349

17.2

2012

342,007

53,826

15.7

55,027

16.1

San Francisco-Oakland-San Jose Metropolitan Area

Year

# of Workers

Union Members

Percentage that are Union Members

Covered by Union Agreement

Percentage Covered by Union Agreement

1986

139,884

72,416

51.8

72,416

51.8

2000

155,118

53,839

34.7

53,839

34.7

2006

205,208

55,579

27.1

55,579

27.1

2007

236,372

51,243

21.7

52,288

22.1

2008

229,711

70,441

30.7

70,441

30.7

2009

158,908

31,685

19.9

32,724

20.6

2010

167,332

19,623

11.7

21,776

13.0

2011

153,608

33,095

21.5

37,044

24.1

2012

179,883

31,373

17.4

32,390

18.0

 
What is stunning about these percentages is the decline in the unionized percentage of the California construction workforce during and after the collapse of the residential construction market from 2007 to 2009.

In the 2000s, residential construction was generally non-union throughout the state, and the virtual stop to residential and commercial construction should have proportionally lifted the percentage of union workers as public works and health care (types of building construction with a stronger union presence) became more dominant in the industry.

In addition, it appears that construction unions were not successful in holding or gaining market share through their political strategy of government-mandated Project Labor Agreements and their litigation strategy of exploiting the California Environmental Quality Act (CEQA) to pressure private developers into Project Labor Agreements. One can only guess at the percentage of unionization if top construction union officials did not promote and practice these strategies.

I expect someone at the University of California Miguel Contreras Labor Program will one day help the unions examine the possible causes of this unexpected trend in the California construction industry. For now, I will guess that difficult economic circumstances starting in late 2007 and early 2008 created a more competitive bidding environment (on both public works and private construction) in which unionized contractors had difficulty competing for and winning bids. Prosperous economic times (such as 2000 and 2006) seem to benefit union representation in the construction industry. At state and local government meetings in 2009, 2010, and 2011, construction union lobbyists routinely reported 25 to 35 percent unemployment rates among their membership.


The best neutral source of information regarding union density is the Union Membership and Coverage Database, available at www.unionstats.com. This is an Internet data resource providing private and public sector labor union membership, coverage, and density estimates compiled from the Current Population Survey (CPS), a monthly household survey, using U.S. Bureau of Labor Statistics methods.

Union statistics in specific metropolitan areas for private construction are found in this category: III. Metropolitan Area: Union Membership, Coverage, Density, and Employment by Metropolitan Area and Sector, 1986-2012. Two regions of California are included in this category: the San Francisco Bay Area and Los Angeles.

Kevin Dayton is the President and CEO of Labor Issues Solutions, LLC and is the author of frequent postings about generally unreported California state and local policy issues at www.laborissuessolutions.com.

Watch Union Official’s Rude Antics at California High-Speed Rail Conference

On January 11, 2013, a video camera recorded a stunning public tirade by Fresno’s top construction union official at a conference about supposed local contracting opportunities for the first segment of California’s High Speed Rail. Below is video footage of the beginning of a panel discussion about Project Labor Agreements, and below that is the ignominious ending of the panel discussion a few minutes later.

The incident exposes the coercive power of special interest groups behind the California High-Speed Rail Authority’s quest to slice the first segments of this rail corridor through the San Joaquin Valley, located in the middle of the planned route between San Francisco and Los Angeles. It also compromises the California High-Speed Rail Authority’s relentless public relations program to portray the high-speed rail to coastal urbanites as a progressive, visionary plan to save the planet.

An effective public relations campaign depends on major news media focusing on idealistic concepts, rather than the coarse ground game related to which people from which places get the jobs to perform the actual construction. But while idealistic concepts for environmental sustainability are promoted by professional activists who work for non-profit environmental and public transit advocacy organizations, building the high-speed rail requires construction trade workers. This injects union officials from the San Joaquin Valley into the coalition to build the rail line. And one of those union officials tarnished the progressive image on January 11.

Background: Why Will Unions Get a Monopoly on Building California’s High-Speed Rail?

Construction trade unions have long planned to use the government as its agent to monopolize the building of high-speed rail, now estimated by the California High-Speed Rail Authority to cost $68.4 billion. It seemed probable (but not guaranteed) that union workers that specialize in heavy industrial infrastructure construction would end up building the rail line itself. However, the stations and other building infrastructure would be prime bidding targets for Northern California’s productive and efficient non-union contractors. And unions do not want another failure similar to their failed plot ten years earlier to win a Project Labor Agreement to build the new University of California campus in Merced.

That plan – backed by Governor Gray Davis – was undermined in 2001 and 2002 by San Joaquin Valley business, political, and community leaders, who worked with some aggressive construction business associations to expose and criticize the scheme. In the end, bidding was done under fair and open competition, and non-union contractors and their non-union employees were prominent in building the new campus.

This time, things are different. Unions provided campaign support to pass Proposition 1A (the “Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century”) in November 2008. The head of the State Building and Construction Trades Council of California was appointed to the High-Speed Rail Authority Board of Directors, along with an official for the Operating Engineers Local Union No. 3, which represents operators of cranes, excavators, and other construction equipment.

So it shouldn’t be a surprise that Section 7.11.3 of the Request for Proposal for Design-Build Services for the first segment of the California High-Speed Rail project states that “Proposers are advised that, subject to FRA [Federal Railroad Administration] approval, the Authority intends to develop a Community Benefits Agreement consistent with the Community Benefits Policy adopted by the CHSRA [California High-Speed Rail Authority] Board at its December 6, 2012 meeting with which the Contractor will be required to comply.” (Note: “Community Benefits Agreement” is a euphemism for “Project Labor Agreement” meant to give the public a nice warm feeling about a union sweetheart deal.)

And Section 10.1 of the Request for Proposal states that  “The Authority [that is, the California High-Speed Rail Authority CEO Jeff Morales] will not make a recommendation for award of the Contract [to the California High-Speed Rail Authority Board of Directors] unless the successful selected Proposer has submitted the following: Escrowed Proposal Documents and corrected any deficiencies identified by the examination of the EPDs, and A letter of assent executed by the Proposer agreeing to be bound by the Community Benefits Agreement.” This indicates a government-mandated Project Labor Agreement.

California High Speed Rail Project Labor Agreement Mandate - Section 10.1

California High Speed Rail Project Labor Agreement Mandate – Section 10.1

In addition, the California High-Speed Rail Authority arranged the bidding process on the first segment of the High-Speed Rail (from Madera through Fresno) so that the five prequalified design-build construction consortiums are obligated to sign a Project Labor Agreement with the State Building and Construction Trades Council of California in order to be competitive. This subtlety is possible because the High-Speed Rail Authority is authorized to select the winning bidder using a somewhat subjective scoring system based on “best value” procurement criteria.

On December 6, 2012, the California High-Speed Rail Authority voted for a policy resolution that established generalized “community benefits” that contractors would have to demonstrate as a result of building the high-speed rail through the Central Valley. Not surprisingly, these same benefits are cited in the union Project Labor Agreement that is now included as a “Community Benefits Agreement” in Addendum 8 of the bid documents for the first segment of the high-speed rail. In order to maximize the score for community benefits, the contractor simply agrees to the Project Labor Agreement, and then everyone will feel good that ‘Needy’ Workers Will Get Jobs on High-Speed Rail.

For technical details about the provisions of this Project Labor Agreement, see my comprehensive, 4000-word Analysis of the Phony Community Benefits and Other Provisions in the Union Project Labor Agreement for the First Segment of California’s High-Speed Rail.

Unexpectedly Defiant Resistance to the Project Labor Agreement Provokes Union Anger

A panel discussion about the draft Project Labor Agreement for the construction of the first segment of the California High-Speed Rail was scheduled for 1:30 p.m. on Friday, January 11, 2012 during the 6th Annual San Joaquin Valley Region Public Contracting / Central Valley High Speed Rail Conference / Expo (Jobs & Contracts) at the Downtown Fresno Radisson Hotel & Convention Center. The panel moderator was Kathleen Ellis Faulkner, a Bakersfield attorney.

Three invited panelists showed up: John Hutson, Secretary-Treasurer of the Fresno, Madera, Kings and Tulare Counties Building and Construction Trades Council (this organization lacks a web site), Eric Christen of the Coalition for Fair Employment in Construction (a Project Labor Agreement opponent), and Nicole Goehring of the Northern California Chapter of Associated Builders and Contractors (another Project Labor Agreement opponent). As you hear in Video #1, organizers of the panel discussion had asked other union officials to participate (some apparently chose instead to sit in the audience).

As shown in Video #1, Hutson was flummoxed to find out he would be defending the unions’ Project Labor Agreement instead of explaining to the construction companies of the Central Valley how they would soon enjoy the benefits of unionization under the Project Labor Agreement if they hoped to work on the High-Speed Rail. He expresses his astonishment that “some little kid” was handing out information from Associated Builders and Contractors about Project Labor Agreements. He then proceeds to tell a colorful story from “when he was a small boy” about farm life.

None of this has anything to do with the terms and conditions of Project Labor Agreements in bid specifications for construction contracts, and Video #2 shows what happened when an effort was made by the moderator to get the panel discussion on track.

Hutson complains that Eric Christen is “edging it on” and “smiling it up.” (Did he mean “egging it on?”) He then says to Christen, in defiance of social norms of respect for other people as promoted by the White House and the U.S. Department of Labor, “I think I recognize you from before your sex change operation.”

The moderator tries to take the microphone away and restore order, but Hutson resists: “get your hands off.” Then he walks away from the table, only to return to spit out some profanity (specific words heard by witnesses but not quite audible on Video #2). He then storms out of the room (and the hotel) with his fellow union officials, leaving the contractors sitting in the room stunned at the personal attacks and derogatory statements launched during the five-minute panel discussion.

A press release jointly issued on January 11, 2013 by the Coalition for Fair Employment in Construction and Associated Builders and Contractors quoted a Fresno-based construction company owner who attended the panel discussion:

I took time away from my workday to be here to discuss this important issue on behalf of my employees that prefer to work in a merit shop environment. The antics displayed today represent the reason why I left the Union many years ago. The taxpayers and voters of California should be deeply concerned about the union favoritism displayed in this agreement.

In November 2008, 52.7% of California voters supported Proposition 1A, called the “Safe, Reliable High-Speed Passenger Train Bond Act for the 21st Century.” How many of them assumed that the 21st Century would involve these kinds of union antics?

Kevin Dayton is the President and CEO of Labor Issues Solutions, LLC and is the author of frequent postings about generally unreported California state and local policy issues at www.laborissuessolutions.com.