Labor Relations Today : Labor & Employment Lawyers & Attorneys : Contract Administration, Collective Bargaining

Following Andy Stern's surprising announcement that he would step down as President of SEIU, his protege, Secretary-Treasurer Anna Burger and California-based labor leader, Mary Kay Henry seek to succeed him.  This weekend, in a memorandum to the union's International Executive Board, Ms. Burger laid out her vision for the priorities she would have the union pursue.  Listed within the first:

Use smart strategies to push the labor‐friendly majority on the NLRB to level the playing field and make it easier to organize through regulation and reconciliation to make quick elections and first contract arbitration the law of the land.

And finally we must face up to the challenge of rebuilding our ability to win traditional NLRB organizing campaigns, as well as exploring new models for organizing the private/private sector where millions of workers, not dependent on shrinking public dollars live on poverty wages in SEIU strongholds.

The first point is likely to raise eyebrows among EFCA-watchers who have recently heard mixed, but generally negative, assessments of the bill's current prospects.

The second point is perhaps more interesting.  A few years ago, when EFCA, card-check/neutrality and corporate campaigns seemed ascendant, the rejection of traditional organizing methods was a primary pillar in the SEIU's break from the AFL-CIO and formation of Change to Win.  This endorsement of a renewed commitment to NLRB processes by the SEIU's probable future leader -- obviously now that there is a former SEIU attorney sitting on the Board -- is notable indeed.

Cross-posted at LaborRelationsToday

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The current issue of Newsweek magazine contains a strongly titled opinion piece, "Unions: We're Better Off Without Them."  The author, Kevin Kelly, C.E.O. of Emerald Packaging in Union City, California. recounts his experiences with two "exhausting, deeply distracting" union representation campaigns.  He lays out in sensible, composed terms why many small business owners might prefer to operate without a union representing their employees, and he expresses his concerns about the evolving regulatory environment under the Obama administration in this regard.

Midway through the article, however, Mr. Kelly subtly shifts gears, and articulates sympathy for the most common arguments in support of EFCA:

Others are taking a more activist approach. One small business person wrote to his senator urging her to vote against the legislation, or at least amend it so that some sort of election period is preserved. "My argument is that the company should have at least some period to make its case," he says. Like many businesspeople, he worries that a union organizer might bully an employee into signing a card. I can't help but feel that prevention is the better route though. When, not if, a bill passes, I'd rather be a less susceptible target thanks to good employee relations.

Years ago that union drive certainly woke me up. Almost overnight we quickly overhauled our employee relations. We put a pay scale in place so that raises occurred in a timely manner and not just at the whim of a manager. We hired a human resource manager to handle day-to-day employee issues, tackling problems like reimbursements for health care costs. I began to meet regularly with employees, including periodic meals with each of our three shifts. These meetings often last two hours—or more—as employee's list ways they think the company could be improved, often offering ideas to boost productivity or quality.

I must confess, unlike many businesspeople, I do have a soft spot for the spirit of EFCA. While I can't agree with doing away with elections, I do accept that six weeks is far too long. If a company can't make its case in three weeks, then it likely deserves the union it gets. Six weeks gives employers too much time to wear employees down. Forcing workers to sit through meeting after meeting, bashing the union, hinting that the company might move or close if the union wins, probably is the corporate equivalent of the fear many businesspeople carry that union organizers might manhandle our employees into signing cards.

There is nothing inconsistent in Mr. Kelly's assertions here and his objection to EFCA, or his desire to operate union-free.  Indeed, many of his insights should be extremely helpful to like-minded small business owners. 

One might also read the last few paragraphs, however, and ask what special insight Mr. Kelly might have into the current efforts underway to make EFCA more palatable to 60 Senators.  Many of the positions referenced here -- preservation of the secret ballot, quicker elections, restricting employer meetings -- are elements frequently discussed in connection with possible substitute labor law reforms. 

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At Town Hall, Carl Horowitz examines the ongoing corporate campaign by Labor and its allies against Starbucks. Horowitz generally notes the irony in the Far Left-Labor alliance continually hammering the coffee giant, which has always "sought to be a hybrid of profit-seeking and social responsibility."  Among other elements of this campaign, Horowitz notes recent developments following Starbucks' announcement just months ago, that it was forming the "Committee for a Level Playing Field", along with CostCo and Whole Foods to explore alternatives to EFCA:

EFCA, as many are aware, has stalled. In 2007, the House passed the measure, but Senate Republicans successfully blocked it. The bill, not unpredictably, has been re-introduced in the new Congress; President Obama has vowed to sign it. Yet even with wide Democratic majorities in the House and Senate this time, the measure remains highly vulnerable to filibuster. A number of Senate Democrats such as Blanche Lincoln (Ark.), Claire McCaskill (Mo.), and party convert Arlen Specter (Pa.) believe the Employee Free Choice Act is ill-suited to deal with the current recession, if not necessarily wrong in principle. Union leaders such as Service Employees President Andrew Stern have expressed pessimism over the prospects for passage.

Here’s where the Seattle-based Starbucks fits into the picture. This March, Starbucks’ Howard Schultz, Whole Foods’ John Mackey and Costco’s James Sinegal announced the formation of an ad hoc group, the Committee for a Level Playing Field for Union Elections. The purpose is to create a Third Way that would protect union organizing rights while retaining the secret ballot. The project would guarantee a fixed time period in which to hold a secret-ballot election and increase penalties upon employers and unions who violate the law.

Many activists on the Left are enraged at this seeming sellout, which in fact is more tilted toward union interests than it looks. It’s another phase in a continuing battle against Starbucks.

His conclusion?   Starbucks should "smell the coffee and fight back."

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In a post a few weeks ago, we speculated that as EFCA's prospects dwindled, employers might expect to see a recognizable uptick in union corporate campaign activity.  Now that card-check is possibly dropping out of the compromise bill being crafted in the Senate, employers must be prepared to face increased organizing by corporate campaigns.  After all, securing agreement on card-check recognition -- often accompanied by an employer's pledged "neutrality" -- is usually the primary goal of these campaigns.  These efforts confront the target employer with a highly coordinated campaign of negative publicity, consumer pressure, legislative and regulatory action, and litigation in order to coerce acquiescence to union organizing efforts

And it appears that the efforts are indeed becoming more visible again.

Yesterday's Boston Globe reported on Change To Win's latest salvo in its ongoing campaign against retailer CVS Caremark: 

CVS Caremark Corp. last year had a 67 percent increase in the number of state violations for allegedly overcharging customers, the largest of any retailer in Massachusetts, according to a report to be released today.

Consumer advocates and organizers from Change to Win, a coalition of American labor unions, plan to unveil the analysis - compiled from inspection reports from the Massachusetts Office of Consumer Affairs and Business Regulation - and call upon lawmakers to do more to strengthen pricing protections.

Beth Israel Deaconess Medical Center CEO Paul Levy continues his excellent blogging on the SEIU's corporate campaign against the Boston hospital, following up an earlier post this week with "Because It Can":

There are sightings of a new mobile billboard hired by SEIU to burn fuel through the neighborhoods of Boston. Add to that the likely rental of bus and trolley stop ads, the ubiquitous internet ads, on top of purchasing full paid ads in the local newspapers. I am sometimes asked, "Why does the SEIU do this?"

As you all know by now, the ads have nothing to do with organizing workers. They are meant to denigrate the reputation of the hospital as part of a corporate campaign. Even if any of the accusations made in the ads were to be accurate, why would the existence of problems at BIDMC be an argument for unionization? By that logic, what would one conclude from certain types of problems at the SEIU?

And late last week, Cintas announced that it would appeal the recent dismissal of its RICO lawsuit against UNITE-HERE and the Teamsters arising out of the unions' long corporate campaign against the uniform company.  Per a statement released by the company:

“We strongly believe in the merits of this case and are hopeful that the Second Circuit Court of Appeals will not allow the District Court’s decision to stand,” said Scott Farmer, Chief Executive Officer of Cintas Corporation. “We disagree with the recent ruling and remain committed to protecting Cintas and our employees from the unions’ ongoing extortion,” he added.

Cintas alleges that, for the last six years, UNITE HERE and the above named labor organizations have carried on a campaign of negative, untrue and unlawful attacks against Cintas in an effort to extort concessions from the company that would enable UNITE HERE and the Teamsters to become the official bargaining representatives for Cintas employees without a valid showing of majority support and without those employees ever being able to freely decide whether they want a union. At the outset of its corporate campaign against Cintas, Bruce Raynor, Co-President of UNITE HERE publicly stated he intended to ‘break the back’ of Cintas if the company did not agree to his demands. The company has long maintained that the right to choose whether to be a member of a union belongs to each individual employee, and has continually reiterated its commitments to protect its employees’ rights to the secret ballot election process.

Time will tell whether the novel RICO approach by employers will preclude more widespread use of the corporate campaign.  In the meantime, however, since it appears the Congress may be unable to deliver card-check organizing to unions, employers should be prepared to face alternative union efforts to obtain it via this potentially effective method.

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Boston Business Journal reports that the SEIU and Change To Win's Pension Funds will spend the next two weeks increasing their attacks against Bank of America and its CEO, Ken Lewis.  The campaign will include media events, demonstrations and a shareholder proxy movement to oust Lewis.  The Journal notes that "some are beginning to question the motives" of the union:

“They’re after blood. They’re chumming the waters for sharks,” University of North Carolina-Charlotte finance professor Tony Plath says of the union’s campaign. “I’m not a cheerleader for BofA. But let’s be objective about this: These attacks are all about card check.”

Taking the fight to BofA, Plath and others suggest, allows the union to build support for proposed federal legislation called the Employee Free Choice Act, commonly called “card check.” It would allow unions to form by way of a majority, public vote. Secret ballots would no longer be required.

Plath is right.  But the union's intended objective may be narrower than obtaining passage of the Employee Free Choice Act.  The SEIU is engaged in what is known as a "corporate campaign."  Labelled by union organizers as the "death of a thousand cuts," these campaigns attempt to bury the target employer in an avalanche of negative publicity, consumer pressure and legislative regulation, in order to coerce acquiescence to union organizing efforts.  Most often that acquiescence comes in the form of agreement to a "neutrality and card-check" recognition process.  Once the company agrees, the publicity and pressure stops.

A few years ago, a number of employers who found themselves targets of these campaigns filed RICO suits against the unions responsible.  Cintas, Smithfield Foods and Wackenhut Security all sued alleging that the campaigns constituted unlawful racketeering activity.   Smithfield settled its case last year after it survived a motion to dismiss, but just last week a federal judge dismissed the Cintas suit against UNITE-HERE and the Teamsters.  As a result, it remains to be seen whether or not the corporate campaign will remain a viable organizing tactic going forward.  Employers must follow developments.  If EFCA fails in its efforts to replace secret-ballot elections with card-check as the primary method of organizing, one might expect to see a resurgence in corporate campaign activity.

More on corporate campaigns:

• Paul Levy, the President and CEO of Beth Israel Deaconness Medical Center, has chronicled SEIU corporate campaign tactics in numerous posts at his Running a Hospital blog.
• "The Death of a Thousand Cuts: Corporate Campaigns and the Attack on the Corporation" by Jarol B. Manheim; or, his piece for the U.S. Chamber of Commerce, "Trends in Corporate Campaigns," available online in its entirety.
• "Comprehensive Campaign" -- Wikipedia
• MLA's Seth Borden is quoted throughout "RICO Suits: Employers Fight Back Against Union Smear Campaigns" in the Capital Research Center's Labor Watch.

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