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Life After Indeck:What It Means to You
What effect will the Indeck decision have on owners, unions and construction industry contractors?
Richard Reibstein,
Attorney At Law |
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Richard Reibstein is a partner in the labor and employment law practice of WolfBlock LLP, where he heads the practice in the firm’s New York City office. He is a former counsel to an NLRB member, and represents a number of construction industry employers in their legal matters involving labor relations, including responses to threats of strikes and picketing. Reibstein was lead counsel for Indeck Energy Services in the case that is the subject of this article. E-mail: rreibstein@wolfblock.com
Web site: www.wolfblock.com |
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For years, owners and contractors have wrestled with project labor agreements. Should we sign one with the unions? Can we secure meaningful concessions if we do? Can we afford to build the project on a union basis? Will unions interfere with our regulatory approvals? The National Labor Relation Board’s Indeck decision impacts these and other related business concerns and raises many questions.
Are all agreements to make a project “all union” illegal under the Indeck decision?
Yes, where they were not negotiated within the context of collective bargaining for the owner’s or the CM’s own employees. In fact, even voluntary agreements entered into outside the context of collective bargaining negotiations are prohibited, inasmuch as section 8(e) prohibits both employers and unions from doing so.
Can owners or CMs unilaterally require all contractors on a particular project to sign a project labor agreement?
While federal labor law permits such unilateral action, some unions might not accept a non-binding decision and may insist that the owner or construction manager enter into an all-union agreement, even though it may violate federal labor law. That is exactly what happened in the Indeck case: the unions demanded a binding commitment on the part of the owner.
What can you do if a union threatens to picket a project?
The Indeck case suggests that you can now have NLRB put an end to such picketing, where the demand for an all-union project is made outside the collective bargaining process.
What about antitrust concerns after Indeck?
They remain real. In deciding Indeck, the NLRB relied on a 1974 Supreme Court case, Connell Construction Co. In Connell, the Supreme Court stated that agreements between a union and an employer that provide for an all-union work force are only valid in the construction industry if they are entered into within the context of a collective bargaining relationship—or possibly where they are for the purpose of reducing jobsite friction created by union and non-union employees working side by side.
The Supreme Court’s decision in Connell was an antitrust case brought by a nonunion contractor. The antitrust case proceeded after the Supreme Court found that the all-union agreement was not protected by federal labor law.
What are the anticipated union responses to the Indeck decision?
While the unions in Indeck have chosen to abide by the decision, this does not mean that unions will forego the powerful political tactic of using the regulatory process to secure all-union agreements outside the collective bargaining process.
In Indeck, the unions failed to demonstrate that the purpose of the agreement was to reduce workplace friction between union and nonunion employees. It is expected that unions will try to recite that purpose when they seek all-union agreements in the future. But their success before NLRB and the courts is by no means assured.
Where does the Indeck decision leave the issue of PLAs?
Indeck has re-ignited the issue of PLAs, and laid the groundwork for owners and contractors who wish to resist such efforts by construction unions. It also poses legal hazards to owners and contractors that wish to play ball with the unions.
Although practical considerations may be the guiding light for some owners and CMs, it would be imprudent to ignore Indeck and the current state of the law before entering into, or resisting, all-union agreements. Thoughtful owners and contractors should, on the one hand, seek to take advantage of the Indeck decision or, on the other hand, attempt to minimize exposure to legal challenges that could disrupt even the most practical course of conduct.
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