Labor Union News

January 2010Newsletters California UPDATE Employment Law

Plumbers Union Forced To Shut Down Resort

Konocti Harbor Resort and Spa is closing its doors. The 261-room resort in Lake County, just north of Napa, was owned by Plumbers and Pipefitters Local 38 of San Francisco. Pursuant to a consent decree with the Department of Labor, the union was required to sell the property in order to settle charges that $35 million in pension fund money had been illegally diverted to the operation of the resort. (Chao v. Mazzola, N.D. Cal. 2007). Some 700 employees, most of them members of UNITE-HERE Local 2850, will lose their jobs.

Vallejo Contract With Electrical Workers Voided by Bankruptcy Court

The City of Vallejo, north of San Francisco, went into Chapter 9 bankruptcy proceedings last year. It was widely acknowledged that overly rich union contracts had busted the city. The leverage of the bankruptcy proceedings allowed the city to negotiate new contracts with the police and fire unions. The IBEW, however, refused to budge. The city appealed to the bankruptcy judge, who threw out the union contract under the principles set forth by the Supreme Court in NLRB v. Bildisco (1984). This is the first time that Bildisco has been used in Chapter 9 proceedings to void a collective bargaining agreement for a municipality.

UNITE-HERE Strikes at San Francisco Hotels; Threatens To Strike in Los Angeles

The contract between UNITE-HERE Local 2 and 32 major hotels in San Francisco expired in August of last year. For the first time in decades, the hotel companies are all bargaining separately. There is no multiemployer bargaining group, and there is no strike-lockout pact among the companies. So Local 2 is conducting rolling strikes, hitting different hotels unannounced for a week at a time. Health insurance cost is the main issue. Mike Casey of Local 2 has called for a national boycott of San Francisco tourist facilities until the hotels capitulate. In Los Angeles, Local 11 is bargaining separately with 21 major hotels whose contracts have expired. Maintenance of cost-free health coverage and wage parity with San Francisco are issues for the union.

Meanwhile, UNITE and HERE are engaged in civil war. The much heralded marriage of the two powerful unions has ended in a messy divorce, leaving some employers unclear as to which union represents the employees. Also, the SEIU is in a bitter battle in California with a spin-off called the National Union of Healthcare Workers. The two rival unions are trading charges of voter fraud and theft of funds.

California Supreme Court To Review LA Grocery Workers Ordinance

In a gift to the United Food and Commercial Workers (UFCW), the Los Angeles City Council enacted an ordinance that required purchasers of large grocery stores to retain all of the seller’s employees for at least 90 days. This, of course, effectively prevents a buyer from acquiring the assets of a business (without the employees and a union contract) and hiring its own workforce. Lower courts have ruled that the ordinance is void and preempted by state and federal law. Cal. Grocers Ass’n v. Los Angeles (2009). The California Supreme Court has granted review. The UFCW is obviously hoping for a reversal.

Orange County Bans Project Labor Agreements

The Orange County Board of Supervisors has voted to prohibit “prevailing” wage labor agreements on county projects. In a direct repudiation of construction trade unions, the board stated that project labor agreements were “anti-competitive” and “discriminatory” toward non-union contractors.