Wednesday, August 17, 2011

Builders Will Risk Two Strikes To Cut Union Wages

Developers who claim they are losing market share to nonunion competitors are backing up industry association. A strike by more than 25,000 carpenters and 2,700 concrete workers could begin on Wednesday.

Some of the city's leading developers met last week and decided to bear the short-term pain of another concrete workers strike—which might begin as early as Wednesday—in order to win concessions that could help them regain market share from nonunion developers of hotels and residential buildings.

The proliferation of nonunion residential and hotel projects in recent years is the driving force behind the holdup at the bargaining table. In Manhattan alone, residential projects built recently or under construction by nonunion labor include a 43-story Holiday Inn on Washington Street; 16-story and 13-story residential buildings on West 23rd Street; a 12-story mixed-use building on Avenue D; and a 14-story residential building on Columbus Avenue.

Sources said developers met last Tuesday with representatives of the Cement League, the industry association handling contract negotiations, and vowed to support the Cement League's demand for a 20% wage reduction on residential and hotel projects. “The bottom line is building owners are prepared to take a strike,” said one participant in the meeting. “The market is sliding away.”

The contract covering 2,700 concrete workers expired June 30, but talks have been extended several times as the industry group and the Cement and Concrete Workers District Council have tried to hammer out an agreement.

The League's continued insistence on the 20% cut led to a three-day strike earlier this month at sites across the city, including 1 World Trade Center and the nearby transit hub. Arbitrators ordered striking workers back to several sites that are covered by no-strike project labor agreements, including the second World Trade Center tower, Madison Square Garden, a luxury residential development on West 57th Street and a new Weill Cornell Medical College research center.

The strike ended at the non-project-labor-agreement sites when the two sides agreed to extend talks through Aug. 16. But they've yet to come to an agreement on the residential and hotel pay cut, and developers are preparing for additional work stoppages.

A source close to the building trades said the two sides remain “far apart,” though negotiations are continuing. “The divide doesn't appear to be closing at all,” the source added.

Concrete workers are again expected walk out at sites covered by no-strike agreements. But even if they don't, they could strike at 1 World Trade Center and the transit hub, as well as other sites not covered by project labor agreements.ment.

The deadline to reach new contracts for some 25,000 carpenters is also near. Those deals, which expired June 30, have been extended until Friday as the carpenters continue talks with a half dozen industry associations.

Rank-and-file carpenters are planning to rally Friday afternoon outside their union headquarters on Hudson Street to protest rumored givebacks. It was reported last week that a tentative five-year deal had been reached that cuts pay 5% in the first year. Members of the District Council, which is operating under a federally-appointed review officer, do not get to vote to ratify their contracts. The carpenters union has publicly stated that their members will strike on Friday if the new contract calls for any cut in pay.

Crain's New York Business
August 16, 2011 4:45 PM