Labor Q&A

With litigation in the construction industry on the rise, contractors need professional legal guidance they can count on. The Labor Hotline from the Chicagoland AGC is fast, convenient and FREE.

Participating Chicagoland AGC attorney members, experts in construction law, provide contractor members with a free professional resource they can use to obtain initial guidance on legal issues.

A free 20-minute consultation (it is understood that no attorney/client relationship is established by the assistance given through this service) with one of our participating construction attorneys can help you:

• Identify the core legal issues of your problem
• Evaluate options on how best to address the program
• Avoid costly and time-consuming litigation whenever possible

Call the Chicagoland AGC at 773.444.0465. We will ask you a few questions to help evaluate your inquiry and direct your call. Within 24 hours, a participating attorney will contact you to help define the core legal issues and advise you on how to proceed.

Advice to employers who are caught in the middle of a dispute between the Laborers Union and the Operating Engineers Union involving the landscaping work continues to be that you should not change your historical work assignment on subcontracting practices. These instances are jurisdictional disputes and should be addressed and resolved through the appropriate jurisdictional dispute resolution procedure, not the grievance procedure.

Contractors who are presented with a grievance or other union action involving landscaping work should contact the Chicagoland AGC to determine what avenues are available to them to resolve the dispute, and should supply the joint grievance committee with evidence of their historical assignment of such work.

A Section 10(k) hearing is a hearing held pursuant to Section 10(k) of the National Labor Relations Act. Such a hearing is scheduled when an employer files an unfair labor practice charge alleging that a union has engaged in an unfair labor practice with regard to a jurisdictional dispute. The purpose of the 10(k) hearing is to determine which union should be awarded jurisdiction in these particular circumstances. Of the factors looked at by the NLRB in such a hearing, the most important are generally the employer’s choice of who should be assigned the work and the past practice in such assignments.

Scenario: My firm is signatory to the collective bargaining agreement between MARBA and the Laborers’ District Council of Chicago and Vicinity. My firm was recently selected for a field payroll review on behalf of the trustees of the Health and Welfare Department of the Union. The purpose of the review is to determine that the proper contributions due to the various fringe benefit funds have been made. The funds stated that it will be necessary for their accountants to have access to and be able to review company records, like quarterly and annual payroll taxes, individual employee earning records, cash disbursements, lists of employees, fringe benefit contribution reports and others. Do I need to provide access to these records?

As part of their fiduciary responsibility to beneficiaries, Union Trust Funds* routinely conduct audits of signatory contractors to determine that proper contributions are being made by the contractor. These audits protect contractors by ensuring a level playing field for all. To meet the audit objective, labor and management fund trustees and legal counsel advise that the records noted above and others that are reasonably necessary to achieve the stated objective of the audit are to be provided by the contractor. If the contractor does not produce the records, and the fund insists on them, the fund can file a lawsuit to force the contractor to produce the records it feels are reasonably necessary for the audit.

Under a 9(a) agreement, if an employer wishes to withdraw from a multiemployer bargaining unit, it must provide “adequate written notice given prior to the date set by the contract for modification, or to the agreed upon date to begin the multiemployer negotiations.” The employer must withdraw from the multiemployer unit in advance of multiemployer negotiations. Failing to provide notification of withdrawal can be enough to bind an employer to the new CBA negotiated between the union and the multiemployer association that bargained the previous contract. If the contractor is bound to a 9(a) agreement, it must continue to recognize the union after a contract expires unless at the end of the contract turn the union loses a decertification election or there is objective proof that the contractor’s employees no longer desire union representation.

Under an 8(f) agreement, an employer is not automatically bound to a new CBA, nor is it obligated to negotiate with the union upon expiration of the contract. Multiemployer negotiations will not bind an 8(f) employer to a successor contract reached through those negotiations. If the contractor has an 8(f) agreement, federal labor law would allow him to repudiate the union and try to operate on a non-union basis. Whether or not such repudiation is practical will depend on a wide variety of factors that will differ from each contractor.

There are no restrictions in the Carpenters agreements on the right of an employer to “lay off” a superintendent and then “rehire” him as a journeyman, assuming that he was a journeyman before being promoted. The employee should be treated the same as any other journeyman with respect to wages and benefits, so that the Union does not say he is really a superintendent working with the tools or that you have adopted a practice of paying 160 hours per month for all journeymen.

Scenario: A contractor that is signatory to the Chicago Carpenters Union worked on a project outside of that Union’s jurisdiction. On the project, the firm used its own Chicago Carpenter Union employees. During construction, the firm continued to make benefit contributions to the Chicago Carpenters Union Fringe Benefits Funds for all hours worked by those carpenters. However, the Local Union Funds with jurisdiction in the area where the project was located, audited the contractor and demanded that benefit contributions be made to their Local Funds. Does the firm need to make these payments?

The contractor needs to first determine if it is signatory to a Carpenters labor agreement covering the location where the project is located. If so, benefits are generally to be paid to the “out-of-town” Union Funds. Such Funds may or may not have an agreement to reciprocate such payments to the employees’ “home funds.” Even if there is a reciprocity agreement there may be obligations to contribute to local union training and advancement funds that are included as a part of a reciprocity agreement. However, the Fox Valley Carpenters and Chicago Carpenters have agreed that fringe payments may be paid back to the “home local” for their respective members working in the other union’s jurisdiction under the “money follows the man” principle.