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Labor Relations News Update April 4, 2014

Today’s Labor Updates:

BP Australasia to close Brisbane refinery

APRIL 2014 Select events and news from the world of organized labor

Demonstration by European labor unions sparks street clashes in Brussels 


BP Australasia to close Brisbane refinery


By Rick Wilkinson OGJ Correspondent

BP Australasia has announced the imminent closure of its Bulwer Island refinery at Brisbane. The 96,850-b/d facility will close by mid-2015 with the loss of more than 350 jobs, slicing another piece from Australia’s diminishing local production of petrol, diesel, and other fuels. The company is investigating the option of turning the refinery into a fuel import terminal.

BP Australasia Pres. Andrew Holmes said the decision was taken because the refinery could no longer compete with the growing number of ultralarge refineries in Asia.

He said BP’s best option for strengthening its long-term supply position in the Australian east coast retail and commercial markets is to buy in product from other refineries.

The move comes despite BP investing heavily in the Bulwer island plant over the last decade to maintain its viability.

At this stage BP’s other Australian refinery—the 138,698-b/d facility at Kwinana, south of Perth, in Western Australia—will remain open. It has the advantage of being the only refinery in the western half of Australia and can count on crude supply from local oil fields.

BP’s Brisbane closure announcements comes on the heels of Shell Australia’s announcement in February of the sale of its 118,000-b/d Geelong refinery in Victoria and its network of 870 retail outlets across the country to Dutch group Vitol for $2.9 billion (Aus.).

Shell had already closed its Sydney refinery and Caltex Australia is getting ready to convert its Sydney refinery to an import terminal by yearend.

Caltex has another refinery—Lytton—at Brisbane that will remain open at this stage. BP says it has a long-term agreement with Caltex for road transport fuels from Lytton and it will import other fuels, including jet fuel from elsewhere.

The Bulwer Island refinery was built by Amoco PLC in 1965. It was taken over by BP in 1984.


APRIL 2014 Select events and news from the world of organized labor


Strikes & Labor Disputes

Major Contract Settlements & Negotiations

Administrative, Court & Other Decisions

Legislation & Politics

Crime, Corruption & Other Misdeeds




National Labor Relations Board (NLRB or the Board) Region 13 Director Peter Sung Ohr ruled that Northwestern University football players receiving scholarships to perform football-related services under a contract for hire in return for compensation are subject to the school’s control and are employees under the National Labor Relations Act (NLRA). Ohr also directed an election for the players to choose whether to be represented by the College Athletes Players Association. Ohr found that the 2004 Brown University ruling, which held that graduate students assistants do not qualify as employees, was inapplicable because the players’ football duties are not related to their studies. Additionally, the fact that the players spend 40-50 hours per week on their football duties and that the football program generates millions of dollars in revenue for the school support a finding that the players are employees. Northwestern has stated that unionization and collective bargaining are inappropriate avenues to address player concerns and plans to appeal the decision.

Flight attendants at U.S. Airways voted in favor of the Association of Professional Flight Attendants (APFA) as their bargaining representative. The APFA will represent some 24,000 flight attendants and will work jointly with the Association of Flight Attendants-CWA to negotiate with the newly merged U.S. Airways and American Airlines. The unions expect a new contract to be executed in early 2015.

Workers at Pilot Flying J gas station and rest stop in Bloomsbury, N.J. voted, 12-7, in favor of representation by the Retail, Wholesale and Department Store Union. The 22 gas station attendants, cashiers, stockers, maintenance workers, and coffee hosts are the first group of employees in the 650-location retail chain to choose union representation.

Nongaming employees at the Quad Resort and Hotel in Las Vegas, a Caesars Entertainment Corp. property, voted by card check in favor of representation by the Culinary Workers Local 226 and Bartenders Union Local 165. The card check neutrality agreement used was part of a January collective bargaining agreement covering employees at seven Caesars casino hotels on the Las Vegas strip.

Voting 287-273, workers at the Novelis plant in Scriba, N.Y. rejected a representation bid by the United Steelworkers (USW). The USW has filed unfair labor practice charges with the NLRB, alleging Novelis used threats and coercion towards employees in connection with the election.

Employees at Tallwoods Care Center, a long-term care facility in Berkeley, N.J. voted in favor of union representation. Local 1199 SEIU Healthcare Workers East will represent 205 direct care, housekeeping, and food service workers.

According to membership figures obtained by Bloomberg BNA, the AFL-CIO gained more than 1 million new members in 2013. The membership of the 56 member unions of the AFL-CIO averaged 9,367,473 members, an increase of 1,016,783 compared with 2012. Notably, though, this latest figure reflects the addition of 1,034,969 United Food and Commercial Workers (UFCW) members after the UFCW re-affiliated with the AFL-CIO in August. UFCW’s re-affiliation helped offset a net loss of 18,186 members by the other AFL-CIO member unions.

The UAW announced that its membership grew by 8,902 in 2013 to 391,415 members. The 2 percent increase is the fourth consecutive year of membership gains for the UAW.


Strikes & Labor Disputes

Upon the New York MTA’s request, President Obama appointed a second presidential emergency board (PEB). The first PEB failed to resolve its contract dispute with the eight unions representing the Long Island Rail Road. After the second PEB members are selected, both sides must submit final offers within 30 days. The board then has another 30 days to select one offer. Upon issuance of the decision, the MTA and the unions will have 60 days to negotiate a new contract.


Major Contract Settlements & Negotiations

The International Association of Machinists (IAM) ratified a four-year contract covering 4,700 Lockheed Martin Corp. workers in seven IAM bargaining units nationwide. Among other provisions, the agreement includes a pension benefit increase, ratification bonus, general wage increases, and a lump-sum payment during the first contract year.

Members of UFCW ratified a two-year contract with various supermarket chains in the Minneapolis area. The contract covers 10,000 employees at 80 stores. The agreement calls for hourly wage increases for certain workers, a new pay progression system for all other workers, and two weeks’ advance notice of upcoming work schedules. Under the new agreement, workers will no longer have insurance coverage through the union but will instead go through the state health insurance exchange.

Culinary Workers Local 226 and Bartenders Union Local 165, representing 550 employees, reached an agreement in principle with the Riviera Hotel and Casino in Las Vegas. The five-year collective bargaining agreement requires Riviera to increase its contributions to the union health and welfare benefit fund. The agreement also allows employees to continue receiving health care benefits through the union plan and maintains the defined benefit pension plan.

The same unions, Culinary Workers Local 226 and the Bartenders Union Local 165, also ratified a five-year collective bargaining agreement covering 940 workers at the Stratosphere Casino Hotel and Tower and 1,336 workers at the Las Vegas Hotel and Casino. Retroactive to June 1, 2013, the contract calls for increased employer contributions to the union health and welfare benefit fund; a worker safety provision; a food and beverage training committee; and pilot programs that will give employers flexibility regarding reopening closed venues, restoring reduced services, and bringing back laid-off employees.

Communication Workers of America (CWA) District 3 and AT&T Mobility ratified a three-year contract covering 13,000 customer service, network organizations and sales employees in Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, and Tennessee. The contract provides for a $1,050 ratification bonus, annual wage increases of 9.75 percent over the contract term, and a separate pension tier for new hires. Other benefits include severance pay increases, certain job upgrades, and a shortened wage progression table. Health care coverage was addressed in a previously ratified agreement.

Members of UFCW Local 1996 rejected tentative collective bargaining agreements with the Kroger Co. despite a unanimous recommendation by union negotiators that the deals be ratified. The proposed agreements would have increased wages for department heads and for “top-rated full-time and part-time employees” and have covered nearly 23,000 workers at 183 supermarkets in the Atlanta and Savannah, Ga. metropolitan areas.

Local 3299 of the American Federation of State, County and Municipal Employees and the University of California reached a five-year tentative contract covering about 13,000 patient care technical employees at UC medical and student health centers. Among other provisions, the agreement includes across-the-board pay and step increases totaling 24.5 percent; health benefits rate freezes for lower-salaried employees; a 9 percent employee contribution to pension benefits; and increased job security through revised language on layoffs and outside contractors.

After a four-year contract dispute, a three-member arbitration panel imposed a contract between Amtrak and the Brotherhood of Railroad Signalmen and the Brotherhood of Maintenance of Way Employees Division of the International Brotherhood of Teamsters covering about 2,500 workers. Under the contract, which largely included provisions from Amtrak’s proposal with some modifications, workers will receive a 15.5 percent wage increase over five years and will contribute a greater amount to their health plans. The award also establishes “me-too provisions,” bi-weekly pay by direct deposit, the workweek as seven consecutive days beginning at 12:01 AM on Monday, and eliminates formal investigations into alcohol and drug waiver violations while expediting the appeals process. The contract follows the pattern established in Amtrak’s current agreements with 13 other labor organizations and is effective immediately.

Members of the Air Line Pilots Association (ALPA) overwhelmingly rejected a tentative 10-year collective bargaining agreement with the American Airlines Group, the parent company of regional carrier American Eagle Airlines. The proposed agreement would have frozen wages until 2018 and increased health care premiums and the American Airlines Group would have provided 60 new aircrafts to American Eagle and a shorter path for pilots to careers at American Airlines. ALPA represents approximately 3,000 pilots.

The International Brotherhood of Teamsters and Anheuser-Busch Cos. LLC reached a five-year tentative collective bargaining agreement covering nearly 3,500 workers at 12 U.S. breweries. Details of the agreement are not being released pending ratification, and the vote has yet to be scheduled.

An analysis of data compiled by Bloomberg BNA through the beginning of March showed that the average first-year wage increase for all settlements was 1.6 percent, compared with 2.1 percent reported in the same period in 2013. The median first-year wage increase for settlements reported to date in 2014 was 2 percent, the same increase as that reported in 2013, and the weighted average was 2.7 percent, compared with 1.6 percent in 2013. When lump-sum payments were factored into wage calculations, the all-settlements average first-year increase to date in 2014 was 1.9 percent, compared with 2.9 percent reported in the year-ago period. Median and weighted average increases were 2 percent and 3.1 percent, respectively, compared to the 4 percent increase reported in 2013. The all-settlements (excluding construction and state and local government) average increase was 2.3 percent, compared with 4.3 percent in 2013; the median was 2.5 percent, a decrease from 2.8 percent a year ago; and the weighted average was 3.4 percent, compared with last year’s 4.1 percent.

According to Labour Canada statistics, collective bargaining agreements reached in January resulted in average wage increases of 1.3 percent. The January average was significantly less than the average posted in the fourth quarter of 2012 and less than the average for 2012 as a whole. On a sectoral basis, the largest average wage growth was in education, health, and social services.


Administrative, Court & Other Decisions

The NLRB held that an Ohio health service company violated federal labor law when it disciplined an employee union delegate who advised a co-worker during an investigatory interview to not answer questions posed by management. The company suspended the union delegate for telling the co-worker not to answer certain questions without further clarification. The Board found the delegate was engaged in union and protected concerted activity when he represented the co-worker and that the company failed to show that the delegate impeded its investigation. Murtis Taylor Human Servs. Sys.

The U.S. Court of Appeals for the Seventh Circuit affirmed an NLRB ruling that an Illinois substance abuse treatment company committed an unfair labor practice when it withdrew union recognition prior to the completion of counting disputed decertification votes. The court also expressed misgivings about NLRB procedures that delay a new decertification election from occurring, but noted it lacked jurisdiction to review the NLRB order setting aside the contested election. Heartland Human Servs. v. NLRB.

The U.S. Court of Appeals for the Fourth Circuit reversed a jury verdict in favor of unionized poultry workers who brought state wage claims against their South Carolina employer. The plaintiffs had argued that their employer violated state labor laws by compensating them only for line-time, rather than clock-time, as stated in various employment documents. The Fourth Circuit held that the workers’ claim was simply a disagreement over the interpretation of their collective bargaining agreement and thus preempted by Section 301 of the Labor Management Relations Act (LMRA). Barton v. House of Raeford Farms, Inc.

The U.S. Court of Appeals for the Fifth Circuit affirmed an NLRB decision that a Texas-based nonunion trucking company violated federal labor law by maintaining a confidentiality policy prohibiting workers from discussing “personnel information” with those outside of the organization. The list of confidential information included financial information, which necessarily incudes wages. The court agreed that employees could construe the confidentiality policy as barring them from discussing their wages. Flex Frac Logistics, et al. v. NLRB.

A federal judge for the U.S. District Court for the District of Alaska found that Lafe E. Solomon did not properly serve as NLRB Acting General Counsel. While the Federal Vacancies Reform Act gave President Obama the power to appoint an acting general counsel, it also made Solomon ineligible because he had not previously served as first assistant and was later nominated by President Obama to a term as general counsel. Nonetheless, the court found that Solomon’s actions taken while in the position of acting general counsel were valid under the “de facto officer” doctrine, holding that a nullification of the administrative complaints issued by Solomon would hinder the policy objectives of the NLRA. The case arose from a hotel management company’s petition for injunctive relief, which claimed that the unfair labor practices against it were unenforceable. Hooks v. Remington Lodging & Hospitality, LLC.

The NLRB upheld an Administrative Law Judge’s (ALJ) decision that a Nebraska beef processor illegally fired three workers for striking in protest of their working conditions. The Board also held – disagreeing with the ALJ – that the employer’s questioning of one of the strikers was a separate violation, and not an integral part of the firing. The panel found that by asking one of the employees what he wanted, the employer made a coercive statement and committed an unfair labor practice. Board member Harry I. Johnson agreed with the decision but was wary of the NLRB adopting a gag rule that would discourage employers from discussing with workers the merits of their complaints. Greater Omaha Packing Co.

The NLRB held a South Carolina restaurant company did not violate federal labor law by maintaining a rule prohibiting employees from “displaying a negative attitude in dealing with fellow employees or guests.” The Board found that the rule was not materially distinguishable from the rule approved in Hyundai America, which according to the court linked an employee’s attitude to work assignments and would not likely be construed to as prohibiting concerted, protected activity. The Board ruled that the restaurant’s policy only prohibits unprotected conduct that would interfere with legitimate business concerns. Copper River of Boiling Springs, LLC.

The NLRB affirmed an ALJ ruling finding NASA’s Jet Propulsion Laboratory violated federal labor law when it disciplined employees for sending emails critical of a background check policy. The NLRB held that the emails, sent by scientists and engineers at NASA’s laboratory, were protected under Section 7 of the NLRA since they constituted a discussion of the employees’ working terms and conditions. California Institute of Technology Jet Propulsion Laboratory et al.

The NLRB held that a union that had filed a wage claim on behalf of workers was entitled to payroll information despite the collective bargaining agreement prohibiting class grievances. The Hawaiian painting company had unlawfully withheld the information for three months. The Board held that employers have a duty to provide relevant requested information regardless of the potential merits of the grievance. The Board also rejected the company’s argument that it should defer acting until the dispute could be resolved in arbitration. Endo Painting Serv.

The NLRB affirmed an ALJ ruling that an American Federation of Teachers (AFT)-New Mexico rule prohibiting employees from participating in “internal politics” and “lobbying” AFT officials violated workers’ Section 8(a) rights. The NLRB held that AFT-New Mexico staff members would reasonably understand the policy as a bar against union activity and employment-related complaints. Am. Fed’n of Teachers N.M.

Acting Regional Director Mary L. Bulls granted workers’ motions to intervene in the UAW’s appeal of the outcome of an election at Volkswagen AG’s Chattanooga, Tenn. plant. The regional director held that the intervention was warranted because some of the alleged conduct involved statements by the workers and Southern Momentum. The workers seek to defend the vote against UAW’s claim that a rerun election should be held after alleged interference by state politicians and outside organizations. Volkswagen Group of America, Inc.

In a memorandum from the NLRB Division of Advice, the NLRB Assistant General Counsel (AGC) found that Walmart did not commit an unfair labor practice by issuing a letter in response to demonstrations. UFCW and Organization United for Respect at Walmart (OUR Walmart) alleged that the company interfered with employee rights when it sent letters to unions, affiliates, and individuals warning that it would take legal action against nonemployees who conducted demonstrations, protests, or picketing on property “owned or controlled” by the retailer. The AGC concluded that the claim was without merit and that the charge should be withdrawn or dismissed. Wal-Mart Stores, Inc.

According to a recent memorandum released by NLRB General Counsel Richard F. Griffin Jr., default judgments have been pursued in less than 1 percent of approved settlement cases since January 2011, the time the NLRB began routinely including default judgment language in settlement agreements. The default judgment language provides that if a party fails to comply with the settlement terms, the regional director may reissue the complaint and seek a default judgment. The memo also stated that in the 2013 fiscal year, 21,394 unfair labor practice charges were filed, and the settlement rate was 92.8 percent.

D.R. Horton Continues: More Arbitration Agreements Invalidated

In yet another decision applying the NLRB’s D.R. Horton opinion, ALJ Nelson Cates found an arbitration agreement unlawful because it prevented employees from engaging in collective action, despite the agreement’s silence on the issue. The ALJ found it was clear from the position and intent of the company that by signing the agreement employees agreed to arbitrate all disputes relating to employment exclusively on an individual basis. The ALJ also rejected the company’s argument that employees were not required to sign the agreement, stating that the agreement was a condition of employment and employees did not realize that the they could refuse to sign. Network Capital Funding Corp. and Erik Papke.

NLRB ALJ Gerald Wacknov held that an agreement requiring future employment-related claims be resolved exclusively through individual arbitration proceedings is facially unlawful. The ALJ reasoned that until the Supreme Court decides otherwise, D.R. Horton must be followed. Pep Boys Manny, Moe & Jack of California and Robert Nash.

Additionally, NLRB ALJ Mindy E. Landow ruled that a Domino’s arbitration agreement containing a class waiver violates federal law under D.R. Horton even though the agreement contains a 30-day opt-out clause. The ALJ held that because the NLRA unambiguously confers rights of protected concerted activity it follows that an employer cannot require an employee to affirmatively act to obtain or retain these rights. The ALJ also rejected Domino’s argument that D.R. Horton was wrongly decided, and noted that it is still binding upon the Board. Domino’s Pizza LLC.


Legislation & Politics

The Pennsylvania House of Representatives passed legislation criminalizing harassment, stalking, and threatening the use of a weapon of mass destruction in labor disputes. The bill passed following the indictment of 10 members of the Ironworkers Local 401 on federal arson and racketeering charges. The union allegedly used such tactics to pressure contractors into hiring union workers. The bill next heads to the Pennsylvania Senate.

The National Mediation Board (NMB) plans to revise its application form to include a showing-of-interest requirement of 50 percent of the craft or class of workers. The application will also include an attestation that the information provided is true to the best of the signer’s knowledge. The proposal reflects a December 2012 final rule.

In a letter to U.S. Secretary of Labor Thomas Perez, fourteen Republican state attorneys general expressed concern and urged the Department to withdraw a proposed Department of Labor rule that would narrow the advice exemption under the Labor-Management Reporting and Disclosure Act (LMRDA). The LMRDA requires employers and legal consultants to report any arrangement to persuade employees directly or indirectly regarding the right to organize or bargain collectively. Currently, however, no employer or consultant is required to file a report covering the services of a consultant if that consultant just gives advice to the employer. The proposed regulation would change the definition of advice to only oral or written recommendations, which would subject more arrangements to disclosure requirements. At a recent hearing on the DOL 2015 budget request, Secretary Perez assured Congress that he is listening to stakeholder concerns about the proposed persuader rule as well as other regulatory proposals.

U.S. Representatives John Kline (R-Minn.) and Phil Roe (R-Tenn.) requested that the NLRB extend the April 7 deadline for public comment on proposed rule changes by 30 days. The NLRB has issued a notice of proposed rulemaking that calls for changes in the procedures for union representation cases. The proposal would change representation procedures to shorten the time period before and election and prevent legal challenges until after the election has taken place. The representatives referred to the proposal as a “ambush election rule” and state that the extension is needed so that the public has sufficient time to understand and comment on the proposed changes.

Reps. Kline and Roe, along with Senator Lamar Alexander (R-Tenn.), have introduced legislation in response to the NLRB’s proposed “ambush” election rule. Under the Workforce Democracy and Fairness Act – H.R. 4320 – an election would not be held until 35 days after the filing of an election petition and the NLRB would have to rule on unresolved pre-election issues before certifying an election’s results. The Employee Privacy Protection Act – H.R. 4321 – would give employers seven days after a final determination by the NLRB on an appropriate bargaining unit to disclose a list of eligible voters, which would include their names and an employee-chosen means of contact.


Crime, Corruption & Other Misdeeds

Mark Kirsch, former President of Local 17, Operating Engineers in Buffalo, N.Y., was convicted on corruption charges. Trial testimony established that Kirsch ran the union as a criminal enterprise for the past 10 years by conspiring to extort employers and employees of jobs, wages, and benefits through the use of physical violence and destruction of property. Kirsch faces a 20 year prison sentence and a $250,000 fine.



AFL-CIO President Richard Trumka criticized the North American Free Trade Agreement (NAFTA) and called for a new approach to trade agreements. Trumka contends NAFTA has had a devastating effect on American workers, and has caused widespread closures of U.S. manufacturing facilities and global outsourcing to reduce labor costs. Trumka also linked NAFTA with the recent union representation election at the Chattanooga, Tenn. Volkswagen plant, claiming government officials have threatened workers by saying unionization would result in a new assembly line move to Mexico. Trumka cites the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership, which are both currently being negotiated, as viable alternatives to NAFTA.


Demonstration by European labor unions sparks street clashes in Brussels

Updated: 5:19 a.m., April 4

BRUSSELS — Belgian police used water cannon and pepper spray on protesters who had showered them with oranges and cobblestones during a demonstration by labor unions demanding a better deal for Europe’s working men and women.

The demonstration in Brussels, in which thousands took part peacefully, was called by the European Trade Union Confederation to protest austerity measures implemented across the 28-country European Union.

Protesters also voiced their concerns over social dumping, whereby businesses import cheaper workers to replace local hires, or export jobs to a low-wage country or area.

As well as paralyzing traffic Friday in the Belgian capital, the demonstration sent the U.S. Embassy into lockdown.


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