Controversy Surrounding NLRB vs Boeing: Analysis and Opinions

[CAC1001]

So many have probably heard by now how the National Labor Relations Board is suing Boeing over its plan to build a plant in South Carolina, a right-to-work state, saying it broke labor laws. Was wondering people's thoughts on this? On the one hand, I can understand it is wrong for a company to violate labor laws if that's what they did, on the other, I find it really uncomforting that the government can tell a private company where it can move its operations.

 

[Char. Limit]

So many have probably heard by now how the National Labor Relations Board is suing Boeing over its plan to build a plant in South Carolina, a right-to-work state, saying it broke labor laws. Was wondering people's thoughts on this? On the one hand, I can understand it is wrong for a company to violate labor laws if that's what they did, on the other, I find it really uncomforting that the government can tell a private company where it can move its operations.

If Boeing violated contract, I blame Boeing. Sorry, but if Boeing violated contract, then this isn't "the government telling a private company where it can move its operations". This is "a private company agreeing to certain terms and then breaking them".

If this was never in a contract, then the lawsuit will fall through.

 

[mege]

The lawsuit aside, it speaks to the power of unions to dictate (using contracts) how a company can do business. Screw 20,000 non-union jobs being created if 10,000 union jobs are saved. The media coverage on this has been very light, suprisingly. That tells me that Boeing is likely in the right and this won't turn out good for the NLRB.

Lawsuit aside, again, even the minor publicity of Boeing 'union dodging' states has a chance to hurt it. If the lawsuit is baseless, just the accusation can stick with a company and may affect their incoming newhires in the near future.

 

[WhoWee]

IMO>
It's time to wake up and smell the coffee. This is not a new cycle - how many companies fled the "Rust Belt" to relocate in the Southern US since the late 1960's? Fortunately, those jobs stayed in the US and quite a few people migrated south to places like Atlanta, Houston, and Tampa.

As per Boeing, the existing union workers are unaffected by the construction of the new plant. Next, the obvious solution is for Boeing to build the plant off-shore. It's doubtful many US workers will be able to relocate to foreign soil.
Again - IMO

 

[Gokul43201]

The lawsuit aside, it speaks to the power of unions to dictate (using contracts) how a company can do business.

In principle, a contract is a mutually beneficial agreement between two willing parties: it is not a forceful coercion of one party by another. I'd rather see companies not bend over and sign these contracts with unions than sign them and then complain later.

 

[Al68]

In principle, a contract is a mutually beneficial agreement between two willing parties: it is not a forceful coercion of one party by another. I'd rather see companies not bend over and sign these contracts with unions than sign them and then complain later.

That's a good point, strictly as a response to unions supposedly "dictating" via contract how a company does business, but as far as I can tell, that's not applicable in this case. This is not a case of a union suing Boeing for breach of contract. They are being sued by the NLRB, and I haven't seen any evidence that Boeing ever signed a contract with the NLRB.

 

[CAC1001]

Boeing says it isn't true that they are retaliating against the union for strikes, that they have increased their plant operations in Washington state since the last strike.

EDIT: Another thing to remember is that if it was retaliation, then that would hurt the workers in Washington state. But this doesn't hurt them at all. Boeing isn't trying to relocate the plant to South Carolina, they just want to build a new plant in South Carolina.

In principle, a contract is a mutually beneficial agreement between two willing parties: it is not a forceful coercion of one party by another. I'd rather see companies not bend over and sign these contracts with unions than sign them and then complain later.

I agree, but IMO contracts between unions and companies I would not say are necessarilly "mutually beneficial agreements between two willing parties," for two reasons:

1) The union doesn't benefit the company
2) The union engages in bullying tactics (do what we want or strike), so the company isn't per se willing

 

[CAC1001]

http://www.manufacturing.net/News/Feeds/2011/05/mnet-mnet-industry-focus-facilities-and-operations-after-boeing-complaint-nlrb-plans-even-more-aggre/

 

[BobG]

This isn't about violating any contract between Boeing and unions. It's about violating labor law. Specifically, you can't retalitate against workers for engaging in a strike, no more than you retaliate against a worker for lodging a sexual discrimination complaint, etc.

The case hinges on whether Boeing opened a new plant in South Carolina to retaliate against Washington workers that engaged in strikes or whether Boeing opened a new plant in South Carolina because it made business sense.

In other words, the NLRB is on real shaky ground and surely they'll lose. To win, they have to prove that Boeing's decision was primarily made directly because of past strikes, specifically to punish union workers for striking. Just proving South Carolina's right to work laws played a part in Boeing's decision shouldn't be enough.

The migration of factories from the rust belt provide a good precedent.

Labor unions have one advantage: factory owners can't very well move their factory. Somebody has to work in those factories where they're located and the company can't fire union workers and replace them with non-union workers, since that would be retaliation against workers for engaging in a strike.

None the less, labor's advantage is limited in time. Eventually, the factory will become so old that it makes more economical sense to rebuild than continually repairing and upgrading a building that's outlived its designed lifetime. The company is free to choose the location of its new factory(s) based on sound business decisions, including tax rates, labor rates, transportation costs, etc. Choosing to build a new factory somewhere cheaper generally isn't considered retaliation against striking workers even if cheaper labor is one of the factors considered when choosing a new location.

In fact, cheap labor and low tax rates may turn out to be only short term advantages. Once a company has built its new factory, it's trapped itself and will have a hard time relocating if the state decides to raise tax rates and to change its labor laws. So, South Carolina's labor laws may be an attractive benefit of building there, but it would be bordering on mismanagement if that's the only reason they have for building there.

Basically, the NLRB will have to have some type of internal memos, etc, that show that retaliating against striking workers was the main motivation for opening the new plant. Without that, it's just going to be too easy for Boeing to show why opening a new plant in South Carolina makes perfect business sense regardless of whether Washington workers had strikes or not.

 

[Vanadium 50]

The timeline is in Boeing's favor - they bought the plant in March, 2008, but their 2008 strike was in September. They would have to argue that this was in retaliation for the 2005 strike.

Of course, the NLRB doesn't intend to win. They intend to settle.

 

[WhoWee]

IMO - if a union wants a seat on the Board - they should make an investment in the companies they represent - buy some stock - share in the profits of their work.

 

[lisab]

IMO - if a union wants a seat on the Board - they should make an investment in the companies they represent - buy some stock - share in the profits of their work.

Hmm...is that ever done, I wonder?

 

[Gokul43201]

I agree, but IMO contracts between unions and companies I would not say are necessarilly "mutually beneficial agreements between two willing parties," for two reasons:

1) The union doesn't benefit the company
2) The union engages in bullying tactics (do what we want or strike), so the company isn't per se willing

How is that a bullying tactic? If I tell my employer that I will not work if they continue to undervalue my worth, is that a bullying tactic? No, I consider that a free market force. The employer is fully free to fire my *** if it thinks it can replace me with a better worker. If I can convince a half dozen other people in a similar situation to join me, it is still a free market force, isn't it?

PS: We should be more mindful that this side-discussion on unions is somewhat off-topic to this thread.

 

[WhoWee]

Hmm...is that ever done, I wonder?

Union pension funds are are widely placed.

 

[BobG]

IMO - if a union wants a seat on the Board - they should make an investment in the companies they represent - buy some stock - share in the profits of their work.

Hmm...is that ever done, I wonder?

Is what ever done? Unions invest in the company or get a seat on the board.

The board of directors consists of whoever is elected and it should represent the corporation's stakeholders (at least according to modern corporate philosophy). The workers (and their union) are a stakeholder in the company, even if not a stockholder, and many corporations do have union representation on their board of directors, along with major creditors, major stockholders, etc, and perhaps a person or two completely independent of the corporation (that way there's at least a person or two who is theoretically unbiased and can consider the corporation's health independent of the impact it has on any particular stakeholder).

The make-up of the board of directors and what the make-up should be is more relevant to things such as who's speech is really protected by giving corporations First Amendment protection, etc.

 

[CAC1001]

How is that a bullying tactic? If I tell my employer that I will not work if they continue to undervalue my worth, is that a bullying tactic? No, I consider that a free market force. The employer is fully free to fire my *** if it thinks it can replace me with a better worker. If I can convince a half dozen other people in a similar situation to join me, it is still a free market force, isn't it?

A union is a legalized worker cartel that let's workers artificially increase the price of their labor to a business, beyond the market rate. Your worth is decided by the market. If the business keeps paying you below the norm the market has set for your profession, then yeah, you are free to tell them to go shove it unless they pay you the proper amount. The business will likely do this because if not, they will lose talent to other companies that are competing for the same labor.

What a union allows is for when workers feel they should be paid more, paid say a "living wage" and thus seek to bully the company into doing this, and if it tries to balk, then strikes. If your industry as a whole pays you and the half-dozen other people a certain amount and you think that is "wrong," and form a union to get more money, that isn't free-market. If on the other hand, you and the half-dozen others discover that the company is paying you half what the industry norm is, then that is different.

 

[turbo]

As Gokul said, calling unions bullies does a real disservice to labor and industry in general. I was in management with a construction company and with a pulp and paper company before managing to cross the line (first ever in the company!) to become a unionized hourly laborer. I was the top operator on a brand new paper machine, my shift's shop steward, and the paper machine's representative in contract negotiations. I have seen both sides of the management/labor divide and participated in both.

Regardless of what the corporate types tell you. companies get some real tangible benefits from dealing with unions. They get a stable workforce that is committed to work at a specified wage and benefit level over a specified period of time. They also get work rules that can be applied uniformly and that are agreed to by both sides and are legally binding.

The paper machine that I ran seemed to outsiders to have really cream-of-the-crop jobs compared to other jobs in the area. The truth is that many of the people that came for the pay and benefits washed out over work-rules relating to absenteeism and other problematic behavior. No problem and no friction with the union, because we had agreed to those work rules and abided by them ourselves. Painting either side of a labor issue as the "bad guy" without any experience in that work-place is short-sighted, at best.

 

[Proton Soup]

IMO>
It's time to wake up and smell the coffee. This is not a new cycle - how many companies fled the "Rust Belt" to relocate in the Southern US since the late 1960's? Fortunately, those jobs stayed in the US and quite a few people migrated south to places like Atlanta, Houston, and Tampa.

As per Boeing, the existing union workers are unaffected by the construction of the new plant. Next, the obvious solution is for Boeing to build the plant off-shore. It's doubtful many US workers will be able to relocate to foreign soil.
Again - IMO

hey, i live in the South. and i say, good for us, too bad for you.

 

[turbo]

hey, i live in the South. and i say, good for us, too bad for you.

Yep! You guys got Maine's shoe-shops and textile factories decades ago, until they all moved off-shore. Then it was bad for you.

My wife works for New Balance Athletic Shoe - the only company that can "afford" to make running shoes, court shoes, basketball shoes, etc in the US. They have some components (and perhaps even some entire shoes) made overseas, but the three plants in Maine and a couple in Mass are busy. Decent wages, decent benefits, including dental, medical insurance and eye exams and subsidized eyewear purchases.

 

[CAC1001]

As Gokul said, calling unions bullies does a real disservice to labor and industry in general.

Not all unions no.

Regardless of what the corporate types tell you. companies get some real tangible benefits from dealing with unions. They get a stable workforce that is committed to work at a specified wage and benefit level over a specified period of time. They also get work rules that can be applied uniformly and that are agreed to by both sides and are legally binding.

They can get much of that without a union as well (stable workforce, uniform work rules that are of good quality b/c of competing with other companies). The only time a union is really needed is when the company is abusing the workers in some fashion, which still happens in certain industries.

The paper machine that I ran seemed to outsiders to have really cream-of-the-crop jobs compared to other jobs in the area. The truth is that many of the people that came for the pay and benefits washed out over work-rules relating to absenteeism and other problematic behavior. No problem and no friction with the union, because we had agreed to those work rules and abided by them ourselves. Painting either side of a labor issue as the "bad guy" without any experience in that work-place is short-sighted, at best.

Not saying unions are "the bad guy" just saying that in trying to form a cartel to raise prices and theatening strikes elsewise, is a bullying tactic.

 

[WhoWee]

hey, i live in the South. and i say, good for us, too bad for you.

"Up North", we've already lost our manufacturing base - now the rest of the country faces the same problem.

To turbo's point of modern facilities - I don't think Boeing will change the plant design any whether unionized or not - sans some plusher break rooms, maybe some union offices, and other union associated investment requirements?

 

[CAC1001]

Yep! You guys got Maine's shoe-shops and textile factories decades ago, until they all moved off-shore. Then it was bad for you.

My wife works for New Balance Athletic Shoe - the only company that can "afford" to make running shoes, court shoes, basketball shoes, etc in the US. They have some components (and perhaps even some entire shoes) made overseas, but the three plants in Maine and a couple in Mass are busy. Decent wages, decent benefits, including dental, medical insurance and eye exams and subsidized eyewear purchases.

New Balance shoes are one of my favorite brands, didn't know that they are made in America.

 

[turbo]

New Balance shoes are one of my favorite brands, didn't know that they are made in America.

Yep! Their walking shoes were endorsed by the USPS, and they actually made a special walking shoe featured a USPS tag on the innersole for a few years, too. I don't know that they still have that, but the shoes are great!

The plant that my wife works for has been trialing training shoes for the Navy, Army, Air Force, and Coast Guard, too - each with their own color-code and branch-specific embroidery.

 

[Proton Soup]

"Up North", we've already lost our manufacturing base - now the rest of the country faces the same problem.

To turbo's point of modern facilities - I don't think Boeing will change the plant design any whether unionized or not - sans some plusher break rooms, maybe some union offices, and other union associated investment requirements?

same problems? i dunno, here in alabama the last several years, we've acquired a mercedes plant, and honda. and thyssenkrupp steel is coming our way.

 

[WhoWee]

same problems? i dunno, here in alabama the last several years, we've acquired a mercedes plant, and honda. and thyssenkrupp steel is coming our way.

Are they all union shops?

 

[CAC1001]

"Up North", we've already lost our manufacturing base - now the rest of the country faces the same problem.

Remember America still manufactures about 19.4% of global manufacturing. Up until recently, we were the global leader, but China just edged us out recently to output 19.8% of global manufacturing. However, we do our 19.4% using about 10 million people, whereas the Chinese need around 100 million. A good amount of the consumer products, stuff you buy at Wal-Mart and Target, are made in China. But a lot of other things, ranging from industrial equipment and machinery to forms of electronics, computer chips, medical devices, things like automobiles, aircraft, jet engines, etc...are made in America.

China is also going to lose its benefit of cheap labor if it expects to create a solid middle-class in that country, because wages and incomes for the overall population are going to have to go up.

 

[WhoWee]

Remember America still manufactures about 19.4% of global manufacturing. Up until recently, we were the global leader, but China just edged us out recently to output 19.8% of global manufacturing. However, we do our 19.4% using about 10 million people, whereas the Chinese need around 100 million. A good amount of the consumer products, stuff you buy at Wal-Mart and Target, are made in China. But a lot of other things, ranging from industrial equipment and machinery to forms of electronics, computer chips, medical devices, things like automobiles, aircraft, jet engines, etc...are made in America.

I wonder how long it takes to reverse-engineer a complex machine?

 

[Gokul43201]

A union is a legalized worker cartel that let's workers artificially increase the price of their labor to a business, beyond the market rate. Your worth is decided by the market. If the business keeps paying you below the norm the market has set for your profession, then yeah, you are free to tell them to go shove it unless they pay you the proper amount. The business will likely do this because if not, they will lose talent to other companies that are competing for the same labor.

What a union allows is for when workers feel they should be paid more, paid say a "living wage" and thus seek to bully the company into doing this, and if it tries to balk, then strikes.

I can't say I see a substantive difference between these two cases, yet.

If your industry as a whole pays you and the half-dozen other people a certain amount and you think that is "wrong," and form a union to get more money, that isn't free-market.

While this sentence raises one point of difference (industry vs single employer), I can't understand your contention that this is not a free market situation. After all, if there is no intervention by the state, any peaceful negotiations between employers and employees ought to constitute workings of a free market.

If on the other hand, you and the half-dozen others discover that the company is paying you half what the industry norm is, then that is different.

I see the difference, but I do not see that it is as bad a thing as forbidding free association of the people.

 

[Proton Soup]

Are they all union shops?

i really don't know, but i believe alabama is what you call a "right to work" state. I'm just happy that we're finally getting some industry here.

 

[Al68]

While this sentence raises one point of difference (industry vs single employer), I can't understand your contention that this is not a free market situation. After all, if there is no intervention by the state, any peaceful negotiations between employers and employees ought to constitute workings of a free market.

I agree with this completely. "Bullying" is a common, legal, and completely ethical tactic used routinely in negotiations by other types of agents, why not for unions?

But that doesn't really apply to this case. In this case, the NLRB is trying to use government force, not peaceful negotiation, to get their way.

 

[russ_watters]

While this sentence raises one point of difference (industry vs single employer), I can't understand your contention that this is not a free market situation.

I see it as unions thwarting the free market by being labor monopolies.

 

[turbo]

I see it as unions thwarting the free market by being labor monopolies.

Of course you do. Do you see mega-corporations as thwarting the free market in labor by dwarfing the influence of small groups of laborers? US history is rife with examples of corporations hiring goons to break strikes. Here in Maine, that has involved violence, dynamiting, and personal intimidation, often targeting immigrants that came here to work in physically demanding industries.

 

[WhoWee]

Of course you do. Do you see mega-corporations as thwarting the free market in labor by dwarfing the influence of small groups of laborers? US history is rife with examples of corporations hiring goons to break strikes. Here in Maine, that has involved violence, dynamiting, and personal intimidation, often targeting immigrants that came here to work in physically demanding industries.

Did any of that happen in the past 50 years? Those sound more like modern-day union tactics to me.

 

[turbo]

Did any of that happen in the past 50 years? Those sound more like modern-day union tactics to me.

Where is your support? Where is the factual reporting to support your claims? I can play this stupid game, too.

 

[WhoWee]

Where is your support? Where is the factual reporting to support your claims? I can play this stupid game, too.

Where is my support for asking you if any of the claims you made happened in the past 50 years? None needed there - please answer.

As for "union tactics" - you can't be serious?

http://www.unionfacts.com/articles/crimeViolence.cfm
"West Virginia miner shot dead for working during a strike
On the orders of the United Mine Workers (UMW), 16,000 miners went on strike in 1993. One subcontractor, Eddie York (who was not a UMW member), decided it was important to support his wife and three children and crossed picket lines to get to his job. He was shot in the head as he left the job site to go home. "

http://npri.org/publications/incidental-union-violence
"Seems like every Teamster strike since the dawn of time has been “accompanied by violence.” What a surprise that, this month, it happened once again."

http://www.thenewamerican.com/history/american/6487-labor-unions-a-history-of-murder-and-sabotage

It's your turn turbo - anything in the past 50 years?