Heading into the summer bargaining season, the goodwill created between New York City contractors and construction unions during landmark labor negotiations in 2009 appears to be spent. Labor bosses are crying foul over an employer campaign aimed at reducing the gap between union and open-shop rates.

Photo: For ENR By Michael Falco

New York building firms’ rep Coletti (left) and union head LaBarbera in 2009 after inking pact to cut costs. Relations now are strained.

Rather than working exclusively with union trades representatives, the Building Trades Employers’ Association, which represents about 1,700 contractors citywide, is reaching out directly to rank-and-file union members to drive home market realities. In 2009, BTEA and the Building and Construction Trades Council of Greater New York (BCTC), which represents 15 unions, found short-term consensus on project labor agreements to improve pricing and unfreeze stalled projects. Now, Coletti says, a long-term solution is needed.

“Labor believes this is a recession like other recessions,” says Louis Coletti, BTEA president. “Things will be bad for a period of time, but by year-end they will get back to normal. Management believes this recession has created a new normal.” He says many contractors and developers recognize the value of building unions, but rates are priced too far above the market.

BTEA members want to remain union but need concessions to get owner buy-in, Coletti says. “[Developers] can no longer afford to build when there is a 25% to 30% differential,” he says. “Either it won’t be built at all, or it will be built non-union.”

To drive home its message, BTEA created a 26-point cost-cutting “framework.” Ron Berger, executive director of the Subcontractors’ Trade Association, says it focuses on cost reduction “without having to reduce men’s salaries.” But a copy obtained by ENR shows a 20% wage and benefit reduction among the proposed changes.

Raymond McGuire, general counsel of the Contractors Association of Greater New York, says employers could begin to include the list in workers’ pay envelopes in the next few weeks. The National Labor Relations Act bars individual negotiations between employers and union members, but envelope-stuffing is legal, he says.

BCTC President Gary LaBarbera calls the BTEA tactic an attempt to undermine collective bargaining. “[BTEA] has chosen to go public with these issues, which is at the very least an act of bad faith,” he says. “It clearly undermines the integrity of the traditional collective bargaining process.”

In January, he says BTEA “made an end run” around BCTC to Sean McGarvey, secretary-treasurer of the AFL-CIO’s Building and Construction Trades Dept., to discuss issues. “My members want us to take every step to preserve this business model,” Coletti says. He rejects the suggestion that BTEA is trying to bust unions. “This is not Wisconsin,” he says.