Saturday, April 23, 2011

Feds to Boeing: we'll tell you where to build new plants

Whenever the Presidency changes hands, so to does the composition of a wide range of regulatory agencies and boards.  Democrats now call the shots at the National Labor Relations Board, which has historically administered union elections and adjudicated claims of unfair labor practices by either companies or unions.  Section 8 of the National Labor Relations Act identifies these unfair practices by employers as follows:

Employer interference, restraint, or coercion directed against union or collective activity (Section 8(a)(1))
Employer domination of unions (Section 8(a)(2))
Employer discrimination against employees who take part in union or collective activities (Section 8(a)(3)
Employer retaliation for filing unfair-labor-practice charges or cooperating with the NLRB (Section 8(a)(4))
Employer refusal to bargain in good faith with union representatives (Section 8(a)(5))

What did Boeing do to get in trouble?  Fire union organizers? Refuse to negotiate a new contract?  Nope.  NYT and WSJ report that Boeing had the audacity to open a plant in South Carolina to produce three more 787 Dreamliner planes per month.  The Machinists union protested to the NLRB, which issued an unfair labor practice complaint this week that, if enforced, would require Boeing to move this new capacity back to Washington state.

Never before has the NLRB or, for that matter any federal agency that I am aware of, questioned a corporate plant location decision.  The NLRB claims the move to SC interferes with workers' right to strike.  Some inconvenient truths:
  1. The Machinists union has full rights to organize the South Carolina workers once the plant opens; they can have the right to strike -- if they want it
  2. Unionized Boeing employment in Washington state has actually increased by 2000 since the decision to open the new capacity in SC
  3. Boeing endured a 58 day strike in 2008, leading them to shift new capacity to a different location
  4. If the Machinists and NLRB get their way, Boeing will open its next new plant overseas and the US will lose one of the few key manufacturing industries where it still holds a comparative advantage
Boeing has hired 1000 new workers for the SC plant which is scheduled to open in July.   Boeing called the NLRB action "legally frivolous" and a "radical departure" from legal precedent.

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