Title: CHAPTER 14 CONSTRUCTION LABOR
1CHAPTER 14CONSTRUCTION LABOR
2BIOMETRIC IDENTIFICATION RECOGNITION
- The Need Even though visitors. Office workers
and residents are given keys or id badges after
being screened, there is still a possibility that
unauthorized people could access important
property with fake ids or keys, etc. Recently,
biometric technology has arisen as a new,
effective and secure method for identification
recognition of personnel - The Technology Biometric are computerized
methods of recognizing people based on physical
or behavioral characteristics. The main biometric
technologies include face recognition,
fingerprints, hand geometry, iris palm prints,
signature and voice
3Biometric Identification Devices
414.1 LABOR RESOURCE
- The man-power component of the four Ms of
construction is by far the most variable and
unpredictable - Man-power or labor has four major aspects that
have an interest to management - To properly understand the management and control
of labor as a resource, the manager must be aware
of the inventory among the following elements - Labor organization
- Labor laws
- Labor costs
- Labor productivity
- Labor includes added human factor
514.2 SHORT HISTORY OF LABOR ORGANIZATIONS
- The history of labor organizations begins in
early 19th century - Initially tradesman possessing some skill or
craft began organizing, called guilds,
brotherhoods or mechanic societies - Their objective was to give widows and children
health and death benefits - They were secret organizations because they
were unlawful - From 1840s until 1930s, the history of labor
organization is the saga of confrontation between
management and workers - American Federation of Labor (AFL) was organized
by Samuel Gompers in 1886. This was the first
successful effort to organize skilled and craft
workers as opposed to industrial assembly line
workers - The Building and Construction Trades Department
of the AFL, which is the umbrella organization
representing all construction craft unions, was
organized in 1908 - The semi-skilled and unskilled factory workers in
sweat shops, plants and mills were unorganized
at the time Gompers started AFL - Gompers was interested in protecting the rights
of skilled workers and little interest in the
unskilled labor organization - In the 1930s, industrial (i.e. factory,
semi-skilled) workers began to organize
effectively with the support of legislation
evolving during the post-depression period
6SHORT HISTORY OF LABOR ORGANIZATIONS CONTD.
- AFL, realizing such organizations might threaten
its own dominance, recognized these organizations
by bringing them into AFL - But industrial workers were treated as 2nd class
citizens by older craft folks - This led to friction and rivalry, which
culminated in the formation of the Committee for
Industrial Organizations (CIO). This committee
was established in 1935 unilaterally without
permission from governing bodies of AFL - The AFL board ordered the committee to disband or
be expelled from the industrial unions - In response, the unions organized as the Congress
of Organization (CIO) with John Lewis of the
united mine workers as the first CIO President - In 1955, two organizations combined to form
AFL-CIO. This organization remains the major
labor entity in the U.S. today
714.3 EARLY LABOR LEGISLATION
- The courts and legislative bodies of the land
have alternatively operated to restart or
accelerate the progress of labor organizations - See table 14-1 for the chronology of major items
of legislation and the significant events in the
labor movement - At the outset, the law was such that the
management was controlling the situation - The more classic illustration of this is the
application of the Sherman Antitrust Act, enacted
in 1890 to suppress the formation of large
corporate trusts, which dominated the market and
acted to fix prices and restrain free trade - More recently, Microsoft Corporation reviewed by
DOJ to prevent dominance in the computer market - In 1980, the Supreme Court ruled that the
Antitrust law could be applied to prevent labor
from organizing - In 1914, Congress acted to offset the effect of
the Sherman Antitrust Act by passing Clayton Act - This act authorized employees to organize to
negotiate with a particular employer - However, in most cases the employer could
demonstrate that the organizing was directed by
parties outside the employers shop - This implied that the action was not a local one
and , therefore, was subject to action under the
Sherman Antitrust Legislation
8Table 14-1 Chronology of Labor Law and
Organization
914.4 NORRIS-LAGUARDIA ACT
- The passing of the Norris-LaGuardia Act was the
major movement of the power pendulum away from
management and toward labor - This Act specifically stated that the courts
could not intercede on the part of the management
so as to obstruct the formation of the labor
organizations - It effectively overruled the Supreme Court
interpretation that the Sherman Antitrust Act
could be applied to labor organizations - It also outlawed the yellow-dog contracts on
the part of management - Yellow-dog contracts are employees hired but
agreed not to join unions - Yellow-dog contracts were ruled illegal by the
Norris-LaGuardia Act
1014.5 DAVIS-BACON ACT
- David-Bacon Act provided that the wages and
fringe benefits on all federal and federally
funded projects shall be paid at the prevailing
rate in the area - The level of prevailing rates is established by
the Secretary of Labor and a list of these rates
is published with the contract documents - To ensure that these rates are paid, the
government requires submittal by all contractors
of a certified payroll - Since the DOL accepts the negotiated union
contract as the prevailing ones, this allows
union contractors to bid without fear of being
underbid by nonunion contractors paying lower
wage rates
1114.6 NATIONAL LABOR RELATIONS ACT
- National Labor Relations Act, is also referred to
as Wagner Act - Its central purposes are to protect
union-organizing activity and encourage
collective bargaining - Employers unfair labor practices defining
precisely what actions are not acceptable are
shown in table 14-2 - This act also established a watch-dog
organization to ensure its provisions were
properly administered. This organization is the
National Labor Relations Board (NLRB). - The NLRB acts as the clearinghouse for all
grievances and issues leading to complaints by
labor against management and vice-versa - It is the highest tribunal below the Supreme
Court - This act also established the concept of a closed
shop - Labor organizations had fought for the right to
force all members of a particular work activity
(shop) to be members of a union - If the majority voted for union membership, then
the order to work in the shop, a new employee has
to belong to the union - This is in contract to the open shop in which
employees are not recognized and do not belong to
a union - The Wagner Act endorsed the concept of the closed
shop and made it legal - This concept was later revoked by the
Taft-Hartley Act and replaced by union shop
12Table 14-2 Employer Unfair Labor Practices
1314.7 FAIR LABOR STANDARDS ACT
- The Fair Labor Standards Act is commonly referred
to as minimum wage law - The law defines the 40-hour work week and time
over this amount as overtime
1414.8 UNION GROWTH
- Under the provisions of the union legislation of
the 1930s, the labor unions began to flourish - Criminal activities within the unions were
widespread and virtually unchecked - 1943, Congress responded to the changing public
perception of unions by passing the War Labor
Disputes Act (Smith Connaly Act) - It was designed to limit strikes in critical
wartime industries - The criminal activities in unions were recognized
by the Hobbs (Anti-Racketeering) Act of 1946 - This legislation was enacted to protect employers
from threats, force or violence by union
officials extorting payments for services rendered
1514.9 LABOR MANAGEMENT RELATIONS ACT
- The Labor Management Relations (Taft-Hartley) Act
together with Wagner Act to form two
cornerstones of American labor relations
legislation - The Taft-Hartley Act amended the Wagner Act and
revised the swing of the power pendulum once
more, still leaving labor in a very strong
position, but pushing the pendulum more towards
center - Giving management a stronger voice and to balance
representation of labor and management - The bill defined the rights of workers to
participate in or refrain from union activities - It also provides the counterpoint to the Employer
Unfair Practices section of the Wagner Act - The law also established the Federal Mediation
and Conciliation Service, which acts as a third
party in trying to expedite a meeting of the
minds between unions and management involved in
the dispute - Under the Taft-Hartley legislation, the president
is empowered to enjoin workers on strike (or
preparing to strike) to work for an 80-day
cooling off period during which time negotiators
attempt to reach agreement on contractual or
other disputes - The president has utilized his powers under this
provision of the law on numerous occasions since
1947 - Closed shop was declared illegal by the
Taft-Hartley Act - The union shop is legal
- A union shop is one in which a nonmember can be
hired
16LABOR MANAGEMENT RELATIONS ACT CONTD.
- The worker is given a grace period (3 days),
during which time he or she must become a union
member. If the new employee does not become a
union member, the union can request that the
candidate employee be released - The union shop gives the worker a chance to join
the union (fig. 14-1). If the worker requests
membership and the union refuses after 3 days,
management can ask the union to show cause why
the employee has not been admitted to membership - The law also recognizes that concept of agency
shop - In such facilities, a worker can refuse to join
the union - The employee therefore, has no vote in union
affairs - The worker must, however, pay union dues since he
benefits from the union actions. Example, union
negotiated pay increase - Under the closed shop concept, workers were
forced to either join the union or go elsewhere.
The Taft-Hartley Act allows the individual states
to enact right-to-work laws that essentially
forbid the establishment of totally union shops
17Table 14-3 Union Unfair Labor Practices
18Figure 14-1 Contract Typical Member Clause
1914.10 OTHER LABOR LEGISLATIONS
- The Labor Management Reporting and Disclosure
(Landrum-Griffin) Act was passed in 1959 to
correct some of the deficiencies of previous
legislation - Its major objectives were
- Protection of individual union members
- Improved control and oversight of union elections
- An increased government role in auditing union
records - Title IV of the Civil Rights Act (enacted in
1964) established the concept of equal employment
opportunity - This legislation was expanded by the Civil Rights
Act of 1991. It forbids discrimination on the
basis of race, color, religion, sex or national
origin. It is administered by EEOC - Executive Orders 11246 and 11375 further
amplified the government position on equal
opportunity
2014.11 VERTICAL vs. HORIZONTAL LABOR ORGANIZATION
STRUCTURE
- The traditional craft unions are normally
referred to as horizontally structured - Contract negotiations are conducted at the local
level and all major discussions are concentrated
at local levels - The construction unions are craft unions with
strong local organizations - The Associated General Contractors (AGC) in the
local area often act as the contractors
bargaining unit - Vertical structured unions tend to concentrate
more of the power at the national level. Labor
contracts are negotiated at the national level - The industrial unions of CIO have traditional
organizations in a vertical structure, while the
construction unions of the AFL maintain the
strong local horizontal structure
2114.12 JURISDICTIONAL DISPUTES
- Major difficulties inherent in the horizontal
craft structured union is the problem of craft
jurisdiction. Job jurisdiction disputes arise
when more than one union claims jurisdiction over
a given item of work - This primarily because many unions regard a
certain type of work as a proprietary right and
jealously guard against any encroachment.
Example traditionally, windows and doors
installation had been considered a carpentry
activity. However, the introduction of metal
frames led to disputes between carpenters and
metal workers
22SCOPE OF WORK
- See page 236 for the agreement that covers all
employees employed by employers - Jurisdictional disputes present less problem in
vertically structured unions since craft
integrity is not a matter that determines the
strength of the union - UAW is a typically vertically structured union.
Therefore, UAW workers can be installing windows
today and can be moved to installation of
electrical wiring next month. Craft integrity
does not have to be jealously protected
23Fig. 14-2 Structure typical of an affiliate of
the building and construction Trade Department,
AFL-CIO
24UNION STRUCTURE
- The largest labor organization is the AFL-CIO
- The building and construction trade unions are
craft unions and as such are affiliates of the
Building and Construction Trade Department of the
AFL-CIO - The structure of affiliates from local to
national level is shown schematically in fig.14-2 - See table 14-4 for a history of the construction
unions that are within the AFL-CIO. Most
construction unions are affiliated with the
AFL-CIO
25Table 14-4 AFL-CIO Construction Unions
26NATIONAL UNIONS
- National unions are defined as these having
collective bargaining agreements with different
employers in more than one state and federal
employee unions with exclusive bargaining rights - In construction unions, however, the locals still
play the most important role in collective
bargaining and, therefore power still resides at
the local level - Each union has exclusive jurisdiction to function
as the workers representative in its trade or
branch of industry - The daily conduct of the union business is in the
hands of the national president
27STATE FEDERATIONS AND CITY CENTRALS
- State federations are concerned mostly with
lobbying for needed legislations and public
relations at the state level - City centrals are concerned more with economics ,
serving as a clearing house for locals and aiding
in dealings with employers
28UNION LOCALS
- The locals are the smallest division of the
national union - They provide a mechanism through which the
national union can communicate with its members
at the local level - Local provide for contact with other workers in
the same trade and are a means by which better
working conditions are obtained, grievances are
settled, etc. - The most important local official is the business
agent, a full-time employee of the local. He
exercises a great deal of leadership
29UNION HIRING HALLS
- One of the features of construction labor is its
transient nature - Union hiring halls provide a referral service
that links available labor with contractors
request
30SECONDARY BOYCOTTS
- Legality of boycotts influence labor disputes has
been an issue of primary importance throughout
the history of labor management relations - A boycott is an action by one party to exert
economic and social pressure on a second party
with the intent of influencing the 2nd party - A secondary boycott is one in which party A who
had a dispute with party B attempts to bring
pressure on by boycotting party C who deals with
party B and who can bring indirect pressure on
party B to agree to some issues. This is shown on
fig. 14-3 - If the electrical workers in a plant, fabricating
small appliances go to a factory and form a
picket line to get agreement - primary boycott - If however, the workers send some of their
members into the town and put pickets up at
stores selling appliances from the plant
secondary boycott - In the construction industry, such secondary
boycotts occur on sites with both union and
nonunion workers when a union attempts to force a
nonunion subcontractor to sign a union contract - This is secondary boycott and Taft-Hartley Act
declared this to be illegal
31SECONDARY BOYCOTTS CONTD.
- In such cases, the union will put up a picket
line at the entrances to work sites, in effect,
to picket or boycott the nonunion sub - Labor unions, however, demands that no union
worker can cross another union picket line - In effect the union picket line will be to
prevent all union workers from entering the site - This may cause the shutdown pending resolution of
the nonunion subs presence on the site - In this situation, the GC is a third party being
pressured by the union to influence the nonunion
sub. This is called common situs - Supreme Court ruled this practice to be a
secondary boycott and hence illegal under the
Taft-Hartley Act - The doctrine of separate gates was developed to
deal with secondary boycott problems - Under this policy the GC puts a separate gate for
nonunion sub with whom the union has a dispute - The union is then directed to place its picket
line at this gate rather than the main project
gate
32Fig. 14-3 Types of boycotts (a) primary boycotts
and (b) secondary boycotts
33OPEN SHOP AND DOUBLE-BREASTED OPERATIONS
- In recent years escalating union wage settlements
have led to an upsurge in the number of open-shop
subs successfully bidding on large projects - In an open-shop firm there is nonunion agreement
and workers are paid on a merit basis - The largest group of open-shop or merit shop subs
is represented by ABC - In order to be able to bid to both open-shop and
union formats, some firms have organized as
double-breasted contractors - Large firms will have one subsidiary that
operates with nonunion contracts. A separately
managed company will be assigned to all union
contracts
34LABOR AGREEMENTS
- Just as the contractor enters into a contract
with the client, with vendors supplying materials
(i.e. purchase orders) and with subs working
under his direction, if union labor is utilized,
the contractor also enters into contracts or
labor agreements with each of the craft unions
with whom he deals with - These contracts usually cover a 1 to 2 year
period and include clauses governing the
reconciliation of disputes, work rules, wage
scales and fringe benefits - Typical contracts also include provisions
governing - 1) Maintenance of membership, 2) fringe benefits,
3) work rules, 4) apprentice program operation,
5) wages, 6) hours, 7) worker control and union
representation, 8) operation of the union hiring
hall, 9) union area, 10) sub clauses (see section
14-1E), 11) special provisions - See fig. 14-4 for a summary of labor
organizations and wage rates
35Figure 14-4 Labor Organizations and Wage Rates
IAF Industry Advancement Fund
36LABOR COSTS
- The large number of contributions and burdens
associated with the wage of a worker makes the
determination of a workers cost to the
contractor a complex circulation - The contractor must know how much cost to put in
the bid to cover the salary associated
contributions for all the workers - Assuming that the number of carpenters,
ironworkers, operating engineers and other craft
workers required is known and the hours for each
can be estimated, the average hourly cost can be
multiplied by the required craft hours to arrive
at the total labor cost - The average cost of a worker to the contractor
consists of the following - 1) Direct wages, 2) fringe benefits, 3) social
security contributions (FICA), 4) unemployment
insurance, 5) workmens compensation insurance,
6) public liability and property damage
insurance, 7) subsistence pay, and 8) shift pay
differentials - The direct wages and fringe benefits can be
determined by referring to a summary of wage
rates as the one shown in fig. 14-4 - All workers must pay social security or a portion
of their salary. For every dollar the worker
pays, the employer must pay a matching dollar - FICA contribution in 2004 was on the first
87,900 of annual income at the rate 7.65, the
contractor, would contribute a like amount
37LABOR COSTS CONTD.
- Unemployment insurance each state sets a rate
that must be paid by the employer - State also require employers to maintain
workmens compensation insurance for all workers
they employ. The insurance reimburses the worker
for injuries occurred in the course of
employment. A typical listing of construction
specialties and the rates are given in table 14-5 - Public Liability (PL) If a bag of cement falls
from an upper story of a project and injuries
persons on the sidewalk, these persons will
normally seek a settlement to cover their
injuries. PL is the responsibility of the owners,
however, normally pass the requirement to insure
against such liability to the contractor in the
form of a clause in the General Conditions of the
construction contract - Similarly, if the bag of cement falls and breaks
the window shield of a car parked near the
construction site, the owner of the car will seek
reimbursement. This is a property damage (PD)
insurance carried by the contractor (for owner)
covers this kind of liability - Therefore, to provide PL and PD insurance, the
contractor must pay 3.00 for PL and 1.88 for
each one hundred dollars of steel erector salary
paid on the job - Subsistence is paid to workers who must work
outside of the normal area of the local - Shift differentials are paid to workers in
recognition that it may be less convenient to
work during one part of the day than during
another. Typical provisions in a sheet metal
workers contract are given in fig. 14-5
38Table 14-5 Building Craft Wage and Insurance Rates
39AVERAGE HOURLY COST CALCULATION
- A typical summary of data regarding trade
contracts in given areas is presented in table
14-5 - A worksheet showing the calculation of an iron
workers hourly cost to a contractor is shown in
fig. 14-6 - The calculation of the hourly average wage
indicates the complexity of payroll preparation.
A contractor may deal with any where from 5 to 14
different crafts, and each craft union has its
own wage rate and fringe benefits structure.
Because of this, most contractors with a work
force of any size use the computer for payroll
preparation
40Figure 14-6 Sample Wage Calculations