Boeing Production (WA vs SC)

[Mardi Gras Audrey]

The former chairman of the National Labor Relations Board told FoxNews.com that a board attorney's bid to stop Boeing from opening a production line at a non-union site in South Carolina is "unprecedented" and could have serious implications for companies looking to expand.

The comments Tuesday from Peter Schaumber add to the roiling debate over the complaint filed last week against the aerospace giant. NLRB's acting general counsel, taking up allegations from union workers at a Puget Sound plant in Washington state, had accused Boeing of violating federal labor law by moving to open a second 787 Dreamliner airplane production line in South Carolina.

The complaint hinged on claims that Boeing made "coercive statements" regarding union-led strikes, and then retaliated by transferring its second line to a non-union facility. As evidence, the NLRB noted that a Boeing executive said in an interview that the overriding factor in going to South Carolina -- a right-to-work state where unions cannot force employees to join -- was a desire to avoid disruptions. The union in Washington state has led several strikes against Boeing since the 1970s, most recently in 2005 and 2008.

But Schaumber said the complaint is a big stretch and would mark a departure. He said that if the claim is upheld, it could jeopardize any company with unionized workers that wants to expand to a right-to-work state.

www.foxnews.com/politics/2011/04/26/ex-labor-board-chairman-union-backed-case-boeing-unprecedented/
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Discuss....

[RoadToRiches]

meh... I got couple friends that work at the SC plant.

[tskeeter]

Can our government agencies get any more stupid? The NLRB's attempts to protect Boeing's employees from their own behavior could easily cause Boeing to set up production in another country, both WA and SC lose the jobs. That's a really smart move. Right?

[shanendoah]

Apr 29, 2011 12:44:37 GMT -5 tskeeter said:

Can our government agencies get any more stupid? The NLRB's attempts to protect Boeing's employees from their own behavior could easily cause Boeing to set up production in another country, both WA and SC lose the jobs. That's a really smart move. Right?

Boeing won't move operations abroad (or at least not all). Neither will their main competitor Lockheed-Martin. The reason for this is that most of their work has nothing to do with building dreamliners, but with defense contracts, which they are not legally allowed to build over seas for security reasons.

I'm a pretty far left liberal about most things, but I honestly believe that unions have (with some exceptions) outlived their usefulness in the US (where we now have laws that govern most of the issues unions were formed to address), and now exist, like all organisms, simply to promote their own continued existence.

I live in the Seattle area, and work at a company that has both union and non-union employees. Because I'm in management, I won't ever end up being union but I HATE the fact that we have to post signs everywhere saying that our company can not force a person to make a decision one way or the other about joining a union- because its a lie.
Technically, our company isn't the one forcing, but the effect is the same. If you get hired in to a union shop, you MUST join the union. You have no choice in the matter. If you fight hard enough to not be in the union, you still have to pay union dues, but you can ask the union that your money be donated to a charity you believe in. You are still represented by the union in collective bargaining and are still employed with our company under union rules. About the only difference is you can't ask for a union rep to be present during a disciplinary hearing.
I believe that people should always have the right to choose whether or not to join a union.

I actually kind of hope this might trigger WA to rethink its laws around unions. The state already makes policy based on what Boeing asks for- their corporate tax rate is ridiculously low, we have UE programs that allow their laid off employees to collect UE without looking for work, so that they are available to be re-hired whenever Boeing decides they want them back, and we have expanded car pool lanes on freeways because Boeing asked for it.

So maybe, just maybe, this move by Boeing to transfer more work to SC, a right to work state, will cause the WA state government to act, making it possible for no one - employer or union - to force people to join unions.

[tskeeter]

Shanendoah, I agree with your assertion that Boeing won't/can't move it's defense production outside the country. But, the civilian Dreamliner production that is at issue with the NLRB now?

Who knows what could happen if the business climate gets too pro-union. Does if really make sense for the NLRB to try to protect union jobs if the consequence could be that the jobs will leave the country? Makes about as much sense as the Chief Union Steward I saw negotiate a $1.00 an hour increase in pay for seasonal employees (including his son) in exchange for paid lunch breaks for 600 employees. If the government starts to regulate where in the US businesses can establish operations, will businesses choose to establish operations outside the US? Is the NLRB taking a narrow view of a much broader issue, and costing US citizens jobs over the long term?

[shanendoah]

The current issue is Dreamliner production, I agree. But Boeing already has offices in 70 different countries. If it made financial sense to build the Dreamliner outside the US, Boeing would already be doing so.
My guess is that the number of facilities capable of building the Dreamliner are low, and that there are other efficiencies that come in to play by making it in WA or in SC, which trump labor costs. So I seriously doubt Dreamliner production is going to leave the US, at least in the next 5-10 years.

Otherwise, I don't disagree with you. I do see some situations (such as with the casinos in NV) where the work of unions is still pretty necessary due to the overlap between local government and business, but for the most part, unions have outlived their usefulness in countries like the US. They have tremendous usefulness in countries that don't yet have many laws protecting workers (such as Mexico).
But in the US, labor unions now mostly seem to exist for the sole purpose of maintaining their existence. (This does not mean that I think governors can decide to ignore contracts they themselves signed because they don't like unions.) I really dislike the fact that workers can be forced to join a political action group simply by getting a job, and would like to see the unions' power to force people to join their ranks taken away.

However, I don't have a whole lot of sympathy for people losing a paid lunch break. I know they used to be the norm, but they no longer are. Depending on how many seasonal workers there were, and if the company hires those seasonal workers every season (kind of like Boeing does), I think the extra $1/hr for seasonal workers probably benefited more people than losing a paid lunch hurt.

[tskeeter]

Shanen, I think the fundamental question is if the Federal government starts to dictate that businesses establish operations in high cost parts of the country, and one of the alternatives is to establish operations outside the country, where it is more cost effective than in the US, how many businesses would move operations outside the country to avoid Federal interference? I don't think it's as much of a union/non-union question as it is how much government interference with business decisions will businesses accept before they start to shift operations to outside the country?

One thing to watch out for is that while the US may be the most cost effective place for companies like Boeing to operate today, it doesn't mean the same will be true in a fairly short period of time. As an example, about 10 years ago, the supply chain of the company I work for was almost entirely domestic. Today, about 30% of the supply chain is off shore. And that percentage is growing. The capabilities of what used to be third world countries are getting closer and closer to those of the US. The US no longer holds the technical superiority card that used to protect our industry from off shore competitors. All you have to do is look at the auto industry. About 35 years ago about all you saw in the US were domestic and European cars. Consumer Reports rated the Mercedes as the best car made by a wide margin. Honda entered the domestic auto market. Then Toyota, Mazda, Nissan, Subaru, Suzuki, Hyundai, and Kia, which will soon be followed by Tata of India. What percentage of the the US auto market is held by domestic and European manufacturers today? What percentage of the selling price of an Asian marque car, even if it is assembled in the US, stays in the US? Where does Mercedes quality fall relative to the quality of other cars today?

In a world where the US no longer has significant technological superiority to protect its workforce, why would the US government do anything that could put US jobs at risk over the long term?

[Mad Dawg Wiccan]

The way I've heard this described is that Boeing isn't moving operations to SC but expanding their operations there. The SC plant voted to be non-union, and the NLRB is clearly out of bounds here.

[Havoc]

Yep... what tskeeter said.

This is a completely counterproductive (ab)use of government power, and it cr@p like this is only going to erode what manufacturing base we have left as companies choose to go elsewhere where they are welcome as opposed to spending millions in legal bills and settlement concessions just to do business in the US.

[lurkyloo]

Here's Megan McArdle's take on it (warning, libertarian ahoy!):

www.theatlantic.com/business/archive/2011/04/nlrb-you-cant-move-away-from-your-union/237758/

I'm no friend of present-day unions, I think they bear a frightening resemblance to the Mafia.
There's also a local community college that is apparently paying the salary of two faculty members who haven't taught a single class in years--they're full-time union representatives. That's just effed up. Somehow, the union sees nothing wrong with it.

Back to the subject at hand: that is also effed up. I can't imagine they have a legal leg to stand on, and it kind of grosses me out that they're trying to control this.