Heritage Foundation: Organized Labor’s Green Blackmail

Organized Labor has a long history with extortion and the mob. Federal prosecutors have put most of those mob bosses behind bars, but unions haven’t renounced using blackmail to get what they want. They simply use more sophisticated methods to do the same thing.

Take the way unions exploit environmental concerns through Project Labor Agreements. Under PLAs, businesses promise to hire only union members — or else. Why would businesses sign such agreements? Because unions threaten to use environmental regulations to shut them down unless they sign the PLA.

The law requires companies to get environmental permits to begin major construction projects. The process takes time, and community groups may object to awarding the permits.

Unions can misuse these laws to kill a project outright — or at least delay it for several years. They can file environmental objections, conduct their own environmental impact assessment that shows that letting it go forward would harm the Earth, and use their influence to block companies from getting the necessary permits. Many businesses face an offer they can’t refuse: Sign a PLA and hire more expensive union members to construct their buildings, or the union will use environmental laws to shutter the project.

Sound like blackmail? That’s because it is. Only this time unions use government bureaucrats instead of armed thugs to intimidate businesses. It happens repeatedly:

— Gaylord Entertainment planned to build a $1 billion hotel and convention center on San Diego’s waterfront. The San Diego Building and Construction Trades Council, however, insisted that Gaylord sign a PLA adding $100 million to the total cost or the union would tie up the project for years with environmental lawsuits. Gaylord pulled out, costing San Diego thousands of new jobs.

— The International Brotherhood of Electrical Workers (IBEW) Local 100 objected to a solar power plant being built in Fresno, Calif. Solar power plants are usually considered environmentally friendly, but this plant was being built with non-union labor. The IBEW discovered many environmental problems with the project and attempted to block it. Fortunately, the Fresno City Council saw through the attempted extortion and voted to reject the union’s complaints.

— Indeck Energy Services applied to build several co-generation power plants in upstate New York. The Building and Construction Trades Council also had environmental objections to this project and requested a meeting with Indeck’s president. At the meeting, however, instead of discussing the environment, the union bosses threatened to “stop every Indeck project in New York unless it went union.” Indeck capitulated, signed a PLA, and the union reversed its earlier objections, strongly urging the government to grant the environmental permits.

So why the shift toward, well, green blackmail? Because competition is putting the labor movement out of business. Unions are a cartel. They try to drive up wages by restricting the supply of workers. Businesses must pay what the union demands, and pass those higher costs on to consumers, or cancel the project. It’s an arrangement that suits organized labor quite well. However, it also means higher prices and fewer jobs overall.

But this only works when non-union competition is scarce. Consumers object to being overcharged and pick better value for their money. The auto, steel, trucking, and construction industries were heavily unionized before free trade and deregulation broke the monopoly. Today non-union companies dominate these sectors because they out-competed their unionized counterparts and provided Americans with better goods at lower prices.

The Labor movement wants its monopoly back. As long as some companies are free to hire non-union workers, that won’t happen.

How can the government stop on this abuse of environmental laws? There’s a simple solution. The government doesn’t enforce contracts signed under the threat of force. Indeck signed a PLA, but after encountering problems with their union contractor, they fired him and built the power plants with non-union labor. The Trades Council sued for breach of contract, and the case came before the National Labor Relations Board (NLRB). The NLRB sensibly ruled that since Indeck was pressured into signing the PLA, the contract was invalid and the Trades Council had no standing to sue.

Unions should have to compete like everyone else, not use the government to force companies to hire them. Environmental blackmail is a return to the worst practices of the Labor movement. Congress should write the NLRB’s ruling into law to ensure that a future board doesn’t overturn it. Environmental laws should protect the earth, not a union monopoly.

James Sherk is the Bradley fellow in labor policy at The Heritage Foundation.