7/24 update 3 of 3: Labor Relations
Welcome to the last post which is actually about our most important subject matter, labor relations and actually performing work as an electrical contractor.
In some ways, I think this is the matter which has been most adversely impacted by Covid-19. The interactions between labor and management as well as contractor and customer are predicated by law and contract it's true. However, so very much of what makes that possible has to do with trust established over years through face to face discussions, longevity, and a common understanding of all the things that make the construction process work.
Covid-19 has thrown a wrench into all of that and it's starting to show. Over the last month in particular, our office has been fielding a significant increase in concerned calls regarding both labor and work outlook. A partial list in no particular order is as follows:
Continuing lack of manpower - In the background of all that has gone on over the last five months, it is easy to forget that even without Coronavirus, our industry was nearing a critical tipping point with respect to the number of people leaving the industry vs. the number entering it. We have failed to bring in an appropriate number of apprentices, despite warnings to the contrary, for more than 10 years. Compound this systemic problem with the significant impact of Covid-19 on those willing to work, due to health, taking advantage of new entitlements, or simply deciding that now is the time retire, and simply put, we have fewer workers now than we need.
Concern for a Second Wave – Whether or not this increase in the number of positive tests and deaths is a second wave or simply a continuation of the first and discussions about who should be blamed are political discussions not really relevant to our industry. What is relevant, however, is that we are seeing a weakening of the long term work outlook as customers adversely impacted by the pandemic are delaying or cancelling projects in order to retain capital through this event.
Productivity – Although ELECTRI published a wonderful paper on the effect of Covid-19 on field productivity, justifying this number on claims for existing jobs and dialing in on productivity modifiers for long-term bids continues to be an exhausting (and likely impossible to get right) task. How could it be anything else? Requirements from owners, states and municipalities, and the difficulties enforcing both with our workforce seem to change nearly every single week.
Labor Issues – In addition to the aforementioned lack of manpower, the productivity issues, and the difficulties managing the changing safety requirements, for lack of a better way to express it, dealing with manpower and their representatives has grown more contentious. I’ve had more interventions in the past two months than the previous eight. Generally speaking, only about one in ten come across my desk so that means that a massive amount of time is being taken up on every job just dealing with labor issues that previously wouldn’t have even been raised. I don’t know why we are seeing this level of unrest, but I can only tell you that we are not alone and that this is something that is happening all over the country. Some of you might recall the concerns I’ve raised about the NECA-IBEW Benefit funds. To a great extent, those problems are a manifestation of the same movement you’re seeing on your jobs. More on that later.
Management Issues – To be fair… labor isn’t the only one causing this. Simply put, we have also been seeing a dramatic increase in preventable labor-management issues resulting from less than optimal field management decisions or policies. As a reminder, NECA offers online foreman training available from our NECA Education folks. It’s fairly basic, but some of these errors we're seeing are just that… basic. To address the most common issues right here and now though, here are a few things you might want to go address with your foreman just to make sure:
Document all discipline: Every foreman should be equipped with at least some way to document any infraction they see on their jobs. It could be duplicate sheets in a log book, a project supervision app, or a witnessed write up process where they can provide employees with notice that whatever infraction they’ve committed isn’t acceptable and that if it continues it will result in termination according with company policy. I know it's difficult to get them to police their fellow union members, but that’s why they get paid the foreman premium. More to the point, them not taking these measures is costing you far more money on the back end than would be accrued in properly enforcing and documenting necessary discipline.
Foremen should know company policy: This seems like a no-brainer, because actually everyone should know company policy. However, we’ve had issues recently so I’m mentioning it. You can’t hold a new hire accountable to your company policies if they’ve never seen them and as far as the DOL is concerned, they haven’t if there isn’t a record of it. Again, document everything.
Foremen must follow company policy: A policy isn’t a policy if it only applies to some. I shouldn’t single out foremen on this as it seems to be more of a “shop” vs. “book” kind of thing, but we have had numerous instances of more preferred employees being allowed certain flexibility while less-preferred are being held to the letter of the law. This isn’t defensible. Pick your policy and apply it consistently. Obviously there are others, but those are the big three and cleaning them up will eliminate the vast majority of headaches many of you report having right now.
In other news, we just completed a settlement in Terre Haute. It was a 3 year agreement that, under the circumstances, was probably higher than we wanted to settle for at 2.75%, 3%, and 3.25% annually. However, recent settlements out of CIR were so outrageously high that we couldn’t risk getting a far worse settlement by rolling the dice at Council. I’ll have wage sheets and the Agreement drawn up for this new contract soon.
Next, a follow-up on the Decatur Fund. Thank you to the Board who unanimously approved supporting the Chapter assisting our Management Trustees with Counsel. We are finalizing the details of retaining our representation now and hopefully, things will move off center with the fund and get back to ensuring that your employees have the benefits you pay for.
Finally, we are still getting new insight into how to address some of the most common employment scenarios related to Covid-19. Here is the latest document from NECA National on testing, leave, and quarantine issues.
Coming full circle in these postings, what it means to be a member of NECA and what our job is as an association hasn’t really changed even though we can’t associate in person. You’re still electrical contractors and our job is nothing less than to do everything we can to help you be successful. Even if it's only from a distance.
Have a great weekend everyone. I hope to see you all soon.
As always, stay safe and call me if you have any questions.