Union contractors can’t
compete with nonunion contractors
Yes they can. They have been doing so as long as
there have been nonunion contractors. If they didn’t make money,
they wouldn’t stay in business year after year; they are not
charities. They remain union contractors because they believe that
it is to their advantage to do so. The Local 617 contract states
right at the beginning, “Either party desiring to change or
terminate this Agreement must notify the other in writing at
least ninety (90) days prior to the anniversary date.” They can go
nonunion if they want to.
While union contractors can and do compete, their
success is hindered when nonunion contractors can hire good quality
workers at substantially lower wages. This takes the burden of
competitiveness away from the contractor—the business man—and shifts
it onto the worker.
The union principle is that contractors should
compete with each other on the basis of their management skills and
not on their ability to hire workers more cheaply. Both union and
nonunion contractors have a common method to insure the efficiency
and competitiveness of their workers—they don’t keep around those
who are not productive for long. The better workers usually work
more hours during the year, both union and nonunion.
We believe that competition is good up to this
point but it should not extend to wages. Setting pay levels
individually would only drag down the pay of everyone and would be
very difficult to administer fairly and objectively. If the new hire
isn’t working out, the solution is to either lay him off or fire him
for cause.
Those workers who are concerned about the
competitiveness of their wage might ask that their pay be reduced to
the minimum wage so that they know that they are the most
competitive workers available. We prefer to make a fair wage.
How can a union contractor compete when he has to
pay $20 an hour more?
Our research has shown that the nonunion
contractors, on average, bid about $5.00 to $8.00 per hour less than
union contractors, not $20.00 They keep $12.00 to $15.00 per hour of
your money as their profit.
Union contractors have access to a labor pool of
workers—a distinct advantage. Nonunion contractors must advertise
for help, take applications, interview, and then don’t always end up
with a qualified worker. As union organizing progresses, fewer
workers will be available to the nonunion contractors, making them
even less competitive. Once the union controls a loose monopoly of
the workers, the nonunion contractor will have no choice but to sign
an agreement.
Why is the union wage as high as it is?
How much per hour does it cost to have your car
repaired? The answer is, about the same as it does to hire an
electrical contractor.
The Bay Area is an expensive place to do business;
wages and salaries, housing costs, and taxes are all high. Even with
these high costs, Fortune magazine named the Bay Area as the
second best place in the world to do business; Singapore is
first. Despite the high cost of doing business, it beat every other
city in the country.
The union wage is necessary because it is expensive
to live here. Also, we are paid only for the hours worked; we don’t
have paid vacations or paid holidays. This makes the pay seem higher
than it is to those outside of construction.
Local 617’s market share
Even with their greater costs, union contractors
still manage to get a significant percentage of the work in San
Mateo County—about 86%.
All the union wants to do is make it more
difficult for the contractor to stay in business
We invite you to carefully read the document that
governs our relationship with our contractors—the contract. A copy
is available from the union office. Judge for yourself if its
provisions are less than reasonable.
Twenty years ago, the contract did contain some
burdensome provisions, but those are no longer there. Union workers
are not out to cause trouble for the contractors. We work with our
contractors, not against them.
