As the construction industry struggles to fill occupational vacancies in the midst of a severe labor shortage, it’s vital that contractors have a firm understanding of unionized and non-unionized workers. Clashing with unions can quickly lead to a firestorm of controversy that can derail your ongoing projects.
In part one of this two-part series, the Broward contractor attorneys at Cotney Construction Law introduced the topic of unionized and non-unionized construction. After discussing the nature of employer-employee relationships in the construction industry, we briefly covered the difference between these two types of construction. Now, we will explore this topic in even greater detail.
Craft unions establish fixed jurisdiction rules for various trades as well as consistent hourly wage rates. They may also offer formal training to apprentices to help create a consistent skill level among all union members. When contractors hire unionized workers, they enter a legally binding collective bargaining agreement with the craft union. There is a system called a “union shop”’ that facilitates a binding obligation for both parties to meet the terms of the collective bargaining agreement. It requires the contractor to hire employees through the “hiring hall,” a union operated referral system that must follow these guidelines:
- All qualified workers must have an equal opportunity to be selected by the contractor without bias related to their relationship to a union.
- Contractors have the right to hire or dismiss referred workers based solely on their qualifications.
- The referral plan is required to be posted in public with information covering the contractor’s priorities or required qualifications.
Although the construction industry is historically tied to unionization, many non-union contractors are finding success in the industry today. Since non-unionized construction doesn’t utilize a collective bargaining agreement, many contractors have instead turned to non-union contractors’ associations. Interestingly, this practice (referred to the “merit shop”) produces a similar result to a collective bargaining agreement, except control is passed to the non-union contractors’ association.
Merit shop operations are predominantly national in scope, although apprenticeship and training plans are typically executed on the local or state level. Merit shop employees work for construction firms and take a vested interest in the success of the company employing them since failure can have an adverse effect on employment. Merit shop construction expanded throughout the mid to late 20th century through the efforts of the Associated Builders and Contractors association. Some of the benefits of merit shops include:
- Increased management flexibility
- Autonomy over workforce selection and decision making
- Maximizing the use of the local labor force
- Heightened focus on worker development
- Collective interest in firm success
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.