Monday, October 12, 2009

In nation’s longest-running labor dispute, hotel fights city hall and wins

Municipalities and elected officials frequently inject themselves into local labor disputes, often to the benefit of unions, who focused much of their advocacy efforts on state and local government in the face of a largely hostile environment at the federal level during the Bush years. Employers have responded by challenging such labor-friendly local impulses on federal preemption grounds, citing the National Labor Relations Act to fend off legislative initiatives closer to home that could prove more advantageous to workers than federal law.

In recent weeks, Chicago’s Congress Plaza Hotel—the site of the longest-running strike in the nation—achieved two solid wins in its ongoing labor dispute with Unite Here, the hotel workers’ union, as the NLRA and preemption concerns foiled the union’s efforts to make some inroads in the battle by way of local politics.

Denial of permit on union’s behalf. On September 28, a federal district court in Illinois, in 520 S. Michigan Ave v Fioretti, held the city of Chicago was vicariously liable for a violation of the NLRA by Robert Fioretti, an alderman who refused to issue a permit to the hotel to operate a sidewalk café. The record showed that Fioretti, who had unseated an incumbent in part with union support, made statements both in public and in meetings with union officials suggesting his approval of the operating permit hinged on the hotel's settling the labor dispute.

The record was devoid of the alderman’s reasons for opposing the permit. However, the court cited Fioretti’s “staunchly pro-Union position,” and noted that he had kept the union president apprised of the status of the hotel’s application and displayed great concern about how the union reacted to his actions on the permit. Based on these facts, the court found Fioretti had impermissibly inserted himself into the collective bargaining process, in violation of the Act. “Fioretti is fully committed to supporting the Union in its strike against the Hotel, which he is entitled to do,” the court wrote. “He cannot, however, use his control over the permit process, the existence of which he so forcefully proclaimed at [a] Union rally, to pressure the Hotel to end the strike.”

Moreover, given its complete delegation of policymaking authority over permit applications to its aldermen, the city was deemed liable, too. The court enjoined the city and the alderman from further interference in the hotel’s negotiations with the union, noting that without injunctive relief, “the Hotel’s positions in the labor dispute and the marketplace will continue to erode.”

No on “right to know.” A union-backed “right to know” ordinance, which would require Chicago hotels to notify guests at the time they book hotel rooms if the hotel is affected by a work stoppage, failed to pass the Chicago City Council last week, with aldermen voting by a narrow margin on October 7 to send the measure back to the council's finance committee for possible revisions.

Unite Here Local 1 lobbied for the ordinance in hopes of gaining some leverage in ongoing negotiations with the city’s unionized hotels. Contracts expired on August 31 for some 6,000 workers at 30 downtown hotels run by several national hotel chains, and contract negotiations are ongoing but remain far from settled. A strike threat would obviously carry more weight (and a lockout would be fraught with greater danger) if hotels were compelled to notify potential guests of a work stoppage.

Still, the Congress Hotel no doubt was a key target of the right-to-know measure. Workers have been picketing the hotel for six years; according to Local 1, more than 1,000 customers have complained about the hotel since the strike began. The proposed ordinance would provide a cause of action against a hotel by guests who were not properly notified of a strike or lockout involving at least 20 employees lasting 15 days or more. Chicago hotels would have to alert guests of the work stoppage before they make reservations, over the phone and in all printed and electronic communications. And notice would have to be made through third parties such as travel agents and online travel reservation websites as well.

Unite Here had campaigned for the ordinance in 2005, but the measure lost by five votes, in part due to concerns over whether the NLRA preempted such legislation. In its most recent round, the proposed ordinance won the backing of the finance committee in August by a 16-3 vote, but it could not get past a deadlocked full city council, at least for now. The Congress Hotel has indicated it will file a lawsuit to challenge the ordinance if it passes.

If the hotel’s recent victories are any measure, employers that are embroiled in labor disputes in union-friendly municipalities increasingly will find they can fight city hall—much to labor’s chagrin.

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