In 2018, the number of construction jobs neared record highs in New York City, fueled largely by a boom in residential construction for rich people. New construction permits are down slightly in 2019 from their historic highs in 2018 — by about 1 percent. But in May, New York State Comptroller Thomas DiNapoli told Crain’s New York he expects jobs in the industry will “be sustained by the large capital programs planned by the city, the Metropolitan Transportation Authority and the Port Authority of New York and New Jersey.”
So why did the New York City District Council of Carpenters — representing more than twenty-thousand carpenters across nine local unions in New York City — vote to approve a new two-tier agreement with the bosses chock full of cuts for working union carpenters?
The Gory Details
Carpenters have been without a “Wall & Ceiling” contract — covering most indoor work — for more than two years. Until now, the old contract has been renewed month by month.
In March, an Executive Delegate to the District Council told members at a Carpenters Local 157 member meeting that cuts for workers and a two-tier system in the contract were suggested by the District Council itself, not the bosses. The proposal was so widely and emphatically panned that workers did not believe it would remain on the table after an outcry from rank-and-file carpenters.
But the new contract actually creates a new second-tier journeyperson who will make up to $34 less per hour in wages and benefits than current journeypeople. The contract will dictate the terms for roughly 80 percent of union carpentry jobs in New York City.
New hires will have to work 10,000 hours in the new lower tier before becoming “certified” journeypeople, at which point they will make what all journeypeople make now. But first they’ll have to spend anywhere between five and eight years as a second-tier journeyperson, depending on how many hours they work each year.
Throughout the union’s negotiations with the employer, the Association of Wall-Ceiling & Carpentry Industries of New York, rank-and-file workers had no say in the process and received very little information about how bargaining was progressing, according to multiple carpenters.
The tentative agreement leaked on July 4 but was never officially provided to the membership. Rank-and-file carpenters had no vote on their contract. Instead, it was approved by the delegate body — which currently has few rank-and-file carpenters as voting members — six days after it leaked.
The contract grandfathers in all current journey workers into the higher-paid “certified” category. “Certified journeypeople” can only make up a maximum of 40 percent of the workforce on a given jobsite under the new contract, and at least 30 percent must be made up of apprentices, who earn less than any tier of journeyperson.
But according to one union activist’s estimate, between 70 and 80 percent of current carpenters qualify to become “certified” journeypeople immediately. This means about half the union’s certified journeypeople will either sit out of work or will have to work for the new, $34-per-hour-reduced rate. In other words, many current workers may also face a massive pay cut on many jobs.
The contract has the potential to make a direct impact on more senior workers, too, whether or not they end up working at the second-tier rate. Only $11–$12 per hour of the $34-per-hour cuts come from salary. Much of the rest comes from reduced contributions to the union’s pension fund.
Forty percent or more of the workforce will soon contribute significantly less to the pension fund — between $1.95 and $4.45 per hour worked, compared to the $12.80 that journeypeople have been contributing for years. The District Council has not announced how it will make up for these reduced contributions in order to keep the pension fund solvent and paying at its current rate.
Slates and Divisions
These givebacks likely would not have been possible if not for a disastrous union election in June.
The 100-seat District Council Delegate Assembly representing workers from nine carpenters’ unions is the ultimate decision-making body on contracts and other high-level matters. Delegates serve three-year terms; unlike most unions, both rank-and-file members and union staff can vote in delegate elections and be elected as delegates. In recent years, the assembly has been dominated by delegates who either work as employees of the District Council or are supers and foremen (front-line bosses), rather than delegates who work as carpenters.
Three years ago, a full rank-and-file slate of thirty-eight delegates was elected in Local 157, the largest of the nine District Council member locals that represents more than 8,600 carpenters. For those three years, the rank-and-file delegate caucus was able to stave off major cuts, concessions, and tiering.
But leading up to the election this June, rank and filers split into two slates: one full slate of established activists, and one smaller slate running alongside John DeFalco, who was indicted on bribery charges related to union recruiting shortly after the election.
The DeFalco slate split the pro-rank-and-file vote and allowed the District Council’s slate — made up, as usual, of District Council employees, industry supers, and foremen — to sweep the elections. Some rank-and-file members are appealing the election results due to a number of irregularities, including the disqualification of 112 ballots from current members.
The new concessionary contract was rushed to a vote almost immediately after the rank-and-file carpenters lost all their seats in the delegate assembly.
There’s another, broader problem beyond the pay cut for new hires and the threat to the pension fund. Historically two-tier contracts — where workers doing the same work get paid different rates — have almost always weakened unions that agreed to them. That’s one reason that a union proposing a two-tier system is almost unheard of.
Once the bosses see that union leaders are willing to settle for less for one group of workers, they naturally start to go after the higher-tiered workers, who are now the more expensive part of their workforce.
As Louis Uchitelle put it in 2013, “The retreat from the middle-class status that unions conferred on so many blue-collar workers is happening gradually. Two-tier schemes, which began to spread in the 1980s, are part of that retreat, undermining union solidarity by separating one generation from another.”
Two-tier systems set up unions to bargain against themselves in future negotiations. Workers in the lower tier naturally want the bargaining team to negotiate the same pay and benefits for them as for their coworkers doing the same work. So union negotiators must expend a great deal of energy trying to bring the lower tier’s compensation closer to the original tier’s.
But every concession the boss makes for the lower tier comes at the expense of improvements for the original tier. While the bosses might agree to improve things for the lower tier at the margins, they have no reason to agree to remove the lower tier completely. Instead, they have every incentive to eliminate the original, better-paid tier.
As Chrysler CEO Sergio Marchionne put it in 2014 in the lead-up to negotiations with the UAW, “I always have been of the view that the two-tier wage structures are unsustainable in the long term …. The real problem here is we need to freeze the [higher tier] and make them a dying class.”
In 2007, the UAW agreed to allow the Big Three automakers to hire a percentage of new workers at half the normal pay rate and with dramatically reduced benefits. The companies naturally pressed this advantage, expanding the number of second-tier workers and trying to permanently lock in their status as lower-paid workers.
In subsequent contract negotiations, the UAW ended up declaring victory when they reduced the impact of a second-tier wage structure. But workers’ overall compensation in both the upper and lower tier remained lower than before the union agreed to the second tier. Contract negotiators spent bargaining sessions trying to lift themselves out of a hole they dug in 2007 rather than making real advances for workers.
While two-tier contracts are a sign of weakness, workers can fight back. Last year, UPS workers in Teamsters Local 804 voted 95 percent against a contract that introduced a lower tier, though the contract still passed — barely — in a nationwide vote.
As in the UAW and the Teamsters, union officials in the Carpenters District Council are overwhelmingly white, male, and older, even as the workforce they work for is increasingly younger and more diverse.
According to the Economic Policy Institute, in New York City, nonwhite workers made up 62 percent of building trade apprentices in 2014, compared to 36 percent in 1993. Among union construction workers, those aged 41–60 were 53 percent white, while those aged 18–40 were 38 percent white.
Incoming and current carpenters of all races and genders face the same cuts. But District Council officials’ willingness to agree to lower wages and benefits for new workers during a historic construction boom has rank-and-file carpenters expressing doubts about just how far solidarity goes for these officials.
While making a point to acknowledge that many older rank-and-file members are upset about the new contract for both the cuts themselves and the way they will undermine solidarity, one rank-and-file carpenter told me,
We have a disproportionately white older membership and a disproportionately POC younger membership. Our leadership is overwhelmingly white. Company owners, supers and foremen, are also disproportionately white. Since I’ve been in the union, I’ve been hearing persistent messages from our union leadership, teachers, and sometimes older members, that we’re to be grateful for what we’re getting and this opportunity at a good life. The thought that this might have been a great career back when it was white, but now that it’s finally become more diverse, we’re going to tailspin backwards and receive every last justification for it along the way — it’s beyond gross, it’s beyond disgusting.
While taking an outwardly dismissive attitude, the District Council is clearly worried about criticism from the rank and file. About 600 workers held a rally outside the District Council’s office last week to protest the vote to approve the new contract, and after the rally carpenter activists called a planning meeting for rank-and-file carpenters on July 28.
Subsequently, the District Council posted a giant banner image at the top of its website and sent automated text messages to the entire membership, calling those who oppose the deal “malcontents” and threatening them with discipline. Meanwhile they deride any criticism of their mismanagement, including from longtime union activists, as inherently “anti-union.”
This last fact gets at the real crux of the problem. Union officials who do not work as carpenters view themselves, rather than workers, as “the union.” To avoid further cuts in the future, and to begin to undo the damage of this new contract, carpenters who work on the tools must reject this idea.
The contract debacle makes clear that carpenters cannot rely on District Council officials. Only by organizing themselves against the bosses — and against union officials, when they get in the way — can carpenters maintain the level of solidarity and militancy that has provided generations of their predecessors with a pathway to a decent living.