President Hickey Keynotes Florida Labor
Management Conference

From L to R: Jerry Haymen, President Local 127; Phil Bernard, HR, Walt Disney World; David Hickey, International President, Rick O'Quinn, VP Region 3, and Steve Eisenhardt, VP Walt Disney World.

The International Union, Security, Police and Fire Professionals of America (SPFPA) was founded as the International Union, United Plant Guard Workers of America (UPGWA) in 1948 as a consequence of Section 9(b)(3) of the Taft-Hartley Act. You will recall that “guards” had to be in separate bargaining units, and that a union that represented non-guards or was affiliated directly or indirectly with a non-guard union could not be certified by the National Labor Relations Board (NLRB) to represent guards.

Thus we have been an independent union. We cannot affiliate with the AFL-CIO or its subordinate bodies albeit we have excellent fraternal relations with the federation and other unions.

We are the largest union in the country representing security personnel exclusively.

In 2000 our name was changed to International Union, Security, Police and Fire Professionals of America (SPFPA) to reflect the times and the professionalism of the occupation. The term “guard” has been replaced with “security officer” albeit “guard” is still defined in the federal labor act.

Another remarkable change in the security industry and occupation is the discontinuance of in-house security and the use of contract agencies. In the halcyon days we represented substantial in-house units at General Motors, Chrysler, steel mills and aerospace. Many of the units were covered by national agreements. While we still represent in-house security, such as at Boeing, the majority of our members are employed by agencies.

The diversity of our bargaining units raises special challenges irrespective of the current hard times imposed by the recession.

From a paper mill in Millinocket, Maine to the transit authority in Miami, Florida, from Boeing in Seattle, Washington to harbors in San Diego, California, and points in between, including Hawaii and Puerto Rico, the SPFPA represents units in both the private and public sector.

While we continue to maintain some national agreements, as in the ailing auto industry, it is difficult to establish patterns in units as varied as factories, retail, hospitals, colleges and universities, casinos, and government installations such as the Space Center and military bases, to name a few.

Bargaining in hard times is not new to our Union. There was a period in our history, particularly prior to 1965 when cut-throat bidding was the mantra of agencies competing for government security service contracts. We would organize a unit of agency security officers, and negotiate a first contract, only to have the employer lose its service contract a year later because the bargaining agreement wages and benefits were underbid. And the cycle would begin again, over and over.

To combat this situation we took action on two fronts.

First, in the early 60’s the Union’s founding President, James C. McGahey, lobbied two Michigan congressmen, Senator Pat McNamara and Representative James O’Hara to sponsor the Service Contract Act which was passed in 1965, effective January 20, 1966. That Act similar to the Davis-Bacon Act, provided for minimum wages and benefits for employees performing services for the federal government. The DOL determines the wage and benefits prevailing in a locality.

As an aside, we had an important hearing at the Cape years back to establish that Canaveral and the Space Center are a locale and not Brevard County.

The Service Contract Act was amended in 1972 to provide that a successor employer is required to pay the wages and benefits established through arm’s-length collective bargaining by the predecessor. This went a long way to reduce cut-throat bidding and job, wage and benefit loss by incumbent employees.

Our second achievement to secure job and benefit security for contract officers was the U.S. Supreme Court decision in the Burns successor case brought and argued by our General Counsel.

In 1971, the Court ruled that where a successor employer hires 51% or more of the incumbent workforce, it is bound to recognize and bargain with the incumbent union, if any. The Court rejected the NLRB finding that the successor was also required to assume any bargaining agreement in effect at the site.

Together, the Service Contract Act and the Burns decision have gone a long way to eliminate a serious problem. But not entirely because there are many contract security officers who are not subject to the Act.

It is against this background that we are now engaged in job loss and hard bargaining caused by circumstances over which none of us in this room have any control. Albeit there has been a surge in private security since 9/11, our members are not immune from the rigors of the economy or the trend to reduce wages and benefits, and to eliminate certain fringe benefits.

As we confront the challenges of concession bargaining several preliminary matters must be addressed and resolved.

Is the employer really unable to pay or to stay competitive? If either is claimed, the Union can request that its books be opened. In this instance the Union may retain professional expertise to review the financial records and prepare an analysis and recommendations. The burden is on the employer to show that employee concessions are the only recourse to remaining in business.

A review of the employer’s books segues into management of the enterprise. This is, of course, the holiest of holies of management rights, but the union is entitled to challenge practices which may have led to the alleged financial exigency. Employees are often able to make sound recommendations for cost saving and effective management. This is particularly true in security where the principal product is human service. Where an employer spurns such inquiry, it raises concern about the motivation for concessions. Is it to save jobs or simply to raise profits.

Of late, there has been increasing concern by government and investors with executive salaries and bonuses, and “golden parachutes.” Many are not merely excessive, they are unconscionable. Where an employer demands employee concessions, there should be mutuality of sacrifice. The sacrifice must be comparative in degree. A 3% wage reduction on $30,000 is not comparable to 3% on $800,000.

We also consider, what is the duration of the loss through concession? Is it for one year or the life of the contract? What are the prospects of recoupment? Even in the best of times, employers flounder and look to employees for support. We must decide whether or not the support will turn the business around or is it prudent to abandon ship. It is apparent that early concessions by the UAW did not prevent the General Motors bankruptcy.

Downsizing or so-called lean manufacturing has not become trendy in the security industry, but we have experienced employers going out of business due to bid loss or general ineptitude. In these circumstances we endeavor to negotiate severance pay and transfer to other sites, if any. Needless to say, the success rate is not high in these circumstances. A not uncommon occurrence given the number and size of security contractors.

Strikes are, of course, old fashioned. And a strike against a failing employer will not have a beneficial outcome. In some circumstances we have proposed interest arbitration which combines a procedure for gathering the facts and delegating the tough decision to a neutral.

It may interest you to know that we have utilized interest arbitration at the Cape with the private housekeeping contractor for many years. The procedure has prevented any disruption of security services at a facility critical to the country’s space program.

Like all unions in both the private and public sector, we have been hit with demands to reduce health care costs and to eliminate defined benefit pension plans.

Health care costs are of universal concern. They continue to rise and there is no plan in place to deal with the crisis. Employees are asked to contribute or increase contributions for health insurance. Deductibles and drug co-pays have been increased and coverage reduced. Our Union is not unmindful of this problem in bargaining. In the SPFPA health and welfare plan, we have been able to offer comparable health care coverage at a lower rate.

Defined benefit pension plans are not common in the security industry. Thus we miss the trend to convert to a defined contribution plan. As with health insurance, we have developed a welfare plan that is sound, reasonable and provides portability. It has gone a long way toward meeting cost control.

We must consider the demographics of the bargaining unit when making hard decisions on concessions and take aways. The age, health and family status of employees is important in selecting alternatives of lesser impact. Rather than take a hit on wages or health care, can sufficient concession be made on premium pay, holiday pay, longevity or similar benefits, if any.

In some instances the interaction between the security employer’s client and the client’s union will establish a pattern for subsequent negotiation with our Union.

For example, the SPFPA represents the employees of a security agency that contracts with the Ford Motor Company. As you perhaps know, Ford avoided bankruptcy due in part to substantial concessions from the UAW. It is reported that 59% of Ford workers voted to forgo bonuses, limit overtime, change work rules, eliminate COLA, suspend the jobs bank, and change the method for paying retiree health benefits.

Ford will, of course, negotiate a lower rate with its security contractor. That contractor in turn will negotiate with our Union for take aways and, among other reasons, will reference the UAW concessions. And the pitch will be pseudo-patriotic that sacrifice must be made to save the auto industry and prevent jobs from going overseas. It’s not a hard sell in Michigan where unemployment approaches 15%.

In a by-gone day, labor unions held to a philosophy that it was better to have ten reasonably paid members then one hundred working for substandard wages and benefits. That no longer holds true, and the order of the day is job security at reduced rates and benefits with the expectation that the economy will get better. But will bargaining get better or has a nearly irrevocable pattern been established? Time and the resurgence of the labor movement will tell.

Because our members work 24/7, there are no viable cost saving measures on short work weeks, work sharing or similar options.

A new dimension has been added to hard bargaining for our Union.

Since 1952, Cape Canaveral Air Force Station has used contract security. At the present time it is Securiguard, Incorporated. Throughout the years and successive contractors and service contracts, our members have provided dedicated, effective and highly praised security and paramilitary service.

Recently, some wizards in Washington decided that contract security should be replaced with federal civil service employees. No rationale has been given, and it certainly is not the performance of the incumbent security force. The conversion is scheduled for October 1, 2009. Incumbent employees are eligible to apply for civil service jobs but it is likely that many will not pass the rigorous non-job related physical tests notwithstanding the fact that they currently perform to standard.

The entire process will have a disruptive effect on individual employees, their families and communities, and security at Cape Canaveral Air Force Station. Some employees will be terminated with new job prospects minimal. New employees will have to be trained at, of course, taxpayer expense. In short, the entire exercise will have a disruptive effect. And to what end? To satisfy a bureaucratic notion that after 57 years of contract security at Canaveral it should be federalized because it is an inherent government function. That is nonsense and we have called upon congressmen and ranking Air Force officers to remedy the situation.

This is not our first encounter with the bureaucratic merry-go-round at the Cape. In 1998, someone decided that the Kennedy Space Center and Cape Canaveral security forces should be merged and administered by a single contract security agency. This transition was accomplished at additional expense but with minimal disruption because of the cooperation of our Local Unions. It appeared that the unified force performed at a high level. This continued until 2008 when someone at NASA or the Air Force, or both, decided to restore separate security forces. Again, this was accomplished at additional expense but with the cooperation of the Union to protect and maintain job security for its members.

At the present time, Wackenhut Services provides security for NASA at the Space Center, and Securiguard for the Air Force at Cape Canaveral at least until October 1 when federalization is scheduled to take place.

Like the uncertain times presented by an eroding economy, the machinations of government in regard to service contracts presents a bargaining dimension over which the union has no control.

I am saddened by the current status of collective bargaining and prospects for the future.

Years of bargaining gains and progress are being wiped out under threat of job loss. Employee options are limited as they are often left with the choice of concessions or no job. We may never see the return of fully paid health care, defined benefit pensions or cost-of-living allowances to the bargaining table. This is particularly tragic for the new workforce which consists primarily of 85 to 90% at will employees.

I am most saddened for the members of the SPFPA and their families.

On June 19, 2009, I attended the funeral service of Brother Johns, a member of Local 444, who was killed in the line of duty at the Holocaust Museum. His death epitomizes the hazards of the security officer occupation, and the dedication of its members. Each of our members, on a daily basis, faces the prospect of serious injury or death as they carry out their duty to protect persons and property. Brother Johns’ death was not the first nor will it be the last.

Our members are first responders to any emergency, including possible terrorist attacks at vital installations such as the space center, military sites, nuclear plants and powerhouses and the strategic petroleum reserve. They are a key component in homeland security. They must be adequately trained, equipped and compensated. And therein lies the problem.

How do you tell a security officer or any employee that you must accept a reduction of wages and benefits, but there will be no reduction of your duties including the constant risk to your health and safety? How do you explain that there are no funds for training and equipment, but you will continue to perform, and perhaps at a higher level because of a reduction in force?

We strive valiantly for answers to these questions. Each contract negotiation presents new circumstances depending upon the application of the Service Contract Act, the structure and size of the security agency and the nature of its client. We are pragmatic and the goal in today’s bargaining climate is to hold the line. Concessions are the last resort and must only be made on the conditions I outlined earlier.

Many of you will recall the 1994 report of the Presidential Commission On The Future Of Worker-Management Relations; also known as the “Dunlap Commission” after its Chairman, a former Secretary of Labor.

The Mission Statement of the Commission stated:

“The future living standards of our nation’s people, as well as the competitiveness of the United States, depend largely on the one national resource uniquely rooted within our borders: our people – their education and skills, and their capabilities to work together productively.”

One of the specific questions to be addressed was:

“What (if any) changes should be made in the present legal framework and practices of collective bargaining to enhance cooperative behavior, improve productivity, and reduce conflict and delay?”

Many of the Commission’s findings and recommendations are applicable today as labor and management adjusts to a new and lean economy. As the Commission observed, a global economy requires the development of labor relations from a broader perspective than in a closed economy. We now know, however, that the so-called “closed economy” has evaporated into a deep recession that has spawned concession bargaining.

As we emerge from that recession we must not let concession bargaining become the norm. Employer’s must not be expected or required to subsidize employers who are unable to compete nationally or globally. In a new economic time, labor-management cooperation must include mutual gain and communication.

This is a time for labor management cooperation to an extent never before practiced. As noted in the preamble of the original National Labor Relations Act:

It is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.

That was the policy of this country in 1935 and today. Free collective bargaining has survived wars and prior recessions. It will continue to do so, and hopefully be restored to its traditional process.

Meanwhile, as stated by a legislator in Michigan, “It’s time to set principle aside, and do what’s right.”