After two contractors at Los Angeles International Airport recently broke off their union ties, a major union is ramping up the pressure to prevent any more defections.

The Service Employees International Union has targeted the two companies, staging protests to pressure airlines to withdraw contracts from them. The union also wants airport administrators to suspend the airport licenses of contractors caught up in labor disputes.

The contractors – Calop Aeroground Services of Los Angeles and Aviation Safeguards, a division of Command Security Corp. of Lagrangeville, N.Y. – have fought back, saying the union’s health care costs were too high and were crippling their ability to compete with nonunion contractors. They also maintain they were within their rights to conduct decertification votes. They oppose union efforts to give city or airport officials the authority to yank permits.

“We are very concerned about political action from the city to intervene and go after nonunion contractors,” said Matthew Chong, executive director for Calop, which has contracts from airlines to provide security and passenger assistance at LAX terminals.

Union officials said the city needs more authority to go after what they call “irresponsible” contractors. They want sanctions severe enough to prevent contractors from walking away from union contracts.

“Reckless contractors endanger lives at the airport and also are able to make more money than the other honest contractors,” said Mark Gomez, SEIU’s strategic initiative director. “We cannot allow contractors to get away with this.”

Most of the workers at the airport, other than the federal security screeners, are employed by the nearly 250 contractors.

The effort to toughen standards for the contractors began five years ago after the Los Angeles Alliance for a New Economy, a non-profit organization with close ties to organized labor, released a report that raised concerns about safety, security and low wages among airport contractors.

Since many of the airport contractors are hired by airlines, the key leverage point for unions seeking city intervention is the license that each contractor must obtain to do business at LAX. In 2010, the Board of Airport Commissioners authorized airport administrators to develop standards that contractors must meet in order to obtain and renew their airport operating licenses.

Last year, a draft of the policy listed requirements for contractor experience, adherence to wage and hour laws, accident investigations, equipment quality and passenger services. A final policy is due before the commission sometime later this year.

Union officials want more stringent standards. They are pushing for provisions similar to those at airports in New York and Boston that give airport officials the authority to suspend or even revoke operating licenses of contractors embroiled in labor disputes that disrupt airport operations.

“The city needs more power to monitor contractors and go after the bad actors,” said Alejandra Valles, vice president of SEIU United Service Workers West.

But contractors fear that provision would give unions an incentive to stage disruptive public protests to force the contractors to make concessions or risk losing their operating licenses.

Last month, for example, SEIU staged a protest at the Tom Bradley International Terminal. The stated aim of that protest was to put pressure on the airlines to clamp down on the contractors they hire or even to drop certain contractors.

Health cost dispute

Aviation Safeguards has drawn the most union ire; the company held a decertification vote last summer and now claims it is nonunion. At the center of the dispute: health care costs.

The company claims that when its employees joined SEIU two years ago, its health care costs rose dramatically, making it uncompetitive with other contractors at LAX. The company and employees paid the health care costs to the union, which in turn paid Kaiser Permanente.

“We lost a number of contracts because we were not competitive, including Alaska Airlines and Hawaiian Airlines” said Joe Conlon, regional vice president for Aviation Safeguards. “When we lose contracts, the employees lose jobs.”

Conlon said that the union required both Aviation Safeguards and its 474 employees to contribute to an expensive health plan that included family coverage for all participants. He noted that many employees didn’t want or need family health coverage and complained to the company that their health care contributions were too high. Those employees wanted out of the union contract because they wanted some of this money redirected toward cash compensation.

After the decertification vote, the company converted to the pay scale mandated by the city’s living wage; at the time it was $14.97 an hour without benefits and $10.47 an hour with health benefits. Conlon claimed that this put an extra $2 million a year total in employees’ pockets while also lowering the company’s overall compensation costs to make it more competitive.

Responding to union complaints that the company misled employees in order to decertify, Conlon in February sent a letter to Los Angeles Mayor Antonio Villaraigosa.

“I want to stress that Aviation Safeguards has not provided false information to our employees … nor did we encourage our employees to decertify,” he said in the letter. “The employees took the initiative to decertify in order to enjoy higher pay with the same health care benefits they formerly received.”

Union officials see the situation differently. They say Aviation Safeguards walked away from a valid union contract so they could pay their workers the lower living wage. They also claim many workers are being forced under the company’s new health care plan to choose between covering spouses or children.

“What we’re seeing here is a classic race to the bottom, skimping on health care and wages so that the management can make more money off the top,” Valles said.

Union officials also claim that the decertification vote was not valid because there was no supervision from the National Labor Relations Board or the National Mediation Board, two agencies that oversee most union-related elections.

But Aviation Safeguards executives claim the decertification vote is valid. They cite a court ruling two years ago in regards to Calop, which had its decertification vote two years ago without supervision from the NLRB or the mediation board. SEIU filed a state lawsuit challenging the Calop vote, but a judge let the vote stand.

Chong, Calop executive director, said his company’s situation was close to Aviation Safeguard’s case with higher health care costs under the SEIU contract. He added that the higher costs would have driven the company out of business.

“When we were bargaining with SEIU, we let them know that if the health costs stayed in place, they would bankrupt the company because our costs were increasing and we were facing losing contracts,” he said. “After the decertification vote, we reverted to the city’s living wage and were able to compete better for contracts.”

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