If You Try To Set This Up Yourself, Without Legal Counsel – Watch Out!
July 2016Richard H. Wessels, Esq.
Here at Wessels Sherman we have seen an uptick recently in legal challenges by unions to construction industry double-breasting schemes. By using the word “schemes”, I don’t mean it in the bad sense at all. There is nothing improper or illegal about double-breasting. Unions hate it, but it’s not illegal. In the simplest terms, double-breasting means having a union entity and a non-union entity.
The fundamental principle is that in order to withstand a legal challenge, the two entities must indeed have separation. This is where it gets tricky. No single factor is determinative, it is like weights on a balance scale. There are many factors that can be evaluated and among these are ownership, interrelationship of operations, management, handling of labor relations, interchange of employees, and then a whole variety of factors such as geographic separation, bookkeeping, personnel policies, use of equipment, telephone, business cards, and advertising to mention just some. Again, no single factor is determinative, but some of these factors such as interchange of employees are definitely more important than others. You have big potential problems if the same workers have hours in both the union and non-union companies.
What makes this area even more confusing is that much depends on how you are challenged. Challenges can come from a union trust fund audit, NLRB charge, grievance alleging a labor contract violation, or a demand for recognition. We have definitely seen increased activity in this area, particularly as union pension funds are desperately looking for more money. A good potential source of money for these union trust funds is to allege that the non-union entity is not properly double-breasted and trust fund payments going back many years should have been made under the union contract with the union entity. In other words, “same book with a different cover”. You can see the problem here, and if you have any concerns, give us a call so that we can help you with risk evaluation and setting up better evidence if you are challenged.
Questions? Contact Richard Wessels at (630) 377-1554 or by email at riwessels@wesselssherman.com
