The days of unions having a firm, if not solitary, hold on construction in New York City have begun to wane. In light of the recent death of 421-a and the Mayor's push for affordable housing, while public projects are still largely union jobs, the private sector, especially residential, is turning to more cost-effective means to build.
Something had to give, and it appears to be union labor. The newly formed New York Construction Alliance, a collaboration of open shop construction firms, is proof positive.
Many major construction managers are refusing to renew collective bargaining agreements and creating non-union companies to handle non-union jobs — known in labor law as "double-breasting." However, ending the relationship with a union exposes employers to "withdrawal liability" from underfunded union pension funds. The dollars involved here can be game-changing.
With careful planning, companies can take appropriate steps to avoid liability to the unions and their companion employee benefit funds, to create a successful and lawful "double-breasting" operation.
Best Practices to Avoid Union Withdrawal Liability:
|Drogin, Laurent S. Partner and Chair of Labor and Employment Practice and Co-Chair of Restrictive Covenant Practice||Partner and Chair of Labor and Employment Practice and Co-Chair of Restrictive Covenant Practice||212.216.8016|