Facilities Management
Moving the office? Beware Hot Cargo, Rats & Unions

By James M. Barnes, CMC, CFM

Is your company about to move its offices? Don’t sign a mover’s contract—or make any moving decisions—until your read this.

Generally speaking, no moving company is prohibited by law from performing work in any building at any location based on its employees’ affiliation or non-affiliation with any particular union. Whether a moving company’s employees have chosen to be represented by one particular union or another—is completely irrelevant for the purposes of performing moving jobs in any building.

Here are some facts, supported by the research of a leading labor attorney, Jonathan D. Farrell of Rivkin Radler, LLP, to keep you safe, out of court and not climbing around an inflatable rat placed in your doorway by picketing unions.

Hot cargo agreements

Section 8(e) of the National Labor Relations Act forbids an employer and a labor organization to make an agreement whereby the employer agrees to cease doing business with any other person and declares void and unenforceable any such agreement that is made. A relevant example might be as follows:

Building Manager A manages Building A. Building Manager A and Union A agree that Building Manager A will prohibit Tenant A from moving in or out of Building A using any moving company that does not have a collective bargaining agreement with Union A. Building Manager A and Union A have just entered into a “hot cargo agreement,” in violation of the National Labor Relations Act. The Facility Manager for Tenant A unknowingly could be party to the “Hot Cargo Agreement”.

Since it is illegal for a union and an employer to enter into these agreements voluntarily, it should come as no surprise that the National Labor Relations Act also makes it unlawful for a union to:

1. engage in a strike, picketing or other coercive action
2. threaten any such action, or
3. induce or encourage others to engage in any such action, where the union’s purpose is to force an employer to agree to a hot cargo provision. For example:

   Union A asks Building Manager A to prohibit its tenants from hiring Moving Company B, because Moving Company B has a collective bargaining agreement with Union B and not with Union A. Building Manager A refuses. Union A threatens to picket Building Manger A unless and until it agrees to prohibit Moving Company B from entering the building. Because Union A has just threatened to picket Building Manager A for the purpose of forcing it stop doing business with Moving Company B, it has violated the National Labor Relations Act.

Because Union A has engaged in unlawful secondary activity in this example, Building Manager A and Moving Company B would each be entitled to receive from the National Labor Relations Board, an injunction prohibiting Union A from engaging in such conduct and would also be entitled to sue Union A for any damages either of them suffer as a result of Union B’s unlawful conduct.

Jurisdictional disputes

The term “jurisdictional dispute” is commonly used to refer to two different types of disputes, both of which are between competing unions, and neither of which affects an employer’s right to conduct its business. The first involves a dispute over which union is entitled to claim certain people. The second involves a dispute over which union is entitled to claim certain work. Both really amount to nothing more than “turf wars” between unions over how they propose to carve up between themselves the labor force in a given region.

With regard to the unions’ disputes over people, a labor union parent organization will often grant its member unions “jurisdiction” over certain classifications of employees. Each of the member unions must then agree, as a condition of membership in the parent organization, to abide by these jurisdictional grants. A “jurisdictional dispute,” in this sense of the word, arises when one of the unions breach that inter-union agreement. For example:

Union Parent Organization grants Truck Driver Union Local 1 “exclusive” jurisdiction over all truck drivers employed in New York City. It then grants Furniture Assembly Union Local 1 “exclusive” jurisdiction over all furniture assembly men employed in New York City. Both of the local unions then agree, as a condition of their membership in Union Parent Organization, that they will each respect the jurisdictional claim of the other. Three months later however, the president of Truck Driver Union Local 1 is seen soliciting union authorization cards from a group of non-union furniture assemblers in the Bronx. Furniture Assembly Union Local 1 complains that the non-union furniture assemblers are “theirs” and not the Truck Driver Union’s. A jurisdictional dispute now exists between the Truck Driver Union and the Furniture Assembly Union.

Whether or how this type of “jurisdictional dispute” gets resolved is of no concern to anyone but the particular unions involved. Indeed, the dispute arises not by any violation of law, but only as a result of one union breaching its own voluntary agreement with the other. It is up to the unions to resolve the matter on their own, if they so desire, and the employer plays no part whatsoever.

The second type of “jurisdictional dispute”, more properly termed a “work assignment” dispute, exists where two or more unions or groups of employees demand that particular work be assigned to members of its group rather than to the other. For example:

Building Manager A manages building A. Building Manager A has a collective bargaining agreement with Union A. Moving Company B is hired to move its customer into Building A. As moving Company B’s employees prepare to deliver its customer’s furniture into the building, members of Union A demand that Moving Company B assign its work to them, rather than to its own employees. Because both Union A and Moving Company B’s employees have actively claimed the delivery work, a jurisdictional dispute exists.

The existence of this jurisdictional dispute, however, does not in any way affect the moving company’s ability to perform the moving job at that building. If the union that claims the work has a good faith belief that its members should be assigned the work in question, it is incumbent upon the union to avail itself of certain specific procedures established by the National Labor Relations Board. The union may not engage in any coercive action against the moving company to support its jurisdictional claim. As in the case with hot cargo agreements, the National Labor Relations Act makes it unlawful for a union to:

1. engage in a strike, picketing or other coercive action
2. threaten any such action, or
3. induce or encourage others to engage in any such action, where the union’s purpose is to force an employer to assign work to its members rather than to another group of employees. Thus, continuing with the example above:

   Union A tells Moving Company B that it will picket the job unless and until Moving Company B assigns its work to the members of Union A. Union A has just violated the National Labor Relations Act.

Once again, Moving Company B would be entitled to an injunction against Union A and could bring suit against Union A to recover any losses incurred as a result of Union A’s unlawful activity. Unfortunately these actions impede on the success of your facility move—don’t let this happen to you. The following happened in New York prior to July 1st, 2003.

The NYC Prevailing Wage issued by the City of New York, Office of the Comptroller as of July 1st, 2005 for the Classification Mover is as follows:

*All services involved in the packing and movement of office furniture and equipment. (1)

Any reputable mover pays its men in excess of the prevailing rate otherwise the mover will be unable to retain quality employees. Please note this is not the published tariff or the contract rate you are being offered for the project; this rate is the actual minimum direct compensation to a mover’s employees. To determine the “sell rate” or contract rate the following items are added: tax withholding, FICA, SSI, vacation, insurance, additional benefits, overhead and profit. The sale rate or published rate to you is anywhere from $42.00 to $60.00 per hour for straight time and $55.00 to $75.00 per hour for overtime

In conclusion, a union cannot take or threaten to take any coercive action against any employer for either of these reasons. Thus, as mentioned in the beginning, no moving company is prohibited by law from performing work in any building at any location based on its employees’ affiliation or non-affiliation with any particular union. These threats could be in the form of the inflatable rat or a distribution of union leaflets in front of your building.

Nevertheless, unions will use these tactics from time to time to force an unaware employer into “cutting a deal” that will benefit only the union. Using the “union jurisdiction” claim above:

Union A might inform, for example, Moving Company B that although it has “sole jurisdiction” to handle deliveries at that particular building, it will nevertheless cut Moving Company B a break and not picket its moving job so long as Moving Company B assigns half of its work to members of Union A. Despite whatever Union A may have said to the contrary, Moving Company B has not just gotten a break; it has just gotten extorted. The fact of the matter is that as soon as Union A threatened to picket Moving Company B for the purpose of forcing it to assign work to its members, Moving Company B was entitled to an injunction against the union and to sue the union for any money it might have lost as a result of Union A’s unlawful threat.

Ask moving vendors to put it in writing when they try to confuse you with tales of “trade unrest.” Don’t unknowingly become a party to a hot cargo agreement. Know your rights under the law.

(1) Prevailing wage law#220. Bureau of Labor Law Office of the Comptroller, 1 Centre Street, Room 1122, New York, NY 10007 Fax # 212.815.8672

Jim Barnes is a Certified Move Consultant and Certified Facility Manager. His current projects are at FITCO, a New York vendor of relocation services and warehousing. Barnes can be contacted at jim@fitcony.com or (718) 628-6000 ext. 8103.

Jonathan D. Farrell Esq., can be contacted at Rivkin Radler LLP, Jonath.Farrell@Rivikin.com or 516.357.3075.

* The information contained in this article is not legal advice. It is a discussion of these two concepts, but only in the most general of terms. The application of the law to any particular factual situation depends on a variety of factors not necessarily discussed herein. You should seek the advice of labor counsel before taking any action in any of the types of situations discussed.