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Local 139, C.G. Schmidt at odds over contract, labor complaint

One of the biggest labor organizations in the state has gotten bogged down in contract negotiations with the general contractor C.G. Schmidt and is meanwhile alleging the company violated federal labor laws in terminating two union members’ employment.

Terry McGowan, president and business manager of the International Union of Operating Engineers Local 139, said Wednesday that his organization has been struggling for weeks to come to terms with C.G. Schmidt executives over a contract for master builders who might be employed in coming years by the prominent Milwaukee-based general contractor.

Separately, Local 139 filed a complaint with the National Labor Relations Board on June 27 alleging that C.G. Schmidt violated federal labor law when it recently ended the employment of two operating engineers. The NLRB’s website states that the allegations concern “coercive statements (threats, promises of benefits, etc).” A full version of the complaint could not be immediately obtained Wednesday.

Rick Schmidt, president and chief executive officer of C.G. Schmidt, said he and his colleagues “believe the unfair-practice allegations are without merit and will be presenting evidence to that effect.”

He declined to discuss the specifics of C.G. Schmidt’s contract negotiations with Local 139, saying he did not want to bargain in public.

“Our dealings have been in good faith with the union and they are ongoing even though we don’t employ any members of local 139,” Schmidt said.

The trouble, McGowan said, is that C.G. Schmidt did have two operating engineers on its staff until recently. McGowan said he believes those workers were let go in part because C.G. Schmidt had wanted to avoid sitting down at the bargaining table with Local 139 when the union’s contract for master builders came up for renegotiation this year.

McGowan said he thinks C.G. Schmidt officials misinterpreted what they are allowed to do under federal labor law.

“They are obligated to come to the table and bargain with us,” McGowan said. “It’s plain and simple. They got bad legal advice.”

Paul Secunda, a labor-law professor at Marquette University, said unions that have an existing contract with a company are given a 60-day window before the agreement expires to initiate renegotiations. Employers then have an obligation to bargain.

“On request from the union, they are supposed to sit down and meet and confer with the other parties for purposes of negotiating a new agreement,” Secunda said.

Pointing out again that C.G. Schmidt is in fact negotiating with the operating engineers this year, Rick Schmidt acknowledged the company did take one unusual step. In the past, C.G. Schmidt, like many large construction companies in southeast Wisconsin, had allowed itself to be represented at the bargaining table by the Associated General Contractors of Greater Milwaukee.

This year, though, C.G. Schmidt officials chose to deal directly with Local 139. Rick Schmidt said that it was only when C.G. Schmidt had operating engineers as employees that it would go through the AGC of Greater Milwaukee for bargaining representation.

McGowan said that as soon as he heard C.G. Schmidt was not going to use the AGC to renegotiate its master-building contract, “that’s when I suspected something was up.” He said the operating engineers sat down with both the AGC and the Allied Construction Employers Association earlier this year when negotiating various five-year contracts for workers.

“They wanted special treatment, and they decided to negotiate independently,” he added. “They wanted advantages that all the rest of the contractors didn’t get. And it would all come at the cost of my members.”

He said the operating engineers and C.G. Schmidt are discussing a large number of employment conditions. The impasse seems to mostly concern the contractor’s apparent refusal to guarantee it will use only union subcontractors on its projects, McGowan said. He said unionized companies like Schmidt usually enter legally binding agreements pledging to use only union labor.

Rick Schmidt said McGowan was not providing an accurate description of the two sides’ differences but declined to provide details.

McGowan said he sat down with Schmidt on Monday in an attempt at reaching a compromise. McGowan said nothing came of the meeting.

He said C.G. Schmidt’s current dispute with the operating engineers could be a sign of things to come. He noted that union construction companies’ contracts with large laborers and carpenters unions are due for renegotiation next year.

Operating Engineers Local 139, headquartered in Pewaukee, has nearly 9,000 members, making it likely the biggest construction-industry union in the state. Many of them are employed building roads and laying underground utility lines.

The master building contract now being renegotiated with C.G. Schmidt covers about 250 union members in Local 139’s Area 1, which takes in Kenosha, Racine, Milwaukee, Waukesha, Washington and Ozaukee counties. The two union members let go by C.G. Schmidt operated cranes, McGowan said.

C.G. Schmidt has done extensive work for health-care providers. Among other work, it has overseen the construction of Columbia St. Mary’s hospital on Milwaukee’s Lake Drive; various projects at the Froedtert & Medical College of Wisconsin campus near the Zoo Interchange, just west of Milwaukee; and a surgery and cardiovascular addition at Aspirus Wausau Hospital.

C.G. Schmidt was also the general contractor in charge of the construction of the 18-story 833 East office building, standing at the corner of Milwaukee’s Cass and Michigan streets, and is a partner with Gilbane Building Co. on the $450 million Northwestern Mutual Tower and Commons project in downtown Milwaukee.

About Dan Shaw, dan.shaw@dailyreporter.com

Dan Shaw is the associate editor at The Daily Reporter. He can be reached at dan.shaw@dailyreporter.com or at 414-225-1807.

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