A Collaborative Approach to Business Development

How construction trade unions and businesses are partnering for economic growth.

By Vince Baglivo, Contributing Writer  On May 31, 2016

When people hear the words union and management in the same sentence, many assume an antagonistic relationship. Yet, union workers and organizations, along with their contractor counterparts, business owners and developers, are finding that collaboration and cooperation are the key to creating win-win situations that translate to new projects being built and jobs for skilled laborers and trades people. In the wake of the economic crisis of 2008-2009, construction and trade unions have found that building partnerships and finding common ground are the fastest route to a better economic future.

Rob Lewandowski, communications director for the Laborers’ International Union of North America (LIUNA), says a focus on things like training and apprenticeships, plus health and safety, are mutually beneficial to both sides of the labor/management equation, and provide a foundation on which to build effective business relationships and partnerships. “On the grassroots level, it has always been about connecting people; business owners and contractors looking for skilled workers and people who need good paying jobs,” Lewandowski says.

LIUNA, with more than 20,000 members in New Jersey, is committed to creating partnerships and has established the New Jersey Laborers’-Employers’ Cooperation and Education Trust (NJ LECET), a nationally-recognized labor-management fund to promote a skilled and productive workforce, create a safe and healthy work environment, and work collaboratively with project owners, contractors and government officials to promote the union construction industry and encourage economic development.

The Associated Construction Contractors of New Jersey (ACCNJ) has made safety and education a top priority as well. As the New Jersey Chapter of the Associated General Contractors of America (AGCA), the oldest and largest construction association in the nation, ACCNJ also serves as a liaison between contractors and their trade partners on project labor agreements that promote trust and create new opportunities.

Executive Director Jack Kocsis, Jr., says that in response to today’s competitive bidding environment, ACCNJ has gone beyond project labor agreements to create market recovery agreements that provide even greater benefits to project owners. That means lowering pay scales regarding the scope of work on specific projects and demonstrating a willingness to work with project partners through standardized agreements. “We have to be at least close to non-union bidders and demonstrate the value in hiring quality, skilled workers,” Kocsis states. “The reality is the system has changed, and we have to find ways to help cut costs. In the past, we paid lip service to the idea, but in the last few years, people have gotten serious about it.”

According to Bernard T. “Bernie” Corrigan, president of IBEW Local 102, building relationships is the focus and foundation of every successful endeavor. “Over time, that relationship grows to mutual respect. When two parties learn to respect each other’s position, resolution is a much easier target to hit,” he points out. “It’s this type of approach that allows us to work with our contractors to provide competitive pricing on all projects.”

Corrigan notes two venues that have allowed IBEW Local 102 to work hand-in-hand with the business community to help foster private-sector growth in New Jersey.

“As the first labor union to become a member of the New Jersey Business & Industry Association (NJBIA), we took a big step in earning the respect of business leaders in the state,” Corrigan notes. “NJBIA’s networking events have provided us with an arena to meet and learn about the needs of our friends in the business community. [NJBIA President & CEO] Michele Siekerka has opened her door to the labor community as together we strive to find common ground where we can all enjoy a more prosperous New Jersey.

“Joining Choose New Jersey, without a doubt, was one of the best moves we made,” Corrigan continues. “From Local 102’s perspective, we saw the results immediately.”

Led by Lt. Governor Kim Guadagno, Choose New Jersey is a privately funded approach to economic development that brings together many of the top companies and organizations in the state. Working together with the Business Action Center, the New Jersey Economic Development Authority (EDA), and higher education, Choose New Jersey has been a catalyst for private sector growth.

“Just to name a few – Bayer, Honeywell, Ferring Pharmaceutical, Realogy and Nestlé are all projects realized by the work of Choose New Jersey that brought construction jobs for our members and long-term jobs for the citizens of New Jersey,” Corrigan adds. “We are proud to be working with Michele Brown and her team at Choose New Jersey as we work to make our state a place that business wants to call home.”

Working collaboratively across the private and public sectors also highlights how industry leaders with experience in business, labor, finance, government and regulatory issues are contributing on the economic development front.

Examples include Joseph A. McNamara, director of NJ LECET, who serves on the New Jersey Economic Development Authority and the New Jersey Schools Development Authority. Raymond M. Pocino, vice president of NJ State AFL-CIO, a NJ LECET trustee, serves as a commissioner for the Port Authority of New York & New Jersey and the New Jersey Turnpike Authority.

Both are also board members of the New Jersey Alliance for Action, an association with more than 2,500 members representing the state’s corporate, labor, professional, academic and governmental communities. The impact of advocacy by the Alliance can be felt on issues like the successful Building Our Future Bond Act in 2012, a $750-million bond issue for higher education capital construction, and the current fight to fund New Jersey’s Transportation Trust Fund (TTF).

Utilizing the collective voice of organized labor, individual unions, as well as statewide organizations, are further contributing to cooperative business development goals by supporting individual projects in addition to major issues confronting the Garden State.

Through NJ LECET, its business development, marketing and civic and government relations arm, LIUNA addresses issues of concern and interest to its members as well as their business counterparts. That includes everything from individual proposed projects to issues like the TTF.

That can translate to everything from attendance at public meetings in support of developers’ new projects as they move through the review and approval process, to information shared through websites, newsletters and press releases.

Greg Lalavee, chairman of the Engineers Labor-Employer Cooperative (ELEC), the Labor Management Fund of Operating Engineers Local 825 and business manager of Local 825, says ELEC 825 will be launching a multi-media advertising campaign in 2016 in support of TTF replenishment to repair and replace New Jersey’s crumbling transportation infrastructure and create jobs. “I tell people when they see our ads on television they will know we are serious about our support,” Lalavee notes.

While working cooperatively on issues impacting both business and labor represents both a willingness to partner to achieve common goals and a commitment of time and resources, union workers are also directly investing in New Jersey projects that impact them on several levels.

Eric J. Sivertsen, executive director of the National Electrical Contractors Association (NECA) of Northern New Jersey, says capital is always needed to keep projects moving ahead, and that union workers are investing in economic development through their pension and annuity funds. “They are investing in their own future by creating work for themselves and other union members,” Sivertsen emphasizes.

ELEC 825’s Greg Lalavee, who serves as a pension fund trustee, says creating jobs is an important measure of success, but must be balanced by the need to provide good returns to pension fund members.

Many point to the 2011 announcement of a plan to redevelop the former home of Merrill Lynch in Plainsboro as the new North American headquarters for Danish pharmaceutical giant Novo Nordisk as a catalyst for this type of investment. The joint venture between Novo Nordisk, Ivy Equities, LCOR and Intercontinental Real Estate Corporation provided a unique opportunity to keep a major employer in New Jersey and create jobs during the total renovation and upgrade of the 770,000-square-foot office building in the Princeton Forrestal Center.

The Northeast Council of Carpenters (NRCC) invested $75 million from its pension fund through Intercontinental to help the $215 million redevelopment project move forward. The New Jersey Laborers Statewide Pension Fund, the IUOE Local 825 Pension Fund, the International Union of Bricklayers and Allied Craftworkers Local 5 Pension invested an additional $130 million combined.

At the time of the announcement, Peter Palandjian, Intercontinental’s CEO, was quoted in Real Estate Weekly stating, “We are honored to invest on behalf of the New Jersey building trades in a project like this that creates fair wage and benefit jobs, yes, but more importantly, also drives excellent returns for their pension funds.”

Dan Gumble, business manager of IBEW Local 164, serving Bergen, Essex and Hudson counties, notes the recent topping-off ceremony for Journal Squared, a project in Jersey City in which the National Electrical Benefit Fund (NEBF) invested. With three towers and a concourse level with shopping and dining and a direct connection to the Journal Square PATH Station, the project is one of many in the Gold Coast  area that are being built to meet demand for walkable, transit-connected live, work, play environments. The AFL-CIO also helped fund the 10 Park Place development in Hoboken, which is expected to be completed within the year.

From the residential towers rising in places like Hoboken and Jersey City, to the redevelopment of corporate office complexes throughout the state’s commercial corridors, New Jersey’s unions are helping to build the case for skilled laborers and construction workers by stepping up as partners with their contractor and business counterparts when it comes to economic development. Add in programs that enhance worksite health, safety and productivity, contribute to impactful communications and lobbying programs, along with strategic financial investments, and the state’s construction trades are effectively managing the conversation about their contributions to the state’s future.

“Our members are just like everyone else, real people with real issues who want and need to work,” Lalavee concludes.

 

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