Chicago Unions Fight MPEA Plan

Just two days after a bill was filed in the Illinois General Assembly on behalf of the Metropolitan Pier & Exposition Authority that would overhaul labor practices at Chicago’s McCormick Place and Navy Pier, the unions fired back with a plan of their own calling for a “customer bill of rights” for exhibitors and greater transparency on exhibitor costs.

“No one understands the importance of conventions and tradeshows in the city and its communities more than the men and women of organized labor,” said Dennis Gannon, president of the Chicago Federation of Labor.

He added, “That is why the unions have worked with management time and time again to lower their costs and make work rules more customer-friendly to improve the experience for exhibitors. But the whole business model must change, not just labor contracts.”

General service contractors who work at McCormick and Navy Pier, including the two biggest, Freeman and GES, said they also have worked to lower costs.

However, it’s not the GSCs, but labor that’s been under fire since two high-profile tradeshows – the Society of Plastics Industry’s NPE – The Intl. Plastics Showcase and the Healthcare Information & Management Systems Society’s Annual Conference & Exhibition – both opted to skip Chicago in 2012, citing high labor rates.

The reforms proposed by the unions that work in the buildings – United Steelworkers Local 17 (Decorators Union); Machinery Movers, Riggers & Machinery Erectors Local 136; Intl. Brotherhood of Electrical Workers 134; Chicago Regional Council of Carpenters; and Teamsters 727 – include two provisions, according to union officials:

• A customer bill of rights that clearly delineates standards by which labor and management must work with the customers to maximize their satisfaction with doing business at McCormick Place.
• Audits of charges and fees that would make clear what costs or savings are, in fact, passed along to customers.

The question is whether the unions’ proposal is too little, too late. The bill recently introduced in the Illinois General Assembly calls for all workers involved with shows and conventions to become public employees hired by the authority, more MPEA control over the contract process and the number of unions involved being cut from five to three.

Frank Libby, president of the Chicago Regional Council of Carpenters, said he’s not convinced the MPEA plan will render any real cost savings for customers, and the bigger picture should be considered before any drastic new plans are introduced that could make things even worse.

“The first (thing) they jump at is labor,” he added. “It’s mass hysteria out there, and they want to blame labor.”

MPEA declined to comment on the union’s proposal.

Libby said the base rate for carpenters working in McCormick is $40.77, with an additional charge of $20.32 for fringe benefits.

But, he added, general service contractors working in the building, such as Freeman and GES, typically charge exhibitors a flat rate of $95 to cover their additional costs, including taxes, overhead and profit.

“We don’t set the labor rates at McCormick,” Libby said. “GSCs set their own rates.”

Union officials also said three recent rounds of negotiations have resulted in major contract adjustments involving the reduction of overtime rates, giving exhibitors the ability to do more of their own setup work and removing jurisdictional distinctions between trades.

“The unions have demonstrated over time that we want to be part of the solution,” Libby said. “Yet, despite what we’ve done to help lower the cost by working with MPEA and the show contractors, those savings haven’t necessarily been passed along to the consumer.”

Joe Popolo, CEO of Freeman, said his company, too, has worked closely with McCormick and show organizer customers to ensure cost savings resulting from labor reforms have been implemented.

However, he added, “some of those savings were offset by significantly higher wage rates. Union wage and benefit rates in Chicago will increase by an average of 5.5 percent in 2010, after a 5.75-percent increase in 2009. We believe that the fundamental labor reform in Chicago is necessary to achieve additional savings.”

Officials from GES said they also support changes in the Chicago exhibition industry and “have been an active participant with MPEA and the labor unions to implement changes (that) better address our customers’ needs.”

In addition, GES officials said the company, along with other contractors, has been audited by MPEA in the past “to ensure customers benefited from the changes in the work rules, and the audit results reflected that all changes agreed to by labor and the service contractors were passed on to the exhibitors.”

Libby said the only way anything will change is if everyone involved – the GSCs, MPEA, a representative from the Mayor’s office and the unions – all sit down and agree on ways to cut costs.

“We’re not pointing fingers,” he added. “We’re tired of pointing fingers. We want to sit down with these people.”

In the meantime, the Illinois General Assembly returns to session Feb. 2, at which time the MPEA bill will begin legislative review.

In related news, the Exhibition Services & Contractors Assn. released a statement addressing the MPEA’s proposed legislation that said its members were opposed to exclusive contracts in tradeshow venues – which would be the case, for instance, if labor were taken in house – especially those venues which are publicly funded, such as McCormick Place and Navy Pier.

In addition, ESCA officials added, “Using legislative powers to address marketplace issues is, at the very least, troubling. Once in place, legislation is inflexible and difficult to amend or retract.”