MPEA Plan Meets Resistance

A sweeping plan to overhaul labor practices at Chicago's McCormick Place almost immediately met resistance from general service contractors and tradeshow industry leaders.

In response to two high-profile tradeshows decamping from McCormick because of high labor costs and possibly more shows on the way out, legislation was introduced in the Illinois General Assembly Jan. 14 that would turn all workers at McCormick Place and Navy Pier into public employees of the Metropolitan Pier & Exposition Authority, which oversees the facilities; deny the employees the right to strike; give MPEA more control over the contract process; and reduce the number of unions that work in the buildings from five to three. The proposed legislation has the backing of Illinois Gov. Pat Quinn and Chicago Mayor Richard M. Daley, according to MPEA officials.

“This is a jobs bill,” said John S. Gates Jr., MPEA's chairman. “By modernizing the work rules for a few hundred workers in one building, cutting management and increasing transparency, we can preserve and expand the 65,000 jobs that our industry supports.”

However, the two main contractors in the building, GES Exposition Services and Freeman, released a joint statement expressing their displeasure with MPEA's proposed labor changes.

“Freeman and GES believe that fundamental labor reform in Chicago is necessary, and, while we support the goals of the proposed legislation, we share the concern of many of our Chicago customers regarding the potential cost and customer service implications of this specific approach,” GES and Freeman officials said. They added representatives with both companies previously met with MPEA to provide suggestions on how to resolve the problems.

The Intl. Assn. of Exhibitions and Events also was quick to release a statement decrying the plans: “First, and fundamentally, seeking legislative relief for marketplace issues always has the potential to be troubling.”

In addition, IAEE officials said, if the end goal really was to reduce labor costs, the current legislation does little to address this issue, adding, “In fact, it is entirely possible that over time the inflexibility of a legislatively imposed solution will only serve to drive rates even higher and to do so with very little prospect for eventual relief.”

The stakes are high for Chicago. Late last year, the Society of the Plastics Industry pulled its triennial show – NPE – The Intl. Plastics Showcase – out of Chicago in 2012 in favor of Orlando, costing the Windy City a potential economic impact of more than $100 million. The Healthcare Information & Management Systems Society also canceled its plans to hold its HIMSS Annual Conference & Exhibition at McCormick Place in 2012.

Other show managers said they would take a wait-and-see approach before deciding whether they would support the changes.

“I don't know much besides, 'Yeah, we're taking labor in house, and this would save money,' but I don't know that it would,” said Tom Shimala, show manager for the Radiological Society of North America Scientific Assembly & Annual Meeting, ranked No. 37 on the most recent Tradeshow Week 200.

“There's been some progress,” he added, noting that in the past few years, new contracts have been drawn up with the unions in the building, including the Teamsters, decorators, riggers, carpenters and electrical workers – the only union under the auspices of MPEA – and changes to work rules have been made.

Peter Eelman, show manager for the Intl. Manufacturing Technology Show, owned by the AMT – The Assn. for Manufacturing Technology and ranked No. 4 on the most recent Tradeshow Week 200, said he, too, wasn't sure how the proposed labor overhaul would impact his show.

“I don't think we're in the stage where we can comment on the final product because there is no final product,” he added. “If they are trying to lower cost and improve quality for exhibitors, and, if this will do it, then I'll back it.”

David Causton, general manager of McCormick Place, said show managers have voiced concerns about the proposed labor changes.

“They are concerned that we are doing this to generate revenue, for us to mark up labor and then pass that cost onto the contractor,” he added. “We have been saying (that) we are not in process of making this a profit center.”

Another concern brought up by show management was that the MPEA wouldn't be able to handle the workload involved with signing labor in and out, or cope with the large administrative load involved, Causton said.

“We do this already through Focus One,” he added of a program run by MPEA which manages telecommunications, electrical and plumbing in both venues.

Causton said he didn't know which two of the five labor unions that operate in the building would be eliminated. He added the Teamsters and riggers both do move-in and move-out and the decorators and carpenters both do booth setup. As noted earlier, the electricians' union already works for the MPEA and likely would be one of the five to stay on.

“We have not gotten a formal response from the unions (about the proposed labor changes),” Causton said.

The Illinois General Assembly returns to session Feb. 2, he added. At that time, the bill will undergo legislative review.

“We think this labor aspect really changes the way we do business because, at the end of the day, this is about aligning the way we operate to be more like our competitors,” Causton said.

In other MPEA-related news, the same week the labor legislation was introduced, another bill was moving through the legislature that would reduce the authority's 13-member board to seven members.

MPEA officials declined to comment on how that bill would impact the other.