Arkansas’ Democratic Attorney General Dustin McDaniel is not willing at this time to support the legal effort of 15 Republican Attorneys General to oppose a National Labor Relations Board action against aircraft maker Boeing related to the company’s decision to locate a manufacturing operation in South Carolina.
The NLRB ruling has sent shockwaves through economic development circles across the nation.
Wyoming Attorney General Greg Phillips, who has sided with the 15 Republican Attorneys General, does not carry a party affiliation, but was appointed to the post in March 2011 by Republican Wyoming Gov. Matthew Mead.
However, the legal action comes from right-to-work and unionized states. States represented in the suit are: Alabama, Arizona, Colorado, Florida, Georgia, Idaho, Kansas, Michigan, Nebraska, Oklahoma, South Carolina, South Dakota, Texas, Utah, Virginia and Wyoming.
Also, the issue is of concern with Gov. Mike Beebe, a Democrat. During a May 11 “Talk Politics” interview with Roby Brock, Beebe said he is watching the development.
“It could be detrimental to Arkansas’ economic development efforts if that is carried to some extreme conclusion,” Beebe said during the interview.
Beebe said at the time he was not fully versed on the “legal background” cited by the NLRB in the ruling, but said it “undoubtedly is raising questions about a company’s ability to move plants to different parts of the company for competitive reasons.”
“It bears watching by Arkansas because it could have an effect on Arkansas,” he added.
In 2008 and 2009, Boeing searched for potential new manufacturing locations at which to build the company’s new 787 Dreamliner. The new plane uses advanced composite materials and new engines to build a large commercial plane significantly more fuel efficient than other planes in the industry.
But union leaders objected when Boeing decided to build a $1 billion plant — the first large airplane manufacturing plant built at a new location in about 40 years — near Charleston, S.C.
Officials with the International Association of Machinists and Aerospace Workers District Lodge 751 filed in March 2010 a complaint with the NLRB. They alleged that Boeing made the decision to locate in South Carolina because, as a right-to-work state, it is difficult for workers to unionize. Further, they alleged that the move was a signal by Boeing to its union workforce in Seattle, Wash., and Portland, Ore., that union strikes and other disruptions could push more production to other right-to-work states.
On April 20, NLRB Regional Director Richard Ahearn agreed with the union allegations, saying the Boeing decision to locate a plant in South Carolina was made to “discourage” union workers from engaging in protected union activities. Evidence cited in the NLRB ruling included several news reports in which Boeing officials said part of the decision was based on fear of future union strikes disrupting Dreamliner production.
“As part of the remedy for the unfair labor practices alleged above in paragraphs 7 and 8, the Acting General Counsel seeks an Order requiring Respondent to have the Unit operate its second line of 787 Dreamliner aircraft assembly production in the State of Washington, utilizing supply lines maintained by the Unit in the Seattle, Washington, and Portland, Oregon, area facilities,” Ahearn wrote in the ruling.
In June, South Carolina Attorney General Alan Wilson (R) and Texas Attorney General Greg Abbott (R), initiated a legal challenge. A final decision has not yet been issued.
On July 20, State Rep. Andrea Lea, R-Russellville, sent a letter to McDaniel asking him to consider joining the legal effort to block the NLRB.
“What is at issue is larger than Boeing, and even larger than South Carolina and Washington state put together. One relevant issue is to what extent a federal bureaucracy thousands of miles away should be able to dictate the details of billions of dollars of private investment,” Lea noted in her letter. “I would respectfully request that you contact the offices of the Attorneys General of South Carolina and Texas and become the newest amicus signatory.”
Lea received a reply Aug. 23 saying McDaniel was "working to respond to the issues.” Without hearing anything else from McDaniel’s office, Lea notified some members of the media on Aug. 29 of her correspondence with McDaniel.
Prompted by a media request from Talk Business, McDaniel’s spokesman Aaron Sadler provided on Aug. 29 this response from McDaniel: “She sent a letter to bring it to my attention, but I had been aware of it and working on it for many weeks before she wrote to me. I am deeply concerned that the NLRB is overstepping its authority in this matter, but I am willing to withhold my final judgment until due process in the matter has taken its course. I have communicated with the Arkansas and U.S. Chambers of Commerce, a number of labor union officials and several other Attorneys General. The Attorney General of South Carolina first brought this to my attention. I assured him that we will monitor the case, and if a ruling comes down that is contrary to our right-to-work laws or common sense, Arkansas will help South Carolina in any appellate efforts.”
BUSINESS, UNION RESPONSE
It was no surprise that the state’s top union and business lobbyists agreed and disagreed, respectively, with McDaniel’s stance.
Alan Hughes, head of the Arkansas AFL-CIO, said it is “obvious they’re [Boeing] trying to get away from the unions.” Hughes praised McDaniel for not getting involved at this juncture.
“I admire Dustin McDaniel for letting it run its course, instead of just jumping off into it. I think it’s the right thing to do,” Hughes said. “It’s politics. They’re just trying to put pressure on him [McDaniel]. It’s a bully tactic.”
Randy Zook, president of the Arkansas State Chamber of Commerce/Associated Industries of Arkansas, issued this statement: “The Boeing-NLRB dispute is a matter of deep concern to business leaders all across the country. In Arkansas, our worry is that it represents a clear-cut threat to our business recruitment efforts. It signals a tilt by the federal government in favor of union bosses’ efforts to exert unprecedented control over basic business decisions, such as where to locate plant facilities and the jobs that go with them. We are a ‘right-to-work’ state by an overwhelming majority vote of the people of Arkansas. The NLRB is seeking to weaken ‘right to work’ through this and other actions. That does not bode well for our efforts to add jobs in Arkansas’ economy. Hopefully, public officials will see the wisdom of vigorously opposing this misguided effort."
Arkansas became a "right-to-work" state in 1944. The "right-to-work" law allows employees to decide for themselves whether or not to join or financially support a union. The law forbids workers from being fired for non-payment of union dues or fees. However, there are exceptions to the law for employees in certain railway, airline, education and government jobs that are unionized.
Last week, the NLRB caused additional controversy with a new rule requiring prominent displays of union rights for workers in employers’ businesses.
Michael Tilley with our content partner, The City Wire, is the co-author of this report with Talk Business & Politics editor Roby Brock. Tilley can be reached by e-mail at email@example.com. Brock can be reached by e-mail at firstname.lastname@example.org.
Latest posts by Talk Business (see all)
- Stovall To Become Executive Director of Two-year College Group - May 29, 2013
- Metropolitan National Bank Posts Q3 Loss Of $1.24 Million - October 26, 2012
- Acxiom's Earnings Jump 21% In First Quarter Despite Revenue Slide - July 30, 2012