After talks fail, road builders turn to non-union engineers

Lansing — An infrastructure association that locked out union engineers over a contract dispute says its contractors are now replacing union workers with non-union operators to restart roadwork after a meeting with the governor failed to break the standoff. 

“Contractors are going back to work as we speak, using other non-union operators. So many projects will be up and running in very short order,” said Mike Nystrom, executive vice president for the Michigan Infrastructure and Transportation Association, Tuesday afternoon.

Nystrom wouldn't disclose the number of non-union operators being utilized but said they are "private operators from other states or non-union operators from Michigan who say they want to help out." He added contractors "are looking at all options" and making decisions "contractor by contractor."

Nystrom wasn't specific about which or how many projects would be receiving new workers.

"I think projects started up even today in small bits and pieces," he said. "It will take time to get up and running, and we’re certainly going to make an effort.”

The move by contractors comes after Gov. Rick Snyder met earlier Tuesday with union and contractor groups but was unable to broker a short-term or long-term deal to break the road building stalemate that has stalled nearly 150 projects across the state since after Labor Day. 

The governor discussed the situation after emerging from a face-to-face meeting with officials from MITA and the Operating Engineers Local 324, which oversees the locked-out union workers.

"The situation is challenging — very challenging," Snyder said. “It’s clear the parties were not in agreement."

Snyder's spokesman, Ari Adler, said Tuesday afternoon that MITA's contractors already use union and non-union employees, and it's "their call as the contractor" on staffing projects.

But with lack of clarity on whether contractors will have enough of a labor force to complete the road construction, Adler said the state will continue to explore its options.

“You need to ask them if they think they can stay on schedule with the workers they have," Adler said. "It is incumbent upon the contractor to complete the work.

"Until we have assurance that can happen, we will continue to review other possible options.”

Local 324 Communications Director Dan McKernan told The Detroit News he was unaware of construction work restarting Tuesday afternoon.

“Not to my knowledge,” he said. “But that’s not to say it’s not true. I just haven’t received word of that yet.”

McKernan declined to comment further on developments.

The state, meanwhile, remains in contact with the National Guard as it considers using the guard's engineering units to address critical projects with higher safety risks or commuter challenges before winter.

“We’re not taking sides … in a labor dispute, but we have an interest for our citizens because our roads are critically important,” Snyder said. “We have a lot of road projects that are currently under construction that are not making progress, and we have the winter coming, so we have a real concern about the safety of our citizens and their quality of life.”

Asked about bringing in the National Guard to help out, Nystrom said contractors “certainly are looking at out-of-state operators. We’re looking at all options, including the National Guard. We have had very productive conversations with them.”

Nystrom also noted as result of the three-week stoppage, “there may be projects affected by the onset of winter, and the industry is used to dealing with this seasonal window of opportunity on an annual basis.”

After its five-year contract expired in June, Local 324 said it didn't want to negotiate a new contract with MITA, an industry group representing contractors. The union said it wanted to bargain with individual contractors. MITA then imposed a work stoppage on Sept. 4 in the midst of a busy summer construction season.

"This has never happened before," MDOT spokesman Jeff Cranson said. "This is unprecedented. No one did see it coming."

The dispute has partially or fully shut down 89 Michigan Department of Transportation projects and 72 local projects, including the major Interstate 75 River Rouge Bridge construction project and Interstate 696 reconstruction and maintenance project in Macomb County.

The I-696 project still needs two-and-a-half more months of work before it will be completed, according to state officials.

Local 324 last week accused MITA of "torpedoing" a hand-shake agreement with the governor's office that could have restarted work, a claim MITA denied. The union said Tuesday it will honor Snyder's request not to negotiate through the press. 

"We're going to abide by his wishes and keep our comments to ourselves and keep hoping tomorrow is the day our members get back to work,"  McKernan said.

The Snyder administration two weeks ago asked Attorney General Bill Schuette’s office to determine whether the impasse should be defined as a labor dispute. If not, the state could take more aggressive action, including payment penalties for contractors that could compel them to reach a deal with the union.

While the issue remains unresolved, “we’re in ongoing dialogue” with the Attorney General’s Office, said Travis Weber, chief legal counsel to Snyder. 

The union does not consider it a labor dispute and has consistently said so because of the "unfortunate decision by contractors to lay off their staff and try to strong-arm the union," McKernan said.

The governor said he thinks he has clear authority to use the National Guard, if needed.

It's unlikely the National Guard would be tasked with completing major road construction projects, Cranson said. Instead, the National Guard would likely prepare work zones for winter in an attempt to normalize traffic as much as possible at key areas. But it remains a hypothetical at this point.

"I think we’re waiting to see how these talks go," Cranson said. "We were hopeful that today would yield something, but I think the National Guard is on notice."

Snyder said the administration plans to follow up with the contractor and union groups later this week and plans to continue the dialogue.

"Our public is not going to be happy about this," the governor said. "I'm not happy. This is not a good situation."

Cranson said contractors can ask for time extensions on projects, but they would be on the hook for damages, an amount of money specified in a contract that MDOT would get if contractors breach their original deadlines.

“MDOT has notified contractors that, based on the information that MDOT currently has, the lockout is an action under the contractors’ control,” he said. “Therefore, requests for extensions of time will be granted, but damages for not being complete on time will still be enforced per the terms of each contract.”

Cranson said he did not have "any specifics" on extension requests or the possible number of contracts that could be penalized because of the lockout, noting "the vast majority of projects have not reached their original completion date yet."

“For the benefit of the traveling public, MDOT is enforcing the terms of our contracts," he said. "We are not taking sides but exercising due diligence.”

Nystrom said Tuesday a “labor dispute industry-wide is something that should have a contract extension and not have penalties applied."

"We believe case law and specifications will support that position,” he said.

Nystrom also showed no signs of MITA backing down on its position with the union.

“The lockout will end when the union ratifies the industry-proposed contract, which is a very fair and equitable proposal,” he said.