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The Honolulu Advertiser

Posted on: Sunday, April 4, 2004

Ameron strike proved costly

By Dan Nakaso
Advertiser Staff Writer

Leevey Paparello of Foundations Hawaii pours concrete into the footing of a new home at the High Pointe Project, the first pouring since the Teamsters began a strike against O'ahu's top two concrete companies Feb. 6.

Jeff Widener • The Honolulu Advertiser


Concrete strike chronology

Feb. 6: About 144 Teamsters concrete workers strike Ameron Hawaii, the state's largest concrete producer. Medical coverage is a key issue.

Feb. 7: More than 60 concrete workers walk out at Hawaiian Cement, the second-largest concrete supplier. Health benefits again prove a sticking point; Teamsters and Ameron Hawaii officials resume negotiations to try to settle the strike, but talks break off.

Feb. 10: Effects of strike spread, with building projects slowing and businesses dependent on construction workers seeing sales declining.

Feb. 12-23: Hawaiian Cement and striking workers in off-and-on talks, but negotiators unable to reach a settlement.

Feb. 27: Hundreds of construction workers reported laid off with impact of concrete strike.

March 1: Gov. Linda Lingle steps in for the first time, meeting separately with both sides. Ameron Hawaii talks resume the next day, but no agreement is reached.

March 16: Union offers to pay part of medical plan coverage provided by Ameron Hawaii. Hawaiian Cement presents "last, best and final" offer.

March 18: Ameron's "last, best and final" offer rejected.

March 19: Hawaiian Cement deal approved by striking workers, who return to work March 22.

April 1: Union agrees to take Ameron Hawaii revised offer to members for a vote to end 2-month-old strike.

Source: Advertiser research
On the 56th day of O'ahu's concrete strike, both sides shook hands. They had negotiated a deal that striking Teamsters and Ameron Hawaii officials could live with for the next five years.

But it came at the cost of an eight-week strike that crippled construction projects across O'ahu and threatened an industry expected to drive Hawai'i's economy for several years.

"Nothing that was said or done will be taken personally," said Teamsters President Mel Kahele.

George West, Ameron Hawaii's vice president of operations for O'ahu, insisted "the relationships are fine. We both had our objectives to achieve. There's mutual respect."

But the separate strikes against Hawaiian Cement and Ameron Hawaii, Ha-

wai'i's major concrete producers, left behind plenty of worries that labor problems could shut down Hawai'i's construction industry again.

"There has to be some serious thinking of how we avoid these types of disruptions, both from management and labor," said Bruce Coppa, director of Pacific Resource Partnership, an advocacy group for union contractors. "I don't think anybody won. As a construction industry overall, we all lost."

The Hawaii Carpenters Union saw 1,000 of its 5,800 members lose their jobs as construction projects stalled because of a lack of concrete.

And although Ameron Hawaii employees are scheduled to return to work tomorrow, it will take weeks for laid-off carpenters to be called back to work, said Ron Taketa, the carpenters union financial secretary and business representative.

The paychecks they missed "are just lost," Taketa said. "You cannot possibly make up for weeks of lost employment in an industry like ours. The strike has had a devastating impact on our membership and our industry."

Kenneth Choate, executive vice president of Haseko Construction Inc., which will get one of Ameron's first concrete deliveries tomorrow, hasn't yet calculated how much the strike cost his company.

"It's more than I probably want to know," Choate said. "It was so ridiculous."

Out of 375 construction workers, Haseko laid off about 120, and won't be able to recall them for perhaps six months, Choate said.

"We lost one-sixth of the entire year's worth of concrete work," Choate said. "The strike didn't just affect those 100-some-odd guys. It affected all of us."

Lawrence Boyd, a labor economist at the University of Hawai'i-West O'ahu, called the agreement between Ameron Hawaii and the Teamsters "probably one of the best contracts in the last couple of years."

The five-year deal would gradually increase employees' share of their medical costs, remaining at 20 percent for the first two years, rising to 25 percent in the third year and reaching the company's goal of 30 percent in the fourth and fifth years.

Wages would rise $1 per hour in each of the first two years, 80 cents in the third, and 70 cents in the fourth and fifth years. The pay increases would add up to $4.20 per hour over the life of the contract.

The new deal defies typical labor agreements that "back-load" pay increases at the end of contracts, Boyd said. The raises also pay for the increased medical payments before taxes are taken out.

Factoring in inflation, Boyd said, the Ameron Hawaii employees "come out ahead by about 6 percent. In other words, they'll be able to go out and indeed be able to buy a new truck."

The talks between Ameron Hawaii and the Hawai'i Teamsters and Allied Workers, Local 996, began Nov. 10 and represented the first bargaining sessions between West and Kahele.

The Teamsters have 84 separate contracts with a variety of companies. "But this is Mel's first contract in our industry, and the first time representing these people," West said. "We needed to feel each other out. We needed to understand each other. They had to learn our business, the jobs and work practices and work rules. All those things really did have an effect."

West grew to respect Kahele's endurance over the course of long talks. "Mel certainly likes long, drawn-out sessions," he said. "He's a tough negotiator. We met practically nonstop from Nov. 10, and he certainly put his effort into it."

After months of negotiations, Ameron and the Teamsters remained stuck over the company's desire to increase employees' share of their medical expenses to 30 percent.

The medical plan cost $479 per employee per month, and Ameron officials believe increasing employees' share will make them more careful about costs.

This month, West said, the company's health plan jumped to $527 per month per employee.

When the talks began, Kahele said, Ameron officials would increase pay by only $1.25 an hour.

"That was crazy, ludicrous, flat-headed and narrow-minded," he said. "I don't believe it was possible to avoid one strike."

As soon as the strike began Feb. 6, construction companies started laying off workers. Even unrelated businesses such as plate-lunch wagons saw business drop by 50 percent or more in the days that followed.

Gov. Linda Lingle held separate discussions with the various parties and sent state negotiator Ted Hong in to monitor the talks.

On March 18, hopes for an end to the strike seemed distant when the Teamsters rejected Ameron's "last, best and final offer."

But then the Teamsters settled their strike with Hawaiian Cement.

The settlement raised the pressure on both sides: Ameron worried about losing some of its 60 percent share of the market to its main competitor. And striking Ameron workers could only watch as fellow union members went back to work at Hawaiian Cement.

"The longer you're out, the longer you don't have a paycheck," West said. "Time puts pressure on the employees and time puts pressure on the company. The longer you're out, the more these pressures build."

The big breakthrough came when Bill Smith, senior vice president of operations for Ameron's parent company, joined the negotiations last week, Kahele said.

Smith withdrew the "last, best and final offer," Kahele said, added a fourth year to company-paid medical benefits for retirees, increased pay raises another 30 cents per hour and pulled back company proposals on changing work schedules.

"We were kind of shocked," Kahele said. "Bill Smith had a lot to do with the company moving off of the issues. If they had done so earlier, a lot of this could have been avoided."

Looking back, West isn't certain what could have prevented the strike that stretched across parts of three months. But he knows it was an experience that will stay with him.

West went through Ameron Hawaii's previous strike 20 years ago. And he's in no hurry to see another.

"Maybe once every 20 years or so, people need to be reminded about these things," West said. "But I don't need any reminders."

Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or 525-8085.