Replacement Workers Roil Unions

TRACEY COOK remembers the moment her company's chief negotiator pointed to each union member at the bargaining table and threatened to replace them if they went on strike. Two weeks ago, she and 5,500 other union grocery store workers struck the company, Giant Eagle Markets Company. Now, instead of wrapping meat inside her Washington, Pa., grocery store, Ms. Cook pickets outside with a large sign. ``UNFAIR,'' it says in big black letters.

Here in southwestern Pennsylvania and across the United States, labor and business are at loggerheads over replacement workers. Once a little-used provision of labor law, the issue has become a cause c'el`ebre. Labor says it's unfair. Employers say it's vital.

When workers go out on strike, an employer can hire people to keep the business operating. In certain cases, the employers can make these replacement workers permanent and displace the strikers. The US and South Africa are the only two major industrial countries that allow this.

Union leaders are backing bills in Congress that would ban permanent replacements. Employers have organized quickly to fight the bills and have secured the promise of a presidential veto.

`Threat to the system'

The real issue here concerns the delicate balance of power between management and labor.

``This is going to affect the balance of power at the bargaining table,'' says Dan Yager, who studied the issue for the Employment Policy Foundation, an employer-funded research group.

The AFL-CIO, the nation's labor federation, calls the hiring of replacement workers ``a direct threat to the vitality of the collective bargaining system.'' Warns the Economic Policy Institute, a labor-supported research group: ``If allowed to continue, this practice will produce negative social and economic effects.''

From the signing of labor legislation in the 1930s until the 1980s, permanent replacement workers were not a major issue. The scant evidence available suggests that employers used them sparingly, and usually in small, localized strikes. When the US Supreme Court set rules for replacements in a 1938 case called National Labor Relations Board v. Mackay Radio and Telegraph Company, labor cheered because the ruling favored the workers.

In essence, the court said employers could permanently replace employees who struck over economic issues alone (such as wages). But employers guilty of an unfair labor practice (such as refusing to bargain in good faith) had to rehire their original workers at the end of the strike.

Later court opinions and labor legislation weakened unions' power to conduct strikes. But even in 1977, the most recent attempt to overhaul labor law in a major way, most policymakers didn't object to the basic power equation of Mackay. An employer's right to hire permanent replacement workers balances an employee's right to strike.

But in the 1980s, a series of large, high-profile strikes showed that labor's ultimate weapon - the strike - had become quite weak.

Greyhound Lines, for example, broke its strike by hiring nonunion drivers and became a nonunion company. The New York Daily News and Pittston Coal also kept operating with nonunion help, but both eventually caved in when labor exerted enormous public pressure. Eastern Airlines kept its permanent replacements and never settled with its unions, but it finally went bankrupt.

It's not clear whether the use of permanent replacements went up in the 1980s. When the General Accounting Office looked at strikes in 1985 and 1989, it found that companies threatened to use permanent replacements about a third of the time. But they hired them in only 17 percent of the strikes. In all, only about 4 percent of all striking workers were replaced permanently.

Mr. Yager's study suggests that the use of replacement workers didn't go up during the 1980s. But his data - decisions handed down by the National Labor Relations Board - covers only a small minority of strikes.

Two sides don't agree

While business argues that the threat of permanent replacements allows companies to negotiate competitive contracts, labor leaders and scholars say the practice is anticompetitive, hindering labor-management cooperation.

Here at the Giant Eagle in southwest Pennsylvania, for example, mistrust is building on both sides. Union workers claim the company threatened to replace them permanently. Giant Eagle says its 480 replacement workers are only temporary.

Each side accuses the other of not bargaining seriously. Giant Eagle's stores lost most their business the first week of the strike, but sales are climbing back.

``We'll be here for the duration,'' says Cook defiantly, holding her strike sign to make sure it doesn't blow away.