NECA TransmissionsNotes from the front lines of the electrical contracting industry
  • Labor Negotiations Prime Time

    Posted on Apr 30, 2009 by John M Grau

    This is labor negotiation prime time. A majority of NECA-IBEW labor agreements have a May 31 anniversary date, so many local areas are deep into the negotiation process. With the deadline for CIR submissions this Friday, the pressure to come to a settlement is even greater.

    One of the most frequently asked questions I hear concerns whether any areas are agreeing to wage freezes or rollovers. The simple answer is yes. With the dramatic change in the construction economy this year, many local unions are taking a sober and realistic look at work prospects in their area. So far only a few have agreed to a wage freeze, but wage increases definitely appear to have moderated.

    On the other hand, I’ve heard quite a few stories about union opening letters with demands that show no recognition of current economic realities. We’ll soon find out whether these were just opening ploys or serious demands.

    The second question I hear most often is, "how were some local chapters able to negotiate wage freezes?" That answer isn’t as simple. 

    Certainly, low market share and a book full of laid-off journeyman can be a big factor. Not every area, however, requires an economic two-by-four in the face to get the negotiating committee’s attention.

    If there is any silver bullet/magic solution in any of these situations, it’s that there’s a good working relationship between the local chapter and the local union. That may seem self-evident, but it’s not. Some think that it’s a lot like winning the lottery: You either are lucky enough to get a cooperative business manager or you’re not. But if we dig deeper, we find that chapters that have a good relationship with their local unions work at it.

    Working at it means good communications. The chapter leaders are constantly meeting with and talking to their union counterparts about industry issues — not just during negotiations, but year-round. Local LMCCs meet regularly and honestly discuss problems. NECA contractors talk and listen to their regular employees, taking time to explain the realities of job costs, estimating, and customer demands.

    This is the message that NECA President Rex Ferry has been preaching at meetings this year. He admits that this is all easier said than done, and he even more readily admits that he hasn’t always been successful in his own communication efforts. The important thing is that he keeps trying, and he believes that if we are ever to achieve a long-term solution in labor-management relations, this is the key.

    Ten or fifteen years ago, a number of chapters were particularly proactive in developing solid working relationships with their local union counterparts. Today, it’s a more common occurrence — and also why we’re seeing some more encouraging results at the bargaining table.

  • Response from IBEW President Ed Hill

    Posted on Jan 17, 2009 by John M Grau

    One reason I blog at NECA Transmissions is because I want to hear directly what people on our industry's frontline are thinking. I don't expect everyone to always agree with me, and I appreciate the people who take the time to write comments to my posts. While most NECA members agreed with my position on the Employee Free Choice Act, IBEW International President Ed Hill had another view.


    I am somewhat surprised that your editorial regarding the Employee Free Choice Act hits as something that has little to do with our working relationship, but is more of a personal attack on the rights of working men and women.  I understand your concern regarding the favored nations issue; however it is our opinion that this is not a real issue, but one that some of you are using to mask your disdain for the rights of workers.  I believe that in the past when your organization wanted something legislatively that we did not necessarily agree with, there was a gentlemen’s agreement that we would not get involved, but would sit it out.  I believe for the most part this has happened and for the most part when there was something that was good for the industry we were there to work with our partners.

    Your buy-in of the position of the anti-union forces does surprise me, and like the rest of them you have got it all wrong.  The present situation lends itself to the control of management when it is they who decide whether to have a card check for representation or not.  As you know if there are 95% of the people want a union, and the company refuses to accept the wishes of the employees and recognize the union as their bargaining representative, then the employer can demand an election. It is then that they grind the process to a halt until they can intimidate enough people against the union that they will permit the process to continue. Well, since it has been that way and anti-union management types seem to like it, we would like to be able to have something to say about the process as well, and if there enough cards to determine that the majority want a union then they should be permitted to have one instead of being brow-beat with the threat of loss of their employment and in many cases the actual loss of their job, until there is an election held.

    However, there may be a bright side to this issue. Your position of concern for the voting rights of working men and women, however narrowly applied to a single issue, may be something to smile about.


    I appreciate Ed's willingness to share his response here. Feel free to use the link below to send me any additional comments on this topic.

  • What I Brought Back From Chicago

    Posted on Oct 14, 2008 by John M Grau

    The just-completed NECA Convention in Chicago was my 31st. That doesn’t even come close to the record set by former NECA President Bob Colgan of Toledo, Ohio. This was his 57th!

    Bob Colgan, Sr. recognized as Founding Fellow of the Academy of Electrical Contracting
    Bob Colgan, Sr. recognized as Founding Fellow of the Academy of Electrical Contracting

    Bob was recognized at both the Convention Opening General Session and at a special Academy of Electrical Contracting Reception marking its 40th anniversary. Bob Colgan and Bob Higgins, my predecessor as NECA’s Executive Vice President, are the only founding members of the Academy still living.

    Colgan attended this year’s convention with most members of his family. The kids tagged along to NECA conventions when they were growing up. Although not all of them at the same time, says Bob’s wife Emily. So it was a special event for the Colgan family, the Academy, and NECA.

    Here are some of my take-aways from the Convention:

    Many of the members I talked to are still cautiously optimistic about their work backlog. They told me that the financing is in place for most of their projects and they expect the work to continue into 2009.

    A couple members told me that they called their bankers to see if they could get credit if they needed it. The answer was yes. Credit is still available for “credit worthy” customers.

    A lot of members are excited about the opportunities available in energy conservation and alternative energy markets. Many are reformulating their business plans accordingly.

    Most left the Special Labor Relations Session encouraged that the IBEW and NECA are working in the right direction. Progress can’t come fast enough, however.

    After attending the ELECTRI International Meeting, the Student Chapter Summit, the Future Leaders Reception, and the International Group Lunch, I couldn’t help walking away feeling proud of NECA and what we are accomplishing in these areas.

    How does Bob Costas remember all those facts? After his speech at the closing general session, I told him that the political campaign “truth squads” were going to check on his accuracy. He said he’s confident that his record is better than the candidates’.

    Before the closing concert, I was able to say hello to performers Bruce Hornsby and Ricky Skaggs. Hornsby said that they don’t just walk through their performance but work hard at being entertaining and fresh. He said we were in for a treat. He was right.

    Wall of Vodka
    Wall of Vodka

    I keep thinking about the ELECTRI International reception at the Chicago Illuminating Company and the 20-foot-high wall lined with shelves of Grey Goose vodka. I wonder if they would agree to be a NECA Preferred Sponsor.

    Did everyone see president-elect Rex Ferry up on stage playing an inflatable guitar during the Opening Reception at Navy Pier? I have pictures.

    President-elect Rex Ferry
    President-elect Rex Ferry

    No doubt this was one of NECA’s best Conventions ever. Take Bob Colgan’s word for it. In our 100 year history he’s been to over half of them, so he should know.

  • Field Rep 2010

    Posted on Apr 07, 2008 by John M Grau

    In my last two posts, I’ve written about the NECA Field Service – its history and the challenges it confronts today. But what about the future?

    Will the job description for a NECA field representative of 2008 meet the needs of NECA members and chapters in the years 2010 and beyond? What will be expected of field reps then? What skill sets will be needed and how will they be organized?

    These are questions we are tackling right now in a project labeled Field Rep 2010. A small task force of NECA staff and chapter managers is working with me to create a profile of the skills and experience that the NECA field rep of the near future will need. Using that profile, we will lay out a plan to create the field service that our members will need in the year 2010 and beyond.

    NECA members can weigh in on this discussion. I recently sent an electronic survey to chapter executives to learn about what field staff services they find most valuable and what services they think we need to improve or provide. That same survey can be taken by NECA members reading this blog.

    Just click here, and you'll be directed to the brief online survey. If that link doesn't work, you may need to copy and paste the URL into into the address bar of your web browser to access the survey. 

    As we move forward with Field Rep 2010, I will keep you informed of our progress and plans. 

  • 21st Century Demands

    Posted on Apr 02, 2008 by John M Grau

    Today, we find that the need for field staff services is exponentially greater than ever before. It can be a challenge for our four regional executive directors and 16 field representatives to juggle all the demands and meet all the needs around the country. So where do we go from here? Let’s start by looking at the facts:

    1. Chapters and local members are continually asking for more field staff expertise and engagement. Chapter staffs are comparably smaller today than they were 20 years ago. Many chapters that used to have assistant managers don’t today. Without this training ground for future manager positions, local chapters have difficulty finding experienced managers with a background in trade association management, labor relations and NECA practices. 

    Also, new chapter managers are less likely to have any labor relations experience since it is so difficult to obtain. Because of this, they will rely heavily on the NECA field staff for assistance in the day-to-day challenges of labor relations and working with local IBEW representatives

    Field representatives are also leading the new labor relations training programs and providing other collective bargaining education. This training aspect of their job is an important support feature for the local chapter.

    2. There is a greater need for field staff interaction with their IBEW counterparts.   The growth of special market recovery initiatives like the Florida Initiative throughout the country requires intensive work by IBEW International representatives and NECA field representatives. Without their constant oversight and guidance, these programs will fail. Meetings to establish an area-wide initiative, to develop market recovery tools, to set up manpower recruiting blitzes, and to guide contractors in the use of the new CW/CE categories require an enormous amount of field representative time. 

    Add to this support for the Code of Excellence and Industry Awareness programs, joint market recovery meetings and efforts toward multi-chapter portability. 

    Each NECA field representative must work with anywhere from three to eight IBEW International representatives. The IBEW has five times the number of field staff (not counting organizers) available to work on these issues compared to NECA. 

    3. Field Representatives are responding to more national directives. The field staffers have always been instrumental in collecting information and data that serve the broader membership. As industry information needs increase, the field representatives are being called on more often to assist in these efforts. They organize chapter board conference calls, prepare workforce development reports, gather labor agreement and labor data information for the members’ on-line database. 

    The field representatives are the face of the national organization at the local level. They are called on to meet frequently with local chapter staff and members to present and explain national programs and initiatives. 

    As NECA looks to the future and seeks the means to grow the value of the association for its members’ benefit, the role of the field staff must also be evaluated. More on what I hope will be the future of the field staff in an upcoming post.


  • The NECA Field Service

    Posted on Mar 24, 2008 by John M Grau

    The idea for NECA “field service” came in the late 1930’s when the Labor Relations Committee reasoned that NECA could negotiate better terms with the IBEW if it represented a significant portion of IBEW-labor employers. The committee adopted a set of seven objectives to guide the work of one field representative whose first objective was membership. The fifth objective was “to give assistance to contractors locally, as needed.”

    In May 1939, NECA hired Paul Geary, former manger of the Youngstown, Ohio Chapter, as its first full-time traveling representative. He had one primary goal: Build members’ bargaining strength by soliciting electrical contractors to join and work together.

    As NECA’s lone field representative, Geary soon found himself concentrating less on his first objective to build bargaining strength and considerably more on his fifth to assist contractors locally. In an October 1941 report to the Committee, he wrote:

    When this Committee adopted that objective, I am sure that it did not fully appreciate how far it was “sticking its neck out.” I am sure that it did not foresee that our Local Chapters and members would need and desire so much assistance as they have; much less, that they would not only request it, but would demand it, backing up their demands with threats that they would drop their N.E.C.A. membership if we didn’t get them exactly what they wanted, when they wanted it. What they want ranges anywhere from the total extermination of Journeymen (working) contractors, to the removal of an alleged uncooperative, incompetent or dishonest Union Representative. Performing under this objective has taken up at least 80% of your Representative’s time and the expense connected therewith represents of course a proportionately large share of your revenue.

    Today the NECA field service team is a vital component in NECA’s service to its members. It is comprised of 16 field representatives organized into four regional offices, each under the direction of a regional executive director.

    Unique among trade associations in the construction industry, NECA’s field service is the link that connects the national organization with independent local chapters and local members.

    More on the field service in my next post.

  • Q&A With Larry Bradley

    Posted on Mar 07, 2008 by John M Grau

    All the news about troubled financial markets is enough to make anyone nervous about their own investments. So I asked Larry Bradley, Secretary-Treasurer for the National Electrical Benefit Fund, a couple of the questions that had been on my mind recently about the NEBF.

    JG: It seems like every time I read a newspaper or turn on the news there’s another big company, like GM, with a pension plan in trouble. This leaves me concerned for NEBF’s future. Is the Fund in trouble?

    LB: No, NEBF is classified by the government as a “green zone,” plan, meaning it is a healthy, well-funded pension plan.

    JG: But what does the government mean by “green zone” exactly?

    LB: When the Pension Protection Act became effective in 2007, it contained a provision that required all pension plans to carry a rating regarding the plan’s status. A pension plan can be classified as healthy, endangered, or critical. A healthy plan is considered in the “green zone” while an endangered plan is in the “yellow zone.” A critical plan is in the “red zone.”

    A “red zone” plan is only about 60 percent funded and may carry a disproportionate ratio of retirees to active workers. A plan in the “yellow zone” is about 70 percent funded and is expecting a funding deficiency in seven years. A “green zone” plan is more than 80 percent funded and has no expected deficiencies in the near future.

    In NEBF’s case, our funding level is squarely within the “green zone.” In fact, the Fund is fully funded with respect to vested benefits based on our most recent actuarial evaluation, so the NEBF has no withdrawal liability—which is important for our covered employers.



  • Health Care is Front and Center, Not on the Fringe

    Posted on Feb 08, 2008 by John M Grau

    Last week, NECA and the IBEW held their annual employee benefits conference. I couldn’t be there this year, but several NECA contractors and staff made the trip.

    I remember in the late 1980s suggesting to then-IBEW Secretary Jack Moore that NECA and the IBEW jointly sponsor a conference dedicated to employee benefit issues. The management of local health and pension plans is a serious responsibility that consumes a large chunk of our plan trustees’ time. We needed a forum for sharing ideas and conveying the latest information on rules, regulations and plan management.

    While the annual IBEW-NECA benefits conference has served some of that purpose, I think we can do better. Attendees have rightly criticized the conference program for promoting joint IBEW-NECA programs and sponsors too much. A number of NECA plan trustees have requested a conference of our own, in order to focus on current and emerging issues relevant to electrical construction industry plans. We’re planning such a meeting for years alternating with the NECA Labor Relations Conference – in other words, next year.

    I think we all recognize that fringe benefits aren’t so “fringe” anymore. They’re a big part of our labor costs and a major factor in our struggle to complete with non-union costs. It doesn’t mean, however, that these benefit plans have to be an albatross hung around our necks. Properly structured and managed, our fringe benefit programs can be part of our competitive advantage. 

    Health and pension plans can serve as a key component in attracting and retaining a qualified workforce. Most surveys I’ve seen show that most non-union electrical contractors offer some amount of health care coverage for their employees, though it usually isn’t the same high level of coverage offered by union employers.

    And this is where we have an opportunity to be more flexible. The marketplace for employer-provided health insurance has changed dramatically in the last few years. Some of our plans are now offering tiered levels of coverage at varying costs. Some no longer pick up the whole premium for family coverage.

    If a plan’s benefit level is structured correctly, then the advantages of a jointly managed healthcare trust come into play. Group-buying through the trust arrangement saves employers significantly, especially compared with individual-buyer options. And since the union is a part of the healthcare trust management, we find that the employees, through their representatives, are as interested in cost efficiencies as we are. 

    If you’ve recently heard about U.S. auto companies turning over the responsibilities for their healthcare and pension plans to the unions, they’re basically trying to achieve this same level of shared responsibility. Rather than making direct contributions to the plan, the company puts a big chunk of cash into a trust fund that the union would manage. And instead of just bargaining for benefits and leaving the cost up to the employer, the unions would have a stake in efficiently managing the trust – and their own benefits. The auto industry may just now be figuring this out, but we’ve had it in the construction industry for years.

    Suffice it to say that fringe benefits and their impact on our industry are at the top of our agenda at NECA. Our objective is to turn what many see as a problem into an opportunity.  It’s not an easy task to accomplish, but it is a vital one well worth pursuing.

    As always, your thoughts and suggestions on this subject are encouraged.


  • Risky Labor or Risky Management?

    Posted on Jan 30, 2008 by John M Grau

    Market share is eroding for union electrical contractors in one their main bastions—large cities. Contrary to common perception, one of the principle reasons for that erosion is not the cost of labor, but how the labor is managed.

    That’s the conclusion found in a new ELECTRI International study titled “We Built This City.” Researcher Perry Daneshgari reported on his work at the Foundation task force meeting last week in Phoenix.

    The Foundation’s annual January Task Force Meeting is one of my favorite meetings.  I was there along with NECA members, chapter staff executives, and other Foundation supporters. Long ago, we realized that academics and electrical contractors communicate differently. So the purpose is to bring Foundation researchers together with industry participants for a reality check of sorts - - having electrical contractors guide the research projects and ensure that they are on-point and relevant.

    If we don’t want good research to sit on a contractor’s shelf, we need to make certain that the academics focus on practical, applicable results, not on the spinning of theoretical concepts. Thus, task forces are created to bring the theoretical and the practical together in a useful format. At last week’s meeting, task forces were formed for projects, including “Local Apprenticeship Best Practices,” “Recruiting and Retaining the Supervisory Workforce,” “The Role of Electrical Contractors on LEED Projects,” and “Implementing Lessons Learned from the Florida Initiative.”

    “We Built This City” is a completed project rather than one just starting, and it generated lots of in-the- halls and after hours discussions among attendees.  In support of his main contention, Daneshgari reports that non-union contractors view themselves as a business, while a majority of union contractors view themselves as an extension of their field operations. Union contractors believe that it is the labor in the field that makes them money. Non-union contractors know that money is made by effectively managing labor. Union contractors believe that labor is the highest risk and uncertainty of the job. Non-union contractors consider management of labor to be the highest risk.

    While operational differences between union and non-union shop contractors were the main highlight of his report, Daneshgari noted additional reasons for the erosion of market share in major urban areas. 

    The continuing shift from an industrial market to commercial and residential markets is one. Portability restrictions and limitations on crew ratios were another. He also noted that the local leadership of the NECA chapter manager and the IBEW Business Manager, and the relationship between the two, has a major impact on market share—something I pointed out in a previous post. 

    As you can see, there were lots of provocative thinking and discussions going on at the Foundation task force meeting. Understanding the problem is a critical first step in implementing solutions. The work of ELECTRI International continues to be a valuable resource in that regard.

    I’d be interested to hear what you think of Dr. Daneshgari’s conclusions. Use the “Send Feedback” link below to send me your thoughts.


  • Q&A on Code of Excellence

    Posted on Jul 12, 2007 by John M Grau

    NECA member Jerry Hayes of United Electric in Atlanta sent a question in response to my recent post “Executive Committee Meeting Recap.” In that post, I said that the committee had taken action to make the Code of Excellence Category I language. Jerry responded with his perspective on what including the Code of Excellence in Category I language would mean. His message clearly expressed similar thoughts I’d heard from other folks, so I was glad that he graciously agreed to let me post both his question and my response to him on NECA Transmissions.

    Feel free to keep the conversation going by sending your comments through the Feedback link below.

    “To me, it looks like the 'Code of Excellence' is another article in the agreements that says labor will do what they are supposed to do. Aren’t we giving trouble-makers a list of things to use as excuses that they could not perform? What do we hope to get by having this a Category 1 language? I am doing this in my shop, but only with my supervision. That is where it counts.”

     - Jerry Hayes

    Jerry raises a good point about the Code of Excellence becoming Category I language. Just because something is good in one area doesn't mean it's good for everyone. In this case, however, I have trouble seeing a downside.

    First, for clarification, the Category I language we're suggesting would be enabling language that would state that each area should develop and adopt its own Code of Excellence with some minimum guidelines.

    Therefore, what's contained in the jointly agreed-to Code and how it is enforced should be customized for each area.

    Second, the Code of Excellence is not just for labor. It establishes obligations for employers, employees, NECA chapters, and IBEW locals.

    And you're right in that it really only says that everybody will do what they already are supposed to do under the local labor agreement. Asking labor to give eight hours work for eight hours pay isn't a novel concept. Neither is suggesting that it's the contractor's obligation to see that the job has proper tools and materials.

    What is important is that both parties to the labor agreement all state in writing that they intend to live up to the spirit as well as the letter of the agreement. Instead of giving trouble-makers a list of excuses, the Code of Excellence takes those excuses away. We can clearly see changes in areas where both parties have embraced the Code and made it their own; they have experienced a dramatic improvement in the quality and attitude of workers. 

    Basically, it’s all about attitude. Poor worker attitudes and the resulting poor productivity is the number one complaint I hear from our member contractors and construction users. Based on what I’ve seen, the Code of Excellence offers a good way out of this destructive cycle. This leads me to the reason for adopting the Code of Excellence across our industry by means of Category I language.

    If we're serious about reforming our industry, we need to make some broad-based changes. Attitudes can be contagious. As they spread and are adopted by others, they form an industry’s culture. We want our industry’s culture to be positive, productive, and customer-oriented – not negative, self-centered, and doing the bare minimum.

    The construction user community is aware of the Code of Excellence, and they view it as one of the most positive changes in the union construction industry recently. Many are demanding that all of the union trades working on their jobs adopt a Code of Excellence similar to the one we’ve pioneered here. Our plan is to be out in front of the pack. We want to be able to tell our customers that our whole industry works under the Code of Excellence, no matter how large or small the job is. I see only good things about being able to do that.

About NECA Transmissions

NECA Transmissions is a collaborative effort from CEO John Grau and NECA staff to provide insight and feedback on key issues from the front lines of the electrical contracting industry.


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