Canadian workers for Maine jobs? Cianbro wins approval to hire 60 foreign workers, but labor leaders claim the process was flawed BY JESS KILBY

When Cianbro Corporation announced last spring that it had secured the contract to finish building two oil rigs for the multinational, Rotterdam-based company Petrodrill after Friede Goldman Halter — the Mississippi construction firm originally hired to do the job — went belly up, there was much rejoicing in Portland. Transferring the contract to the Pittsfield-based construction firm meant 800 new jobs for Southern Maine; up to $1.4 million in rent money for the city of Portland (which owns the project site); the return of real " working-waterfront " activity on the waterfront; and — did we mention? — eight hundred new jobs!

Those jobs — like the project — are only temporary, of course. Work on the oil rigs is slated for completion some time this summer. But in today’s grim economy, a job is a job, no matter how short-lived.

Which is why the state’s labor activists went ballistic last fall when Cianbro applied for H-2b foreign-worker visas to fill 120 slots on the Portland project. That contentious application process has just been wrapped up, and despite objections from both labor leaders and the Maine Department of Labor (MDOL) that the wages being offered are too low, the US Department of Labor (USDOL)certified Cianbro for 60 H-2b visas, on February 5. The company, which must go through the Immigration and Naturalization Service for final visa approval, has already begun its foreign-worker recruitment in Saint John, Canada.

But this is not the end of the story.

When an American company wants to import labor via the H-2b visa program (which covers temporary, non-farm jobs), it must first prove to the US Department of Labor (USDOL) that there are no qualified, unemployed domestic workers available to hire. In doing so, the company must advertise the job locally at a pay rate that the state Department of Labor determines to be the " prevailing wage " for that job in that area. The company must also pay that same prevailing wage to any foreign workers it ultimately hires. (A major tenet of the H-2b program is that domestic job markets not be undermined by the importation of cheap foreign labor.)

Last October, Cianbro offered the jobs locally at $15.20/hour, a wage determined by the Maine DOL but falling well below union scale. Labor lawyer Patrick McTeague, whose firm McTeague, Higbee, and Case has been a vocal opponent of Cianbro’s visa application, filed a complaint in district court on Friday, February 21, contending that the MDOL used the wrong guidelines to arrive at that minimum wage rate of $15.20.

Move over, Bacon

Adam Fisher, assistant to the commissioner of the MDOL, explains how his office calculated the prevailing wage for the 120 structural-welder and pipe-welder jobs for which Cianbro (an aggressively non-union shop) originally sought visas.

" If there’s a union contract in place, " he says, " the rate is whatever the union contract says it is. If a union isn’t in place, we look to see if there’s any federal or state money in on those jobs — if it was a highway contract, or some sort. If that’s the case, then we use the Davis-Bacon Act to determine what the wage rate is; there’s a formula there. If there isn’t state or federal money in the contract, we use what’s called the Online Wage Library to determine the rate. "

It was this latter method, in conjunction with another indexing tool called the Service Contract Act, that the MDOL ultimately used to determine that Cianbro had to offer at least $15.20 an hour for the jobs, with no benefits. But, despite having set the figure, the MDOL agreed with McTeague, union leaders, and US Representative Tom Allen, that $15.20 was too low — and it said as much when it forwarded Cianbro’s application to the USDOL. An excerpt from the MDOL staff comments on the application reads:

" [A]lthough consistent with the procedures established by the USDOL for wage setting, we do believe that the Service Contract Act likely understates wages for similar work ... in this location. "

The comments go on to suggest a more appropriate rate would be $18 an hour plus $5.10 an hour in benefits, and, " [i]n addition, we suggest that you confirm with the employer that US workers with the skills necessary to perform this work are, or would be, hired at a rate equal to or less than the $15.20 per hour rate. "

While the MDOL maintains that the lowball rate of $15.20 was arrived at lawfully, McTeague disagrees. In a November 13, 2002 letter to MDOL commissioner Valerie Landry, he notes that the Service Contract Act should be applied only " when the principal purpose . . . is to furnish services in the United States though the use of service employees. " Welders, he maintains, are not " service employees " — they are construction workers, which are covered under the Davis-Bacon Act. And the Davis-Bacon Act lists pay rates between $22.27 and $24.17 per hour for welders in Cumberland County, plus benefits that range from $10.03 to $11.02 per hour.

The MDOL doesn’t seem to disagree that the jobs in question are construction jobs. In the same comments section noted above, it states: " [I]t is the opinion of the Maine Department of Labor that the position in question more closely resembles the positions as surveyed under the state’s Fair Minimum Wage Rate on Construction Projects Law. "

Nevertheless, MDOL’s Fisher says the Davis-Bacon Act can’t be applied, because there’s no government money involved in the Cianbro project.

" It was a private refurbishing project that Cianbro had taken on, " he says. " And for that reason, we could not apply Davis-Bacon. "

But actually, there is government money involved in this project. As was pointed out by Phoenix contributor Lance Tapley in his July 2002 Portland Monthly article " Buoys from Brazil " (the article is reproduced on Cianbro’s own Web site), the US Maritime Administration has guaranteed a $342-million bank loan to rig-owners Petrodrill, part of which is being funneled directly to Cianbro.

" Even though Petrodrill is a foreign entity, the US government assists it in order to flow money to Cianbro, " Tapley writes. " Or, as Jean McKeever, associate administrator for shipbuilding in the Maritime Administration, expresses it, government assistance is given ‘to have the work done in American shipyards.’ Cianbro and Portland probably would not have the work without this corporate welfare. "

Fisher says the MDOL is " aware of that issue. "

" That was one of the issues we consulted the US Department of Labor on and said, ‘Are you sure this is the right wage? Are you sure this is the case?’ And again they verified that we were taking the proper steps. "

Pick a number

After all the controversy over the $15.20 wage rate being proffered for its welding jobs, Cianbro says it actually intends to pay more for the positions.

" We will be paying around $18.50 an hour plus benefits, like we have for everyone else in that group, " says Alan Burton, director of safety and human resources at Cianbro. He estimates that benefits will total about $5 per hour.

So why not advertise locally at the real rate? Burton says Cianbro has been advertising all along that the positions will pay " competitive rates, " but " the DOL had to advertise for the H-2b visa ones " — meaning, the ads that explicitly stated the $15.20 rate.

Fisher says this isn’t exactly true.

" What happened was, Cianbro put the ad out, but they put the Maine Department of Labor as the contact, " he says. " We didn’t run any ads. But the MDOL was the contact, and the purpose for that is so we get all the resumes; so we know who’s applied for the work — so that if Cianbro comes back and says ‘We couldn’t find anybody,’ we can say, well, we actually know differently. "

Moreover, Fisher says Cianbro wasn’t limited to the $15.20 rate — the company could have advertised a higher wage, just nothing lower.

" They could have advertised at $100 per hour if they wanted to, " he says.

Cianbro’s Burton is unfazed by the wage issue, claiming the low advertised rate did not deter potential local applicants from coming forward.

" I think people know what we’re paying, " he says. " And as people have been coming in, we have told them what the pay rates are. "

It would be understandable, though, if would-be applicants were confused. The MDOL states that Cianbro " originally offered $14 per hour " for the position, and Brian Treadwell, business manager for Iron Workers Local 496, told the Lewiston Sun Journal on September 22, 2002 that he " received notification of openings [at Cianbro] in mid-September, with a $12.50 hourly rate. "

Additionally, McTeague points to ads for pipe fitters and pipe welders that ran in Gulf Coast newspapers last fall, offering $20 per hour plus $400 per week per diem. The ads don’t bear the Cianbro name; they merely state that the work is in Portland, Maine. But an affidavit submitted by Mobile, Alabama union organizer Darrell Cross recounts the conversation that transpired when Cross replied to the ad. The woman who returned his call " advised that her firm was a labor broker acting on behalf of Cianbro. "

NIMBY

But what does it matter how much Cianbro is willing to pay, one might ask the labor activists, if there are no Americans available to take the jobs? The company says it has exhausted the local supply of qualified welders; Burton provides as evidence of local hiring activity the fact that Cianbro was able to reduce its H-2b application from the original 120 visas requested down to 60. (The original application, it’s also worth noting, was kicked back to Cianbro from the USDOL, which asked for " additional information " on several issues — including the number of visas requested. Burton readily admits that cutting the number of requested visas in half " weighed heavily on [MDOL’s] decision to approve the request. " )

Fisher and McTeague imply, however, that Cianbro may be ignoring a legitimate supply of local workers.

In discussing why this issue has raised the hackles of laborites when no other company’s application for H-2b visas has elicited such a response (Maine hosted 5800 H-2b workers in 2002, mostly in the forestry and hospitality industries), Fisher judiciously replies, " Well, it’s a skill set where there are a lot of people out there who have that particular skill, and I think it came to the attention of some individuals, and they thought it was unfair, and they got involved. "

McTeague makes more direct claims that local welders are going untapped. Qualified workers have approached Cianbro both en masse and individually, he says, with offers to meet the company’s staffing needs. In an October 28 letter to Burton, McTeague writes " Cianbro has received our four unions’ letters with offers to provide, under the terms and conditions of each of the local work agreements, in excess of 120 welders . . . Cianbro has apparently rejected these offers. Nevertheless, the four unions hereby renew their offers . . . "

Burton’s October 30 reply to McTeague is obtuse. In it, he encourages " all qualified and unemployed welders to apply for employment " via the MDOL or directly with Cianbro. He concludes, " Given our extensive local multimedia recruitment effort and the variety of ways to apply, we can only determine that we have exhausted the population of qualified and unemployed welders. If you have additional local available skilled welders we implore you to refer them to us for employment. "

But McTeague claims that when union " salts " went down to Cianbro to apply, outside of any collective bargaining agreement, many potential applicants were told there were no openings. Others passed Cianbro’s welding test and were told the company would be in touch, but never heard back.

Burton denies these things ever happened.

" You know, in anything he says, he doesn’t have to be truthful, " he says of McTeague. " He just has to say it. And then someone else can decide whether it’s truthful or not.

" I’m sure he strongly believes that, " he adds. " Just like I strongly believe that we have hired every qualified person that has applied who has passed the test, and I’m comfortable saying that, because it’s the truth. But other people, when they’ve got a beef, they don’t necessarily have to tell the truth. That’s for you to decide. "

To be fair, Cianbro’s seemingly cagey behavior is not without defense. They aren’t a union shop, and yet Burton says the unions want it their way or the highway. They want a contract.

" The last I knew, this was a free country, and you could run a business, and your employees could chose if they wanted representation or not, " he says. " And I think they like it the way it is right now. "

McTeague argues that " We would prefer that the job would be an all-union job, but Cianbro doesn’t work that way, so we accommodate them. "

Jess Kilby can be reached at jkilby@phx.com