Criminalizing the Rights of Labor

...The other key definitions apply to "a pattern of racketeering activity...

...But if it chooses to fight and loses—that is, fails to get a collective-bargaining agreement— the union is faced with the likelihood of a draining RICO suit...

...Actual or threatened force" includes economic force, which is to say, the strike...

...It was this threat, more than anything else, that brought them to the bargaining table after four months...

...Gomez and a few others like Roy Navarro and Antonio Hernandez began to meet quietly...

...Drywalling became overwhelmingly a Mexican trade in Los Angeles, Orange and San Diego counties...

...In the drywall suit, we are talking about maybe thirteen million dollars...

...drywallers have collective bargaining...

...Skimming off a percentage became common practice...

...He now runs a drywall company in Fullerton...

...But it can be made to apply to labor disputes because of how the law defines the key words and phrases in it...

...A real American success story...

...They often got the scabs to quit, but scabs were also yelled at and pushed around and rocks were thrown...

...Drywalling deteriorated into a classic sweated trade...

...It is as if, now that the labor movement is down, the judges of the 1920s have come back to life to be in on the kill...

...Once its motions for dismissal fail, as they did in the drywall case, the union begins to bleed no matter how it fares in the end...

...Maybe labor's decline was not irreversible, union people said, and the Mexican-American workers not beyond reach...

...The Norris-LaGuardia Anti-InjunctionAct (1932) effectively stripped the federal courts of their labor jurisdiction ("little" Norris-LaGuardias did the same for the important state courts...

...When the Carpenters' Union lost its grip on home construction in the early 1980s, drywalling throughout the area became nonunion...

...Strikers began to be arrested...

...The contract contained an innovative scheme addressing the competitive problems of the industry...

...In either case, since there is so little recourse in law, the union can only choose between surrendering and throwing up a picket line...

...In civil suits, moreover, the law mandates that the defendant pay treble damages, plus costs and attorneys' fees...

...Their main tactic was mass picketing...

...In 1992 a stirring strike broke out among the drywall installers of southern California...

...The drywallers' victory was a "wakeup call" for the labor movement...

...Hitchman v. Mitchell (1917), prohibiting them from organizing workers who had signed contracts (the so-called yellow dog contract) waiving their right to join unions as a condition of employment...

...This gave it preemptive standing: conflicting law bearing on its jurisdiction had to defer to the federal labor relations law...

...Racketeering activity" means any in a very long list of federal offenses plus any crime under any state law punishable by more than a year in prison...

...On November 10, they had the contract...

...It takes very superior legal talent to carry a RICO civil suit...

...Latino labor contractors, "labor barons," began to take over, bringing in gangs of workers and paying them off in cash...

...Other men from El Maguey followed him, in a chain migration that was replicated by jobseekers from other Mexican SUMMER • 1995 • 363 Rights of Labor villages...

...And then, in two steps, a systemic shift occurred...

...How it might have fared will never be known because the Carpenters settled before the case came to trial...

...The part of the law that applies to labor disputes is paragraph 1962 (c), which reads as follows: It shall be unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt...

...Consider the landmark cases: In re Debs (1894), handing federal judges unlimited power to restrain labor activity by means of injunctions...

...Labor lawyers say that the key decisions are badly argued and contradictory...

...The criminal conduct engaged in by the individual defendants and the other mercenaries was designed to coerce the signing of Carpenters' Unions' contracts, ultimately providing financial benefit to the District Council, and financial benefit to the local carpenters unions...

...Neither seems likely in the present political climate...

...This time they were going to build a permanent movement...

...There are about four thousand drywallers in southern California...

...When the contractors finally agreed to talks, the secretary-treasurer of the Carpenters' district council, Doug McCarron, took over the negotiations...

...But only labor lawyers are likely to be aware that what is foundational to our labor law—that it has preemptive standing—is also under siege...

...Enterprise" means legal entities of all kinds, including unions, but also any "group of individuals associated in fact although not a legal entity...

...The prospect was thereby opened 364 • DISSENT Rights of Labor for a collective-bargaining structure that one day might rescue the subcontractors from the cutthroat competition that bled them all...

...ABC leaders must have read the drywallers' victory in just the same way as did the jubilant L.A...

...One might think that the chilling effect on the 366 • DISSENT Rights of Labor rights of labor applies only to the building trades...

...It was a bad development when the venue was moved from Los Angeles to San Diego, where the union faced a Republican judge and a San Diego jury in the nasty atmosphere that has given us Proposition 187...

...It took street demonstrations and acts of civil disobedience, but this spring the janitors won a new contract...

...There are law suits and law suits, of course...

...American Steel Foundries v. Tri-City (1921), declaring picketing to be inherently violent and subjecting it to draconian court regulation...

...This is the kind of law firm that sponsors programs on public television (which it has done in the Bay Area) and it has a billing rate to match—around $300 an hour for partners...

...and they gathered support and some money through an informal network of relatives and countrymen in the trade...

...After all, the labor law provides, in the representation election, an orderly process for determining whether workers want collective bargaining, and hence eliminates the need for the kinds of make-or-break strikes that prompt RICO suits...

...What the settlement cost the Carpenters has not been disclosed, but the press release speaks of a "substantial payment...

...Sickler set in motion a major fund-raising drive...

...The status of labor-law preemption—its supremacy over conflicting law—is by no means settled...

...Violence at the building sites escalated, accompanied by some trashing of unfinished construction...

...The strike fund was administered by an AFL-CIO unit, but the biggest contributor was the Carpenters' Union...

...The federal courts now are saying (with some demurs) that it does, notwithstanding the harm to the NLRA rights of workers...

...The drywall case, in fact, was framed as a pattern of racketeering activity to extort a contract from the subcontractors...

...Aweek after the agreement, nonsigning San Diego drywall firms filed suit against Antonio Hernandez, Federico Castaneda, and Luciano G. Salazar—the strike leaders in San Diego—and the Carpenters' Union...

...With rent and utility bills coming due, the thin resources of the strikers ran down...

...They had no contact with organized labor, no formal structure or elected leadership, not even a name, but they were nevetherless a real movement...

...over two million dollars flowed in from many unions, some as far away as Australia and Canada...

...The RICO suit was their counterthrust...

...and those that do not—fraud and extortion—have exceedingly elastic meanings...

...So Los Angeles is becoming a live union place...

...In the legal skirmishing, the CIWA lawyers gained the upper hand when they charged the contractors with massive violations of the overtime provisions of the Fair Labor Standards Act...

...We must organize...

...The routine resort by employers to striker replacements raises the stakes even higher...

...We can be sure, at any rate, that management lawyers will be probing these frontiers of RICO litigation...

...This is what we were destined to do," said one CIWA official, "what we should have been doing all along...

...To understand how the drywallers' strike could become a RICO case, we have to enter the arcane universe of RICO litigation...

...In the meantime, the L.A...

...And the Carpenters got the contract and the drywallers...

...The gist of the case is contained in the following paragraph in the complaint: Hernandez, Castaneda, Salazar, and other mercenaries received payments from the District Council, through the Drywall Strike Fund...

...what it had was judgemade law applying mostly common-law doctrine to the relations between employers and workers...

...The drywallers' strike, of course, also fell squarely under federal labor law...

...janitors, thanks to the Justice for Janitors movement...

...A unity of purpose exists between and among the goals of Hernandez, Castaneda, Salazar, the other mercenaries, and the Carpenters' Unions...

...Just what a court might construe as "wrongful," or what mix of violent and purely economic acts and threats it might accept as a pattern of racketeering activity, is entirely open...

...Or, alternatively, a unionized employer who wants to be rid of the union bargains to impasse, provokes a strike and brings in permanent replacements— what might be called a recognition strike in reverse...

...And it was understood that, when they got a contract, the drywallers would vote to join the Carpenters...

...The Pacific Rim Drywall Association gave them a piece rate of 7 1/4 cents per square foot plus half the cost of health insurance...

...If contractors resist collective bargaining, the only option they have is a recognition strike, which is what the drywallers were engaged in...

...Texas Air, for example, brought a RICO suit against the Air Line Pilots and the Machinists based on allegations of mail and wire fraud in the conduct of their corporate campaign against Eastern Airlines...

...The first meeting made a big impression on AFL-CIO regional director Albert David Sickler...

...In itself, this says nothing about the merits of the case...

...Or, alternatively, Congress could easily do this by a clarifying amendment...

...Violence has always shadowed strikes for recognition because, as with the drywallers' strike, so much is at stake for the strikers...

...B., in fact, RICO is going to be a problem for the entire labor movement because the "orderly process" mentioned above is no longer working...

...A "pattern" is two or more racketeering acts committed within ten years that have the same unlawful purpose...

...The space thereby opened—"labor disputes," in the language of Norris-LaGuardia, meaning controversies over the terms and conditions of employment and over association or representation regarding those issues—was filled three years later by the National Labor Relations Act (NLRA), which established the rights of workers to organize and engage in collective bargaining...

...Capturing this kind of elusive activity demanded legislative crafting that was at once comprehensive and elastic, and this, in the hands of inventive prosecutors and lawyers, has made for a law of nearly endless applicability to alleged patterns of criminal conduct not remotely attributable to the Mafia...

...Police harassment also got worse...

...As it turned out, that wasn't the only lesson that might be drawn from the drywallers' strike...

...In 1987 a similar campaign had won a wage increase, but only temporarily...

...Not all the enumerated racketeering crimes in RICO involve threats or acts of violence...

...Cases involving organized crime or business fraud generally arise from criminal prosecutions by the Justice Department...

...There is no other way," Gomez later said...

...Much more probable is more of the creeping assault on labor by a judiciary—this time with RICO as its text—whose reflexive privileging of property rights once convinced Sam Gompers that organized labor could never expect justice in the American courts...

...If the labor law is preemptive, there would be no point to the construing of RICO's language in which I have indulged (and, I might add, scarcely done justice...

...The job is specialized, physically exhausting, and brutally hard on the arms and shoulders...

...The start of the union movement, says Jesus Gomez, was the day in November 1991 when he was cheated out of $60 by one of the labor barons, and decided he had had enough...

...Drywall workers hang the four-by-twelve wallboard panels that make up the interior walls in residential housing...

...The San Diego subcontractors had only the best—Sheppard, Mullin, Richter & Hampton...

...As a comprehensive federal code regulating labor relations in interstate commerce, the NLRA was held by the courts to be the "supreme law of the land...

...In fact, the legal fees were paid by the Associated Builders & Contractors (ABC), the employers' association that has been orchestrating the de-unionization of the construction industry...

...Carrying on a strike or conducting an organizing drive generally meets the criteria for an association-infact enterprise...

...The Los Angeles Manufacturing Action Program is bringing unions, community groups, and academics together to find ways of organizing the immigrant workers in the city's low-wage industries...

...v. Thordarson (1981), the federal courts have undermined that bar by distinguishing among illegal acts: those whose illegalSUMMER • 1995 • 365 Rights of Labor ity is "independent" of the labor law, that are "per se" criminal, do not invoke the preemption bar...

...The strikers remained formally independent, but they became increasingly linked to the Carpenters' Union, which provided them with meeting facilities and free phone lines...

...But this particular one was deadly serious...

...some were held for deportation...

...There is no way the San Diego subcontractors could have afforded this quality of legal representation...

...Nor were the facts of the case especially favorable to the union...

...No reader of Dissent needs to be told that this law has eroded grievously in recent years, and that there is today a crying need for labor law reform restoring the rights the law says that workers have...

...Any hard-fought strike—the drywallers' strike, most certainly—will produce sufficient allegation of "a pattern of racketeering activity" so defined as to pass the threshold, and hence may become a target for a RICO suit...

...It seemed, at any rate, worth trying...

...It has to be doubly emphasized that the issue is not whether criminal acts committed during a labor dispute are chargeable—of course they are, and always have been...

...The labor law contains its own definitions of unlawful activity, provides for enforcement, and specifies punishments...

...In what is very like a conspiracy proceeding, the plausibility of concerted action would have made for hard going in a San Diego courtroom...

...On June 1, 1992, the drywallers went on strike, and virtually shut down home construction in the Los Angeles area...

...The strikers were exercising their right to organize, and they were striking for a collective bargaining agreement, which it is the purpose of the law to encourage...

...The bulk of the AFL-CIO strike fund supporting them came from the Carpenters...

...there were mass arrests, trumped-up kidnapping charges at one point, and INS deportation round-ups...

...This paragraph originally pertained to the use of legitimate businesses by gangsters as a cloak for carrying on racketeering activity...

...The help they were getting from local churches and community organizations was not enough, and a month into the strike, they turned to the labor movement...

...And as that happened, the ethnic composition of the work force changed...

...But RICO also permits civil suits for damages, and these, not criminal prosecutions, are the ones brought in labor disputes...

...This is probably the place to specify just what was at stake in these charges...

...It is not necessary that RICO defendants be convicted or even charged, only that they be shown to have committed acts for which they could have been charged...

...they set up committees on a county-wide basis...

...Many of the things that can occur during strikes—throwing rocks, threatening scabs, destroying property—are potentially "racketeering activities" within the meaning of RICO...

...On top of this are the legal costs, notoriously heavy in RICO suits, that the Carpenters' Union itself incurs...

...If judges acted unfairly, declared Samuel Gompers, "contempt of court" was "obedience to law...

...Now the strike comes after the union has won the NLRB election and the employer refuses to negotiate a first contract...

...We must rely on each other and those who are fighting for us to make things right...

...The result was a deep, almost systemic insult to the concept of justice for workers, so much so as to make defiance of the courts a tenet of American trade unionism...

...Hernandez, Castaneda, Salazar, and the other paid mercenaries were agents of the District Council, and/or the Carpenters' Locals, and acting within the course and scope of their employment, when committing the criminal acts herein alleged...

...Strikes for recognition are not obsolete, only their form has changed a bit...

...Beginning with U.S...

...The complaint initiating the legal proceedings against the Carpenters makes surreal reading...

...The California Immigrant Workers Association (CIWA), which had earlier been set up primarily to recruit Hispanic workers into the AFL-CIO's associate-membership program, took on the mounting legal problems of the drywallers...

...But those arriving in later years didn't fare as well as Valadez...

...Construction workers cannot have representation elections—and are exempted from this provision of the law—because as casual workers they have no fixed employer base for the election...

...The strike fund is there to employ them in their criminal activities and provide bail and pay fines so that these activities can continue...

...The issue is whether the commission of criminal acts taints labor disputes as such and opens them to legal attack...

...At that time the pay was good, and a drywaller could make a living...

...As for extortion, federal law defines it as "the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence or fear...

...But the question has to be asked: what will labor leaders do when this ferment brings them up against the next potential RICO suit...

...movement, that is, as a breakthrough event for construction unionism...

...q SUMMER • 1995 • 367...

...With the collapse of California home building in the late 1980s, competition among the subcontractors became fierce, forcing them to drive down piece rates until drywallers were working for as little as three-and-a-half cents a square foot...

...On the other hand, a RICO argument is highly demanding for the plaintiff because every element has to be satisfied with particularity...

...The market share of the unionized subcontractors in the various counties would serve as a benchmark for reopening the agreeement after two years: the piece rate would be raised if market share went up, the subcontractors' health care contribution would be eliminated if it went down...

...In fact, the United States had very little labor law as such...

...Every morning they would set off in their battered pickups for building sites with fancy names like Coronado Point, La Cresta, Sunburst Tierra...

...Around Los Angeles the word that leapt to mind for the agreement was "historic...

...The main charge against them was violation of the Racketeer Influenced and Corrupt Organizations Act (RICO...

...For a sixty-hour week a man might make three hundred dollars...

...a break anywhere along the chain means the collapse of the case...

...The San Diego strike leaders named in the complaint are referred to respectively as "ringleader and coordinator" (Hernandez) and "leaders in the field" (Salazar and Castaneda), while the strikers are always called"mercenaries...

...In this instance, the union is a "person" associated with the enterprise—the strike— not the enterprise itself...

...The strikers remained independent until the settlement, but they used the Carpenters' facilities and met with local union officials...

...Loewe v. Lawlor (1908), exposing trade unions to crippling antitrust suits...

...Bail money had to be raised and legal representation found...

...There were no benefits, no security, no overtime pay, and eventually, not even an even break...

...The law, as written in 1970, was intended to deal with a particular problem: the penetration of legitimate business by organized crime...

...The issue has not yet returned to the Supreme Court, which could reaffirm an earlier 1973 decision (now badly eroded) sustaining the preemptive authority of the labor law...

...the drywallers' strike produced a blizzard of them...

...So do L.A...

...Valadez got a house, raised a family, even sent a couple of his kids to Stanford...

...One of the first Mexican drywallers was Juan Valadez, who came to Orange County in 1963 from the village of El Maguey in the state of Guanajuato...

...The Carpenters' Union takes a hardboiled line on law suits—a cost of doing business, so to speak—and generally seeks to get away as cheaply as possible...

...But even if they can develop extraordinary picket-line discipline, unions still might not escape RICO charges...

...The reason why a plaintiff would not want the union to be the enterprise is that, under paragraph 1962(c), only persons associated with the enterprise, not the enterprise itself, can be sued, and it is the union, not its officers and agents, that has the deep pockets...

...Sickler came away "inspired by the guts" of the strikers, and "touched by the wives and kids there at the hall, and I guess we felt morally obligated to do something for them...

...But preemption does not bar a RICO suit, or rather, no longer bars it...