Labor News

IAEE board calls San Jose exclusive labor program detrimental

Calls on Mayor Reed and San Jose City Council to set new program aside

DALLAS — [Sept. 15, 2009] Calling Team San Jose's recent seizure of all Teamster labor at the McEnery Convention Center a plan primarily designed to generate new revenue for that convention center, the board of directors of the International Association of Exhibitions and Events (IAEE) is calling upon the city's Mayor and City Council to rescind the program immediately.

IAEE says that the new program eliminates competition and like most exclusive in-house services, is very likely to drive customers' costs much higher while driving down service levels. It also tramples upon an already existing collect bargaining agreement that was negotiated by the general service contractors who service most of the business in the McEnery Convention Center with Teamsters Local 85 that runs through the end of March 2011. General service contractors who refuse to agree to the new exclusive labor program are not permitted to work in the building. If they do accept the terms of the new agreement they face grievances from Teamsters Local 85 who has already warned at least one contractor who has worked an event in the building under the new plan that they have violated their agreement.

To make matters even worse, says IAEE, the new plan exposes exhibition and event organizers, exhibitors and general service contractors to serious liability exposures because San Jose's exclusive labor agreement renders them third parties not covered by the exclusive remedies of workers compensation insurance.

The new exclusive labor plan also improperly intrudes into the business contracts of general service contractors and their organizer and exhibitor customers, some that run for many more years. Team San Jose's new program also assaults key provisions of its own existing building leases with customers who have already agreed to bring their events to San Jose.

IAEE President Steven Hacker, CAE communicated its concerns directly to Mayor Chuck Reed and the San Jose City Council on Sept. 15.

Since 1928, the International Association of Exhibitions and Events(tm) (IAEE) continues to provide quality and value to its members through leadership, service, education and strong relationships. IAEE is the largest association of the exhibitions and events industry in the world, with a membership of show organizers, exhibitors and exhibition suppliers. Organizers of more than 20,000 exhibitions and buyer-seller events around the world are members of IAEE. Through the 2006 consolidation with the Center for Exhibition Industry Research (CEIR), IAEE delivers valuable industry research reports. IAEE also supports IAEE Services, Inc., a wholly owned subsidiary that partners with industry suppliers and service providers to offer high quality, low cost exhibition products and services to the industry. IAEE recognizes its strategic partners: American Airlines, ASP, Inc., Bearcom, IEG, Mexico Tourism Board, Orange County Convention Center and Orlando/Orange County Convention & Visitors Bureau. Visit www.iaee.com for more information.

Exhibitors, Event Marketers face higher costs for doing business in San Jose Convention Center

SAN JOSE, Calif. — Despite meeting face-to-face with exhibitions and events industry executives to discuss the abrupt announcement made by the San Jose Convention Center (SJCC) to bring labor in house as an exclusive building service provided by Teamsters Local 287 (San Jose), negotiations have faltered and exhibitors and event marketers are facing substantially higher costs to do business at the SJCC.

A meeting held between the SJCC, The International Center for Exhibitor and Event Marketing (ICEEM), the International Association of Exhibitions and Events (IAEE), the Exhibition Services & Contractors Association (ESCA), and the Society of Independent Show Organizers (SISO), was unsuccessful in negotiating a temporarily suspension of the in-house exclusive service agreement. As a result, exhibitors and event marketers will face the following:

Increase in Base Labor Cost

The possibility of 40 to 50 percent increase in base labor costs to end users. Additionally, new rules outlined in the plan would add additional costs for non-working supervisors and would also reduce flexibility - e.g. no labor can be ordered after 3 p.m., no phone orders, and orders will not be guaranteed with less than 24 hours advance notice.

A preliminary comparison of the rates reveals that the current base rate for teamster labor under the agreement negotiated by major general service contractors is $55 an hour. In comparison, the SJCC base rate is $86 and does not include any markup that contractors will have to make to cover their own higher costs.

New Legal Liability Issues

New liability issues will be possible for injuries sustained by labor, exposing exhibit management, exhibitors, organizers, exhibitors and contractors to liability claims for injuries sustained by teamsters of Local 287. SJCC proposes to be responsible for the teamster labor and is therefore shielded from these liabilities but others are not. Typically these injuries would be provided by under Worker's Compensation laws.

Conflicted Labor Unions

Conflicts will possibly arise from binding collective bargaining agreements now in place with both Teamsters Local 85 (San Francisco) and Teamsters Local 287 (San Jose). The decision by SJCC to take Teamsters labor in-house exclusively using Teamsters Local 287creates a serious jurisdictional and contractual conflict which would certainly lead to grievances filed with the National Labor Relations Board (NLRB) triggering a work action response from the International Teamsters Union.

Precarious Financial Position for Exhibitors and Exhibit Managers

Exhibitors and exhibit managers who planned to use the SJCC in the coming months will be forced to reexamine their established budgets which will be directly impacted by the abruptness of the announced plan. Fixed budgets had been based upon costs and rules that now are invalid. Many will have no alternative but to pay substantially higher costs.

ICEEM Interim Chairman Bob Dallmeyer said, “Even in normal times, cost escalations and abrupt policy changes would be difficult if not impossible to justify. Coming in these troubled times, the prospect of substantially higher costs as well as new punitive work rules are backbreaking.”

ICEEM salutes the over-arching IAEE Policy Statement on In-House Exclusive Service Contracts which urges exhibition management, service contractors and facility management to promote and maintain competition in the market place by avoiding in-house exclusive service agreements in all but the most essential services that bear on the health, safety and welfare of attendees and exhibitors.

As negotiations continue to evolve, ICEEM will communicate the impact on the exhibitor and event marketing community immediately.

Created in 2008, The International Center for Exhibitor and Event Marketing (The Center) is a virtual resource stemming from a collaboration of industry organizations and leaders to provide a powerful focal point for the exhibitor and event marketing professional community by serving as a resource for all who are actively engaged in exhibitor and event marketing. Its multi-dimensional approach promotes education and professional development for exhibit managers and event marketers through a resource-rich and interactive Web site at www.iceem.net. The Center provides research, expert views, international perspectives and face-to-face meetings and supports building strong business relationships to achieve the highest level of exhibitor and event marketing excellence. The Center is made possible through the generous support of TS2 – Total Solutions Marketing for the Exhibit and Event Professional. For more information, visit www.iceem.net.