A Labor War Ended

Labor's longest-running and most contentious divorce dispute has finally been settled. The Service Employees International Union (SEIU) and UNITE HERE, the union of hotel and gaming workers, announced last night that they had reached an agreement on who will represent which workers and who will get which financial assets, ending a two-year battle that had pitted two of the nation's most progressive and innovative unions against each other.

UNITE HERE plainly won the lion's share of its demands. The union will receive a cash settlement of roughly $80 million from SEIU and its Workers United unit, which was formerly the UNITE-half (the apparel workers) of UNITE HERE until it left that union to join SEIU in 2009. (UNITE and HERE had merged in 2004.) UNITE HERE also retains control of the headquarters building, a Manhattan high-rise, formerly the headquarters of UNITE, that is estimated to be worth $70 million or $80 million in today's real-estate market. For its part, Workers United will retain control of the Amalgamated Bank, the nation's only labor-owned bank, which was founded by one of its predecessor unions in 1923 and which often plays a key role in shareholder campaigns to alter corporate behavior.

UNITE HERE also won a guarantee from SEIU that it would not seek to organize in UNITE HERE's historic jurisdictions, hotels and gaming. Until their dispute, the two unions had jointly been organizing such giant food-service companies as Sodexo and Aramark; their accord specifies which union has jurisdiction over which parts of the food-service industry. It also returns to their original union some locals that switched from one union to the other in the course of the split; it permits some locals and regional bodies that switched to stay switched (notably the New England region of the former UNITE, which remains with UNITE HERE); and it lays out an arbitration process for locals that are still contested terrain.

"We're extremely pleased by the settlement," UNITE HERE President John Wilhelm said last night. He should be. With the at-least $150 million in cash and real property assets with which his union will come away, UNITE HERE's campaigns to organize hotels in historically nonunion cities and to organize the ever expanding casino industry beyond Las Vegas should get a huge boost. "From the point of view of assets," Wilhelm said, "the settlement accomplishes the original goals of the merger with UNITE, though it was an odd way to get there."

Was it ever. When UNITE and HERE merged back in 2004, the logic seemed compelling: UNITE had considerable financial assets, but its industry -- clothing and textile manufacturing -- had all but vanished from America's economic landscape. HERE, then led by Wilhelm, was a union whose core industries, hotel and gaming, could not be offshored and were rapidly growing, but it lacked the financial assets required for large-scale organizing. Both unions were centered in industries with low-paid, heavily immigrant workforces; both had reputations for organizing private-sector workers at a time when no other union, except SEIU, could claim that distinction. With UNITE's money, HERE's targeted industry, and both unions' organizing smarts, the marriage looked close to perfect.

It proved to be anything but. Deep differences over organizing strategies and a host of other issues were never resolved. UNITE-side leaders favored spending the merged union's resources on large-scale national organizing campaigns; HERE's leaders preferred bottom-up campaigns that generally took longer and were often smaller in scale. As the 2009 convention approached, UNITE HERE President Bruce Raynor, the former president of UNITE, whose forces were sure to lose control of the union to the larger HERE legions at the convention, led the UNITE locals out of the union and into SEIU, and erected legal obstacles that put most of the union's treasury out of reach of UNITE HERE's remaining leaders and members. A ferocious conflict immediately ensued, with SEIU raids on UNITE HERE locals and UNITE HERE counter-raids on SEIU's, with organizing campaigns disrupted and contracts left unsigned, and with numerous lawsuits clogging the courts. The legal claims of UNITE HERE to the union's assets were strong, but by joining SEIU, Raynor and Workers United had affiliated with a mega-2.2-million-member union that had the resources, attorneys, and desire to stonewall UNITE HERE until, strapped for funds, it would agree to a settlement to SEIU's liking.

It didn't work out that way. Years before the conflict erupted, the leaders of HERE, Wilhelm above all, had already won a certain cachet within the labor movement as the guys who never give up. The central myth in the modern HERE's creation epic is the nearly seven-year strike the union conducted against the Frontier Hotel in Las Vegas, during which not a single HERE member crossed the picket line. It was clear early on that Wilhelm viewed the battle as another Frontier.

But Wilhelm had more going for him than sheer resolve. By taking the seceding UNITE HERE forces into SEIU's ranks, and then waging a large-scale campaign to get the remaining UNITE HERE members to come over as well (all in the cause of pressuring Wilhelm to settle), SEIU President Andy Stern crossed a line. In the eyes of his fellow union presidents, and numerous other union activists and sympathizers, Stern was sanctioning raiding, devoting his union's considerable resources to destabilizing another union instead of organizing the more than nine in 10 American workers who were not union members. SEIU's moral sheen -- as the union that had organized immigrant janitors and impoverished home-care workers, that had gotten out more votes for Obama than any other organization and had been a driving force for health-care reform -- took on more and more tarnish.

Within six months of Workers United's entry into SEIU, Stern realized that he was fighting a losing battle and decided to seek a mediated settlement. Joe Hansen, the president of the United Food and Commercial Workers, took on the thankless task of trying to get Stern, Wilhelm, and Raynor to agree on a pact. By numerous accounts, his proposal -- SEIU/Workers United keeps the bank, HERE gets the headquarters -- resembled last night's settlement save in two major particulars: the amount of money SEIU was to pay UNITE HERE was a great deal smaller than the amount ultimately agreed upon, and the former New England region of UNITE would rejoin its former UNITE brethren in SEIU. But Wilhelm wouldn't go for it. The strife and the stalemate continued.

What eventually changed the equation was a surprising change in leadership at SEIU. When Andy Stern announced this spring that he was stepping down and that he wanted his closest associate, Secretary-Treasurer Anna Burger, to succeed him as president, he sparked a revolt among a number of other top and secondary SEIU leaders, who had watched with dismay as SEIU had become embroiled in the UNITE HERE wars, and feared that their union was becoming a pariah in the larger union movement. One such leader, Executive Vice President Mary Kay Henry, challenged Burger, vowing to repair the damage the dispute had caused both SEIU and the broader movement by ending the conflict. In May, Henry won SEIU's presidency and almost immediately began meeting with Wilhelm.

"Mary Kay really drove this," one SEIU associate remarked last night, and Wilhelm concurs. "I give her a lot of credit," he said. "She pushed it hard."

But Wilhelm hung back hard, too, demanding a higher cash settlement. He had one more card to play: SEIU is also involved in a dispute with the onetime leaders of a large (150,000-member) California local who left, after being removed from office, to form a rival union, the National Union of Healthcare Workers (NUHW). This is a dispute that Henry and her fellow SEIU leaders have no interest in settling: They are going head-to-head with the new union in a series of elections to determine to which union those 150,000 workers will choose to belong. In a few weeks, the biggest such election -- for 45,000 workers in Kaiser hospitals -- will be held. It's a contest SEIU is determined not to lose -- and Wilhelm knew it.

UNITE HERE had been providing organizers and resources to NUHW as a way to pressure SEIU. The pressure worked. With the Kaiser election looming, SEIU agreed to the higher cash settlement, and in return, UNITE HERE agreed to cease its assistance to NUHW.

"We feel we made some really hard choices," Henry said last night. "Some of our leaders agreed; others did not. But both the boards [of SEIU and its Workers United unit] have approved the terms of the settlement." Asked about the cost of the settlement, Henry replied, "It's not as costly as an ongoing conflict."

Henry is determined to use the agreement to propel SEIU back into its place within the family of unions. "This settlement is a first step to our being able to restore relationships across the labor movement, and there's no more important time to re-establish those relationships," she said. "We needed to do this for the rest of the labor movement."

And with that, Henry envisions focusing her union on organizing and politics -- in conjunction, she stressed, with other unions. "My next priority is to get private-sector organizing focused inside Change to Win, which the other union leaders are committed to as well. My priority after that is to make sure that we have the most tightly coordinated effort going into the 2010 elections." Ever since SEIU led several unions out of the AFL-CIO into the Change to Win Federation in 2005, the AFL-CIO has approached each election with some trepidation over how closely SEIU, the union that provides the most money and bodies for election campaigns, will coordinate with their efforts. Henry clearly intends to allay their suspicions.

SEIU and UNITE HERE stand out among their fellow unions for their successes in organizing private-sector employees -- though in the past decade, even they have had a harder and harder time unionizing such workers. Worker United's Raynor plainly hopes that the settlement will enable their unions to refocus. "SEIU is a union that's capable of doing something about low-wage workers," he said last night -- a notion that Wilhelm seconded. "My hope is that SEIU will focus on private-sector organizing," he said, "particularly since health-care reform will bring new capital to that sector." For its part, UNITE HERE is already engaged in a nationwide contract battle with the Hyatt chain. How it will move its more locally oriented organizing campaigns to a nationwide level now that it has the resources to do so will be a key question for both the union and the hundreds of thousands of unorganized hotel workers.

The rift between these unions has been a damaging one not just for labor but for the broader progressive cause. The unions involved were the ones that had organized the low-wage minority and immigrant workers that conventional wisdom said couldn't be organized. They were among the first to involve community groups and college students in their struggles. They spawned the living-wage and anti-sweatshop movements. They led the successful battle to convert the broader labor movement's opposition to immigrant workers to one of strong support; they championed universal health care. Their disarray and their diversion of resources during the past two years of epochal struggle in Washington have hardly served liberalism's or labor's cause. Now, at least, their divorce is finalized, and they can turn their full attention to the hard slog of improving workers' lives.

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