Labor Raises the Floor in Nashville

You can't spend much time in Nashville without someone telling you that 100 people move to the city every day.

The city is growing at a pace similar to that of Seattle or Silicon Valley, and developers are putting up new corporate headquarters, entertainment venues, and luxury hotels as fast as they possibly can. The Nashville skyline boasts more cranes than New York City.

Construction is intense. Vibrations from a $1 billion, four-million-square-foot mega-development in downtown Nashville shook the foundations of the nearby Frist Museum so badly that curators had to box up and ship back an art exhibit on loan from the British Museum before it was damaged.

There were more than 100 hotels in development last year as investors raced to meet the soaring demand from the city’s explosive growth in tourism. Kitschy honky-tonks on Broadway are routinely flooded with throngs of visiting bachelorettes enjoying the city’s weekend nightlife. Celebrities like Jack White and Taylor Swift call Music City home. Hipster boutiques, locally roasted coffee, microbreweries, and skyrocketing rent make East Nashville a Southern cousin to Brooklyn’s Williamsburg.

But the glitz and glamor of rapid development has produced more than huge profits for real-estate investors. It has also resulted in pain and poverty for construction workers and, correspondingly, an affordable-housing crisis for working-class families. Like many cities across the country, Nashville's economic growth comes complete with full-throttle inequality.

But something else is happening on the ground as well: Craft labor unions, embracing innovative strategies, are starting to grow, and they're hoping to turn the tables on corporate power. They're using their power in a tight labor market and an increasingly progressive city to boost both membership and labor standards—the kinds of leverage not available to manufacturing unions that have tried and failed to unionize Southern factories.

Failing to Keep Pace

Nationally, the construction industry has made a full recovery from the 2008 economic collapse. Revenue in the industry reached a record-setting $2 trillion last year, and the share of that revenue going to profits for construction firm owners has continued to steadily climb.

Construction worker wages, in contrast, have largely remained stagnant, even though employers claim it's almost impossible to find enough workers to keep up with demand.

Nowhere is this dynamic more powerful than in the South, which is not only the most populous region of the country, but boasts the highest number of construction firms and the lowest density of workers in labor unions.

“The construction industry in the South is a prime example of an industry that has been run down,” says Nik Theodore, a professor of urban planning at the University of Illinois at Chicago and co-author of Build a Better South, a 2017 report that analyzed the working conditions that construction workers face in six Southern cities, including Nashville. “Wages are very low, health and safety concerns are rampant, exposure to heat and other dangers on the job is widespread. It is an industry that has failed to keep pace with its own growth.”

Drawing on an in-depth survey of over 1,400 workers, Build a Better South provides more accurate data on the industry than government statistics, which are hamstrung by loose reporting requirements and an almost nonexistent investigation and enforcement system. It’s no surprise, then, that the report found massive underreporting of injuries, with the actual injury rate in Nashville more than five times higher than the government-reported rate.

Ten percent of Nashville construction workers surveyed had suffered an on-the-job injury within the last 12 months—with one in five of these injured workers reporting that they had to cover the cost of their medical bills without any assistance from their employers or from workers' compensation.

Some of these injuries resulted from egregious working conditions. For example, many employers failed to provide federally mandated protections to workers, like rest breaks or access to drinking water during the summer months.

The exploitative conditions that construction workers face are hardwired into the industry's structure. The intense competition between contractors, the reliance on subcontractors and informal recruitment, and a low barrier to entry in a largely unregulated market all but ensure the poor treatment of workers.

Developers provide the capital for new construction projects and lobby politicians and government agencies for subsidies, zoning changes, permits, and whatever else they need. The developer then hires a general contractor to manage the actual construction. The general contractor picks from any number of competing subcontractors to provide the requisite labor to accomplish a job, such as installing reinforcing iron rebar hundreds of feet above the ground or putting up drywall.

With few regulations barring subcontractors from hiring a small crew and providing few or no safety protections or job training, there is often intense, lowball competition for job bids. Many subcontractors have begun to rely on temp agencies to provide the largest number of workers for the lowest price. Today, about one in five construction workers in Nashville is recruited through these staffing agencies. These temporary workers tend to suffer higher levels of wage theft, less safe working conditions, and more racial discrimination than direct employees.

“The price pressures within the industry are being pushed down the chain,” explains Theodore. “We have wound up in a perverse situation where employers that play by the rules are in competition with those that cut costs by misclassifying workers or paying off the books or cutting corners when it comes to worksite safety.”

Heavily represented on the lowest rung on that chain are Latino workers, many undocumented, who make up a significant and growingshare of the workforce on Nashville construction sites. Their immigration status leaves them particularly vulnerable to employer abuses, since they are less likely to make waves by reporting issues to government officials.

Faced with all these challenges, the Painters Union has taken a new approach to organizing Latino workers in Nashville. Last year, the union hired Rosa Ponce, a local organizer with deep roots in the Latino community, and opened Alianza Laboral, a worker center. The Painters also opened worker centers in three other cities, including two others in the South: Atlanta, Denver, and Houston.

Like many worker centers, Alianza Laboral has focused on being a community resource, hosting cultural events and safety trainings and providing a space for workers to meet and discuss issues. Workers are recruited as “affiliate members” to the union, paying about half the normal rate for dues.

When construction was near completion on a 33-story JW Marriott luxury hotel and more than a hundred Latino workers who did drywall and finishing were fired without being paid for the work they had already performed, Alianza Laboral immediately took action.

“They were fired on May 29 and within 30 minutes of finding out I was on the job site. By that afternoon we began meeting with groups of workers to collect their contact information and information on the wages owed to them,” says Ponce.

“We soon realized they were owed more than two weeks of pay,” she recounts. “They had also been misclassified as independent contractors and had never been paid overtime. There were some people with medical bills from injuries that occurred on the job site and the subcontractor took them to the hospital but the worker ended up with the bill.”

The multinational construction firm Skanska was the general contractor on the project and had contracted work to MR Drywall LLC, which had hired the workers through First Class Interiors, a labor contractor. Both MR Drywall LLC and First Class Interiors are based in Florida.

According to Ponce, both subcontractors left town after firing the workers.

“Contractors often move across state lines and set up crews, and when the work is finished they move back across state lines without paying workers,” says Theodore. “And then they try and claim the contractor up the chain is responsible.”

Alianza Laboral has organized several actions to pressure the companies into paying the $1.6 million they estimate the workers are owed. Using the increasingly common tactic of pressuring the company at the top of the chain, rather than the fly-by-night subcontractors, Alianza Laboral is trying to hold Skanska responsible for the actions of the contractors it hired.

Seventeen city council members signed on to a public letter urging Skanska to take responsibility for the unpaid wages. For their part, the workers have filed a mechanic's lien against both Skanska and JW Marriott.

Alianza Laboral has embedded itself in the community in the hope that the relationships forged will, over time, lead to an increased capacity to police employers and raise standards.

“This fight alone won't change all the conditions in the industry, but hopefully we can organize more workers and with the help of the community and elected officials we can begin to hold larger contractors like Skanska accountable,” Ponce says.

Unintended Consequences

One of the ironies of Nashville's construction boom is that it has produced a labor shortage. With wages so low and working conditions so brutal, many companies face delays because they can't find enough workers to complete the job.

The scarcity of workers now threatens to become the limiting factor in the city’s growth—and provides unions with a unique opportunity to organize.

In response, the Ironworkers Union has created an associate membership program, similar to the Painters' affiliate membership program. Both of these membership programs are a kind of reverse engineering of craft unions. Often, construction unions organize the work in the industry, not the workers. Frequently this means focusing more on winning agreements with employers and relying heavily on unionized crews and apprenticeship programs to control the supply of the skilled labor.

In cities with high union density, becoming a union ironworker generally requires a years-long apprenticeship program, during and after which journeyman ironworkers can work for higher pay and benefits through unionized contractors.

Unions present contractors with a simple value proposition: Hire union workers and we'll ensure a high-quality, stable, skilled workforce. The virtuous circle, when it works as designed, means that contractors are able to perform at a high level and can win more bids on more jobs, providing more work for union members.

There was little hope that such a cycle could be easily jump-started in Nashville, however, where almost none of the essential reinforcing ironwork was being done by union workers, and union contractors couldn't compete with non-union contractors that cut corners by misclassifying workers, scrimping on safety equipment, and paying little above the minimum wage.

Under the Ironworkers' new program, associate members do not have to go through the apprenticeship program. Instead, the apprenticeship program is part of the benefit of becoming a full member. So a prolonged apprenticeship no longer serves as barrier to organizing more workers into the union. This quicker pathway to union membership and increased presence on Nashville construction sites simultaneously provides opportunities for workers to call out the worst contractors and take action against them, while funneling workers to “high road” contractors that offer higher wages and safer working conditions.

“Workers would not have organized here if we didn't have this [associate member] program,” says Garrett Stark, an organizer with Ironworkers Local 846. “The program doesn't have dues. Instead, it's more a focus on basic information and follow-up with meetings, actions, newsletters, and trying to find workers interested in changing conditions for themselves and others.”

In the current tight labor market, workers can quit their job on one construction site and walk across the street to get a job at another site that same day. This is a ripe environment for using collective action to raise standards.

In one successful example, a short, impromptu strike led to a $2-an-hour raise.

“There was a Texas-based contractor across the street that was paying two dollars more an hour on a separate project,” says Stark.“So the workers all went in, put their belts on, got ready for work, called the employer and said, ‘We are ready to work if you pay us what they are making across the street.' And they got it in 45 minutes.”

Given the labor shortage plaguing contractors, an action-oriented strategy is meeting with success. “Over the last three years, because of the organizing workers have done, wages have gone up from $11 an hour to $18 to $20 dollars an hour,” says Julio Fernandez, a former Nashville ironworker who's now a community organizer.

The associate membership program also provided opportunities for workers to experience firsthand the difference that a union can make.

Wages for ironworkers in Nashville are far below the national average. The median wage for ironworkers is around $50,000 a year nationally, although journeymen in unionized companies can earn far more than that, sometimes pushing six-figure annual incomes.

“I had plenty of hours, but I didn't have the pay. I didn't have the insurance. I didn't have a retirement,” says Todd Overcast, who has worked as an ironworker in Tennessee for 24 years. Through the associate membership program, Overcast was able to get work on union jobs in other states—and make union wages, even without having gone through a full union apprenticeship.

“You go on other sites and see what people make, and they're doing the same work you're doing, and making quadruple what you make,” says Overcast. “I would cash my paycheck and spread the cash out, take pictures of it and send it to all my friends that were here doing a trade and say, ‘There is another way.'”

Overcast's experience has spurred him to keep fighting for Nashville to catch up to other areas of the country. He is now a foreman at the largest union contractor for reinforcing ironwork in the city. “I started off with six people and we've got 26 now,” Overcast says.

Through a combination of associate membership available to all and raising standards to make a union contractor competitive in bidding for contracts, Ironworkers Local 846 has gone from zero to 20 percent density in just a few short years. Today, one in five working ironworkers in Nashville is now a union member.

Raising the Floor

The Ironworkers and Painters are organizing workers to enforce standards on the job, but they are also part of a united effort to hold developers accountable to higher standards before a project ever breaks ground. Both unions are members of Stand Up Nashville, a citywide community-labor coalition that is leading the charge for a more equitable city.

“We've seen rich folks moving into our city, we've seen sections of our city become a playground for tourists,” says Anne Barnett, who works for the Central Labor Council of Nashville and Middle Tennessee and serves as a co-chair of Stand Up Nashville. “Everybody else who lives here are seeing prices skyrocketing and they're getting pushed out further and further away, [so] we have crumbling infrastructure and transportation issues.”

Labor and community groups have fought for and won a number of progressive local policies over the years, only to have the Republican-dominated state legislature steal their victories. “We are a blue city in a red state—preemption is a real problem,” says Odessa Kelly, the other co-chair of Stand Up Nashville and a leader in Nashville Organized for Action and Hope (NOAH), a faith-based coalition primarily composed of churches.

“The state came and preempted the law to say we couldn't local hire,” Kelly says. “Then we had ban the box. It was preempted. Then we had inclusionary zoningthat ended up being torn down by the state.”

When Major League Soccer (MLS) proposed bringing a team to Nashville, the league sought the red-carpet treatment—and lavish incentives. The project was being spearheaded by John Ingram, heir to the multibillion-dollar Ingram family fortune and one of the leading real-estate investors in Nashville.

Stand Up Nashville's member organizations wanted to organize around any proposed incentive package for MLS, hoping to win guarantees that the project would benefit vulnerable Nashville residents, many of whom are already struggling with low wages and rapidly inflating housing costs. But organizers had zero doubt that any potential contract between the metro government of Nashville and Major League Soccer would become part of the power struggle between progressive local officials and a state legislature that is consistently eager to please corporate interests.

So Stand Up Nashville decided to go a different route: a community benefits agreement. This would be a private contract between Stand Up Nashville and the team owners. The city itself would not be a party to the deal, so the question of state preemption would be rendered moot.

But the city government still had a part to play. Thirty of Nashville's 40 city council members signed a letter to MLS stating that they would not approve the sought-after incentive package—which included $225 million in revenue bonds and a 99-year lease on a ten-acre parcel of land next to the stadium for a mixed-use commercial and housing development—unless there was a community benefits agreement.

The team owners agreed to bargain, and Stand Up Nashville focused its outreach efforts on building public support and generating broad community-based demands.

“All demands at the table came from the community,” says Barnett. “We had several big meetings, big town halls; we surveyed individuals on the top three things they wanted to see in a community benefits agreement. We talked with churches and neighborhood associations. We had folks going door to door.”

Through a combination of political and community pressure and savvy negotiating, Stand Up Nashville was able to secure the first community benefits agreement in Tennessee history.

“The Nashville agreement really reflects the urgency that the community rightfully feels around affordable housing and the displacement crisis in the city, and contains strong measures on that front,” says Ben Beach, the legal director at the Partnership for Working Families and a national expert on community benefits agreements. “It will help institute a new culture of community accountability with regard to economic development.”

The agreement created a level playing field for construction contractors, mandating that hiring preference be given to contractors that participate in a certified apprenticeship program and provide health insurance to employees. It also mandated that 20 percent of the housing built in the mixed-use development be set aside as affordable or workforce housing, including the three-bedroom apartments that were a key demand for working families. The agreement also mandated that two separate, 4,000-square-foot areas be set aside for child-care facilities and small businesses at a reduced rental rate.

Stand Up Nashville even won some of the demands they thought were impossible, like guarantees that everyone working at the stadium would be a direct employee and paid at least $15.50 an hour. The agreement also stipulated the creation of a community advisory committee that would oversee the implementation of the terms.

“This can't be our only tactic, but it is a pretty damn good tactic,” says Barnett. “A community benefits agreement is one way that we give everyday people more power and control over how development is happening in our city.”

Now the coalition is setting its sights on an even larger target: Amazon.

While Nashville was not the official victor of the high-profile battle to host the company's HQ2, it did secure a commitment from Amazon to place an operations hub with 5,000 employees in the new Nashville Yards development. In return for this investment, Amazon will realize up to$102 million in incentives (in the form of grants and tax credits), with a potential total inducement of more than $20,000 per job created.

The Tennessee capital doesn't have the progressive infrastructure of New York City, which sent Amazon running after an uprising of community groups, unions, and politicians began hammering the company for causing explosive gentrification, expecting taxpayer handouts, and its unapologetically anti-union behavior.

In an attempt to hold companies accountable for the millions of dollars they receive in public subsidies, Stand Up Nashville pushed the city council to pass a “Do Better” ordinance in 2017. The ordinance requires companies to disclose detailed information about jobs they create, including data on wages and whether they are truly fulfilling the commitment to hire local workers. The city council has the power to revoke the financial incentives if the companies are falling short. Stand Up Nashville is already using Amazon's disclosures, required by the Do Better ordinance, to hold the company to account.

Still, with Amazon promising to bring thousands of workers earning six-figure salaries to the city, local activists are deeply concerned about the impact on the already overheated housing market.

As Kelly put it, “I work a nine-to-five. I'm a young black female with a college degree and am out here just trying to make it every day. But I live the issues we fight for.”

Nashville's boom shows no sign of slowing down. In the midst of rapid economic growth, partially fueled by massive incentives and subsidies, Stand Up Nashville is fighting for a more equitable vision of economic development. The group recently supported metro Nashville teachers who organized “sick-outs” to demand higher investment in K-12 education from city government. Working together, union and non-union workers from numerous industries, along with community members and churches, are deploying creative organizing to rein in rising corporate profits that are exacerbating economic inequality and displacement.

“We've petitioned, lobbied, spoken at council, talked with and mobilized our neighborhoods, and we are hitting a point where people are starting to run for office,” said Barnett. “We are going to get more progressive folks elected. There is power shifting in the city.”

July 18: Skanska recently made a payment to workers in exchange for removing the mechanic's lien, however the Fair Labor Standards Act case against both MR Drywall LLC and First Class Interiors is ongoing and workers still await payment.