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NLRB Accuses Boeing of Retaliating Against Union by Opening SC Facility

    Client Alerts
  • April 22, 2011

South Carolina scored a major victory several years ago through its recruitment of a Boeing manufacturing plant in Charleston. On Wednesday, the National Labor Relations Board (NLRB) accused Boeing of opening the facility in order to retaliate against unionized workers at its Washington plants.

An attorney for the NLRB stated that internal Boeing documents demonstrate that the company was seeking to avoid labor problems it had experienced in Washington, including production delays due to threatened strikes. The Charleston facility is currently non-unionized.

It is not unusual for employers to run "double-breasted" operations, meaning the use of unionized and non-unionized facilities. Unions often contend that new, non-unionized facilities are established for the purpose of weakening the union, or in retaliation for the union's exercise of its collective bargaining rights. Under the National Labor Relations Act, employers are required to demonstrate legitimate business reasons for establishment of the new facility, unrelated to labor issues experienced at its existing plants.

In this case, Boeing received hundreds of millions of dollars in economic incentives from South Carolina. Based on these financial factors, combined with the generally lower cost of operating in the Southeast, the NLRB may have a difficult time demonstrating retaliation. However, this new claim is another demonstration that given legislative gridlock on employment measures, the NLRB continues to be the source of aggressive government attempts to defend organized labor.