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Legal rulings.

* The Department of Labor ruled that special local union assessments to subsidize wage costs for unionized employers are not legal under the Copeland AntiKickback Act and the Davis Bacon Act. In issuing the ruling, the Department rejected the contention of the Associated Builders and Contractors that criminal prosecution was also warranted against the defendant, Local 595 of the International Brotherhood of Electrical Workers, located in Oakland, CA.

The trade association's complaint arose from the local union's practice of financially aiding employers with whom it had collective bargaining agreements to help them counter the labor cost advantages of nonunion firms. The aid, which was approved by a majority vote of the local's members, emanated from an assessment on all members equal to 3 percent of their earnings.

* General Motors Corp. (Gm) settled charges that it had discriminated against black employees in pay and promotions. Under the consent accord, which did not include an admission of guilt by the company, GM Will track the careers of black "salaried" employees to assure that they fare the same as do whites. Factors to be used in assessing the qualifications of the employees are total time with the company, time in the current job, years of education, area of study, and degrees earned and when the degree was obtained. If, after considering the factors, the percentage of promotions is substantially less among blacks than among whites, GM will be required to correct the imbalance. The aim is not to ensure promotions for specific employees, but to attain equality in three broad areas: clerical, engineering, and manufacturing supervision.

The plan applies to GM'S nonexecutive salaried employees in Michigan, Ohio, and Indiana, or about 75 percent of its total salaried employees, 7,000 of whom are black.

The plaintiffs' attorney said that, unlike the typical plan which has rather rigid goals, this plan is better because it accommodates the legitimate objectives of management and employees without resorting to a "myriad of exceptions."

The plan provides for annual reviews of the results over a 5 -year period, with provision for financial penalties if GM does not conform to the formula. GM would not estimate the plan's cost, but attorneys for the plaintiffs estimated as much as $53 million over the 5 years.

* Chrysler Corp. agreed to pay $8.1 million to a group of nonunion salaried employees forced into retirement in the wake of the company's financial crisis that began in 1979. Chrysler's consent decrees with the Equal Employment Opportunity Commission, ending the long legal dispute, provide for payments totaling $2.9 million to 82 employees who were involuntarily retired "at corporate option" and $5.1 million to 149 employees who signed "voluntary" retirement agreements that contained illegal conditions.

The settlement came after Chrysler lost in proceedings before the Commission and on appeal to a Federal district court. In its defense, Chrysler presented a "failing company" justification for the retirements.

* Nissan Motor Corp.'s distributor in the United States settled 4 1/2-year-old charges by the Equal Employment Opportunity Commission that the unit had discriminated against minorities, women, and older employees. While not admitting any discrimination, an official of the Japanese vehicle producer conceded that "there was room for improvement in the way we developed opportunities for protected employees, and, in that regard, we are specifically committed to implementing several changes in our practices."

Under the settlement, which did not involve Nissan's manufacturing plant in Smyrna, TN, the company agreed to give managerial jobs to 68 current employees who were denied promotions between June 1981 and December 1987; pay a total of $605,600 to the 68 employees and others who took early retirement after not being "properly considered" for promotion; drop a requirement that employees have a college degree to be considered for promotion; advertise managerial job openings within the company more frequently; and require supervisors to attend classes on preventing discriminatory practices.
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Title Annotation:Developments in Industrial Relations
Author:Ruben, George
Publication:Monthly Labor Review
Date:Apr 1, 1989
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