Wednesday, February 12, 2014

Labor Relations: Blacklisting companies that ship work overseas

Published in the Portland Phoenix

Seeking to protect nearly 20,000 Maine jobs from being sent overseas, labor and union activists lobbied the state legislature last Thursday, with solid support and some modest, but expected, opposition. The bill they supported, LD 1710, would pressure companies that have customer-service call centers in Maine to keep their work in the United States.
Sponsored by Troy Jackson, a Democratic senator from Allagash who is running to replace Congressman Mike Michaud (who is himself running to replace Republican Governor Paul LePage), the bill would require call-center companies to notify the state before relocating call centers from Maine to foreign countries. (It does not require notification if a company moves elsewhere in the US.) And it would require all state-agency call centers to be in Maine.
Notification would have negative effects beyond bad publicity. The bill declares all companies that send Maine call-center jobs overseas ineligible for any “direct or indirect state grant, state guaranteed loan or tax benefit” for a period of five years after
the relocation.
Companies that, at the time of relocation, were receiving state benefits would have to repay to state coffers the unused amounts.
A recent union-conducted tally found 19,470 call-center jobs in Maine, with an average annual wage of $31,500, according to Jenn Nappi, assistant business manager of the International Brotherhood of Electrical Workers Local 2327, which represents most FairPoint employees in Maine.
FairPoint, which has about 900 unionized call-center workers in Bangor, Portland, and South China, is not the largest such company in Maine. That firm is LL Bean, which has about 2000 call-center staffers in Portland, Bangor, and Lewiston. Other major call-center players, according to the union research, are Bank of America with nearly 1000 people between Belfast and Brunswick, T-Mobile with 520 people in Oakland, and TD Bank with 500 in Auburn.
Companies often move call centers in search of low-cost labor: In 2009, the Baldacci administration’s economic commissioner John Richardson said Maine’s low wage levels should be considered by call-center firms (see “Maine — the India of the United States?” by Jeff Inglis, at
In 2011, Carbonite, a Boston-based data-storage company, brought 150 call-center jobs from India to Lewiston. But other companies have gone the opposite direction: In February 2012, Bank of America closed a call center in Orono, laying off 200 people. Nappi and the IBEW say those jobs likely went to other Bank of America call centers in the Philippines.
And in September 2013, Sykes Enterprises, a Florida-based helpdesk company, closed a Wilton call center, laying off 150 people. The company has nearly 60 call centers in 25 countries, the IBEW says.
Some of these companies, including T-Mobile, have received tax incentives and other state support in exchange for promises of increased hiring.
“We’re constantly allowing all these companies to have all these great breaks, but we don’t require anything of them,” Nappi says.
There is, however, a possible loophole in the draft law, which allows state aid to go to a company that offshores work if not doing so “would result in substantial job loss in the State or harm the environment.”