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Labor leaders hail bus maker pact to hire more women, minority workers

The deal comes as transit agencies are set to receive billions from last year’s infrastructure package to transition bus fleets to battery power

A Metro bus driver in downtown Los Angeles. (Damian Dovarganes/AP)

One of the nation’s largest bus manufacturers has agreed to hire and promote more women and racial minorities, a deal that worker advocates say is a model for ensuring that federal funds to replace diesel buses with battery-powered buses boosts workers in struggling communities.

The deal, announced Thursday at events in California and Alabama, is in response to a lawsuit over a $500 million contract New Flyer won in 2013 to supply buses to the LA Metro transit agency. But its effects will ripple through the country to communities where the company has plants and potentially to other cities and states, where it could serve as a template for public-sector infrastructure contracting, labor officials say.

That includes Anniston, Ala., a majority-Black city with a history of racism, where a White mob once bombed a bus carrying civil rights activists and where New Flyer manufactures buses.

New Flyer struck the deal with worker advocacy organization Jobs to Move America. It comes as transit agencies are set to receive billions from last year’s $1.2 trillion infrastructure package to transition fleets to battery power and as the Biden administration is seeking to ensure that racial equity is a priority as money is spent.

“This is a hands-on, full-blown partnership between a company and a set of community groups and the workers themselves to achieve this kind of opportunity and equity that everybody’s talking about,” said Madeline Janis, Jobs to Move America’s executive director. “This gets in there and creates a holistic plan to achieve racial justice and gender justice in green manufacturing.”

Janice Harper, New Flyer’s executive vice president of people and culture, said the company shares advocates’ goals of “wanting to provide equal opportunity for people and communities to thrive — and more so — to continue investing in workforce development that fosters scalable adoption of clean transportation across America, in an industry where every person can participate meaningfully.”

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The roots of Thursday’s deal stretch almost a decade. In 2013, LA Metro awarded $500 million to the U.S. subsidiary of New Flyer Industries of Canada for an order of up to 900 buses fueled by compressed natural gas.

To win the contract — one of several the bus maker holds with major U.S. transit systems, including those in Washington, New York, Atlanta and San Francisco — New Flyer said it would create more than 50 full-time positions that paid $11 to nearly $50 an hour.

A four-year legal battle ensued over whether the company lived up to its promises. When the manufacturer sued to prevent the release of public records, a court fight was waged by Jobs to Move America, whose board includes the leaders of major U.S. unions, including the AFL-CIO and those representing auto, steel, electrical, transit and transportation workers.

In October 2017, Los Angeles County Superior Court Judge Mary Strobel ordered the release of New Flyer job creation and salary data, saying the public interest in determining compliance with government contracting terms outweighed the company’s privacy interest. Based on pay stubs and corporate reports it uncovered, Jobs to Move America then filed a whistleblower lawsuit under California’s False Claims Act, alleging New Flyer did not pay wages it said it would and misstated the value of benefits it was providing.

The company disputed the allegations. The case was set to go to trial before a Los Angeles judge this week. In the settlement signed Tuesday, New Flyer — without admitting wrongdoing — entered what both sides called a win-win, multistate agreement spanning the company’s factories in Anniston and Ontario, Calif.

Los Angeles County Supervisor Hilda Solis, the chair of Metro’s board, said the settlement was a reflection of the agency’s “commitment to creating good jobs for people who need them the most.”

Advocates said the agreement made the case that when taxpayers foot the bill for buses, trains and light rail, they can also demand the creation of good jobs.

“This case is an important marker for labor and manufacturing companies across the country. It shows it isn’t a zero-sum game,” said Rachel Jensen, co-lead trial counsel for the plaintiffs and a partner with Robbins Geller Rudman & Dowd. “When we invest in quality jobs, fairness and dignity, everyone wins big.”

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In a community benefits agreement also signed Tuesday, New Flyer committed to creating new workforce programs and to boosting its hiring and promotion of people from disadvantaged groups, saying that at least 45 percent of new hires and 20 percent of promotions would be given to women, minorities and U.S. military veterans. The deal includes enhanced company reporting to LA Metro about employment programs associated with its contracts for five years.

The company agreed to allow a designated community organization to assist workers with any claims of harassment or discrimination and to pay $7 million to a settlement fund to cover Jobs To Move America’s legal costs, with the rest to be divided among the plaintiffs and government.

Proterra and BYD, two other electric-bus manufacturers, have similar community agreements tied to their operations in California.

The New Flyer deal stretches beyond the state to Anniston, where the company acquired a plant in 2013. Janis said the workforce is about a third Black, with few women, and that disparities grow along with the level of skill and supervisory responsibility workers hold. Hiring goals are backed by apprenticeship programs designed to guarantee workers from disadvantaged groups have access to better jobs.

Anniston was home to a Monsanto plant for decades that was secretly poisoning the ground, water and air as it manufactured chemicals known as PCBs.

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Erica Iheme, Jobs to Move America’s Birmingham, Ala.-based deputy director, said Anniston residents feel they were never properly compensated for the contamination and have continued to feel the “sting of economic lack.” She said the deal with New Flyer is a chance to build a partnership between the community and a relatively new employer to the area.

“New Flyer coming in with the higher wages is really important,” Iheme said. “That’s why the community really wanted to focus in on New Flyer because we saw New Flyer as a partner.”

Labor strategists called the lawsuit one of the first to enforce pro-worker incentives that state and local governments have increasingly incorporated into public contracts.

Deputy U.S. Labor Secretary Julie Su joined the announcement Thursday, saying her department is encouraging those approaches as the federal government implements the infrastructure law.

“For too long we’ve accepted that an economy where some people get good jobs and others don’t is just the natural way of things,” she said. “We can do better than that.”

In the Anniston area, the unemployment rate and number of unemployed residents are hovering at decade lows. In the Ontario metropolitan area in California’s sprawling Inland Empire, manufacturing employment has recouped about 96 percent of pre-pandemic jobs but is still 20 percent off its turn-of-the-century peak.

Racial and gender disparities among workers have persisted during the pandemic-era rebound, with job gains among women and minorities trailing those of men and White employees, economic data shows.

Timothy J. Bartik, an economist who has studied labor demand and development policy at the Upjohn Institute in Michigan, said raising the minimum wage and expanding unionization could achieve greater and more inclusive wage growth on a national scale, but using tax dollars and individual public-sector contracts to advance such goals as a “retail strategy” could be achievable more quickly.