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Puerto Rico electric utility union sues gov’t, fiscal board

By on August 7, 2017

SAN JUAN – The Irrigation & Electrical Workers Union (Utier by its Spanish acronym), which comprises some 3,600 employees of the Puerto Rico Electric Power Authority (Prepa), has sued the utility, the commonwealth government and the financial control board, challenging the constitutionality of the board members’ selection process and their determinations, the certified fiscal plans and budgets, and several local laws, among other matters.

The union also seeks to protect its collective bargaining agreement (CBA) and have Prepa be declared “a protected essential public service.”

The two lawsuits were filed in federal court as part of Prepa’s bankruptcy case under Title III of Promesa. About 3,600 of Prepa’s workers are affiliated to Utier.

(CB photo/Agustín Criollo Oquera)

The first action, filed Sunday, challenges the validity of the nomination process to select members of the fiscal board. According to Promesa, the U.S. president selects members from lists provided by the House speaker, Senate majority leader, House minority leaders and Senate minority leader. The president also selects his own member to the board.

According to the suit, the process collides with the appointment clause of the U.S. Constitution, which stipulates it is the president who should nominate and appoint with the advice and consent of the Senate. The union also argues it violates the separation of powers because the president can’t fulfill his constitutional mandate.

With Prepa Filing for Title III, Privatization Looming

“Nowhere does it mention or imply that an alternate process would be valid in regards to nominating or appointing Officers of the United States… It is our contention that due to the nature of Promesa’s OB [oversight board], its appointees are clearly Officers of the United States and therefore, their nomination and appointment process falls under the Appointment Clause,” the suit says.

The second action, filed Monday, seeks to have the court to declare as invalid several local laws, the commonwealth’s budget and fiscal plan, and Prepa’s fiscal plan as they all violate the taking and contract clauses of the U.S. Constitution, according to Utier.

It also seeks to have the budget and fiscal plans “totally recast” to “comply with relative lawful priorities or agreements in effect prior to the date of enactment of Promesa, comply with the U.S. Constitution, enable the achievement of fiscal targets, ensure funding of essential public service and provide for estimates of revenues and expenditures based on applicable laws or specific bills that require enactment in order to reasonably achieve the projections of the Fiscal Plans.”

Utier argues that despite the role Prepa employees play for the utility’s operations and Puerto Rico’s economy, the commonwealth government enacted four laws—namely Act 66 of 2014, and Acts 3, 8 and 26 of 2017—that undermine and impair their CBA, along with the agreements it establishes. Such legislation is part of the fiscal plans that the board certified for the commonwealth and Prepa.

“The impairment of the CBA holds severe and negative consequences for the UTIER members, Prepa, and the Commonwealth. It throws employees into a trustless, illegal, unsafe, and economically unstable environment,” reads the suit, which adds that until the fiscal plans are “totally recast,” Prepa should not be allowed to present any plan of adjustment as part of its Title III bankruptcy process.

Although the CBA was enacted with a lifespan lasting from August 2008 through August 2012, it has a provision that establishes that it will continue to dictate the labor relations between Prepa and Utier until a new collective bargaining agreement is negotiated and comes in effect.

Some of the major areas covered by the CBA are: vacation and illness accrual and pay, employee classifications, job reclassifications, fringe benefits, job stabilization, and dispute resolution procedures, among others.

“Such an agreement is extremely important to the well-being of the UTIER members, and as a result PREPA. These employees perform high risk jobs that require them to be continually exposed to danger, and as such need assurance that in case any fateful event might happen they will be covered and taken care of, and that neither they nor their families will have to incur in losses,” the suit says.

The legal action also includes a “Salaries and Benefits Report,” prepared by economists José I. Alameda Lozada and Alfredo González Martínez. The study says Prepa has suffered a significant and drastic loss of capital productivity from 2008 through 2017 but has been able to continue providing its service, because labor production has gone up, with Utier members leading the productivity growth.

“Essentially, it is their labor what has allowed Prepa to continue rendering its service,” the suit adds.


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