Louisville management arms Tsar Bomba

The largest man-made explosion in history occurred on October 31, 1961, when a Soviet bomber dropped a thermonuclear device yielding 50 or so megatons on the Mitysushika Bay testing range in the Soviet Artic. The device, known as Tsar Bomba, was actually capable of twice that power. The fireball and blast wave could be seen and felt 600 miles from Ground Zero.

The management of the Louisville Orchestra seem to think that the orchestral equivalent of Tsar Bomba is now the way to settle the long-running labor dispute in Louisville.

Drew McManus at Adaptistration has been doing a good job following this situation, with posts both today and yesterday. But some additional context is warranted.

It is a matter of record that the use of replacement workers during a labor dispute has never been tried by the management of an ICSOM orchestra. I believe the tactic has never been tried by the management of any full-time American orchestra, even prior to the formation of ICSOM.

There are two substantive reasons for this. The first is the economics of orchestras. Orchestras are like the proverbial business that loses money on every sale but makes up for it in volume. An orchestra that is on strike is an orchestra whose management is actually saving money, which is a major reason why orchestra strikes go one for weeks – it generally takes that long before management feels significant pressure from donors and the local power structure to settle. Why would a management in that situation try to hire a replacement orchestra? Not only would they lose money faster than by simply waiting the striking musicians out, they’d still not achieve labor peace, as the strike – and the legal requirement to bargain with the union – would continue, as would the resulting uncertainty and PR disaster.

The second is that the orchestra business is that rarity in the American private sector, the (virtually) 100% unionized industry. That has two consequences for orchestras contemplating using replacements; the difficulty of finding replacement workers and the trouble that anyone associated with the replacement orchestra will have in future endeavors with every other orchestra.

And yet Louisville management is showing every sign of being willing – perhaps even eager – to run this experiment. The clearest indication yet came last Monday at the bankruptcy hearing (in the interests of full disclosure, I had been asked to be an expert witness on behalf of the musicians at the last bankruptcy hearing in June).

One day prior to the hearing, the lawyers for LO management filed a “proffer of testimony” from LO CEO Robert Birman, which essentially laid out what he would say on Monday were he to be called to testify (which he was). The proffer included the following:

52.    Skilled replacement workers can be hired when a unionized work force is on strike.

53.    Studies show there is a vast over-supply of concert musicians relative to available positions.

54.    The number of music performance graduates (supply) has continued to grow steadily since 1982, while job openings (demand) has stayed stagnant or decreased.

55. The “supply” of aspiring symphony musicians is huge. According to a 2008 Stanford University Business School study, a one year measure equaled 3,671 students who majored in performance on a symphonic instrument.

56.    The number of annual vacancies is very small relative to the annual number of music performance graduates – 2 to 4 per year per Orchestra.

57.    From 2003-05, job openings at ICSOM orchestras (sample size of 52 salaried American orchestras, of which the Debtor is one) were at an all-time low for a ten-year period.

58.    Job openings in the largest American orchestras (Group 1) were down 34% between 1981 and 2007.

59.    Job openings in the second largest American orchestras (Group 2, of which the Debtor is part) were down 34% between 1981 and 2007.

60.    Looking at the 52 International Conference of Symphony and Opera Musicians (ICSOM) member orchestras alone (of which Louisville is one), based on a 10-year analysis (1994-2003) there were job openings for only 6-10% of all music graduates in any given year; 90% or more of graduates could not find work in an ICSOM-level orchestra.

In addition, management provided the an affidavit from their lawyer that was equally… interesting:

The affiant, James U. Smith III, after being first duly sworn, deposes and states as follows:

1.    My name is James U. Smith III. I am a partner in the law firm of Smith & Smith Attorneys, Suite 300 South, First Trust Centre, 200 South Fifth Street, Louisville, Kentucky 40202-3274.

2.    I have been with Smith & Smith Attorneys since 1972 engaged in the practice of labor and employment law representing management. Our law firm practices exclusively in these areas and has for over six (6) decades.

3.    Currently, I represent The Louisville Orchestra, Inc. (hereafter “LOI”) in its contract negotiations with American Federation of Musicians, Local Union No. 11-637.

4.    In recent contract negotiations in which I participated on behalf of another employer client, an impasse in negotiations was reached and the union called a strike against the employer. The bargaining unit members collectively withheld their labor and began a strike against the employer. The individuals on strike were highly trained mechanics. The employer advertised for permanent replacement employees and within two (2) days a sufficient number of permanent replacement employees had been hired to enable the employer to resume normal production operations. At that point, the union asked to meet with the employer. A meeting was held and agreement was reached between the parties. The strike lasted three (3) days.

I have read the foregoing affidavit and everything I have said herein is true to the best of my knowledge, recollection and belief.

The final cherry on the cake was Birman’s live testimony that the LO Board had authorized him to hire replacement musicians in the event negotiations with the LO musicians were unsuccessful.

The optimistic reading of this brandishing of The Big One is that this was merely rhetoric intended to encourage the bankruptcy judge to approve the management reorganization plan, which of course he did. A less optimistic take is that it’s intended to terrify the LO musicians into agreeing to management’s A-B-C scheme (which has the effect of laying off a good percentage of the current orchestra).

I don’t know Rob Birman well. But I know people who do, and the picture painted for me is that of a manager who marries his ideas to the extent that trying to persuade him of their unwisdom has the opposite effect. Coupled with his background running small per-service orchestras, and a possible desire to make his bones with this negotiation, there is ample reason to fear that he is deadly serious about intending to go the replacement route if the musicians don’t agree to a structure that they will never agree to.

My prediction is that this would produce the Mother Of All Orchestral Labor Disputes. I will explain why in my next post.