Amazon expansion: First big win for Kentucky's right-to-work law?

Ohio: Union issue 'never came up'
Posted at 4:47 PM, Feb 01, 2017
and last updated 2017-02-01 19:38:46-05

CINCINNATI -- Kentucky became a “right-to-work” state Jan. 7.

Amazon Inc. announced a $1.5 billion expansion Jan. 31.

Coincidence? Some think not.

“I’m sure it came up,” said Boone County Judge Executive Gary Moore. “I think right-to-work was an issue for all of Kentucky. Was it a positive in their final decision? I would have to think it was.”

Kentucky became the 27th state to adopt legislation that prevents companies from requiring employees to join a union or pay dues to get or keep a job. It was seen as a major victory in Frankfurt for Republicans, who took control of the Kentucky House and Governor’s Mansion in November.

Some also viewed the legislation as an assault on unions, possibly because House Republicans are also seeking a repeal of “prevailing wage” laws that require construction companies to pay union-scale wages on publicly-funded projects, whether or not the contractor is a union shop.

Gov. Matt Bevin made right-to-work legislation a campaign promise. And he lobbied for it in a Jan. 4 session of the House Economic Development and Workforce Investment Committee. It was House Bill 1, signifying its importance to Republicans.

“Over the last 10 years, the states in which there is right-to-work legislation have actually seen an increase not only in overall jobs but in union jobs,” Bevin told lawmakers. ”Where union jobs are growing the fastest, these actually are right-to-work states.”

But was it a factor in Amazon’s expansion announcement?

"I don’t know that specifically,” said Joe Mazurak, communications director for the Kentucky Cabinet for Economic Development. "Amazon has a significant presence already in Kentucky, dating back 20 years, but it certainly could well be a driver."

Amazon declined to comment on whether it requested a legislative change or was influenced by it. An economic development official in Wilmington said Amazon didn’t cite Ohio’s lack of right-to-work legislation as an impediment to expanding in Clinton County.

“It never came up in any discussion we had,” said Dan Evers, executive director of the Clinton County Port Authority.

Moore doesn’t know how important a role it played. But he thinks it was a factor in Boone County’s win.

“I do think it helped, yes,” he said. “And I think it’ll help us attract manufacturers and other distribution (companies) that will want to be close to the Amazon Prime Hub.”

Moore is convinced that Northern Kentucky will have a bigger pipeline of projects, now that Kentucky has outlawed union allegiance as a condition of employment.

“The consulting agencies that bring projects to local communities would tell us regularly, ‘Yeah, we have more potential clients but they’re not going to look at you because you’re not right-to-work,’” he said. “The numbers quoted by some of the leading location firms will tell you that you miss half the opportunities if you’re not right-to-work."

Kentucky's altered stance on union activity came just a month after the Teamsters union tried to shut down the cargo hub at CVG. The Teamsters Local 1224 went on strike to protest pilot shortages at ABX Air and Atlas Air Holdings Worldwide, two companies hired by Amazon to operate its Prime Air cargo flights.

ABX Air, which operates about 35 Amazon flights a day out of Wilmington, declined to comment on what impact a Kentucky relocation would have on its negotiations with the Teamsters. The union did not respond to WCPO's inquiries, although it did release its reaction to Amazon's Kentucky expansion.

"Our carriers are losing pilots at record rates and we fear there won’t be enough qualified pilots to get the job done safely and efficiently as Amazon continues to expand," Rick Ziebarth, executive council chairman for Teamsters Local 1224. "We’re thrilled to see a company like Amazon invest in our communities, but we’d hate to see them lose these job opportunities and investments if operations become unsustainable."