Expanding Scope

CAGNY Has Evolved in Changing Times

by Al Heller

Though it started out as a collective bargaining organization, the Contractors Association of Greater New York has evolved through the years into a more multi-purpose trade association.

The origins of the evolution go back to the early days, however, said Raymond McGuire, managing principal for the group. He said around 15 years ago, CAGNY worked closely with the New York City Buildings Department's general counsel when it was drafting regulations on netting regulation to protect passersby from falling objects at work sites. That collaboration beginning under Mayor Edward Koch and his then-buildings commissioner, Charles Smith, has grown under today's commissioner, Patricia Lancaster, McGuire said.

"There's a feeling that an industry that moves ahead together is better, safer and more efficient," he said. Today, CAGNY spends considerable time acting as a liaison with the buildings department, which regulates every aspect of construction. In Lancaster's three years since being appointed by Mayor Michael Bloomberg, "she's been almost relentless in seeking our opinions," McGuire said. "We're a partnership in many respects. The department works closely with the most responsible experts in the industry."

Other industry powers also recognize CAGNY's influence. For one, Louis Coletti, president and CEO of the Building Trade Employers' Association, called CAGNY and its member companies major players in the New York City construction industry, both in terms of labor relations leadership as well as in promoting regulatory and legislative initiatives benefiting unionized construction and the city as a whole.

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"Their firms provide financial support to many civic and charitable organizations," Coletti said. "They donate their construction services to many worthwhile projects at no costs. They're major contributors to the economic, social, and civic fabric of New York City, and to making this a place where real estate developers will want to continue to invest. Their commitment to the city means not only pursuing work but pursuing growth and economic development of the area as a whole."

The real estate side of the business also appreciates CAGNY's contributions, said Steve Spinola, president of the Real Estate Board of New York. "More than simply building a quality project, CAGNY contractors understand construction in New York in a larger context, as part of the larger fabric of New York and critical to the success of our city," Spinola said.

CAGNY has built similarly constructive relationships with other New York City agencies such as the Department of Design and Construction, the School Construction Authority, the Department of Business Services, and the Department of Transportation, as well as with the Dormitory Authority of the State of New York. CAGNY also maintains close relations with other construction industry associations, such as the BTEA, the New York Building Congress, the Construction Industry Partnership for the 21st Century, the Building and Construction Trades Council, the General Contractors Association, and the Building Contractors Association.

One small example of CAGNY's cooperation with the city's Department of Transportation came during the recent Republican National Convention, when the trade group helped the agency meet its traffic flow and security goals while minimizing inconvenience to work sites.

But a bigger example of the group's collaboration with other construction sector players - and its contributions to the industry's betterment - is in how it is taking a lead on promoting safety. For instance, CAGNY is helping the city buildings department and the BTEA plan their second safety summit, a one-day event planned for this fall at Gracie Mansion bringing together contractors, engineers, architects, and regulatory bodies. Safety directors from every CAGNY member company will suggest topics and serve on panels discussing practice improvements and worker safety.

"While the number of fatalities and serious injuries is fraction of what it was 30 years ago, there was a spike in 2002 that raised a lot of concerns," McGuire said. "It was happenstance. The industry has been back to nominal numbers since then."

Of 25 worker fatalities on New York City construction projects between Oct. 1, 2001 and Sept. 3, 2002, 70 percent occurred on non-union construction sites, noted "Construction Safety: A Tale of Two Cities," a report issued by the Construction Industry Partnership in November 2003. Factors that most led to deaths and accidents included a lack of safety training for project management staff and trade labor workforce, and a lack of proper safety supervision on-site, as well as language barriers, the report concluded.

The industry is nevertheless working hard to address overall construction safety needs said John Cavanagh, CAGNY's chairman emeritus. "I started as a surveyor on structural steel 45 years ago when there was absolutely no protection," he said. "You expected two to three people to get killed on every major job. Now it doesn't happen."

FOCUS ON PEOPLE

Superintendent training is another CAGNY focus. For the past two years, CAGNY has collaborated with the Cornell School of Industrial and Labor Relations to teach superintendents with less than five years experience ways to manage interchanges with diverse groups they work with daily, such as unions, subcontractors, building inspectors, and police. "They're the face of the owner on the site," McGuire said, "but they're basically civil engineers. They know how to build the building, but not necessarily how to manage everyone they come in contact with. There's a lot of role-playing in these three-day sessions."

James Abadie, senior vice president of Bovis, said he has taught some of the classes at Cornell "in order to make sure that all superintendents have consistent training and act the same." He recalled how a Cornell professor developed the program after visiting ten of our CAGNY-member job sites and interviewing project members. CAGNY later formed a committee to help customize the program, resulting in consistent training in safety, cardio-pulmonary resuscitation, first aid, specialized foundation work, and aspects of steel structures. The goal, he said, is "to make each superintendent and project manager well-rounded in all areas of the industry."

CAGNY has already gone through two full cycles of the course and will likely have another in fall of 2004. "My company hired 15 new college graduates this spring and we'll put them through it," Abadie said.

CAGNY is also taking steps to ensure that its members value the role of project superintendents, McGuire said. McGuire said he meets with all superintendents for every CAGNY member company twice a year to review collective bargaining agreements.

"Superintendents are crisis managers," he said. "Everybody on the job is pissed off about something. How you function in that situation is critical to the tenor of that job. Will it be hysterical, or will people put aside their differences and try to work together? The techniques that managers pick up in business school are revelations to these guys. Many have the skill intuitively. Others haven't been exposed."

HRH Construction, a CAGNY member, has run its Superintendent Training Program for 10 years, said Frank Ross, Jr., senior vice president at HRH Construction. The 18-month mentoring program takes talent hired out of school to work directly with seasoned professionals. "We typically start people in our plan room teaching how to read drawings and develop basic office skills," Ross said. "When they move into the field to work under our superintendents and assistant superintendents, they acquire a sense of working on-site. Then they return to the office to work with project managers. They get broad exposure, from mailroom to boardroom."

For its part, Plaza Construction has had Ray McGuire "come talk with our senior managers about the nuances of proposed building regulations, licensing, collective bargaining agreements, and issues that affect all of us," said Richard Wood, the company's president. "He helps educate us about new issues that pop up all the time."

On other fronts, CAGNY supports industry programs involving recruitment. One of those organizations is the ACE Mentor program, which guides high school and college students into design and construction industry management positions. Another is Construction Skills 2000, an organization run by BTEA and BCTC that brings high school students into labor unions for apprenticeships. CAGNY's Cavanagh serves on its board, and the group includes the New York City Board of Education, the School Construction Authority, and the Port Authority of New York and New Jersey.

A third group is Non-Traditional Employment for Women (NEW), established to bring more women into the construction industry. Susan Hayes, president and CEO of Cauldwell Wingate, is involved in this effort along with Cavanagh. And since 2001, CAGNY's John A. Cavanagh Scholarship program has awarded 19 college scholarships to enhance educational opportunities for students hoping to one day lead the construction industry. CAGNY anticipates that beginning in 2005, one scholarship a year will also go to an economically disadvantaged public high school student who is interested in this industry.

Those programs reflect another focus for CAGNY as the industry evolves - supporting the growth of diversity in the ranks of professionals and laborers. Although women comprise just 3 percent of skilled union laborers in construction, CAGNY is working toward a 7 percent goal this decade, Hayes said. "By the time the pipeline could open for some large initiatives such as the Hudson Yards Redevelopment, Jets Stadium, and the 2012 Olympics, sufficient numbers of women should be job-ready when jobs become available, having been identified, recruited and put through pre-apprenticeship programs," she said. "The construction industry is a man's world. We have to prepare women to work in a non-traditional setting, because having a job in a trade union can bring a change in lifestyle for people who may not otherwise achieve economic self-sufficiency for themselves or their families."

Hayes cited how CAGNY members such as Bovis, Turner, and HRH aim to ensure diversity on their projects. "CAGNY sees this as a way of doing business in the 21st century," she said. "With a large job like AOL Time Warner, where Bovis employed over 400 women, that doesn't happen by accident. Someone made it happen."

Though more needs to happen at the boardroom level as well, CAGNY has only been welcoming, she said. "There aren't 20 of us," she said. "Yet I'm never made to feel different at CAGNY. My opinion is regarded and sought out by people I'm honored to be in a room with, even though my expertise and years in the business may not be as significant as some of theirs. They are bright, open people who want to advance the industry at both the blue- and white-collar levels."

Beyond collaboration, safety, recognition of superintendents, and diversity, CAGNY has even focused on narrower, yet vastly important topics for the industry. A prime concern is the matter of 240/241 regulations that have wrought an insurance premium crisis in the industry, McGuire said. "Premiums used to be 2 percent of the total gross cost of construction - now they range between 5 percent and 7 percent," he said. "We've seen a 400 percent increase in premiums over the past three years, and only three carriers remain - AIG, Liberty, and Zurich."

The upshot is that on some large jobs, the insurance companies are the real power behind contracts, in the sense that the premium rate can determine the final bid number. "Insurance companies are starting to reach their contingent liability limits," he said. "At that point, they look at the safety records of companies contending for a job and give a quote."

In this complex scenario, McGuire said an injured worker can't sue his own employer, but can sue the general contractor and building owner: "So if someone is hurt falling from a height, even if he failed to wear a safety harness or drank alcohol at lunch, there is virtual absolute liability against the general contractor and building owner," he said. "The only question is damages. New York is the only state to still have this law beyond the year 2000."

This causes a chain reaction in which owners are indemnified by contractors, the contractors are indemnified by their subcontractors, and it comes back to the worker's own employer. "These actions are largely unknown to the immigrant community working non-union, and many of them won't identify themselves in court, so non-union shops aren't particularly concerned," McGuire said.

The issue will only fester, said Cavanagh. "The more this drags on, the more small sub- and general contractors are going out of business," he added. "Many that have recently come into being are minority-owned, and they're just being put right out of business. It affects medium and large companies as well in their pocketbooks. We really can't afford this extra cost."

The insurance issue could ultimately prevent some projects from being built, Abadie said. "It's an enormous amount of money to pay," he said. "If a developer can't project so much income, when costs get so close, they don't want to take the risks."

McGuire said CAGNY has sought modest reforms for many years to allow its members to introduce contributory evidence. "But trial lawyers have a strong lobby and have stymied our effort," he said.