BUSINESS WEEK ONLINE NEWS FLASH!
August 14, 1997


Edited by Douglas Harbrecht


SECRETARY IN THE MIDDLE: LABOR'S ALEXIS HERMAN

As the United Parcel Service strike enters its 11th day on Aug. 14, Labor Secretary Alexis Herman finds herself in an increasingly tough position.

On one side, she is defending the Administration from charges by Republicans and some businesses that President Clinton won't intervene in the nasty job action because of $8.5 million in Teamsters political contributions to Clinton and the Democrats over the past five years.

On the other side, she's being pressured by a President who wants the strike settled -- even though he won't directly intervene. Aides say Clinton feels strongly that the UPS strike doesn't meet the threshold required for him to invoke the Taft-Hartley Act, because it doesn't appear to be endangering the nation's health and safety.

So far, the new Labor Secretary, who has never mediated a high-profile dispute before, has focused on bringing the warring sides back to the bargaining table. Trouble is, getting UPS's management and its union talking again won't be enough for her boss. Clinton wants a deal now. The reason? He's planning on a vacation at Martha's Vineyard (Mass.) beginning on Aug. 18 and he doesn't want to be bothered by pesky reporters asking pesky questions about a protracted UPS job action.

That means Herman has just four days to perform miracles. "We would, for many different reasons, want to see if we couldn't make progress in resolving their differences even before then," White House press secretary Mike McCurry said on Aug. 13.

Herman, a former Democratic National Committee official and close ally of the late Commerce Secretary Ron Brown, says she's looking for creative solutions to the walkout. It may take more than that to fashion a settlement. Both sides are digging in for a long dispute. The AFL-CIO has ratcheted up the rhetoric by siding strongly with Teamsters President Ron Carey and offering financial assistance to striking workers. UPS is threatening to fire 15,000 employees or hire replacement workers if a swift settlement isn't reached. The two sides are becoming more--not less--strident, despite Herman's peace entreaties.

Adding to the pressure on Herman, Republicans also are trying to score political points at the expense of the White House. Citing the disruptions felt by businesses in their states, GOP governors led by George Allen of Virginia and Terry Branstad of Iowa have demanded Presidential intervention. Other Republican officials hint darkly that Teamsters' political contributions have prompted Clinton's refusal to order the strikers to return to work under the Taft-Hartley Act.

The White House response? "Well, that is not true," said McCurry. "Those [Taft-Hartley provisions] are rarely invoked. They've not been invoked by a president since President Carter did so in 1978 ... As a general premise, we take the view that government should not step in and resolve labor-management disputes. They should be resolved by the parties through collective bargaining."

McCurry replied to the GOP critics by pointing out that "some of those calling upon the President to act are usually the first to decry government intrusion in the marketplace. Why don't we let the labor markets work here and let the collective-bargaining process protected by federal law take its due course?"

So as execs and entrepreneurs howl about lost business caused by an extended strike, the White House is leaving Herman with the heavy lifting. "We have a lot of confidence in Secretary of Labor Herman, and she's working hard on it," said McCurry.

By Richard S. Dunham in Washington

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