Medical meetings are the heart of the Pennsylvania Convention Center client base — half its 2002 citywides are health care-related — but that heart skipped a beat in July when the American Society of Cataract and Refractive Surgery threatened to pull its 2008 conference out of the city because of labor problems at its 2002 Symposium and Congress in June.
“In my over 25 years of involvement in producing meetings from New York to Anaheim to San Francisco and Chicago, I have never been confronted with such a negative labor situation as was experienced in your city,” wrote David A. Karcher, ASCRS executive director in a letter to Philadelphia Mayor John F. Street and quoted in The Philadelphia Inquirer (July 17, 2002).
“I want to emphasize that Philadelphia is a great destination, but it [the center] is just too darn expensive,” says ASCRS Director of Meetings and Conventions Jane Krause. The June meeting, the first held by ASCRS in Philadelphia, saw labor costs “a couple hundred thousand dollars higher” than other sites, and that was after pre-meeting negotiations that mediated some of the costs. “By the hour, they're not any more expensive than any other city, but if it takes three times as long to do a job, it's three times as expensive.” ASCRS will make a final decision about 2008 in the next couple years, based on improvements.
The problems with ASCRS underscored the findings of a study released in June, which found that the PCC labor situation “is perceived as the worst encountered anywhere in the country at this time.” Among the problems identified by Philadelphia-based Econsult Corp., which was hired by the Board of Directors of the Pennsylvania Convention Center Authority to assess the center's competitiveness, were low labor productivity, delays caused by jurisdictional disputes among the center's six unions, and complaints of high labor costs.
In interviews with 31 convention center clients, “virtually every customer suggested that PCC labor was either inefficient or hostile,” the report said. (Download the 68-page report at www.econsult.com/e_news.htm .)
Readers experiencing a sense of déjàvu may recall the January 2001 Project Labor Agreement (PLA) negotiated by Mayor Street and the center's six labor unions, which was supposed to establish work rules and iron out jurisdictional conflicts. It also created the job of “site representative,” a person dedicated to resolving disputes.
In the estimation of the Econsult labor management consultants, that site representative role can be compared to a tourniquet on a major wound, it “slowed the bleeding, but it has done nothing to prevent injuries.”
Among Econsult's recommendations for change are the addition of a chief operating officer at the center to oversee day-to-day operations, consistent discipline of PLA rule breakers, and elimination of jurisdiction distinctions among the carpenters, laborers, and Teamsters. Econsult suggests a unified workforce model, in which workers would be hired by show contractors through a new labor broker.
The Philadelphia Convention and Visitors Bureau has endorsed all the Econsult recommendations, and has worked with the PCCA to create a new policy for customer complaints and to establish a permanent customer advisory council. Bureau President Tom Muldoon sees a resolution of the union problem as a key step toward the state legislature's approval of funding for a convention center expansion.
“The reality is that if we weren't trying to expand the building then we wouldn't have all this publicity,” says Muldoon. “But nobody…is going to approve $450 million dollars [for the expansion] unless they have an assurance that we're going to maximize that money, and we can't maximize that expenditure unless we're able to keep our base business.”
According to the bureau, of the 133 conventions with more than 2,000 room nights that have met in Philadelphia since 1995, only 20 are booked to return. That's a return rate of only 15 percent.
The carpenters and Teamsters unions each publicly rejected the unified workforce idea in mid-August; however, at press time, Mayor Street, the unions, and the Convention Center Authority were in negotiations over the issue. Muldoon is hopeful for a quick resolution. Stay tuned.