Labor Union Protests Lehman Bros. Developer At Howard U.

This story was written by Jessica Lewis, Hilltop


The Services Employees International Union is organizing against the hiring of Archstone, a controversialcontractor and developer, at Howard University.

Archstone contracts and develops apartments in California, Florida, Washington and the District of Columbia. But the developer has been at the center of recent controversy for undercutting worker wages.

The Wall Street Journal cited Archstone as a partial reason for Lehman Brothers' loss of $2.8 billion during the 2008 second quarter.

In addition, there have been several protests in New York City and New Haven, Conn. against the corporation to protect workers' wages. The protests have been organized by SEIU branch Local 32BJ.

SEIU is a union of property service workers and this particular branch (32BJ) represents workers from D.C. to Connecticut.

Local 32BJ represents about 300 maintenance and custodial workers at Howard. It recently took notice that Archstone is on the short list for possible contractors for the Howard University Town Center.

"One of our main concerns is that, given the company's practices of undercutting workers' wages in New York, [they may] try to do the same thing here at Howard if they're given this contract to develop the Town Center," said Jaime Contreras, Area Director for SEIU Local 32BJ.

The Howard University Town Center will be on a 2.2 acre plot of land at 2112-2146 Georgia Ave., N.W. It will be a mixed-use facility that will include rental units, a grocery store and a parking garage.

Howard developed the initiative with aid from the Fannie Mae Foundation and the D.C. government.

"At a time when workers are struggling to buy gas, food and pay for mortgages, we believe that educational institutions should hire responsible contractors," Contreras said.

He continued, "Close to one out of three [D.C.] residents lives in poverty and struggles to get by on low income. We believe that worker's wages should be considered for these types of projects."

Contreras added, "It concerns us greatly because we can't allow a contractor to come in and pay workers a lot less than members make. We have to protect workers wages."

SEIU recently secured Howard workers a 16.5-percent increase in wages under a three-year contract effective until Nov. 10, 2010.

"We would hope that they would seriously consider our concerns," Contreras said. "Our hope would be that they hire responsible contractors to do this project."

He continued, "At this point, I have not received a response from the university, so I don't know what they're thinking of doing."

In response to the union's concerns, Diane Branch, associate vicepPresident of the Office of Real Estate Development and Asset Management, said, "Archstone is one of several developers we are considering as potential developers for the Howard Town Center."

Branch continued, "All prospective developers will be reviewed for the extent to which they have met the programmatic, legal and business requirements set forth in the Request for Proposals."

She added, "Until a selection is made, we will not be responding to any issues that do not directly address the criteria set forth in the university's selection procedure."

The criteria included in the selection procedure do not include protection of workers' rights.

On Sept. 12, SEIU Local 32BJ sent a letter to the university that stated, "In light of your ongoing review of Archstone's proposal to develop the Howard Town Center, we wanted to bring to your attention to some concerning news about Archstone and one of its parent companies, Lehman Brothers."

The statement reads, "Two days ago, Lehman Brothers' share price declined 45 percent, bringing the shares down over 91 percent from their peak last year.

"In a shareholder's call yesterday, Lehman Brothers reported that it is planning to shed assets, including transferring Archstone assets to a newly-formed, publically traded company called Real Estate Investment Global in early 2009."

Another letter written on Sept. 3 states, "As representatives of 100,000 property service workers, including hundreds of cleaners and trade workers at Howard University, we are concerned about the business practices of Archstone, one developer in consideration for the development of Howard Town Center.

"Given the company's practice of undercutting workers' wages in New York City, we are concerned Archstone may try to undermine wage standards at the University."

The statement referred to the Town Center as a necessary means for "battling Washington's chronic poverty rate."

According to Contreras, "There has been activity on the street all over in the 32BJ jurisdiction. We may or may not do one here depending on the route the university takes."

Archstone did not reply toe-mail requeststo commentfrom The Hilltop.
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