By Richard Korman

1/24/2000 issue

The phone call that signalled the end to Roy Kay Inc.'s days as an enemy of building trades unions came last June. LeRoy Kay, the contractor's owner, rang up James Cahill, international representative of the plumbers' union.

Kay told him that " 'I have an opportunity to be bought out and I'd like to talk to you and you've always been straight with me,' " says Cahill. " 'Regardless of what happens, my lawyer is getting rich and your lawyer is getting rich and it can't go on.' "

Last summer, the two met regularly. In concert with Edward Malloy, president of the Building and Construction Trades Council of Greater New York, bargaining began over how to untangle numerous lawsuits and investigations that the building trades had instigated. Roy Kay, which had been using nonunion labor on bigger and bigger projects it was winning in New York City, was also suing the unions. The company had been the target of a huge, sometimes violent, union demonstration on June 30, 1998, when workers clashed with police in Manhattan.

Powerful union leaders also kept local public works agencies and politicians focused on Roy Kay, including a state investigation of the company's apprenticeship program, and organizers were set free to use bottom-up methods. Union members "salted" into Roy Kay supplied information to the New York Dept. of Labor. Organizing efforts accelerated, aimed at depriving the contractor and other firms of their workers, and bringing hundreds of plumbers and sheetmetal workers into the union.

"His work force was decimated, he couldn't hire, and every time he turned around he was in court," according to Tom Tighe, a special organizer with Local 9 of the plumbers' union in Englishtown, N.J. Tighe coordinated the work of a coalition formed to fight Roy Kay. The campaign included theatrical elements, as well. About 300 union members performed Christmas carols with bagpipes and base drums outside Kay's son David's home in December 1998.

Building trades unions are still savoring their victory. By most accounts, Roy Kay's switch to the union side was a business decision. John Harrington, president and business manager of Local 28 of the sheetmetal workers' union, says his local had for years been helping subsidize union competitors against Roy Kay. That helped push the company into general contracting, complicating its business, he notes.

Last Oct. 28, the formal signing of a peace pact took place outside Roy Kay's Manhattan project site. And just like that, the firm became, in the eyes of the unions, a welcome signatory employer. The Freehold, N.J.-based company subsequently signed collective bargaining agreements with key New York locals.

To the Associated Builders and Contractors, which represents nonunion firms, the successful drive against Roy Kay confirms what is wrong with unions. "As long as unions are in the street, jumping on cars, punching police horses in the nose and stopping the flow of traffic in a major international city like New York, they are making our case that they are out of touch with construction's free-market economy and its principles," says Scott Brown, an ABC spokesman.

Even so, unions have signed with a firm whose annual revenue may be approaching $100 million. They also may have cleared the way to complete the firm's sale. Union sources say the Kays soon will announce the sale of part or all of the company to Keyspan Energy, a deregulated subsidiary of a parent company that also owns Brooklyn Union gas and other utilities. Last fall, Keyspan bought Delta Mechanical, a Rhode Island mechanical contractor. Keyspan officials did not comment, and the Kays, who shun publicity, did not return calls.

For Roy Kay's nonunion workers, jitters about joining unions apparently have disappeared, says Cahill. Experienced craft workers were given journeymen cards and gained 50% pay increases on nonprevailing wage work, union sources claim. They will try hard to assure that Roy Kay, the new union contractor, is a runaway success.