Federal Judge: Chicago Convention Reforms Illegal

Arguing that the Illinois state Legislature violated the collective bargaining rights of unions when it enacted them, a federal judge ruled late last month that many of the convention reforms implemented recently at Chicago's McCormick Place convention center are illegal.

U.S. District Judge Ronald Guzman issued the ruling on March 31 in response to a lawsuit filed by two unions — the Teamsters and Carpenters — alleging that the state had overstepped its authority when it passed a series of reforms impacting the production of trade shows at McCormick Place. According to the unions, the National Labor Relations Act prohibits state legislatures from enacting changes to collective bargaining agreements between unions and private companies.

"[The state] had no business trying to interfere with collective bargaining," Marvin Gittler, an attorney representing the Teamsters, told the Chicago Sun-Times.

Although it admitted that it is a setback, the Metropolitan Pier and Exposition Authority (MPEA) — the agency that runs McCormick Place — said it will appeal the ruling. And in the meantime? Because Guzman did not issue a permanent injunction against them, McCormick Place said it will continue implementing reforms until a federal judge bars it from doing so.

"As all observers of the convention and trade show business are aware, the implementation of those reforms has, virtually overnight, transformed McCormick Place from a great convention and trade show facility that was rapidly losing its customer base into an industry powerhouse," said Jim Reilly, who is the trustee appointed by the Legislature to oversee reform. "Not only were our existing customers convinced to keep their events in Chicago, but new shows have been rapidly signing up, and these reforms have had a strong impact on the economy of Chicago during these difficult times."

Added Illinois Senate Minority Leader Christine Radogno, "We are hopeful [MPEA] wins a quick stay and that the decision is overturned on appeal. The bipartisan legislation passed by the General Assembly is critical to the viability of McCormick Place."

Passed in May 2010 and implemented on Aug. 1, 2010, McCormick Place's Phase I convention reforms included: standardized and expanded straight-time, overtime and double-time windows; expanded exhibitor rights; changes to the in-house electrical contractor; a new automobile and small utility vehicle policy; reduced crew sizes; and reduced food prices.

Initiated in November, Phase II reforms included free Wi-Fi throughout the convention center; reduced parking rates; new rules allowing companies to compete to provide electrical services for trade shows; and new rules allowing exhibitors to bring outside food into the convention center for consumption by employees.

Last month's ruling questions the ability of exhibitors to set up their own booths, as well as the expanded straight-time window for paying union labor. It does not impact reforms making food and electrical prices more competitive.