Welcome to the 12th and final issue of the year for The Site Report.

As we come to the end of 2022, we invite you to provide us any feedback regarding issues you would like us to revisit. Is there a topic that you find interesting and could use some guidance? Would you like our opinion about a particular issue or case? Please email us your thoughts and we will include them in our 2023 planning.

We wish you and yours a wonderful holiday and a prosperous new year!

We hope you enjoy this issue and, as always, thank you for reading.

Stephanie U. Eaton - Co-Chair, Construction Group; Vice Chair of Southern Offices, Litigation Department; Editor, The Site Report

and

Julian E. Neiser - Co-Chair, Construction Group; Vice Chair of Northern Offices, Litigation Department

By Julian E. Neiser

Construction professionals sometimes feel as if it is déjà vu when it comes to disputes—and they are right. There are a handful of claim types that always seem to rear their heads, even in projects that generally are run well. This article will briefly describe those claims and how to avoid them in 2023.

Click here to read the entire article.

By Stephanie U. Eaton and Alexander L. Turner

The Site Report has extensively discussed the developments of 3-D printing building construction and its impact on the construction industry. 3-D printing structures is becoming more commonplace. Last month, Iowa State University began designing 3-D printed housing for rural Iowa. ICON Technology, Inc., an Austin, Texas company, is currently planning to build an entire subdivision in Texas using its 3-D printing technology. Expanding on its 3-D construction experience, ICON recently entered into a contractual partnership with NASA that will see its 3-D construction technology used extraterritorially.

Click here to read the entire article.

By Jonathan A. Deasy

A picture is worth a thousand words, but what about a drone video? To construction firms and the lawyers who represent them, drones, also known as unmanned aerial vehicles (“UAVs”), enable firms to capture large amounts of high-quality information in a quick and efficient manner. Whether a construction project is in the pre-planning phase or involves a dispute giving rise to litigation, construction lawyers should be familiar with regulations regarding the use of UAVs and how data generated by them can be used by counsel to prove or disprove construction claims. 

Click here to read the entire article.

By Steven C. Hemric

As we wrap up 2022, the outlook for 2023 in the construction industry is more positive than many expected. This survey reflects strong project backlog numbers and confidence in new projects coming into the pipeline. However, a number of contractors pointed to decreases in private projects due to the current struggles hitting the economy at large. This signals that public projects, specifically infrastructure projects based on the data from this survey, are likely to be the drivers of new work. This could create great opportunities for contractors to take new approaches, like setting up joint ventures to pursue larger projects than would be possible alone or to pursue contracts set aside for small and minority-owned business (e.g., Section 8(a) projects). The contractors that participated in this survey also continued to express concerns about material and equipment cost increases. These cost increases will impact both contractors and project owners, and everyone with projects on the horizon should be prepared to address price escalations during contractor negotiations and during the life of their project.

By: H. Dill Battle III

NCCI’s annual survey of top insurance executives provides insight into carrier concerns for 2023, and reminds employers of the importance of a vigilant safety program.

For the carriers surveyed, the shifting workforce in the current economic environment was one area of concern for 2023. A tight labor market may require hiring inexperienced workers with less focus on safety training, which could affect the frequency and severity of on-the-job injuries. Changes in work patterns to remote and hybrid workers following the pandemic created work environments with which the industry has little experience, causing trepidation for the surveyed insurance leaders.

Building a culture of safety reduces workplace injuries, limits lost production, and allows an employer to take advantage of cost savings in the current workers’ compensation insurance market.

The survey results and other resources can be found on NCCI’s website.

By: Kevin L. Carr

A Gallup Poll (August 2022) reports that 71 percent of Americans approve of labor unions, the highest approval rating in nearly 60 years. It is no surprise that this meteoric rise in union popularity comes at a time when unions were in the news on a near-daily basis and involving businesses like Amazon, Starbucks and Trader Joe's. Unlike the immediate post-pandemic period when it was a seller’s market, we will enter 2023 with signs of a recession, rising inflation, and a tightening job market. These factors will likely test the ability of unions to bargain on behalf of their newly unionized employees, and employers will be equally incentivized to give little ground with the pending economic risks. Regardless of whether unions continue to grow in popularity, employers must be more vigilant than ever in ensuring they compensate employees fairly, create a positive work environment for all employees, and otherwise take steps to make a union unnecessary.

By: Mitchell J. Rhein

Following the unionization efforts at nationwide chains (e.g., Starbucks, REI, Trader Joe’s, and Chipotle) that took place in 2022, these newly unionized chains will be busy negotiating initial contracts throughout 2023. During these negotiations, we expect two trends to emerge:

Employers with unionized and non-unionized employees at different locations will attempt to withhold compensation increases offered to non-unionized locations from newly unionized locations. An employer may need to increase wages for legitimate reasons (e.g., retention), but it cannot change its unionized employees’ wages without the union’s agreement. An employer is unlikely to increase wages for unionized workers without concessions from the union, which may cause the employer to withhold raises offered to non-unionized employees. Employers must beware of the risk of discrimination claims by unionized workers if pay increases are offered to only non-unionized locations (see the Board’s complaint against Starbucks from this summer). However, there has also been a general trend in favor of more pay increases for non-unionized workers. The Bureau of Labor and Statistics reported total wage and benefit costs for private-sector nonunionized employers was 3 percent higher than unionized employers for the 12-month period ending June 2022. 

Unions that represent unionized employees in different bargaining units at multiple locations will attempt coordinated bargaining. To increase their chances of winning organizing campaigns against nationwide chains, unions sought to unionize employees on a location-by-location basis. After winning these campaigns, unions' lawyers and representatives will be spread thin trying to negotiate separate contracts at individual employer locations, which will be costly and time consuming. To mitigate the costs and time to negotiate contracts, unions negotiating on behalf of employees at many locations may attempt strategies to achieve coordinated bargaining (e.g., making similar demands or using identical bargaining representatives for all locations). Under current law, however, the unions cannot insist the employers accept a “master” agreement covering employees at different unionized locations or condition any agreement on the employer’s acceptance of similar terms at a different location. We expect unions will test the limits of this current law.

By: Heather M. Garrison

The rapidly changing legal landscape on marijuana usage is a challenging area of compliance for employers – particularly multi-state employers. Workplace and public safety, employee privacy, and disability laws further complicate matters. Employers must address the use of medicinal marijuana and recreational marijuana in the workplace to ensure that their policies comply with all applicable laws and that appropriate steps can be taken when faced with positive marijuana drug test results.

Some state laws prohibit employment discrimination against applicants and employees who use medical and/or recreational marijuana, and we can expect to see courts continuing the trend to protect the rights of individuals in the workplace. Employers should continue to monitor changes in federal, state, and local laws while carefully drafting policies with the guidance of legal counsel.

Kelsie A. Wiltse

Associate

Winston-Salem, NC

336.725.4425

kwiltse@spilmanlaw.com

Kelsie Wiltse is an Associate in our Winston-Salem, North Carolina office. Her primary areas of practice are commercial litigation and employment law. Kelsie assists in various types of employment law matters, including workplace investigations, advising and counseling businesses, and defending charges and lawsuits. In addition, she assists in commercial contract review, depositions, and trial preparation.  

Kelsie is a member of the North Carolina Bar Association and Forsyth County Bar Association. She received her B.A. in Criminology/Criminal Justice, magna cum laude, from the University of North Carolina at Charlotte and her J.D., cum laude, from Elon University School of Law. She is admitted to the North Carolina Bar and the United States District Court for the Middle District of North Carolina.