Union Power in Public Utilities: Defending Worker and Consumer Health and Safety

Unions whose members work for utility companies regulated by state public utility commissions have an underutilized opportunity to confront their employers. Where employee objectives and public utility commission (PUC) statutory responsibilities overlap, unions can raise member concerns at both the bargaining table and the regulatory table. Workforce participation in PUC proceedings concerning proposed utility mergers—many of which are accompanied by layoffs—is already routine. However, as utilities need regulatory approval to achieve virtually all significant financial goals, unions must be cognizant of potential opportunities afforded through the PUC process. Unions should view PUC proceedings as a forum in which to advance vital interests, whether through intervention in cases initiated by their employers or through matters commenced by unions themselves.

This article briefly reviews the broad scope of state PUC authority,¹ describes the typical players in a regulatory proceeding, and offers real-world examples of how utility unions are successfully using the PUC process to advance workforce objectives. These opportunities can and should be considered throughout the country, but especially by unions operating in regions in which concerns have been raised about the quality and reliability of the services provided by their utility employers. In seeking to improve service delivery, union and consumer objectives should often coincide. However, implementing service quality improvements may require rate increases, which can make it more difficult to forge union-consumer group alliances.

The Scope of PUC Jurisdiction

Companies operating under PUC jurisdiction—which typically include gas and electric utilities, water service providers, and telecommunications companies—require commission approval to take actions ranging from raising rates, to issuing stock, to acquiring other utility companies. While the scope of each PUC’s jurisdiction depends on its governing statutes, commissions are generally given broad supervisory authority over the utilities within their jurisdiction. They are typically charged with ensuring that utility operations are conducted in a “safe,” “adequate,” and “reasonable” manner, consistent with the “public interest,” and that utility rates are “just and reasonable.”² Some PUC statutes refer expressly to employee interests; Pennsylvania even requires its PUC to consider union interests in limited circumstances.³ However, such formulations are by far the exception, and a reference in a PUC statute to employees should not by itself determine whether a union participates in a regulatory proceeding. Even the most “generic” PUC statutes leave ample room to raise employee concerns. For example, a regulated employer that is chronically understaffed can be attacked on the ground that failing to hire sufficient staff adversely impacts service quality, thereby implicating PUC oversight.

In most states, courts or legislatures have enumerated wide-ranging powers for utility commissions. For example, in Tennessee the state Supreme Court has described the power of its PUC (the Tennessee Regulatory Authority) as “practically plenary.”⁴ In Alaska, the PUC is authorized by statute to “investigate the management of a public utility, including but not limited to staffing patterns . . . for the purpose of determining inefficient or unreasonable practices that adversely affect the cost or quality of service of the public utility.”⁵ And Nevada law requires its PUC to ensure that providers of electric service “engage in prudent business management, effective long-term planning, responsible decision making, sound fiscal strategies and efficient operations.”⁶

Many traditional labor union concerns—including ensuring adequate staffing levels and safe working conditions—are intimately intertwined with a utility’s ability to provide adequate service. This means that there are often solid grounds for asserting that PUCs have authority in the context of utility regulation to address matters of central concern to employees and their labor representatives. As the Pennsylvania PUC observed in construing its statutory authority, “unless the quality or value of service rendered by a utility is taken into consideration, a judgment on the lawfulness, justness, and reasonableness of the rates sought cannot be made.”⁷

Nonetheless, a PUC’s jurisdiction to regulate traditional “labor matters” is not unlimited,⁸ and unions seeking to participate in rate proceedings should anticipate employer opposition on the ground that “union issues” fall outside the PUC’s jurisdiction. For instance, [End...