"There's a perception outside government that employers are not high on the department's priority list," O'Claray told state legislators in Juneau Jan. 27.

To repair the department's image, Gov. Frank Murkowski has formed a new Division of Business Partnerships within the labor department. The governor has hired Katherine Farnham, a senior human resources manager for BP Exploration (Alaska Inc.), to run the division, O'Claray told the House Finance Committee.

Farnham has been active on state training and workforce development advisory councils and is considered the driving force behind the formation of the Alaska Process Industries Careers Consortium, an industry group. APICC has been working with the University of Alaska on programs to train skilled workers for the oil and gas industry.

Bringing Farnham on board is part of an effort by the department to jump-start its training programs. Two years ago state agencies were reorganized and responsibility for training programs managed by the state Deptartment of Community and Regional Affairs, which was dimembered by in 2001, were transferred to the labor department.

"We want to send a message to the business community that we have had an image problem. Our style has to change. The tone of our relationship with business will be positive," O'Claray said.

"We realize that without a healthy business enviroment, there will be no good jobs in the economy," he said.

In a separate presentation to the House Labor and Commerce Committee, O'Claray said that, despite the new initiative with business, his department won't lose its traditional focus on enforcement of state labor standards, wage and salary laws and safety.

Rep. Dave Guttenberg, D-Fairbanks, said he hoped the new pro-business tilt won't distract the department from its core missions.

"I see the department as basically an advocate for workers in areas like safety and labor standards. I hope the 'partnership' message doesn't set up an internal conflict," Guttenberg said.

Legislators tried to pin O'Claray down on controversial topics like right-to-work laws and Project Labor Agreements. The commissioner, who previously represented labor groups as a lobbyist, told lawmakers that he may have his own opinions but he is obligated to support the governor's positions on these topics, which have not yet been developed.

"Personally I'm opposed to right-to-work laws," O'Claray said, referring to laws which prohibit exclusive union contracts. "But the position of this department will be that of the governor."

The same went for O'Claray's position on Project Labor Agreements, which are agreements negotiated with unions before major construction projects and which contain agreed-on provisions like no-strike clauses and wage scales.

"Project Labor Agreements have their place. A PLA was very effective for construction of the trans-Alaska oil pipeline. It kept labor disputes and delays to a minimum. A PLA can be good in some cases, but these are my views, not that of the governor," he said.

One initiative O'Claray hopes to accomplish is an increase in state unemployment benefits, he told the House Finance Committee. Alaska has the lowest unemployment benefits in the nation, and the state is losing skilled workers in seasonal industries like construction because the benefit is not enough to live on during the off-season, he said.