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Archive for August, 2013

Same-sex spouse gets ERISA death benefit

Thursday, August 15th, 2013

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Sarah Farley had worked at a law firm where she participated in the firm’s Profit Sharing Plan – a plan qualified under the Employee Retirement Income Security Act (ERISA). The Plan provides that death benefits be paid to the participant’s “surviving Spouse.”

Sarah then married Jean Tobits in Canada. When Sarah died, both Jean and Sarah’s parents claimed the death benefits.

The dispute went to federal district court in Pennsylvania (Cozen O’Connor PC v. Tobits) where the judge had no trouble deciding that Jean was Sarah’s surviving spouse.

In United States v. Windsor (US Supreme Court 06/26/2013) the Supreme Court held that Section 3 of the Defense of Marriage Act (DOMA) – defining “spouse” as a person of the opposite sex – is unconstitutional. Therefore, since Sarah and Jean were lawfully married, and that marriage is recognized by the laws of Illinois, ERISA has to be interpreted as meaning Jean was Sarah’s spouse. And thus the law firm’s ERISA plan has to be interpreted as meaning Jean was Sarah’s spouse.

This leaves me with one huge question: Will you get the same result in every state? That seems doubtful to me. The opinion in Windsor (a 5-4 decision) relied heavily on the fact that Windsor’s same-sex marriage was recognized by the State of New York (and the Tobits marriage was recognized by the State of Illinois). As Justice Kennedy put it, “DOMA’s principal effect is to identify a subset of state-sanctioned marriages and make them unequal.” So, if you’re in a state where same-sex marriages are not recognized, it may be difficult to apply the logic of the Windsor case.

Hat Tip to Mike Reilly at Lane Powell, who writes Boom: The ERISA Law Blog.

This article originally appeared on Ross Runkel Report on August 13, 2013.  Reprinted with permission

About the Author: Ross Runkel Ross Runkel is a full-time labor-management arbitrator, professor of law emeritus, and former editor of Employment Law Memo.

Oil Drilling Boom Boosts Boilermakers, Other Shipyard Unions

Thursday, August 15th, 2013

Bruce Vail

Unionized workers at Aker Philadelphia Shipyard breathed a collective sigh of relief late last week with news that an agreement to build as many as eight new oil tankers has been finalized. The investment, estimated to be worth $1 billion, should keep the yard humming for the next four years.

The contract to build the new ships means that some 1,000 workers will continue to be regularly employed beyond next year, when the yard will complete most work on two crude oil tankers now under construction for a shipping subsidiary of ExxonMobil Corp. Recent years have seen some lean times at the shipyard, with employment falling to 400 as recently as 2011 when new orders for vessels were hard to come by, says Aker spokesperson Kelly Whittaker.

“It’s feast or famine in this business, so we’re really happy they [Aker] got the contract,” says Phillipp J. Evans, a regional representative for the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers. The Boilermakers union represent about two-thirds of the workers at the Aker yard, Evans estimates, with the remainder represented by local units of 10 other unions organized into the Philadelphia Metal Trades Council.

The Aker Philadelphia contract is welcome news also because it confirms a national rebound in commercial tanker construction, adds Ron Ault, President of the AFL-CIO’s Metal Trades Department (MTD), which represents unionized shipbuilders around the country. In May, shipyard employees in San Diego got a similar boost when a company called American Petroleum Tankers signed a contract for new vessels at the General Dynamics NASSCO yard there. Some 800 workers are expected to be hired to complete that contract, according to a NASSCO statement.

Rumors are rife that there are further tanker orders in the offing, most of which are related to an unusual rise in the U.S. production of crude oil, Ault says. Increased shale oil drilling—largely in the Bakken region of North Dakota and the Eagle Ford geologic formation in Texas—are flooding the domestic market with new crude, and the oil industry is scrambling to line up tankers to move the crude to refineries and then ship the refined petroleum  products to consumers.

Largely absent from most discussions of the tanker resurgence is the environmental impact of the drilling increase. Most of the new oil is thought to displace imports from the Middle East or Africa, so there appears to be little net impact on total oil consumption or the resultant air pollution. With a decision due soon from federal government authorities on whether the Keystone XL pipeline will go forward, it is a tricky moment in relations between environmentalist and organized labor, and neither side seems anxious to worsen the situation by introducing new, potentially divisive issues. And for the Boilermakers and other unions that build tankers and equipment for the energy industry, environmental concerns rarely register.

Shipping industry experts are startled by the tanker boom. Tim Colton, a retired shipbuilding executive who writes the popular blog Maritime Memos, commented Aug. 9:

It’s amazing to think that it’s not very long ago that it was safe to say that all the… (U.S.-flag commercial tanker construction) was done, which it was, and here we are building ships like crazy, with a bunch more still to be ordered.  This upheaval in the domestic product trades is the most exciting thing that’s happened in the industry in decades, especially as there’s been almost no growth in these trades since the 1970s.

The excitement was accentuated in June when Reuters reported that ExxonMobil had chartered one U.S.-flag tanker at the astonishingly high rate of $100,000 per day. Controlled by the Koch Shipping and Supply Company (owned by the notorious Koch brothers), the vessel American Phoenix was reported to be earning 50 percent more than similar vessels at the same time last year. With charter rates at these levels, operating U.S.-flag tankers is estimated to be a very profitable enterprise that will spur construction of additional ships.

The lively tanker market also has an effect on the barge industry, which along with pipelines and railroads is an important player in the oil transport sector. For example, barge builder Jeffboat reported in late July that it was adding about 100 new jobs to help fill orders for tank barges. Coincidentally, Teamsters Local 89 ratified a new contract covering about 800 of its members at the Jeffersonville, Ind. yard at about the same time.

Back in Philadephia, Boilermakers’ Evans adds that the new tanker contract there should provide some respite also from political attacks on Aker Shipyard, and also on the Jones Act, the law that requires ships carrying cargo between U.S. ports to be built here and crewed with U.S.civilian seafarers.

Pennsylvania lawmakers have been subjected to intense criticism since 1998 for a series of efforts to financially aid the shipyard’s conversion from a military facility to a commercial yard, and the unions have come in for their share of attacks, he says. Such attacks have been most intense when the yard has struggled, while the benefits of such aid are most apparent when the yard’s order book is full.

Attacks on the Jones Act itself (particularly from big business interests and their Republican Party allies) are almost constant, adds MTD’s Ault. Complaints typically focus on the high cost of building ships in U.S. yards, compared to dramatically lower prices for similar vessels from countries like South Korea or China. But American labor has always argued that the ships are worth the price because they support U.S. jobs and are crucial to the country’s manufacturing base. Shortages of U.S.-flag tankers invariably prompt new calls for doing away with the Jones Act, Ault says, but strong labor union support for the law has been successful in blocking repeal efforts in the past. Today’s unusual conditions in the U.S. domestic tanker market can be expected to draw fresh fire against the Jones Act, he predicts, and unions will have to stand ready to defend the law again.

This article originally appeared on Working in These Times on August 14, 2013.  Reprinted with permission.

About the Author: Bruce Vail is a Baltimore-based freelance writer with decades of experience covering labor and business stories for newspapers, magazines and new media. He was a reporter for Bloomberg BNA’s Daily Labor Report, covering collective bargaining issues in a wide range of industries, and a maritime industry reporter and editor for the Journal of Commerce, serving both in the newspaper’s New York City headquarters and in the Washington, D.C. bureau.

Detroit firefighters and police face pension cuts with no safety net. Not even Social Security.

Wednesday, August 14th, 2013

Laura ClawsonLosing a pension you’ve worked years to earn is a nightmare scenario, one that can change a comfortable, secure retirement into one filled with worries and penny-pinching as Social Security goes from being part of your retirement income to all of it. For public workers in many places, including firefighters and police in Detroit, it’s a doomsday scenario, because they don’t get Social Security at all.

About 30 percent of public employees nationwide aren’t covered by Social Security; government workers weren’t covered by the program at its inception and while many have been moved under its umbrella over the years, some cities, towns, and states continue to run pension plans that don’t include Social Security. Detroit’s firefighters and police are in that group:

Of the nearly 21,000 city retirees now collecting pensions, 9,017 retired police officers, firefighters or their surviving spouses don’t get Social Security, or about 44 percent of all city pensioners.

For those who have worked in other jobs for long enough to qualify for Social Security, those benefits are reduced by a percentage of their Detroit pension. That’s not a lavish pension, by the way: The average annual police pension in Detroit is $30,000, compared with $58,000 in Los Angeles, $47,000 in Dallas, and $42,000 in Kansas City. And public workers’ pensions, unlike the pensions of many private sector workers, aren’t insured by the federal Pension Benefit Guaranty Corporation, meaning if they lose their Detroit pensions, that’s it, there’s no safety net to catch them.

What we’re talking about here are workers who spent decades earning less than they might have elsewhere in exchange for the promise of a secure—though not lavish—retirement. And now they face the very real threat of being left with a small fraction of what they earned and need to live on. They kept their promises to the city of Detroit. It must keep its promises to them.

This article originally posted on Daily Kos Labor on August 12, 2013.  Reprinted with permission. 

About the Author:  Laura Clawson is the labor editor at Daily Kos

Honeywell Plant Freezes Summer Vacations

Monday, August 12th, 2013

Mike ElkAt a time of year when many workers are taking family vacations, uranium workers at Honeywell’s plant in Metropolis, Ill. won’t have that option. On July 27, the company announced a vacation freeze. United Steelworkers Local 7-669, which represents workers at the plant, claims that the decision is just another salvo in a three-year-long battle by Honeywell to bust the union.

Honeywell is currently in the process of rehiring several hundred operations workers at the uranium plant who were laid off in July of 2012 when the plant shut down for earthquake-safety improvements requested by the Nuclear Regulatory Commission.

Earlier this year, Honeywell began slowly rehiring the laid-off workers—both hourly union employees and non-union salary employees—to restart the plant. Now all but 21 of the 200 union employees have been rehired as the plant moves toward full operationality. But instead of rehiring the final 21 union workers, Honeywell is proceeding short-staffed and calling in workers on their days off to make up the gap.

In order to put pressure on the company to rehire the 21 laid-off union members, some union employees are refusing to work any overtime (and passing up the time-and-half pay). In response, Honeywell announced that because of the staffing shortage, no workers can take a vacation this summer.

In a July 27, 2013 email to employees, Honeywell Metropolis Operating Manager Jim Pritchett wrote:

Effective immediately, all vacations are cancelled and no further vacations are to be granted in operations including individuals’ days—that includes all hourly and salaried staff. The purpose is to assure we are staffed to support operations and to continue to get the remaining units on line so we can support our customers. … I am disappointed it has gotten to this but we have no choice due to employees not responding to call ins and taking care of their responsibilities…. This vacation freeze will be lifted as soon as the business needs of the plant are being effectively met by people coming when they are called.

The union speculates that Honeywell has an ulterior motive for not hiring the remaining 21 workers: It doesn’t want to rehire Local 7-669 President Stephen Lech. Under the union contract, Honeywell is obligated to rehire all of the laid-off union employees according to a mutually agreed upon list developed according to workers’ qualifications and seniority. The next person on the list is Lech.

“It’s directly targeting me for my work as union president,” says Lech, who thinks that Honeywell is trying to send a message about the length that the company is willing to go to crush the union.

The union says that instead of following the list, Honeywell has told the final 21 workers that they must compete against outside applicants and reapply for their jobs as if they were new hires directly off the street.

“It’s a violation of the contract,” Lech says. “How can Honeywell do it? Well, Honeywell does whatever they want.”

“It will take six months before the case even gets before an arbitrator and another six months before the arbitrator rules,” he says.

Workers are refusing overtime in the hopes that they can resolve the issue sooner. Many were planning family vacations and were outraged by the vacation moratorium.

“It’s a morally bankrupt company that punishes their employees for staffing shortages it created out of spite,” reads a text message to Working In These Times by one Honeywell employee who wished to remain anonymous for fear of being fired. “Two years ago we took their lousy contract and they’re still kicking us.”

Honeywell did not respond to request for comment for this piece.

Lech says that despite being laid off, he is undeterred from his work for the union.

“This absolutely will not stop me from doing my job,” says Lech. “Heck, I got more time than ever to work as union president.”

This article originally appeared on Working In These Times on August 12, 2013.  Reprinted with permission.

About the Author: Mike Elk is an In These Times Staff Writer and a regular contributor to the labor blog Working In These Times.

We Cannot Build a Strong, Equitable Economy on Low-Paying Jobs

Friday, August 9th, 2013

Mary Kay HenryWhat started out last fall as a one-day walkout at fast-food restaurants to protest poverty-level wages and stand up for basic human dignity has transformed into a movement that has captured the public interest.

I’ve been privileged, especially in recent weeks, to talk to institutional partners, policymakers and media about why low-wage workers across the country are risking their jobs and forgoing a much-needed day’s pay to work toward a better future for themselves and their families. We will be better off when hardworking people have enough money in their pockets to put back into their communities and generate more jobs, and SEIU members are proud to back these workers in their pursuit of economic justice and better lives for their families.

I traveled to New York City on Wednesday, to talk to Comedy Central host Stephen Colbert about the fast-food strikes. How in the world did this happen? I told Kendall Fells, an organizer from Fast Food Forward, it is because of the courage of the strikers, such as Shay Kerr and Shakira Campbell.

Shay has worked at McDonald’s in East Flatbush, N.Y., for six months. She earns minimum wage and, because sometimes her hours are cut for no reason, she can’t rely on a set pay every week. Since she cannot make ends meet on her wages, she has been bouncing around shelters. She’s fighting for a union so she can make a better life for herself and her 6-year-old son. Shakira is leading an action tomorrow at her store to be put back on the schedule. Their stories echo stories I’ve heard from workers all around the country.

Shakira, Shay, and many others who I have had the privilege of meeting in recent months are helping the public understand that, contrary to what some believe, these positions aren’t being filled by teenagers. Anyone who thinks they are is nostalgic for a time that no longer exists.

More than 4 million people work in the food service industry. Their average age is 28. Many of these workers have children and are trying to support a family. The median wage (including managerial staff) of $9.08 an hour still falls far below the federal poverty line for a worker lucky enough to get 40 hours a week and never have to take a sick day. According to the National Employment Law Project, low-wage jobs comprised 21 percent of recession losses, but 58 percent of recovery growth in the last few years.

This means middle-class jobs are disappearing while low-wage jobs are growing. If we simply accept this as fact, then the divide between the haves and the have-nots will only grow worse. And that is just wrong.

We cannot build a strong, equitable economy on low-paying jobs. Corporate profits are at an all-time high. McDonalds earned $5.5 billion just last year; other fast-food restaurants and retail chains are similarly profitable. They can afford to raise wages.

Americans have a long history of sticking together to fight for something better. SEIU can be proud of how we are fighting on so many fronts, from winning commonsense immigration reform, to delivering on the promise of the Affordable Care Act, to telling our elected officials to invest in vital public services, and to organizing in various sectors to make sure workers have a voice in the workplace. All of our members are involved in these campaigns to help workers strengthen and grow our union. As we do it, we know we have to reach out to the growing service sector of low-wage jobs in retail and fast food.

We are united to make a path to power for all workers; winning a just society; and leaving the world a better and more equal place for next generations to come.

This article originally appeared on SEIU blog on August 8, 2013.  Reprinted with permission.

About the Author: Mary Kay Henry is the International President of the Service Employees International Union (SEIU).

Can McDonalds Make A Profit While Paying $15 An Hour?

Thursday, August 8th, 2013

Bryce CovertWhile the average McDonalds employee in the United States makes just above the $7.25 minimum wage, that story is different in other countries. As Jordan Weissmann reports at The Atlantic, the minimum wage for full-time adult workers in Australia is $14.50 and McDonalds employees just negotiated a 15 percent raise by 2016. Yet the company has about 900 locations in the country.

Meanwhile, its profit margins at company-owned restaurants are higher in Europe than in the U.S. despite many countries there having a higher minimum wage. France’s minimum is about $12 an hour, and yet there are more than 1,200 locations there.

Residents of other countries pay more for their Big Macs, in part at least to make up for those extra costs, but the increase in prices is not drastic. Australians paid an average of $4.62 in U.S. dollars for a Big Mac in July and it cost $4.66 in the eurozone, while Americans paid $4.56. That’s a difference of about 6 to 10 extra cents, which would mean raising Big Mac prices a little over 2 percent in the U.S. to come equal with those in Europe.

Higher prices are related to the fact that the company does spend more on the cost of labor in other countries. In the U.S., it spends about 25 percent of its expenses on workers at the locations it owns, and franchises usually assume labor costs will take up about 30 to 35 percent. Worldwide, those costs have been found to come to closer to 45 percent of expenses. But the company reported nearly $5.5 billion in net income overall last year, up from about $2.4 billion in 2007, with more revenues coming from Europe than the U.S.

Australian locations have other ways to keep labor costs low, like exploiting a loophole that only requires an $8 wage for teenagers. Weissmann also reports that the company likely gives its higher paid European employees more responsibility and so ekes out more productivity from those workers. While productivity has risen in the U.S., wages haven’t.

But it’s clear, even to the company itself, that its American wages are not enough to get by on. It released a sample budget for employees that suggested paying nothing for heat, getting a second job, and spending just $20 a month on health care. While it claims to be an above minimum wage employer in the U.S., its average wages are mere cents more.

The inability to get by on its low wages has sparked pushback from workers across the country, with fast food workers striking in nine different cities. They are calling for a $15 minimum wage, the same as Australia’s, which is higher than President Obama’s $9 an hour proposal and Congressional Democrats’ of $10.10 an hour.

This article originally appeared on ThinkProgress on August 6, 2013.  Reprinted with permission. 

About the Author: Bryce Covert  is the Economic Policy Editor for ThinkProgress. She was previously editor of the Roosevelt Institute’s Next New Deal blog and a senior communications officer. She is also a contributor for The Nation and was previously a contributor for ForbesWoman.

8 Ways That ALEC Is Targeting Working Families

Wednesday, August 7th, 2013

Kenneth-Quinnell_smallInformation about the American Legislative Exchange Council (ALEC) working in secret to push state-level policy to more extreme levels is coming to light more and more and America’s working families are starting to stand up to the group’s corporate-driven agenda. While ALEC’s agenda is all over the policy map, the organization has a particular focus on pushing new laws that attack working families and undercut the rights of workers, both in the workplace and in retirement.  Here are eight of the most dangerous and most widespread ways that ALEC is targeting workers and their right to a voice on the job.

8. Voter ID Act: Laws directly based on or similar to ALEC’s Voter ID Act have been introduced in recent years in nearly every state, with more than a dozen states passing or strengthening such laws in the past three years. These laws disproportionately affect working families, senior citizens, people of color and residents of rural areas and help elect legislators who vote against the rights and needs of workers.

7. Paycheck Protection Bills: ALEC has at least four different versions of this legislation, each one more extreme than the last, that were introduced 20 times in various states in 2013. These bills range from requiring that each employee sign an annual form authorizing that their union dues be allowed to be used for political purposes to preventing payroll deductions from being used for union dues. These bills provide no additional rights to workers and do nothing more than weaken the ability of workers to collectively bargain by depriving unions of the funds they need to fight on behalf of their members.

6. Direct Union Assaults: Through model legislation such as the Election Accountability for Municipal Employee Union Representatives Act and the De-certification Elections Act, introduced in Idaho and Arizona, respectively, ALEC is seeking to make public employees vote over and over again to retain their union status, giving ALEC and other groups the opportunity to flood workers with anti-union propaganda.

5. Public Employees’ Portable Retirement Option Act: Through this and similar bills, 10 states have attempted to weaken or eliminate defined-benefit pension plans and replace them with defined-contribution plans, which make retirees depend on the market for how much money they have for retirement and health care.

4. Council on Efficient Government Act: As Orwellian a name as any in the ALEC arsenal, this legislation does nothing but use government money to create a commission to figure out ways to privatize government services. In other words, yet another example of ALEC attempting to get taxpayer money into the hands of private corporations without any accountability or taxpayer recourse.

3. “Right to Work” Act: This incredibly misleadingly titled legislation gives no one any new rights and does nothing but prevent employees from paying for the benefits that unions earn on their behalf. So-called “right to work” for less states end up paying their workers a lot less than states that don’t have such laws. In 2013, 15 states introduced this legislation.

2. Parent Trigger Act: These laws give parents the option, once a majority of parents sign a petition, to change a public school into a charter school, give students vouchers or close the school. Seven states have passed parent trigger laws similar to the ALEC bill. Parent Trigger laws force parents to make a bad choice—either stick with a poorly performing school, or take drastic actions that are likely to make things worse, do little to help students and are a boon for corporate groups that run private schools. Meanwhile one of the best tools for helping working families reach the middle class—public education—gets less and less funding.

1. Wage Protections: In 14 states, ALEC model legislation attacking wage protections were introduced. The bills sought to weaken or eliminate laws that require prevailing wages, living wages or minimum wages. Big corporations heavily support these efforts, which would only serve to lower wages for workers.

On Thursday, Aug. 8, working families and other opponents of the ALEC agenda will be rallying at the conservative group’s convention in Chicago. Those who are in the area can RSVP online.

This article originally appeared on AFL-CIO NOW blog on August 7, 2013.  Reprinted with permission. 

About the Author: Kenneth Quinnell is a long-time blogger, campaign staffer and political activist whose writings have appeared on AFL-CIO, Daily Kos, Alternet, the Guardian Online, Media Matters for America, Think Progress, Campaign for America’s Future and elsewhere.

Walmart: Portrait of a Job Killer

Tuesday, August 6th, 2013

Image: Mike HallWhenever communities, lawmakers or activists question or criticize Walmart for the way it treats workers—the low-pay, the stores’ impact on the communities—the retail giant pulls out a well-worn script with a simple message, “Walmart creates jobs and if there’s one thing this economy needs, it’s more jobs.”

Setting aside the quality of the jobs for another day, is Walmart telling the truth? Sure doesn’t look like it, according to Salon’s Kathleen Geier, who matches Walmart’s claims against in-depth research from universities, economists, government studies and other sources. Here’s what she finds:

Contrary to Walmart’s self-glorifying mythology, the retailer is anything but a job creator—in fact, it is a huge job killer. Not only that, destroying jobs is an essential component of Walmart’s anti-worker business model.

She cites a study led by Economist David Neumark—who, by the way, has written against raising the minimum wage in a Wall Street Journal op-ed.

Using data from more than 3,000 counties, [the] results show that when a Walmart store opens, it kills an average 150 retail jobs at the county level, with each Walmart worker replacing about 1.4 retail workers. These results are robust under a variety of models and tests.

2009 study by Loyola University found that the opening of a Chicago Walmart store was “a wash,” destroying as many jobs as it created. According to the report, “There is no evidence that Wal-Mart sparked any significant net growth in economic activity or employment in the area.” Says Geier:

In short, when Walmart comes to town, it doesn’t “create” anything. All it does is put mom-and-pop stores out of business.

Walmart’s job-killing spree doesn’t stop at the city limits. The remains of once good jobs are scattered throughout Walmart’s entire supply chain. Its cut-throat drive for lower prices, writes Geier, squeezes suppliers to deliver goods at the lowest possible prices and that means cutting labor costs—aka jobs.

Read the full article.

Walmart’s using that specious jobs argument in its fight to block a living wage law in Washington,D.C. Find out more here.

Article originally appeared on AFL-CIO NOW  on August 6, 2013.  Reprinted with permission. 

About the Author:  Mike Hall is a former West Virginia newspaper reporter, staff writer for the United Mine Workers Journaland managing editor of the Seafarers Log.  He came to the AFL- CIO in 1989 and has written for several federation publications, focusing on legislation and politics, especially grassroots mobilization and workplace safety

Pizza-Making Strikers Win Small Slice of Justice in Milwaukee

Monday, August 5th, 2013

Roger BybeeThe 14-month-long strike at Palermo’s Pizza in Milwaukee produced a small slice of justice this week for the Mexican immigrant workers who have been fighting for higher wages, safer conditions and a union voice at the frozen-pizza maker.

Last Tuesday, Palermo’s finally agreed to comply with a finding by the National Labor Relations Board and re-hire eight workers with back pay, which will cost the pizza chain tens of thousands of dollars. The eight had been illegally fired for trying to unionize, the NLRB ruled.

Palermo’s has also agreed to post a notice announcing that the firm will no longer violate federal labor law. “This agreement confirms that Palermo’s used threats, intimidation, surveillance, discrimination, and retaliation to deny the freedom to choose a union voice,” says Raul de la Torre, an organizing committee member of the Palermo’s Workers Union. Fully 75 percent of the workers signed cards seeking union recognition prior to the strike, but Palermo’s management responded only with threats and other illegal tactics.

But Palermo’s decision to comply with the NLRB ruling does not reflect a softening of the intransigence that has driven about 125 workers, almost all immigrants from Mexico, out on strike for over a year. Palermo’s has refused for months to even engage in bargaining, said spokesperson Brian Rothgery of the United Steelworkers (USW) union, which has been assisting the Palermo’s strikers since they walked out on June 1, 2012.

Low pay, hazardous working conditions and arbitrary management decisions drove workers to form a union with the help of the immigrants-rights group Voces de la Frontera, which has been vocal and visible force in Wisconsin for the rights of immigrant workers.

Voces, the Palermo’s Workers Union and the USW are preparing to intensify their boycott of Palermo’s frozen pizzas at stores and institutions across the nation, said Rothgery. This escalation of the boycott will mean a focus on getting Palermo’s products removed from universities and on the Costco chain, which accounts for half of Palermo’s sales.

USW District 2 Director Mike Bolton called the settlement for the eight workers a positive development, but expressed exasperation with U.S. labor laws that allow a firm like Palermo’s to thwart the democratic choice of workers to form a union.

“It took much too long to get even this small bit of justice for these workers,” Bolton tells Working In These Times. “And unfortunately, they will be going back to jobs where union busters have created such an atmosphere of fear and intimidation that a democratic election is not possible.”

“The American system of labor laws has failed for most of the Palermo’s workers,” says Rothgery. “But that doesn’t mean we’re going to stop. The boycott is continuing, and we’ll keep fighting until there is justice for all the workers at Palermo’s.”

The workers and their allies will need to puncture the stone wall that has been Palermo’s response to the onslaught of community protests and legal challenges. Palermo’s refused to accept a letter from clergy and other community leaders following their 18-mile pilgrimage from Palermo’s plant to the palatial suburban home of Palermo’s co-owner Giacomo Falluci on June 1, 2013, the one-year anniversary of the strike.

Meanwhile, Palermo’s still faces various federal charges of both tolerating safety hazards and breaking labor-relations laws. Palermo’s is contesting seven “serious” charges filed May 7 by the Occupational Safety and Health Administration that its handling of nearly 30,000 pounds of anhydrous ammonia—used in freezing food—was unsafe and posed a severe safety hazard. Palermo’s faces $38,500 in fines from OSHA.

The penalties reflect the threat posed by a potential accident. The Environmental Protection Agency estimates that a one-minute accidental release of 1,000 pounds of ammonia would spread toxic fumes 1.2 miles in an urban area.  A release of the full 29,500 pounds could travelsix miles. The Milwaukee Brewers’ major-league baseball stadium, with a seating capacity of 42,200, is just 1.3 miles west of the Palermo’s plant.

OSHA also requested that the frozen-pizza company turn over uncensored records of worker injuries and other safety problems, after Palermo’s submitted information with key information redacted.

Unfair labor charges

Until finally conceding on the one NLRB complaint, Palermo’s had refused to comply with the NLRB order issued last November. Palermo’s management and its advisors—which include the Chicago-based anti-union Jackson Lewis law firm and the PR firm of prominent local Democrat Evan Zeppos–seemingly want to project a message that the firm is impervious to any form of pressure, and thereby demoralize the workers and their supporters, say supporters of the strikers.

“They want to flaunt their impunity, “ explained Christine Neumann-Ortiz, director of Voces de la Frontera, the influential immigrants-rights group which has reinvigorated Milwaukee’s long tradition of May Day marches—dating back to 1886–by assembling tens of thousands of immigrant workers and supporters. Zeppos has attacked Neumann-Ortiz in harsh terms for supposedly discouraging business development: “I’ve talked to businesses who say, ‘Why should I move to the valley when that’s happening?’ She has hurt the city, she has hurt those workers, and she has hurt herself. She’s become toxic property.”

Palermo’s has managed to replace the striking workers with “scab” replacement workers. Many of these replacement workers were hired through the BG temporary agency, which faces its own set of charges issued by the NLRB—including a contingent of refugees from Myanmar (until recently, a nation wracked by dire poverty ruled by an extraordinarily brutal military dictatorship). A 21 year-old refugee suffered the loss of three fingers in an accident at the plant.

Big subsidies for low-wage jobs

Palermo’s stance has been reinforced by the overtly pro-corporate and anti-unionadministration of Gov. Scott Walker, especially the scandal-wracked Wisconsin Economic Development Agency, which has been willing to overlook the company’s failure to provide family-sustaining wages as promised in exchange for state grants. Wages at Palermo’s have fallen far short of the $12 an hour target set a full decade back in 2003 by the Menominee Valley Partners, a joint public-private initiative, when a plan was laid out for the area, which had been vacated by many large employers. One Palermo’s worker reported that she made just $9.30 an hour after 10 years at the plant.

Total taxpayer subsidies to Palermo’s—from city, state, and federal sources—have totaled $48 million, according to an updated version of an AFL-CIO report called “Too Much Pork in the Pepperoni.”

Allies and foes

Despite Palermo’s failure to meet its obligations to taxpayers, the company has found allies in the Milwaukee area’s top Democratic leaders. County Executive Chris Abele, who both gained office with labor support, openly aligned himself with Palermo’s in an op-ed shortly after the dispute started. For his part, Mayor Tom Barrett issued a deceptively neutral-sounding call for a “fair and timely” union representation election late last November, in a statement describing Palermo’s as “a valued corporate citizen.” But holding elections under the prevailing conditions would mean that the Palermo’s strikers would be shut out of the election while replacement workers would constitute the voters, noted Neumann Ortiz.  “They [Palermo’s and Barrett] only want an election where the voters would be hand-picked,” she pointed out.

But has been extensive support for the workers around the state and in the local community—as exhibited by the clergy-led 18-mile walk to protest Palermo’s practices. At UW-Madison, students held a sit-in ON April 29 at the office of Chancellor David Ward and won a halt to the university’s licensing deal with Palermo’s, under which the UW receiveD about $200,000 for promoting Palermo’s pizzas with a “Bucky Badger” logo.

Some Wisconsin Democrats, like state Rep. Jon Richards, have been actively demanding records on Palermo’s failure to provide the quality jobs needed to comply with the terms of its subsidies. Several County Board and City Council members have also been outspoken in their support of the strikers.

Meanwhile, labor activists nationwide are pressuring chains like San Diego-based Costco to stop carrying Palermo’s pizzas until workers’ rights are honored. While Costco has marketed itself as a humane alternative to Wal-Mart’s infamous low-wage and unashamedly brutal disregard of worker suffering, as with victims of factory disasters in Bangladesh for whom Wal-Mart has denied any responsibility, Costco has thus far refused to budge on selling Palermo’s pizzas  produced under harsh conditions closer to home.

With Palermo’s concession n the rehiring of the eight workers and acknowledgement of labor-law violations, the Palermo’s strikers and their allies see a small step forward. The boycott campaign gains ammunition at universities with strong policies on labor rights.

But until a breakthrough occurs to cut significantly into Palermo’s sales, Palermo’s seems intent on maintaining a hard line against the strikers. Image-conscious Costco, with 449 warehouse-style stores across the U.S., may prove to be the crucial target if Palermo’s workers are ever to win justice.

This article originally posted on Working In These Times on August 5th, 2013.  Reprinted with permission.  

About the Author:Roger Bybee is a Milwaukee-based freelance writer and University of Illinois visiting professor in Labor Education. Roger’s work has appeared in numerous national publications, including Zmagazine, Dollars & Sense, The Progressive, Progressive Populist, Huffington Post, The American Prospect, Yes! and Foreign Policy in Focus.

In Streets of Chicago, Fast Food Workers Celebrate Small Victories

Friday, August 2nd, 2013

kari-lydersenChicago workers continued the roving fast food and retail strike Thursday, joining strikers and picketers around the nation calling for increased wages and better working conditions for the thousands of low-wage workers who staff some of the nation’s largest companies but are not paid even enough to scrape by.

A crowd of workers and supporters sporting employee uniforms or red “Fight for 15” t-shirts—referring to the call for a $15 hourly wage—snaked through downtown streets all day, stopping to rally outside businesses, ranging from fast food outlets such as McDonald’s, Wendy’s and Chik-Fil-A to more expensive stores like Nike, Macy’s and Victoria’s Secret. Pharmacies, delis, health food stores and beauty salons were also on the route.

The mood was celebratory. Many workers said they had gotten raises, better schedules, more hours and better working conditions since the April 24 strike by the Workers Organizing Committee of Chicago (WOCC) union. While the union doesn’t have any contracts with employers or even official collective bargaining power, it has already leveraged the power of public pressure to gain concessions from major businesses. It is supported by a wide range of labor unions and community groups, as Jeff Schuhrke reported yesterday for Working In These Times.

Krystal Maxie-Collins, 29, says that, about a week after the April protest, she was promoted from part-time to full-time and got a raise from $8.25 to $8.50 an hour at her job at Macy’s. A mother of four, she said it is nearly impossible to make ends meet on retail wages that hover at or just above the state minimum wage of $8.25.

“You have rent, gas, lights, just the cost of living in Chicago,” she said. “Even being able to go to lunch and participate in society here in Chicago, you need more than $8.50 an hour. You should be able to afford to shop where you work, but I can’t do that unless there is a 60 percent off sale. It’s hard to even buy personal necessities. We’re not talking about wanting to get rich. We just want to get by and take care of ourselves.”

Outside one of downtown Chicago’s numerous McDonald’s franchises, one worker after another called in Spanish and English for higher wages.

Robert Wilson, 25, described working for a McDonald’s at Water Tower Place for seven years and getting only a single, 10-cent-per-hour raise. He finally got a 25-cent-per-hour raise after Black Friday last year, thanks to the retail-fast food workers movement, he tells Working In These Times.

Wilson described to the crowd how he has worked 15-hour days at two different stores when McDonald’s managers were in a pinch.

“It’s a shame to know I’ll give that kind of dedication to work, and not even receive paid sick days or a steady schedule, and have to negotiate for days off when I have an emergency,” he said. “We work too hard for this company to back down…we’ll keep fighting until we get what we deserve.”

The crowd went into the restaurant to try to deliver a petition, but police officers ordered them out.

“They’re just trying to raise the minimum wage,” said Monica A., 20, a passerby who saw the workers earlier in the day outside a Walgreens and, sympathizing with their message, decided to continue walking with them.

“$8.25, you can’t do anything on that, especially after they take taxes out and everything,” said Monica, who declined to give her last name.

McDonald’s unintentionally gave the fast food workers movement a boost last month when it published a sample budget for workers that was apparently meant to help them manage their money but instead highlighted for the country how nearly impossible it is to survive on their wages. The budget included a “second job” and even so did not cover realistic living expenses. Health insurance was penciled in at $20 a month, heat (in an earlier version) as “$0,” and gas and child care were not included at all.

It’s not only employees serving customers at private companies who make such low wages. Grace Hill works in the kitchen at Homewood-Flossmoor high school in the south suburbs, earning $9.87 an hour. Even as she makes healthy food for the students, she told Working In These Times, she can’t afford to buy healthy food for herself—a particular problem since she is diabetic.

“Half the time I can’t pay all my bills,” she said. “The school does have the money, they just aren’t giving it to us.”

Union employees of the Chicago Public Schools, including teachers, janitors and food service workers, were on hand to support the Fight for 15.

“Like all movements, it starts small, and then it will grow,” said Eric Ortega, 30, who works as a prep cook on Navy Pier.

Campaign organizer Deivid Rojas said it’s clear the movement has already made an impact and will continue to do so.

“We’ve had workers having victories in all kinds of ways,” he told In These Times. “They’re getting raises of $1 or $2 an hour, or moving from part time to full time. People have more predictable scheduling and report being more respected at work, by their managers and their co-workers.”

This article originally appeared on Working In These Times on August 1, 2012.  Reprinted with permission.  

About the Author: Kari Lydersen, an In These Times contributing editor, is a Chicago-based journalist whose works has appeared in The New York Times, the Washington Post, the Chicago Reader and The Progressive, among other publications.

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