Archive for March, 2015
Tuesday, March 31st, 2015
Sucker punched by massive, illegally subsidized imports, American steel producers laid off thousands of workers in bedrock communities from Ohio and Illinois to Texas and Alabama.
That’s in just the past three months.
The families of furloughed workers are struggling to pay mortgage bills. The communities, losing tax dollars, are canceling needed road work. The companies are talking about the similarities between now and the 1990s when half of the nation’s steel firms disappeared. Members of the Congressional Steel Caucus are worrying about the effect on national security if America can’t make its own steel for guns and tanks.
Virtually everyone who testified last week at a Congressional hearing on the state of steel fingered bad trade as the culprit in the current collapse. Lawmakers, steel company executives, industry group leaders and a vice president of the United Steelworkers (USW) union all agreed on this. Foreign firms, particularly those operating in non-capitalist countries, are violating international trade regulations. Those rules also require American companies, communities and workers to forfeit a pound of flesh before trade enforcement can occur. They’re failing America.
Just seven days into 2015, U.S. Steel said it would lay off 636 workers at its Lorain, Ohio, tubular plant. Before January’s end, the company announced it would furlough 2,000 workers at three locations in Alabama and Texas. In February, U.S. Steel disclosed plans to close its Gary, Indiana, coke plant, displacing 300 workers. Early in March, U.S. Steel revealed the loss of another 83 jobs at its Gary Works, for a total of 780 there this year, as well as 412 at one of its iron-ore operations in Minnesota. Later in March, the company said it would indefinitely shut down its Granite City, Illinois, mill and lay off 2,080 workers.
It’s relentless. And that’s just U.S. Steel. Other U.S. producers furloughed workers too.
Steel executives told lawmakers last week that the job cuts are a direct result of foreign companies dumping steel in the U.S. market. “American steel companies are being irreparably harmed by illegal trade practices,” U.S. Steel CEO Mario Longhi said.
China produced as much steel last year as the rest of the world combined. It continued doing so despite dwindling demand within China as both its real estate development and economy cooled.
China sends the excess steel overseas. Last year, China exported more steel than any country this century. And the numbers are still rising. China’s steel exports rose 63 percent in January from a year earlier.
The USW and U.S. producers have won trade case after trade case involving Chinese-made steel because it violates international regulations forbidding government subsidization of exported products. Those improper subsidies lower the price. When trade regulators determine that Chinese producers violated international rules and place tariffs on a particular steel product increasing its price, China ships a different one. In addition, though it’s not considered in trade cases, China manipulates the value of its currency so that its exports are cheaper.
At the Congressional hearing last week, John Ferriola, CEO of Nucor, a non-union steel company, described the situation this way: “Blatant foreign government support of their steel industries has resulted in a glut of global steel production. A brazen disregard for international trade rules has led to the dumping of steel products in our market. As a result, one in three tons of steel sold in the U.S. today is produced abroad by less efficient, less safe, and less environmentally friendly countries. Our government must take a much tougher line with countries that break the law.”
This is not whining from uncompetitive producers. The European Union, Korea, Australia, even low-labor-cost India, are investigating whether China is dumping steel in their countries in ways that violate international law.
U.S. Steel’s Longhi talked about the consequences for national security if nothing is done. “We do not build a steel plant in an emergency,” such as war, he told lawmakers last week. Instead, he said, “we rely on it” to already exist and quickly fulfill national needs.
He noted that during World War II, his company produced 90 percent of the steel used to make 21 million military helmets.
“In a moment of exceptional need for the steel required to maintain its strength, America makes a local call,” he told the Congressmen. It doesn’t call China.
Dumping means companies like U.S. Steel and Vallourec USA that have invested billions in modernizing and expanding their American mills face financial difficulty. The same is true of furloughed workers and their communities.
Granite City Mayor Ed Hagnauer said that while the U.S. Steel plant in his town was shut down in 2008, 10 times as many residents sought help at food banks. Granite City business owners are concerned about U.S. Steel’s indefinite shut down beginning in May because mill jobs pay good, middle class wages that 2,080 laid off workers will not have to spend.
The lost jobs also mean lower tax revenues for towns and school districts. In Lorain, Ohio, now hit by layoffs at Republic Steel and U.S. Steel, Mayor Chase Ritenauer said that to balance the budget he would have to consider scaling back city projects and leaving job vacancies open.
For this to stop, USW Vice President Tom Conway told the Congressmen at the hearing, trade laws must be fixed. “I understand aggressive enforcement of trade laws, but aggressively enforcing a lousy law does not get you much,” he said.
“The continual failure and weakening of our laws is killing us, and it is time to rewrite our laws,” he added.
The laws should not require draconian damage before trade sanctions can be imposed, he said, and Congress must stop the swindle called currency manipulation.
No new trade deals, such as the proposed Trans-Pacific Partnership (TPP), should be approved without these changes, he said. In addition, Congress certainly should not prohibit itself from amending proposed trade agreements by fast-tracking them, he said, because the price of bad trade is too high.
This article originally appeared in Inthesetimes.com on March 31, 2015. Reprinted with permission.
About the author: Leo W. Gerard is the president of the United Steelworkers International union, part of the AFL-CIO. Gerard, the second Canadian to lead the union, started working at Inco’s nickel smelter in Sudbury, Ontario at age 18. For more information about Gerard, visit usw.org.
Tuesday, March 31st, 2015
Isn’t it funny how much we need our smartphone?
It’s not so different than how we depend on our union.
Finding a way to support both means giving our families the best, from companies that are giving their best to their workers.
If you’re a union member who hasn’t chosen a unionized wireless carrier (or maybe didn’t think to look!), here are some things to consider.
Supporting good jobs.
When you’re choosing a cellular plan, your first thought probably isn’t about the technicians, customers service representatives and retail store personnel that make the mobile magic happen. You’re probably thinking most about data plan savings, or the dilemma of choosing a smartphone with the best features.
But being union is all about having each other’s back, and an out of sight, out of mind attitude allows wireless companies to treat labor as just the “cost of doing business.”
As we ask ourselves about our new smartphone’s camera resolution or cost of service, maybe we should also be asking does our wireless carrier…
- Respect workers’ right to organize a union?
- Support collective bargaining?
- Have union contracts to provide good, middle class jobs and health care benefits?
- Have a fair grievance procedure to resolve workplace disputes?
When companies hire union labor, their workers live better. That’s a real upgrade.
Creating a better economy.
Even as televisions, tablets, and smartphones dual for our attention, many of us are still eagerly awaiting the release of the latest smartwatches. The point couldn’t be clearer; we just can’t get enough gadgets.
There’s nothing wrong with that, of course. But as more of our dollars flow out of our pocket and into our cellular plan, we should seriously consider where that money is invested. And the best investment, as we know, is the middle class.
And it is a big investment! Consider this:
- More than 60% of Americans pay more than $100 for their phone plan.
- More than 50% pay $200 or more.
- One in five people spend more on their cellular plan than food each month.
As mobile technology becomes more ingrained in our daily lives, the shift in consumer spend should create more good jobs to keep our economy moving. Our money should be creating middle-class consumers, the true job creators.
Union members can save with Union Plus. AT&T is the country’s largest private union employer, with some 120,000 organized workers, and the only major U.S. wireless company with a union workforce. Union members who choose Union Plus AT&T Discount Program can save:
About the Author: David Tindell is a Marketing Assistant for Union Plus. He joined Union Plus in 2012, and has written about union benefits for the Union Plus Consumer Bargains blog since 2013. Union members looking to keep up most up-to-date, union-exclusive savings is to sign up for the Union Plus E-Newsletter. Click here to get started >>
Monday, March 30th, 2015
Discrimination is in the news every day in one form or another, and its effect in the workplace can be devastating to employees and their livelihood. We’ve updated our pages in areas of discrimination law that have been front and center in the news and in the workplace. Updates have been made to our pages on Pregnancy Discrimination, Family Responsibilities Discrimination, and Gender Identity Discrimination. We’ve also added a new page with information about the rapidly growing body of State and Local Paid Sick Leave laws.
The case of brought pregnancy discrimination into the lime light last year. The case, argued before the Supreme Court in December 2014, asks to what extent the requires that employers give accommodations to pregnant employees. In Ms. Young’s case, UPS refused to limit the amount of weight she was required to carry during her pregnancy. As a result she was forced to take unpaid leave and ultimately lost her health insurance. This type of predicament is all too common for pregnant women in the workforce. Our updated Pregnancy Discrimination page explains the scope and level of protection that various federal laws might offer to pregnant women. It also explains what employers can and cannot do with respect to the many pregnancy related issues that women in the workplace face. It covers pregnancy-related medical leave, work accommodations, parental leave after pregnancy, recovery from terminated pregnancies, paid or unpaid time off, and health insurance.
Transgender and Gender Identity rights are another issue on the forefront of the news these days. While acceptance and understanding of the rights of transgender people seem to be increasing in the public, employers and companies don’t always keep up with the times. Gender identity issues can be most difficult to deal with in the workplace, especially if your employer doesn’t acknowledge or properly deal with problems. We’ve made extensive updates to our page on Gender Identity Discrimination to provide as much information as possible for transgender workers, as well as for companies looking to develop policies and procedures to effectively address gender identity issues. This area of law is quickly changing and developing on the state and local level, and somewhat more slowly at the federal level. The Gender Identity Discrimination page will help fill you in on the current state of the law, and also direct you to more information on this important issue.
The definition of Family Responsibilities has certainly changed over the decades. Employers in the U.S. have continued to place more importance on work/life balance, but workers continue to face significant obstacles in this area. Our new updated page on Family Responsibilities Discrimination provides information about how existing laws may protect you against discrimination based on your status as a parent, spouse, or caregiver. It is important for employees and employers to understand what personal information can and cannot be the basis for employment decisions.
This year, President Obama has of paid sick leave laws. As the President and others urge Congress to pass federal laws providing for paid sick leave to employees, states and localities have also begun to heed the call and pass their own laws. See our NEW page on State and Local Paid Sick Leave Laws for information on which jurisdictions are leading the charge, and see what different approaches each jurisdiction is taking.
About the Author: Shannon Rusz is a general practice litigation attorney in Annapolis, Maryland. She currently serves as the content manager for WorkplaceFairness.org. Shannon received her law degree from George Washington University Law School in 2012
Monday, March 30th, 2015
A new effort is underway to deprive a certain class of workers of the most basic benefits and protections of employment.
Last month, Assembly member Marie Waldron (R-San Diego) introduced AB 500, which would allow employers to hire workers who have successfully completed a drug rehabilitation program following conviction of a non-violent felony as independent contractors rather than employees for a period of two years.
The targets of this bill are workers for whom steady and fair employment is a means to rebuild a life and to prevent a relapse of the ravages of addiction. AB 500 is a cynical bill that would codify discrimination and perpetuate mistreatment of this already vulnerable group.
For starters, the language of the bill violates existing federal anti-discrimination law. The Americans with Disabilities Act considers those who have received treatment for drug or alcohol abuse as qualified individuals with a disability who are entitled to reasonable accommodation. Contrary to the express purpose of the ADA, AB 500 stigmatizes individuals who have completed a substance abuse rehabilitation program by denying them, for a period of two years, the legal protections normally offered to employees in California. Stigmatizing people with disabilities is what gave rise to the disability rights movement to begin with.
Codifying second class status for workers with a substance abuse history is bad enough, but the effect of the bill is even more insidious. Under California law, a person who provides services for another person or entity is presumed to be an employee of that person or entity – as opposed to an independent contractor. The distinction is meaningful.Independent contractors are not entitled to the protections of the California Labor Code, which means they have no minimum wage or overtime protections and no entitlement to meal and rest breaks. Independent contractors are also exempted from the laws prohibiting discrimination or retaliation in the workplace, and they are not entitled to unemployment insurance or Social Security contributions. The bill would also allow employers to avoid the cost of carrying workers’ compensation insurance, leaving independent contractors unprotected in the event of a workplace injury.
Employers often complain that the cost of providing these benefits to their workers has grown too high and some may look with favor at the proposed economic windfall — being able to hire rehabilitated drug offenders for two years for less than the minimum wage, without having to provide overtime pay, workers’ compensation insurance or protections from unlawful discrimination. But these benefits are essential to providing a fair and safe work environment for California workers. Without these protections, the State would invariably end up shouldering much of the costs, while the employers would reap all the benefits.
Some advocates of the bill may believe that the bill encourages employers to give people with a history of substance abuse an opportunity to work their way into full employment status. But AB 500 would require applicants to disclose to potential employers that they have been convicted of a crime. Such disclosure is currently prohibited under certain circumstances. More importantly, there is ample evidence that qualified applicants who disclose their criminal history are just as likely to be denied employment altogether, a result directly contrary to the intended result.
Others may take a harder line toward former substance abusers, believing that second class status in the workplace is appropriate because substance abusers should suffer the consequences of their poor decisions. But how does stripping anti-discrimination protections, overtime, and workers’ compensation achieve any policy goal related to rehabilitation or substance abuse prevention?
What is undeniable is that AB 500 targets a vulnerable constituency. And if the move to strip their rights is successful, it could embolden employers to seek further erosions of the benefits and protections of employees. Who would be next? The long-term unemployed, veterans, the homeless? For those already struggling to become productive members of society, our goal should be to eliminate obstacles, not create them.
This article originally appeared in Celavoice.org on March 30, 2015. Reprinted with permission.
About the Author: Sami N. Khadder is the founder of the Khadder Law Firm. He has a decade of litigation experience, with the majority of his career dedicated to fighting for the rights of employees and individuals. Mr. Khadder began his career as an intellectual property defense attorney, but soon realized that the pursuit of justice on behalf of those who need it most was a far more gratifying use of his legal education and experience. Mr. Khadder looks forward to continuing the fight for justice.
Saturday, March 28th, 2015
Nearly two dozen major corporations have joined together in recent years in an effort to gut workers’ compensation laws in the states. Walmart, Lowe’s, Macy’s, Kohl’s, Sysco Food Services and others formed the Association for Responsible Alternatives to Workers’ Compensation (ARAWC) in 2013, and the organization already has had success in Tennessee. Mother Jones takes a look at ARAWC’s methods:
Now, ARAWC wants to take the Texas and Oklahoma model nationwide. Tennessee, where Lowe’s, Walmart and Kohl’s each have about 20 locations, is the only state where the group has pushed legislation so far. But ARAWC is already considering its next targets. “ARAWC hopes to see some neighboring states take up legislation this year and we’re ready to assist those legislatures as well,” [Richard] Evans, the group’s executive director, writes in an email.
Conservative Southern states where ARAWC’s corporate funders have major operations—including Florida, Georgia and Alabama—are on the group’s short list. And ARAWC already has hired lobbyistsin North and South Carolina. The group has written model legislation, but ARAWC intends to work closely with lawmakers to adapt its model for individual states.
When ARAWC targets a state, it moves aggressively. In Tennessee, the group has spent more than $50,000 deploying lobbyists to push its legislation. Evans says that state Sen. Mark Green, who introduced the opt-out bill, was already working on the legislation before ARAWC started pushing for it. But a February blog post written by an executive at Sedgwick, an insurance company that helped found ARAWC, suggests the group played a more active role. In the post, the executive boasts that ARAWC “secured a highly respected bill sponsor”—presumably Green—to introduce the bill, which the group “assisted in drafting.”…
Green’s proposal, which supporters are calling the Tennessee Option, bears many of the hallmarks of the Texas and Oklahoma system: It allows businesses to place strict spending caps on each injured worker and to pick and choose which medical expenses to cover. “We took the best of both and put it together to make it work for Tennessee businesses,” Green told an insurance trade magazine.
The bill as introduced does not require employers to pay for artificial limbs, hearing aids, home care, funeral expenses or disability modifications to a home or a car for injured workers. All of these benefits, notes Gary Moore, president of the Tennessee AFL-CIO Labor Council, are mandated under the state’s current workers’ comp system.
“This piece of legislation is designed as a cost-saving measure for the employer,” Moore says. “Anywhere they save a dollar, it costs the employees a dollar. It’s just a shift in costs.”
This blog originally appeared on aflcio.org on March 28, 2015. Reprinted with permission.
Author’s name is Kenneth Quinnell. He is a long-time blogger, campaign staffer and political activist. Before joining the AFL-CIO in 2012, he worked as labor reporter for the blog Crooks and Liars. Previous experience includes Communications Director for the Darcy Burner for Congress Campaign and New Media Director for the Kendrick Meek for Senate Campaign, founding and serving as the primary author for the influential state blog Florida Progressive Coalition and more than 10 years as a college instructor teaching political science and American History. His writings have also appeared on Daily Kos, Alternet, the Guardian Online, Media Matters for America, Think Progress, Campaign for America’s Future and elsewhere.
Thursday, March 26th, 2015
The United States is one of just three countries in the world that doesn’t require paid maternity leave. Just 12 percent of people who work in the private sector are offered paid family leave. That’s one of many major hurdles women, particularly mothers, face in the workplace.
But women make up half of the labor force. So what can be done to change that picture so that they aren’t so often stuck between a rock and a hard place? Two new websites have one answer: transparency.
Ursula Mead is a self-described working mom and “data geek.” “I come from an area where data can really help you make good decisions and help you understand situations,” she explained.
So with InHerSight, a website that allows people to anonymously rate their workplaces on a variety of metrics such as paid maternity leave, flexible work, and women’s representation and opportunities, she’s decided to apply data to the problems facing women in the workforce. To her, it feels like a faster and more effective way to tackle them. “Some of the other solutions that are out there just weren’t resonating with me,” she said. “I don’t have time for a Lean In circle.” She noted that mentorship doesn’t address issues on a large enough scale, company initiatives are unaccountable to the employees themselves, and policy changes, while important, are “just slow.”
For Sarah Seltzer and Meredith Clark, the decision to start Having It Some, a Tumblr that collects anonymous submissions on companies’ paid family leave policies, came from watching friends struggle with parenting and work. “In the last two years, I’ve been hearing more and more horror stories from friends about companies that didn’t have any maternity leave or having to craft their own or getting job offers rescinded when they told their future bosses they were pregnant,” Seltzer said. “I started becoming really curious as to what companies offer new moms.”
Seltzer and Clark feel that it’s an important conversation to have, and sooner rather than later, but that many people aren’t thinking about it. “We talk about navigating salary negotiations or vacation benefits, but it doesn’t feel like there’s as much of a discussion around the importance of trying to figure out what you might be getting into where family leave is concerned,” Clark said. “We’re encouraging people to really start advocating and asking those questions as early as possible.”
That’s because Seltzer says she’s seen many friends’ careers derailed by workplaces that couldn’t accommodate their needs. “I think some women are changing their career options based on things like how family-friendly their workplace is rather than just what the best fit for them might be,” she said. “If there was more transparency, at least it would help people make informed decisions.” She also noted that being able to compare a particular company to the others tagged in the same industry can be useful. “That can actually give you leverage,” she said, to get a company to consider more generous benefits if peers are already doing the same.
Mead hopes InHerSight will give women a way to pick the right workplaces for their needs. Part of the mission is to “help women find what they’re looking for and improve what they get” at work, she said. She thinks women themselves are best able to articulate what they need as well as what’s actually happening inside a given company. “I’m giving them that platform,” she said.
She also thinks it will be useful to employers. “I think it’s in companies’ interests to figure out what they need to do to attract and retain that top female talent,” she said. “Companies could use this as a starting point for an action plan for themselves.” The website can certainly point out when a company’s policies are simply lacking. But it can get more nuanced metrics around those it already has about how comfortable female employees feel using them. Some companies have even told Mead they want to send the site to their employees to gather ratings. “They’re essentially saying that they are going to own these numbers and they want to be held accountable for them,” she noted.
Seltzer and Clark they also think that companies can respond to their anonymous data. “One person emailed me saying she works at a new company and they’re going to use one of the entries on our site to help model their policy because they think it’s good,” Seltzer noted.
Both websites recognize that men are increasingly interested in figuring work/life balance out as well. “I would love for men to open up their company handbooks,” Clark said. She noted that male friends have looked at their companies’ policies and realized that “things were written very clearly for new mothers or adoptive parents,” not necessarily new dads.
Mead agrees that men are also concerned about the things that her site’s ratings measure and that men are free to rate their companies as well. But she also noted that change shouldn’t happen just because men take up the cause. “I don’t want these things to just magically fall into place when men need them too,” she said. “That shouldn’t have to be the case.”
Both sites are new and will be most effective if they reach a larger scale. Mead says she is focused right now on getting more ratings, and while the site has thousands, she wants to take it to the hundreds of thousands. More data will mean deeper insights, such as being able to benchmark a company profile against others in the same industry or of the same size. She and her team are also working on rolling out new tools, such as seeing how the ratings on each metric vary for a given company. If a company gets a bunch of fives and ones on a given aspect, that may show something different than everyone giving threes, like perhaps using a policy “depends on your manager or your department or experiences across the company are varying widely,” she said.
Having It Some is also looking for more submissions, but has about 40 at the moment. “We have some good variety,” Seltzer noted.
The work both sites are trying to do is urgent. The United States used to beat other developed countries in our share of working women, but we’ve recentlybeen falling behind because of our lack of family-friendly policies. Meanwhile, women face discrimination or even termination for talking about their pregnancies or asking for changes to company policy. “We shouldn’t be working in an environment where a woman feels uncomfortable asking about a parental leave policy in a job interview,” Clark noted. Armed with data from these websites, women may have more options.
This article originally appeared in thinkprogress.org on March 26, 2015. 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. Her writing has appeared on The New York Times, The New York Daily News, The Nation, The Atlantic, The American Prospect, and others. She is also a board member of WAM!NYC, the New York Chapter of Women, Action & the Media.
Tuesday, March 24th, 2015
Nursing is an occupation massively dominated by women. But the small fraction of nurses who are men earn substantially more than the women
, according to an analysis of two large data sets:
Every year, each of the data sets found men earned more than women; the unadjusted pay gap ranged from $10,243 to $11,306 in one survey and from $9,163 to $9,961 in the other.There was a gap for hospital nurses, $3,783, and an even bigger one, $7,678, for nurses in outpatient settings.
Men out-earned women in every specialty except orthopedics, with the gap ranging from $3,792 in chronic care to $17,290 for nurse anesthetists.
Some of the usual possible explanations for how it’s totally not sexism apply, except that those explanations themselves typically involve some form of sexism, if not direct wage discrimination. So, yes, maybe women are more likely to work part-time (because they’re doing the work of caring for families that men don’t bother with).But given pay differentials this pervasive within one occupation (so we know it’s not that women make less because men are on Wall Street and women are secretaries) and across specialties within that occupation, a few of the “it’s not sexism because it’s really about women’s choices, which I am pretending are not constrained by sexism” excuses for the gender pay gap are eliminated. Which makes it just one more big glaring data point on the mile-long list of data points showing that women are systematically underpaid (or men are systematically overpaid) throughout the American economy.
This blog originally appeared on dailykos.com on March 24, 2015. Reprinted with permission.
About the Author: Laura Clawson is Daily Kos contributing editor since December 2006. Labor editor since 2011. Laura at Daily Kos
Tuesday, March 24th, 2015
The massive push toward subcontracting and supply chains I wrote about in my prior post didn’t happen overnight, and it certainly won’t be fixed overnight either. There are many pieces to this puzzle, all in the service of one big overarching principle: Lead companies must take their fair share of responsibility for the pain and misery that is generated when they squeeze too much from their suppliers and subcontractors. Here are some of the pieces:
1. Challenge Payroll Fraud. What used to be called “misclassification” of employees as independent contractors is really the practice of defrauding employees out of social security, overtime, worker’s compensation, health and safety protections, family and medical leave, unemployment insurance, protections against discrimination, and the right to bargain collectively, among other things. In addition to losing these protections, employees who become “independent contractors” have to cover their own costs.
Cases challenging bogus “independent contractor” status have been multiplying as more and more businesses adopt this practice in order to cut their payroll costs. Last August, the Ninth Circuit held that thousands of FedEx truck drivers were employees, even though FedEx called them independent contractors. Recently, the judge in a misclassification case against Uber ruled that a jury should decide whether the drivers employees of the company, and noted that “many of the factors in that test appear outmoded” in the “context of the new economy.”
Former Secretary of Labor Robert Reich has proposed that, instead of waiting for the courts to decide these cases one-by-one, the IRS and Department of Labor adopt a new, simpler test: “Any corporation that accounts for at least 80 percent or more of the pay someone gets, or receives from that worker at least 20 percent of his or her earnings, should be presumed to be that person’s employer.”
2. Treat Lead Companies as Joint Employers. Every federal circuit and many state courts have their own version of the “joint employer” test to determine when one company should be liable for the wage and hour violations of another – including subcontractors or franchisees. Some of these tests are being re-examined to take into account the ways in which “lead companies” maintain control.
In December 2014 the National Labor Relations Board issued complaints naming McDonald’s Corp. as a joint employer of workers at its franchises. In another case, theNLRB has proposed a “totality of the circumstances” test that would impose joint employer status on any company that wields sufficient influence over the working conditions of the other company’s employees, to make meaningful bargaining impossible in its absence. A similar rule in state and federal courts would recognize the significant power and control that is exerted from the top.
3. Enforce Supply Chain Liability. Regulators and legislators are also coming to recognize the need to affix responsibility at the top of an industry. California Labor Code Section 2810.3, which became effective January 1, 2015, provides that an employer must share responsibility for wages, taxes, and workers compensation with the middlemen who provide the labor to the employer. In a similar vein, a provision of the Fair Labor Standards Act known as the “hot goods” provision, prohibits the selling or transporting in commerce any goods produced in violation of the FLSA’s wage and overtime provisions.
Decent wages and safe working conditions are not just an idealistic goal. The lack of a healthy middle class hurts all of us. Public health researcher Richard Wilkinson has reported that the average well-being of modern societies — including health, lifespan, literacy levels, crime levels, and so on — is no longer correlated with national income or economic growth, but with the extent of income inequality. The Center for American Progress has just issued an exhaustive report on “inclusive prosperity,” concluding that nations succeed when their middle class is secure in the expectation that those willing to work are able to work and that standards of living will increase.
Clearly, more work needs to be done. It is time to invest in living wages and sustainable employment, instead of pioneering ever more ways to create dead-end jobs that benefit only those at the very top.
This article originally appeared in CELAVOICE.ORG on March 23, 2015. Reprinted with permission.
About the Author: Anne Richardson is the Associate Director of Public Counsel Opportunity Under Law, a project aimed at eliminating economic injustice on behalf of underrepresented workers, students, and families throughout California and nationwide. Previously she was a partner at Hadsell Stormer Richardson & Renick representing plaintiffs in all varieties of employment discrimination and civil rights matters for over twenty years. A graduate of Stanford Law School, she has been named to the Top 100 Lawyers in Southern California and has received numerous honors for her work.
Tuesday, March 24th, 2015
A fundamental change has taken place in the American workplace, and we are only now beginning to realize just how monumental it is.
A new book, The Fissured Workplace: Why Work Became So Bad for So Many and What Can be Done About It, by David Weil, makes the case that in every corner of the employment world, companies are increasingly shedding their employees, while maintaining control over the ultimate product or services to be provided under the “lead” company’s logo and brand. Beginning with peripheral services such as janitorial and security, and gradually including ever more central services, such as receptionists, truckers, and even lawyers, large employers are deliberately subcontracting out their work.
Here’s how it works: A member of a loading dock crew is paid by one company, which is in turn compensated by another company, for the number of trucks loaded. That company, Schneider Logistics, manages distribution centers for Wal-Mart. Wal-Mart sets the price, time requirements, and performance standards that are followed by Schneider, which in turn uses those standards to structure its contracts with its subcontractors.
Why do they do it? Employers can reduce costs by pushing many of the responsibilities connected to being the employer of record down the chain to someone else. Yet by controlling the quality and price of their goods and services, they do not lose their reputations and the goodwill of their brands.
But should lead companies be allowed to have it both ways? Should they be permitted to control the production, delivery, and cost of goods and services, without sustaining any liability for the manner in which their contractors provide them? To take a real world example, if a company like Wal-Mart sets a price that is so low that the only way for suppliers to meet it is by underpaying their employees, isn’t that really Wal-Mart’s responsibility?
This new “fissuring” model has drastic consequences for employees who have been forced to trade in traditional jobs at a lead company, with benefits and a pension plan, for part-time temporary positions with no benefits. Pushing responsibilities down the chain often means that the direct employer is less well capitalized and less capable of maintaining wage and hour standards, or enforcing health and safety rules. Since the company on top sets the price, often as low as the market will possibly bear, the company on the bottom is forced to cut to the bone. Many of the subcontractors are small businesses that go under, and then reemerge as a different company, which results in there being no responsible party to foot the bill when legitimate claims are made.
Fissuring also negatively affects the health and safety of the broader public. Weil argues that a significant contributing factor of the devastating environmental oil spill caused by the BP Deepwater Horizon accident in 2009 was the extent of BP’s use of contractors. In order to shield itself from liability by maintaining less control over its subcontractors, BP did not sufficiently oversee the safety component of the operation. Other authors have similarly noted the increase of injuries and fatalities that have accompanied the rise of contracting in, for example, coal mining, construction, and trucking, among others.
To be sure, there are some who benefit from the practice. The third consequence of “fissuring” is to shift the surplus generated by businesses away from the workforce and to investors. This helps to explain why the operative trend in the American workforce is the widening income gap between the rich and the working poor. The gap between the wealthy and the poor is at a hundred year high. For example, in 1965, the average CEO made about 20 times what the average worker made at any given company. By 2013, the ratio had grown to approximately 331 to 1. What’s fascinating is that a recent study found that not only did people worldwide grossly underestimate the ratio of CEO to worker pay, but that people across all backgrounds preferred a smaller pay gap.
Weil, who was appointed the Administrator of the Wage and Hour Division of the United States Department of Labor in May 2014, argues that since “[t]he modern employment relationship bears little resemblance to that assumed in our core workplace regulations,” laws and judicial decisions need to adapt current rules about workplaces to the realities of the modern world.
In every corner of the American workforce, the pressures to cut costs and improve the investor’s return have resulted in a worsened standard for the middle-class worker, as well as a worsened standard of health and safety. What can be done about it? Stay tuned for my next post.
Friday, March 20th, 2015
Workers who get cheated out of their due pay in central Florida will have a much easier time recovering what they’re owed after Osceola County approved a tough new wage theft law, making it the latest in a string of local governments to take on increased responsibility for enforcing federal wage and hour laws.
Under the new rules, workers will be able to file cases with the county and employers who are accused of wage theft could end up having to repay triple the amount they stole from employees if they fight a case and lose. Workers in Miami-Dade County have so far recovered about $1.8 million since that wage theft law came online in late 2010.
Osceola’s law adds an important, tougher element to the basic model laid out in Miami-Dade. Companies that fight a wage theft claim and lose can have their business license revoked by the county.
Efforts to combat wage theft at the local level appear to be spreading, according to Tesedeye Gebreselassie of the National Employment Law Project (NELP). “It’s clear that existing laws and resources on fed state level are insufficient, and we’re starting to see more cities and counties take action in any way that they can,” she said. “There’s a growing trend to figure out what can be done on the local level now that everybody’s acknowledged that wage theft is a huge problem.” Propagating enforcement systems that work will be especially important if low-wage workers are to actually realize the economic benefits that should come from a rash of state and local minimum wage increases around the country, as the NELP argues in a new report.
There is no perfect deterrent, since a business owner willing to ignore wage laws in the first place is often going to choose to go out of business rather than dole out back pay. And the prevalence of low-wage, low-skill jobs in the American economy has helped create a sort of race to the ethical bottom among employers who are more interested in cutting corners than giving honest pay for honest work. As David Weil, the top federal official in charge of enforcing wage and hour laws for the Department of Labor, told the New York Times in 2014, “We have a change in the structure of work that is then compounded by a falling level of what is viewed as acceptable in the workplace in terms of how you treat people and how you regard the law.”
“I have a very close relative that had this happen to him,” Osceola County Commissioner Michael Harford (D) told ThinkProgress. “It was very difficult for him to understand how he was getting paid.” Harford gradually realized that wage theft was relatively common among his constituents, and helped push the law through this spring after voters elected four Democrats and one Republican to the commission last fall.
Harford’s reforms not only increase the consequences of wage theft for employers who get caught, but also make it easier for workers to find legal help. If the new adjudication process finds a company liable for wage theft, it must pay treble damages for the withheld pay and also cover the legal fees incurred by the workers who brought the allegation. “If we had more of an incentive for representation in these cases, we’d see hopefully the same effort to vindicate workers’ rights that we see to vindicate the rights of the injured in personal injury cases,” Rep. Alan Grayson (D) told ThinkProgress.
There’s no reason other localities can’t follow Osceola and Miami’s lead. Jeanette Smith, executive director of South Florida Interfaith Worker Justice and a key member of the coalition that researched the wage theft question for two years before bringing a legislative proposal in Miami-Dade, told ThinkProgress she thinks the model ought to be easily transferred even beyond the state line.
“I tell people not to just change the name on it, make sure it works,” Smith said. “But in general I think this kind of process is portable, as long as you’ve got a division of your government that can pick it up and administer it, and you have the political will, and frankly that you have responsible businesses that speak up.” Partly that’s because the laws don’t require business owners to comply with any new regulations and they don’t require local governments to hire new enforcement officers. “These ordinances do not put new regulations in place. Nothing at all. It’s simply offering a venue where the workers can go,” Smith said.
The real cutting edge of a law like Osceola’s comes well before a lawyer would ever get involved, in a pre-hearing process called conciliation. After a worker notifies the county of a wage theft allegation and provides evidence for the claim, the county contacts the employer and invites him to address the complaint voluntarily. Conciliation has produced a little over half of the $1.8 in recovered wages and damages under Miami-Dade County’s law and 53 percent of cases brought under the law were resolved at that early stage, according to Smith.
“There’s a big emphasis on conciliation, because the idea is that these are predominantly low-wage workers and they need to get their money right away. These are people who can’t go to court and wait all that time,” Smith said. By creating a two-stage process and giving employers immunity from the damages provision of the law as long as they resolve a legitimate wage violation in the conciliation stage, these laws give employers an incentive to be responsive to complaints. “There is gonna be that smaller group of completely unscrupulous employers that just completely disappear, often people who never even had a business license to start with,” Smith said. But even if workers for such employers never get made whole under this new process, the law still discourages willful violators from setting up shop in the area.
Wage theft steals more money from American workers each year than the combined haul from every robbery and heist nationwide. The term refers to violations of federal wage and hour protections, and that federal jurisdiction is part of the reason that local protections like the ones just passed in Osceola County are rare. Workers who think they’re being cheated by the boss can file a suit anywhere, regardless of local ordinances, and they have done so at a rapidly increasing clip in recent years. Workers have won court settlements from retail logistics firms, trucking companies, strip clubs, and fast food companies. They’ve also lost one significant case before the Supreme Court, though it only narrowly curtailed the types of employer policies that can be considered wage theft.
But going to court is expensive, in both dollars and time, and Osceola is the most recent place to erect a more worker-friendly system for addressing the complaints. Wage theft laws intended to help workers recoup wages without getting tied up in court have come into effect in Chicago, Houston, andColorado in recent years.
Lowering the local barriers to recovering stolen wages is a good start, Grayson said, but it does not address the various other ways in which workers have been pitted against one another by recent attacks on union solidarity on the job. “The right to organize has been frustrated and in many cases defeated by business groups. That’s left a disorganized low-wage labor base that can be exploited at will by unscrupulous employers, so the problem increases over time,” Grayson said. Right now, “crime does pay if you’re cheating your employees. And we have to stop that.”
This blog originally appeared in Thinkprogress.org on December 10, 2014. Reprinted with permission.
About the Author: Alan Pyke is the Deputy Economic Policy Editor for ThinkProgress.org. Before coming to ThinkProgress, he was a blogger and researcher with a focus on economic policy and political advertising at Media Matters for America, American Bridge 21st Century Foundation, and PoliticalCorrection.org. He previously worked as an organizer on various political campaigns from New Hampshire to Georgia to Missouri. His writing on music and film has appeared on TinyMixTapes, IndieWire’s Press Play, and TheGrio, among other sites.