Outten & Golden: Empowering Employees in the Workplace

Archive for the ‘Uncategorized’ Category

Caterpillar’s CEO Just Got A Big Raise, And It Explains What’s Wrong With American Capitalism

Tuesday, April 21st, 2015

AlanPyke_108x108Heavy machinery manufacturer Caterpillar gave its CEO a 14 percent raise last year, in a $17.1 million package of cash, stock, and other compensation that is hard to justify in light of the famed brand’s actual performance.

CEO Douglas Oberhelman’s big raise came despite a decline in Caterpillar’s sales. The company justified its decision to Crain’s by pointing out that Oberhelman oversaw a good year for the company as measured on a per-share basis. Those accounting metrics benefited from the company’s decision last year to buy back a bunch of shares to make Caterpillar look better on a per-share basis, the Wall Street Journal notes.

Caterpillar is hardly unique in finding creative ways to justify paying CEOs. Therules for performance pay are broken across all industries. Fortune 500 CEOs are now paid hundreds of times what the typical worker makes, up from the healthier 30-to-1 ratio that was typical in the long middle-class boom that followed World War II.

Oberhelman has been paid nearly $18 million per year on average since assuming the company’s top office. The $17.1 million package for 2014 is a hefty percent raise from the $15 million Caterpillar paid Oberhelman in 2013. That year’s package was portrayed as a significant cut from his 2012 earnings of $22.4 million, but critics in 2013 argued that even that down year was still a severe overpayment for the CEO’s performance. The way the company’s performance-based compensation systems are designed, the CEO got a $2 million performance bonus for a year when sales fell by 16 percent.

The company is a perennial favorite when politicians and journalists need something to stand in for middle-American moxie and blue-collar striving. Profiles of both Caterpillar and Oberhelman tend to play up the firm’s roots in Peoria, Illinois, a town rendered synonymous with Real America by the cliched old test of an idea’s marketability: “Will it play in Peoria?”

Caterpillar earned its associations with American grit and ingenuity in its early decades of success, but its modern behavior is testament to the financialization of even the blue-collar segments of the U.S. economy. Modern-day Cat does what is best for the share price even if that means squashing its actual production workers in contract talks and moving their jobs across the state lineif they object too loudly to the new treatment.

Identifying Caterpillar’s success with humble midwestern values is a lie, at this point in the company’s history. Oberhelman and his shareholders make gobs of money from a wink-nudge arrangement in Switzerland. A Swiss subsidiary claims to be the final destination for much of the cash that Cat brings in. Caterpillar paid $55 million to wish that Swiss branch into being about 80 years after its founder opened his first factory in Peoria.

The scheme has avoided $2.4 billion in U.S. tax payments since 2000.

The deal is also entirely legal, much like the highly technical profit-shifting arrangements that tech giants use to keep their profits away from the Internal Revenue Service. Caterpillar gets all the public relations gloss that comes with being from Peoria while ducking the taxes that fund roads and fire departments and houses that people can afford to buy in central Illinois.

Caterpillar’s Swiss swindle is especially useful to shareholders and people like Oberhelman whose pay is determined more by stock tickers than by what happens on the factory floor. The company’s stock price benefits from engineering a flow of company cash that leaves more overall value on the books, even if the books are Swiss and the stocks trade in Chicago.

Moves that hurt workers but benefit investors threaten to become a defining pattern in the American business world. Years of hostile takeovers in the 1980s and 1990s helped create a fascination with short-term indicators of shareholder value, as Steven Pearlstein explains, and that fascination is now part of the curriculum in business schools. Executive compensation shifted more and more from cash to stock, giving the people in charge of the largest firms in the U.S. economy a huge incentive to chase short-term on-paper valueat the expense of the long-term, concrete business success. Because that shift benefits people wealthy enough to own stock at the expense of working people, the financialization of the American business world has naturallyexacerbated inequality.

Opposing the sheer size or inequity of modern CEO compensation doesn’t do much to address the roots of the problem, no matter how loud the objections. Restoring the traditional link between work and economic mobility means reversing the financialization of companies like Caterpillar — causing them to focus on the long-term and consider interests that aren’t gauged in stock prices. Ideas for changing corporate behavior include greater profit-sharing for lower-level employees and closing tax loopholes that make stock-based CEO pay deductible.

Last year, such ideas featured prominently in the work of an international working group of left-of-center policymakers that some pundits expect will serve as the basis for Hillary Clinton’s economic platform in her run for the White House. If the 2016 cycle stops through Peoria, as so many previous politicians have done to use Caterpillar production facilities as a backdrop for speeches and glad-handing, the company may find itself cast in a very different kind of story about the American economy.

This blog originally appeared in Thinkprogress.org on April 21, 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.

Maryland Agency Deliberately Paid Female Workers Less Than Men For Equal Work, Lawsuit Claims

Monday, April 20th, 2015

Bryce CovertLast week, the Equal Employment Opportunity Commission (EEOC) filed a lawsuit against the Maryland Insurance Administration, which regulates the state’s insurance companies, for willfully paying female employees less than men who were doing the same work.

The lawsuit claims that since the end of 2009, the agency has paid Alexandra Cordaro, Mary Jo Rogers, Marlene Green, and a group of other women who worked as investigators or enforcement officers less than men at the agency for “substantially equal work” in similar roles.

The suit says the agency’s actions violate the Equal Pay Act of 1963, which prohibits paying men and women differently for equal work unless due to seniority or systems that pay based on the merit, quantity, or quality of work. It seeks to get the agency to end the different pay practices, institute equal employment policies for women, and pay back wages for the three women and other female employees who were potentially discriminated against.

In response to the lawsuit, a spokeswoman with the agency said, “The Maryland Insurance Administration strongly disputes the allegations. The case will be vigorously defended.”

American women still make less than men in virtually every job, on average earning 78 percent of what men earn when they work full time, year round. While many factors go into the wage gap, such as the fact that women often have to take time out of their careers to care for family members and they tend to be clustered in lower-paying jobs, economists who study the gap consistently come up with a portion that can’t be explained by such factors, which could indicate bias or discrimination. Nearly a third of American women say they would be paid more if they were a man.

But it can be very difficult to prove that discrimination is motivating lower pay. One big obstacle is that about half of all employees say they are either banned or discouraged from talking about pay with their coworkers, even though they have a legal right to do so, which means many women may not be able to find out whether they are being paid less than men.

It can also be hard to prove that pay differences are due to bias. Francine Katz, formerly the highest-ranking woman executive at Anheuser-Busch, sued the company for allegedly discriminating against her by paying her less than the man that had her job before her and for paying all women on a lower tier than the male executives paid at the top tier. But she lost her case, and the jury foreman said “the evidence was not enough to single out gender.” The experience is common: employees alleging pay discrimination have only wonabout a third of equal pay claims over the last decade.

Meanwhile, U.S. law may require equal pay for equal work, but it doesn’t require equal pay for similar work in different jobs. Yet in the states that experimented with such requirements and with regular audits of payscales in the 1980s, the wage gap dropped significantly.

This article originally appeared in thinkprogress.org on April 20, 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.

Alleging Labor Abuses, U.S. and Mexican Workers Call for Boycott of Driscoll’s Berries

Saturday, April 18th, 2015

in these timesDriscoll’s may be the U.S.’s most recognizable brand name on strawberry, raspberry, blueberry and blackberry cartons. Its conventional and organic berries can be found year-round everywhere from Sam’s Club to Whole Foods. To keep its berries stocked far and wide, the company uses a vast supplier network stretching from Canada to Argentina.

But some of those suppliers are coming under fire for allegedly abusing workers, in the U.S. and Mexico. One Driscoll’s grower has spent weeks embroiled in a major farmworker protest, while a nearly two-year boycott against another grower recently intensified. Workers in both disputes have called for a boycott against the company.

Poverty wages in Baja

While Driscoll’s is a family-owned company, it’s no mom-and-pop operation. According to its website, over 40,000 people are involved in its berry production worldwide. The company has a code of conduct for its suppliers, called the “Promise for Workforce Welfare,” which includes obeying minimum legal requirements and avoiding egregious labor violations like human trafficking and conditions “posing immediate risk to life or limb.” Driscoll’s says it is committed to hiring suppliers that “show a sincere commitment” to such principles.

But Bonifacio Martinez questions whether those requirements are enough. Martinez picked strawberries and blackberries destined for Driscoll’s boxes for 10 years. Now he’s a leader in the farmworker movement that erupted last month in the fields of San Quintin, in the Mexican state of Baja California. Thousands of farm laborers picking multiple crops stopped work for nearly two weeks, demanding higher wages and legally required benefits, among other protections.

“The principal demand is for [growers] to actually respect the workers’ rights,” says Martinez. He wants them to honor labor laws that are, at the moment, he says, just “dead words.” Those include health benefits and freedom from sexual harassment.

Many of the San Quintin protesters are indigenous people from some of Mexico’s poorest states, like Oaxaca and Guerrero. Indigenous people make up more than half of Mexico’s agricultural workers.

The striking pickers initially wanted wages increased to 300 pesos a day, then lowered the demand to 200 pesos, about $13. Most of them earned $7 to $8 a day before the strike.

Protests turned acrimonious when demonstrators threw rocks at government vehicles and police responded with tear gas and rubber bullets, reported the Los Angeles Times. Workers also blocked 56 miles of the Trans-Peninsular Highway. By April, the strike had effectively ended after growers signed agreements raising wages 15 percent—far less than the pickers demanded.

The leaders of the movement rejected the meager increase, saying the unions that signed those agreements, which are affiliated with the Partido Revolucionario Institucional (PRI), which held power for nearly three-quarters of the 20th century and has strong connections to many unions throughout the country, do not represent workers. The workers continue protesting even as many have returned to the fields.

Although the dispute involved various crops and growers, a primary target of the strike was BerryMex, one of Driscoll’s largest suppliers in the region. Last week, on the anniversary of the death of agrarian revolutionary Emiliano Zapata, the farmworkers called for a boycott against Driscoll’s and “all the companies that make a profit by exploiting our labor.”

According to statements by Driscoll’s and BerryMex, following the strike BerryMex increased the “earning opportunity” for its more than 4,000 workers to $5 to $9 an hour—well above the strikers’ demands and the growers’ concessions. “This pay increase means that each individual now has an average earning potential of six to 10 times of Mexico’s minimum Federal wage and as much as 16 times for higher performing workers,” the statements read.

“This is a terrible lie,” says Martinez. He says BerryMex has raised its wages more than some of its peer growers, but only to 180 pesos a day, about $12. That’s a far cry from $5 to $9 dollars an hour. Others familiar with the protests expressed skepticism of the calculation as well. Pickers are paid based on how much they pick, not by hour. That means hourly rates for fast pickers under optimum conditions can far exceed average rates. In that case, the “earning opportunity” will not be the earning reality for most laborers.

BerryMex is not just any Driscoll’s supplier. It is part of Reiter Affiliated Companies (RAC), which says it is “the largest fresh, multi-berry producer in the world.” Driscoll’s is RAC’s only customer. And RAC’s CEO, Garland Reiter, is the brother of Driscoll’s CEO Miles Reiter.

From San Quintin to Skagit County

Driscoll’s responded swiftly to the BerryMex fracas. But it was not as quick to act to resolve a dispute that escalated while the San Quintin protests raged: a bitter labor fight in Burlington, Washington.

Familias Unidas por la Justicia (FUJ), which says it represents over 400 berry pickers, has been locked in a labor struggle with Driscoll’s supplier Sakuma Brothers Farms since 2013. FUJ has long held a boycott against Sakuma berries and its largest customers, Driscoll’s and Häagen-Dazs. On March 24, it doubled down on the boycott when the fair trade advocacy organization Fair World Project sent a letter to Driscoll’s, signed by nearly 10,000 consumers, asking it to suspend buying from Sakuma Brothers until the dispute is resolved. The signatories pledged not to buy Driscoll’s berries until then.

FUJ’s list of complaints is long: poor wages, squalid labor camps, firing and retaliating against workers for organizing and hiring guestworkers from Mexico to replace FUJ’s members. The H-2A guestworker program Sakuma Brothers participated in is meant to be used only when there aren’t enough workers domestically. FUJ says it had plenty of willing workers, but that Sakuma Brothers used guestworkers to avoid hiring back FUJ’s members.

“The only thing we want is a fair contract for both of us,” says FUJ president Ramon Torres.

Sakuma Brothers denies that FUJ represents the berry pickers, calling them “outside agitators” who “have attempted to fabricate the impression that this is a worker movement.” Danny Weeden began his tenure as the company’s CEO just this year and says FUJ’s campaign is hard to understand.

“We’re really doing everything and more than what they’re asking, but they just continue to misrepresent the facts,” he says.

Weeden says that starting this season, the company will pay workers $10 an hour plus a generous bonus for each pound of berries picked. He says the housing is continually upgraded and that the company does suffer from a labor shortage.

After nearly two years of deadlock, the Fair World Project and its nearly 10,000 consumer signatures finally prompted Driscoll’s to respond. In a statement, the company said it had hired “an independent, leading worker welfare organization” to audit Sakuma Brothers, and that the final audit showed that the company had “properly addressed any potential claims” of worker mistreatment.

Felimon Pineda, FUJ’s vice president, doubts the audit’s accuracy. “If it’s true that people from Driscoll’s came to check Sakuma farms, the first thing they should have done was ask the farmworkers,” he says. “Because they’re the ones who feel the pain. They’re the ones who know the working conditions.

Pineda, who is from Oaxaca, is a link between San Quintin and Burlington. For him, the connection between them runs deeper than boycotting Driscoll’s. He got his start picking strawberries at the age of 13 in a town in Baja California right next to the current protests. “I’m in solidarity with these people because they’re my people,” he says.

Like many of the Baja workers, Pineda is indigenous. “The valley of San Quintin is full of people from Oaxaca and Guerrero who speak Mixteco like me,” he says, referring to an indigenous language spoken in the region. He says his own brother is part of the protests in Mexico. “I remember my people because I also suffer from the company. … It didn’t seem right that the folks in San Quintin would be on strike and I would just be quiet.”

The connection makes sense, says Gaspar Rivera, a binational advisor to the Frente Indigena de Organizaciones Binacionales and researcher at the UCLA Labor Center. Indigenous people have a history of picking berries, one of the hardest and least desirable farm jobs. Once they acquired berry-picking know-how in Mexico, many migrated all the way up to Washington to do the same work.

“They’re working on both sides of the border for this international company,” Rivera says. “Driscoll’s has managed to develop a production system that extends from Baja California all the way to Washington to be able to supply the U.S. market, and other markets, with strawberries all year round.”

Workers on both sides of the border are now leading boycotts against Driscoll’s, but it’s unclear whether the company’s actions will go beyond issuing statements. Although Driscoll’s requires its suppliers to commit to the Promise for Workforce Welfare, it says it will not intervene in labor negotiations.

“Driscoll’s does not have a role in any labor negotiations between farmers and farmworkers,” the company says. “Our focus and responsibility is on worker welfare and ensuring legal compliance is adhered to by all our independent growers.” The company says it has never terminated a supplier for labor violations.

Rivera thinks Driscoll’s hands-off approach is disingenuous.  “It’s more like the Walmart model of shifting the risk to these growers,” he says. “This has been Driscoll’s line, [that it is] not responsible about the working conditions. Which is partially true but partially false. Ultimately they have a lot of power over these growers because they can say, Hey, if you don’t shape up and employ workers in a fair way, we’re going to stop buying.”

This article originally appeared in inthesetimes.com on April 18, 2015. Reprinted with permission.

About the Author: Rachel Luban is a writer living in Maryland. She contributes to Full Stop and her work has appeared on Jezebel, The Rumpus, and In Our Words. Follow her on Twitter: @rachelcluban.

Adjunct Faculty Around the Country Join Fight for 15 Protests

Thursday, April 16th, 2015

Rebecca BurnsAfter speaking to an adjunct instructor participating in yesterday’s massive low-wage worker protests, I thanked her for her time and walked away. Another adjunct, who had been listening on the sidelines as my interviewee talked about her 12 years piecing together part-time work at five different Chicago colleges, approached and introduced herself. “I just wanted to make sure we connected today,” she said to my interviewee before adding knowingly, “It sounds like we have a lot in common!”

A key component of any union drive is workers’ recognition that their problems on the job are shared rather than unique ones, and that they therefore must be solved by collective action. Organizers involved in the growing effort to unionize contingent faculty say that this is often an especially difficult realization for highly educated, low-wage workers who are trained to pursue individual success by putting their noses ever harder to the Ivory Tower’s grindstone.

But that appears to have changed as of yesterday’s walkouts and rallies in more than 200 cities nationwide, in which adjuncts joined fast-food, homecare and other low-wage workers in what organizers say was the largest such protest in history. The day’s actions marked a new phase of the “Fight for 15,” which will head to colleges as contingent faculty press for union representation, a wage bump and greater job security.

Earlier this year, the Service Employees International Union (SEIU), which backs both adjunct and fast-food worker organizing, announced a new campaign called “Faculty Forward,” which will demand a minimum compensation of $15,000 per college course taught, plus benefits. That would be a staggering increase over adjuncts’ current median pay of just $2,700 per course nationwide, but it complements the bold demand of a $15 minimum wage that fast-food workers have been advancing since 2012.

“This is the time to be heard for all low-wage workers,” said Alyson Paige Warren, an adjunct who has worked at Loyola University Chicago and other Chicago-area schools for 12 years, sometimes making as little as $100 per weekly class.

Chicago is one of the most recent cities where SEIU is hoping to organize adjuncts citywide, following considerable success in the Boston, San Francisco and Washington, DC metro areas. While the city’s major public school and several community colleges already have active faculty unions, there are approximately 8,000 part-time and contingent faculty members across the city that remain non-unionized, including at private universities such as Loyola and DePaul.

Ahead of yesterday’s main Fight for 15 protest in Chicago, a group of about 50 adjuncts, students and full-time faculty supporters rallied at Loyola on the city’s far North Side. Carrying signs that read, “Invest in instruction, fight for $15K” and “No more profs in poverty,” the group marched across campus before boarding buses to join an estimated 6,000 demonstrators calling for a living wage.

The group of adjuncts also delivered a petition with 500 signatures to Loyola administrators, urging them to live up to the school’s Jesuit values of social justice by granting instructors fair benefits, fair wages and the right to unionize. Adjuncts at Loyola are not formally demanding $15,000 a course, but they say their current rate of between $4,000 and $4,500 isn’t enough to make ends meet.

They’re not alone. A study released this week by the University of California Berkeley’s Center for Labor Research and Education finds that a full 25 percent of part-time college professors rely on some form of public assistance to supplement their wages. That’s not as high at the 48 percent of homecare workers who received assistance from programs including Medicaid, food stamps, welfare payments or the Earned Income Tax Credit, or the 52 percent of fast-food workers who do so. But it’s a stunning statistic that flies in the face of the assumption that higher education is a path to prosperity.

Paige Warren believes that it’s also a basis for solidarity with other workers, something that adjuncts are increasingly attuned to. “If someone who serves my coffee before I go to teach my students is struggling to make ends meet,” she said, “it’s my job to be concerned about his plight, just as he should be about mine.”

This article originally appeared in inthesetimes.com on April 16, 2015. Reprinted with permission.

About the author: Rebecca Burns is an In These Times assistant editor based in Chicago, where she also covers labor, housing and higher education. Her writing has also appeared in Al Jazeera America, Jacobin, Truthout, AlterNet and Waging Nonviolence. She can be reached at rebecca[at]inthesetimes.com. Follow her on Twitter @rejburns

"The market rate for me as a C.E.O. compared to a regular person is ridiculous, it’s absurd”

Tuesday, April 14th, 2015

jonathan-tasiniPearls of wisdom. Not the economics–because it is absurd, the reality not of “free market” competition but the reality of cronyism, corruption and greed. But, Dan Price saw the immorality of paying people shit and did something about it: he cut his pay and is raising everyone’s wages.

A caveat: I am naturally hesitant to put anyone on a pedestal too quickly, especially someone who gets some uncritical free media without too much inquiry. But, until I see otherwise, Price gets a free ride and a tip of the cap for this:

The idea began percolating, said Dan Price, the founder of Gravity Payments, after he read an article on happiness. It showed that, for people who earn less than about $70,000, extra money makes a big difference in their lives.His idea bubbled into reality on Monday afternoon, when Mr. Price surprised his 120-person staff by announcing that he planned over the next three years to raise the salary of even the lowest-paid clerk, customer service representative and salesman to a minimum of $70,000.

“Is anyone else freaking out right now?” Mr. Price asked after the clapping and whooping died down into a few moments of stunned silence. “I’m kind of freaking out.”

If it’s a publicity stunt, it’s a costly one. Mr. Price, who started the Seattle-based credit-card payment processing firm in 2004 at the age of 19, said he would pay for the wage increases by cutting his own salary from nearly $1 million to $70,000 and using 75 to 80 percent of the company’s anticipated $2.2 million in profit this year.

The paychecks of about 70 employees will grow, with 30 ultimately doubling their salaries, according to Ryan Pirkle, a company spokesman. The average salary at Gravity is $48,000 year.[emphasis added]

What he came to understand:

“The market rate for me as a C.E.O. compared to a regular person is ridiculous, it’s absurd,” said Mr. Price, who said his main extravagances were snowboarding and picking up the bar bill. He drives a 12-year-old Audi, which he received in a barter for service from the local dealer.[emphasis added]

The reaction from his workers:

Hayley Vogt, a 24-year-old communications coordinator at Gravity who earns $45,000, said, “I’m completely blown away right now.” She said she has worried about covering rent increases and a recent emergency room bill.

And:

Phillip Akhavan, 29, earns $43,000 working on the company’s merchant relations team. “My jaw just dropped,” he said. “This is going to make a difference to everyone around me.”

A note: to be sure, Price is going to still be a very wealthy man–he has a company which is still making a lot of money.But…he did this. And as far as I can tell it comes from an honest place, an honest morality.

The fact that this even gets some buzz is a sign of how corrupt CEOs truly are, grabbing millions of dollars for themselves and leaving most of their workers to pick up crumbs. The only slight disagreement I’d have with Price is on his view of the “market” for CEO pay.

There is no “market” in the sense that normal people would understand. It’s a corrupt, closed system of cronyism. I’ve written about this many times over the years and had the good fortune, when writing my book“The Audacity of Greed” back in 2009, to talk with Graef “Bud” Crystal who was once one of the country’s premier compensation consultants—the guy who would be hired by CEOs to come up with compensation packages. He told me back then:

“In 1970, one CEO hired me and said, ‘we don’t have a bonus plan and do we need one?’” recalls Crystal. “I did the study and I went back to the CEO and said ‘yes you do need a bonus plan. But we have a problem area. You are making $150,000-a year and the problem is that the $150,000 is equal to the salary and the bonus to what your competitors are paying so we have to cut your pay to $100,000-a-year and then we can put in a bonus.’” Crystal laughs. “It was like a scene from The Exorcist where ice formed on the windows…he started arguing about the findings and he finally said ‘let me say this to you this way: who do you think is paying your bills anyway?’ I replied, ‘If I recall correctly the checks were drawn on the corporate account, not your personal account so the shareholders are paying me, not you.’ The meeting ended quite quickly.

The point is the whole game is fixed. The CEO stacks his board with cronies, pays them $20,000-per-meeting board fees and, then, makes sure his cronies approve pay packages though the real money is in the pensions and deferred pay. It’s a scam.It is interesting that Price’s decision comes on the eve what will be huge national demonstrations to raise wages to a minimum of $15-an-hour.

This article originally appeared in workinglife.org on April  14, 2015. Reprinted with permission.

About the author:  Jonathan Tasini on any given day, I think like a political-union organizer or a writer — or both. I’ve done the traditional press routine including The Wall Street Journal, CNBC, Business Week, Playboy Magazine, The Washington Post, The New York Times and The Los Angeles Times. One day, back when blogs were just starting out, I created Working Life. I used to write every day but sometimes there just isn’t something new to say so I cut back to weekdays, with an occasional weekend post when it moves me. I’ve also written four books: It’s Not Raining, We’re Being Peed On: The Scam of the Deficit Crisis (2010 and, then, the updated 2nd edition in 2013); The Audacity of Greed: Free Markets, Corporate Thieves and The Looting of America (2009); They Get Cake, We Eat Crumbs: The Real Story Behind Today’s Unfair Economy, an average reader’s guide to the economy (1997); and The Edifice Complex: Rebuilding the American Labor Movement to Face the Global Economy, a critique and prescriptive analysis of the labor movement (1995).

On Equal Pay Day, Mind the Gap, All $431,000 of It

Tuesday, April 14th, 2015

Image: Mike HallToday, Equal Pay Day, marks the day when women workers close the 2014 pay gap, and that wage gap is huge. Women, on average, earn 78 cents on the dollar compared to men’s wages and that adds up to more than $10,800 a year and more than $400,000 over a career.

A new report finds that wage gap is even wider for mothers, especially single mothers and mothers of color, most of whom are essential breadwinners and caregivers for their families.

The report, An Unlevel Playing Field: America’s Gender-Based Wage Gap, Binds of Discrimination and a Path Forward, by the National Partnership for Women & Families, finds mothers who work full-time, year-round in the United States are paid just 71 cents for every dollar paid to fathers who work full-time, year-round. Single mothers are paid just 58 cents for every dollar paid to fathers. And African American and Latina mothers suffer the biggest disparities, being paid just 54 cents and 49 cents, respectively, for every dollar paid to white, non-Hispanic fathers.

National Partnership President Debra L. Ness said:

“At a time when women’s wages are essential to families and our economy, the persistence of the gender-based wage gap is doing real and lasting damage to women, families, communities and to our nation. It defies common sense that lawmakers are not doing more to stop gender discrimination in wages.”

In 2009, Congress passed and President Barack Obama signed the Lilly Ledbetter Fair Pay Act, which overturned a 2007 U.S. Supreme Court ruling that denied many pay discrimination victims their day in court. But since then, Republican lawmakers have blocked votes on the Paycheck Fairness Act.

That legislation would strengthen penalties that courts may impose for equal pay violations and prohibit retaliation against workers who inquire about or disclose information about employers’ wage practices. The bill also would require employers to show pay disparity is truly related to job performance—not gender.

The bill was reintroduced last month by Sen. Barbara Mikulski (D-Md.) and Rep. Rosa DeLauro (D-Conn.), who said:

“Equal pay is not just a problem for women, but for families, who are trying to pay their bills, trying to get ahead, trying to achieve the American Dream and are getting a smaller paycheck than they have earned for their hard work.”

Last April, President Obama signed two executive orders on equal pay, one that banned retaliation against employees of federal contractors for discussing their wages and another that instructed the U.S. Department of Labor to create new regulations requiring federal contractors to submit data on employee compensation. While these actions will help federal contractor employees, congressional action is needed to end gender-based pay discrimination for all workers.

Here are some other facts on unequal pay and the wage gap between men and women.

  • If the pay trends of the past five decades remain the same, it will take nearly another five decades—until 2058—for women to reach pay equity with men.
  • If women and men received equal pay, the poverty rate for all working women and their families would be cut in half from 8.1% to 3.9%.
  • The gender wage gap among union members is half the size of the wage gap among nonunion workers.
  • Union women working full-time earn, on average, 90.6% of what their male peers earn.
  • The wage gap for union members fell 2.6 cents between 2012 and 2013 but was virtually unchanged for nonunion workers.
  • Paying women the same wage as their male peers would have added an additional $448 billion to the economy in 2012 or roughly 3% of the country’s GDP.
  • 62% of women who work in the private sector report that discussing pay at work is strongly discouraged or prohibited, making it harder for women to discover if they are missing out on wages they deserve.
  • Requiring employers to disclose employee pay rankings would allow women to know if they are being paid the same wage as comparable workers.

On-Equal-Pay-Day-Mind-the-Gap-All-431-000-of-It_blog_post_fullWidth

 

 

This article was originally printed on AFL-CIO on April 14, 2015.  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.

The High Cost of Fighting for $15

Tuesday, April 14th, 2015

Leo GerardThis is no plea for pity for corporate kingpins like Walmart and McDonald’s inundated by workers’ demands for living wages.

Raises would, of course, cost these billion-dollar corporations something. More costly, though, is the price paid by minimum-wage workers who have not received a raise in six years.  Even more dear is what these workers have paid for their campaign to get raises. Managers have harassed, threatened and fired them.

Despite all that, low-wage workers will return to picket lines and demonstrations Wednesday in a National Day of Action in the fight for $15 an hour. The date is 4 – 15. These are workers who live paycheck to paycheck, barely able to pay their bills, and certainly unable to cope with an emergency. They know the risk they’re taking by participating in strikes for pay hikes. They’ve seen bosses punish co-workers for demonstrating for raises. To lose a job, even one that pays poverty wages, during a time of high unemployment is terrifying. Still, thousands will participate Wednesday. That is valor.

0-Fight-for-15-graphic

Kip Hedges exhibited that courage. He’s a 61-year-old with 26 years of service as a baggage handler for Delta at the Minneapolis-St. Paul Airport. He wanted better wages for young workers and a union. He said so in a video, noting that “probably close to half make under $15 an hour.”

Delta fired him. The airline said he’d disparaged the company. Apparently Delta believes it has been disparaged if the flying public learns the truth about the way Delta treats workers.

Clearly, Delta planned to shut Hedges up and intimidate other workers. The message to his co-workers was clear: “You wanna talk about the paltry wages you get? Well, let’s talk about this pink slip.”

But when Delta messed with Hedges, it messed up big time. The firing failed to silence him. Hecontinued to protest low wages. His co-workers rallied round him. The media covered his firing and his appeal. He looked like a low-wage worker hero. Delta looked like a vindictive heel.

Unlike Hedges, Shanna Tippen was no activist before she got fired from her minimum-wage job in Pine Bluff, Ark. She was just trying to get by, and falling short by about $200 a month. Her boss at the Days Inn where she worked as a night shift jack-of-all-trades asked her to talk to a Washington Post reporter who had dropped by the hotel to discuss the state’s newly instituted 25-cent increase to the federal minimum wage of $7.25.

Tippen told the reporter, Chico Harlan, that she hoped the little bit of extra money would help her pay for her grandson’s diapers.

After the Post published the story, the manager of the Days Inn, Herry Patel, telephoned Harlan to complain about being quoted in it. Then he fired Tippen. She recounted it to Harlan:

“He said I was stupid and dumb for talking to [The Post].”  Even though, of course, Patel had told Tippen to talk to the reporter. Tippen continued: “He cussed me and asked me why you wrote the article. I said, ‘Because he’s a reporter; that’s what he does.’”

Patel told Harlan that Arkansas voters, who approved the pay increase in a referendum by 66 percent, should not have done it. “Everybody wants free money in Pine Bluff,” Harlan quoted him as saying.

Patel apparently did not understand that Tippen performed work that kept the hotel running every night, which means she earned the money. The truth is that Patel, like so many other employers, believes that employees should work for free.

The Post and other papers wrote about Tippen’s firing, making her an icon for ill-treated, low-wage workers and Patel the personification of miserly bosses.

Worker-exploiting employers like McDonald’s, Chipotle and Walmart have shown themselves to be craven in the face of courageous workers’ wage protests as well.

Over the past few months, the National Labor Relations Board (NLRB) has filed charges against McDonald’s and Walmart alleging they violated workers’ rights, including threatening retribution against those who participated in strikes.

In December, the NLRB in California ruled that Walmart illegally punished workers for striking and seeking to unionize. The judge determined that Walmart managers illegally intimidated workers by, for example, telling one, who had tied a rope around his waist to pull a heavy load, “If it was up to me, I would put that rope around your neck.”

In the Chipotle case, the NLRB ruled that a manager in St. Louis illegally fired worker Patrick Leeper for participating in Fight for $15 demonstrations and for talking about wages at work. After the decision, a company spokesperson told the news website Think Progress: “Generally speaking, it is always a top priority for us to remain compliant with all local and federal labor laws.”

“Generally,” Chipotle tries. Generally. Not in this particular case involving low-wage workers demonstrating for better pay. But, you know, generally Chipotle tries to obey the law.

In the original Washington Post story about the tiny increase in the minimum wage in Arkansas, Dominic Flis, whose company owns 18 Burger Kings in central Arkansas, said raising the minimum wage pushes up pay for other workers too. Here’s what he said:

“If somebody was already making $7.50, and minimum wage goes to $7.50, they’ll have some expectation of a raise as well,” Flis said. “And I have to maintain my workforce.”

The Brookings Institute calls this the ripple effect. The pay increase at the bottom ripples all the way up the pay scale.

Hedges, the fired Delta worker, put it another way: “a lot of the better paid workers also understand that the bottom has to be raised otherwise the top is going to fall as well.”

If for no other reason than self-interest, join the gutsy minimum-wage workers at a Fight for $15 event Wednesday.

This article originally appeared in ourfuture.org on April 14, 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.

Workers Sue Walmart For Manipulating Employee Classification To Deny Them Overtime Pay

Friday, April 10th, 2015

Bryce CovertWalmart is facing a potential class action lawsuit over alleged wage theft in Alameda County Superior Court from an employee who claims the company illegally denied managers overtime pay.

Bonnie Cardoza, who worked at the company as an assistant manager for about five years, says she and other assistant mangers were made to do the same tasks as hourly workers for more than eight hours a day. The extra duties included greeting customers, operating checkout areas, and taking inventory.

But because they are labeled managers, they are exempt from federal overtime laws that require employers to pay workers time and a half for more than 40 hours of work a week. The lawsuit alleges that they “were ‘managers’ in name only because they did not have the managerial duties or authority,” but that Walmart purposefully classified them as managers to avoid overtime pay and cut costs. The suit claims they should have been paid that extra wage for more than eight hours of work a day.

The lawsuit also says the company deprived Cardoza and other assistant managers of rest and meal breaks.

She is suing for back wages to make up for the lack of overtime pay and compensation for the missed breaks on behalf of any Walmart assistant manager who has worked there since January 2011, although her lawyers say it’s too early to know whether it will achieve class action status.

In response, a Walmart spokesperson said, “It is our policy to pay associates according to federal and state laws. We take this matter seriously. We are investigating the allegations and will respond appropriately with the court.”

It’s not the first time the company has been accused of denying its workers pay. At the end of last year, the company was ordered by the Pennsylvania Supreme Court to pay $151 million in back wages to 187,000 current and former employees who accused it of making them work off the clock during their breaks.

A big Walmart supplier also had to pay out over wage theft in 2013 over allegations that it forced workers to forgo meal breaks. While Walmart doesn’t own the operations, it effectively runs facilities for the company and the company has been accused of squeezing its suppliers so hard that they have to crack down on labor costs.

Wage theft is rampant beyond Walmart, however. In 2012, nearly $1 billion was recovered in back wages for the victims of wage theft, but even that undercounts the breadth of the problem since most workers don’t report the problem. It’s estimated that employers deny workers $50 billion that they’re owed every year by making them work off the clock, shave hours off of their paychecks, pay for work-related expenses out of their own paychecks, or other practices that dock wages. That figure dwarfs the $14 billion taken from all victims of robberies, burglaries, larcenies, and car thefts together.

The problem is particularly rampant in fast food, where recent suits have been filed against TGI Friday’s, McDonald’s, Subway, and Chipotle.

The issue of overtime misclassification has also gotten attention recently. Last year, President Obama issued an executive order that would update overtime laws so that fewer employees could be classified as managers and therefore exempted from time and a half. It would also raise the salary cutoff for getting overtime pay, which currently means anyone who makes more than $23,660 is exempt, a threshold that hasn’t been significantly updated since 1975. These changes could also aid employees like Cardoza, who would likely qualify for overtime pay even if they are assistant managers.

This article originally appeared in thinkprogress.org on April 10, 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.

Workers and Wages Aren’t a ‘Cost,’ We’re an Investment

Tuesday, April 7th, 2015

Kenneth-Quinnell_smallReading today’s Politico Morning Shift column, this sentence stood out in a short piece on Wisconsin Republicans’ efforts to repeal the state’s prevailing wage law: “That’s an 80-year law requiring that workers on construction jobs for local and state governments be paid a wage that the state determines to represent the prevailing norm—a calculation that tends to raise labor costs.” The bias in that construction is pretty simple, and it’s one that is often repeated by journalists despite it being a very clear anti-worker frame: Workers are a “cost” and not an investment and not the part of a business that does the work that creates the company’s profits. In other words, this common construction says workers are a pesky obstacle instead of the source of revenue a company needs to survive and grow.

When was the last time you heard a reporter refer to CEO pay as a “labor cost,” despite the fact that for many companies these massive payouts are much bigger than the amount any prevailing wage law might increase worker pay? When was the last time you heard other common costs such as buying machines to build products or raising investment capital, as a similar type of burden? When was the last time we talked about worker compensation as an investment that grows a business? When was the last time you heard about how hiring workers and compensating them well increased profits for a company, when the evidence is pretty clear that such a thing happens all the time?

Those questions are rhetorical, but this one isn’t: Why is there an insistence on repeating extreme right-wing anti-worker talking points as if they were facts? Reporters, who represent objectivity and balance, have a responsibility to not favor business interests over those of workers.

This insistence on focusing on workers as secondary to the interests of business owners shows that there is a need to pivot the debate in America. Reporters aren’t making up this language; they’re reporting what anti-worker politicians, pundits and business owners are saying. But the conversation is starting to change, and working families are the ones forcing the change. They expect us to stay silent and allow them to get away with whatever they want, but we’d rather talk about raising wages, expanding the middle class and making the American dream more real for more working families. When the national conversation only includes one side of the story, it not only leaves most Americans out of the conversation, it helps keep wages stagnant and creates an obstacle to giving people a raise.

This blog originally appeared on aflcio.org on April 4, 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.

The War Against Women Getting Paid Family Leave

Monday, April 6th, 2015

Meghan-Byrd_avatar_1422562197-140x140[1]A mother with a newborn baby in Canada has the right to receive paid family leave. So do mothers in France, Brazil, Australia, Pakistan, Venezuela – even Russia. But not those in the United States. Our country is one of only five in the world, and the only developed nation, that does not require paid family leave.

One would think paid family leave would have bipartisan support, given the economic benefits, overwhelming public support and fundamental right of caring for your own child at hand. Yet somehow Republicans in Congress have consistently fallen on the wrong side of the matter, just one battle in their endless war they have continued to wage against women.

The good news is that Sen. Kirsten Gillibrand (D-N.Y.) and her colleague in the House, Rep. Rosa DeLauro (D-Conn.) recently reintroduced the FAMILY Act. The bill would provide workers with up to 12 weeks of partial income when they take time off for health reasons, including pregnancy, childbirth recovery and adoption. Additionally, it would allow workers to earn up to 66 percent of their monthly wages, and would apply to workers at companies large and small. The law would be funded by small employee and employer payroll contributions (two-tenths of one percent each).

Thanks to states such as New Jersey and California, which have already implemented similar programs, we can see positive economic benefits of requiring paid family leave that refute claims by critics that such a policy would be too expensive and be bad for business.

In these states, paid family leave costs less than $1 per week for each employee using payroll deductions, and the benefits are outstanding. In California, 91 percent of employers said the law had either a positive or no noticeable effect on profitability, and 99 percent said it increased or had a non-noticeable effect on employee morale, according to one survey. The policy has also led to more women joining the labor force, which in turn boosts the economy.

Mothers are far more likely to be employed up to 16 years after the birth of their first child if they received paid maternity leave, according to a Center for American Progress study. Additionally, theInstitute for Women’s Policy Research found that paid family leave increases consumer spending and generates a larger tax base, and could boost the country’s gross domestic product by 5 percent.

Current Law Is Not Enough

Current federal law requires employers give employees 12 weeks of unpaid leave for caring for a newborn child or a sick family member. Critics argue that this policy should be enough job security for new parents. However, when it is a single parent or a household living in near-poverty trying to make ends meet, 12 weeks without a paycheck simply isn’t possible. This is especially true when considering the costs associated with having a new baby.

What if we left it up to businesses? So far, that strategy hasn’t worked out, seeing as only 11 percent of workers in the U.S. get paid family leave through their employer or their state.

Rebecca Traister, writing in The New Republic, recently detailed what paid family leave would mean for her. As a pregnant woman, she was left with little choice – she had to keep her job even if she might have wanted to pursue other options. “My body and its condition defined my professional situation,” she wrote. She was thrilled when the new management announced a policy of paid maternal and fraternal leave for up to 16 weeks. She asks the question, “Is it such a bad thing to attract workers by offering them more equitable conditions..?”

In his most recent State of the Union speech, President Obama highlighted why paid family leave is so important and pledged to make it one of his top priorities: “It’s time we stop treating childcare as a side issue, or a women’s issue…Today we’re the only advanced country on Earth that doesn’t guarantee paid sick leave or paid maternity leave to our workers.”

The women’s economic agenda, “When Women Succeed, America Succeeds,” includes policies such as mandatory paid family leave, and is being promoted by the White House and Democrats. The President has set an example for Congress – giving six weeks paid leave to all federal employees after the birth or adoption of a child through executive action.

And not only is it the sensible thing to do – but voters agree. In a recent poll conducted by Lake Research Partners, 81% of respondents agreed that “paid time off to care for family members and affordable child care is good for our nation.” Poll after poll show Democrats, Independents and Republicans overwhelmingly supporting paid family leave policies.

Recently, Minnesota state Rep. Andrea Kieffer (R) called women who seek equality and fundamental rights in the workforce ‘whiners’. She opposed a set of bills aimed at raising the minimum wage, shrinking the gender pay gap and introducing paid family leave, saying that the bills were “putting us backwards in time.” She said that “we [women] are losing the respect we so dearly want in the workplace by bringing up these special bills for women.” This is in a state where women earn 80 cents on the dollar to their male counterparts. Instead of addressing the reality of women in the workplace, Rep. Kieffer prefers to antagonize those who want to improve the situation. This is just one example of conservative lawmakers trying to hold back much needed progress in the workplace. We can’t let this mentality poison the conversation.

President Obama and the American public want paid family leave. Requiring it is good for the economy, good for people and good for the country. Now, the important issue is in the hands of our legislature. Due to the Republican Congress’ misguided agenda, the chance of this important bill getting through committee is relatively slim. If you agree that paid family leave should not just be a luxury, but a right, call your congressional member and urge them to support sending the FAMILY Act to the floors and once it arrives, voting ‘aye’.

This blog originally appeared in ourfuture.org on April 6, 2015. Reprinted with permission.

About the Author: Meghan Byrd is a student at Bucknell University studying political science and Spanish. In 2015 she spent a semester at American University. She is originally from Palo Alto, California in the San Francisco Bay Area and center of Silicon Valley. She is interested in public policy and the intersection between government and technology.

Your Rights Job Survival The Issues Features Resources About This Blog