Outten & Golden: Empowering Employees in the Workplace

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Day 1 in the Newly Seated Kentucky Legislature Is About Attacking Working People

Monday, January 9th, 2017

Kentucky Republican leaders, led by Gov. Matt Bevin, gained control of the state House, giving them control of the executive and legislative branches. Their first order of business? Go after working families. Bevin and the Republicans are pushing forward with several anti-worker resolutions. In the process, they have given more say in the state’s future to outsider billionaires and CEOs than the people of the state.

Kentucky Republicans abused their power, changing the rules to move the anti-working people bills as “emergency legislation,” even though the only emergency happening is the one they are creating for working families. Legislators don’t even have time to read the bills, much less take the time to fully understand the impact of the legislation. New legislators don’t even have phones or offices yet, and they’re being asked to quickly vote yes or no on dangerous, destructive bills.

Even worse, by bending the rules in their favor, Republicans have given the public no chance to weigh in on the legislation. The bills have been reported out of committee and could be voted on the floor of the legislature as early as Saturday.

The Kentucky State AFL-CIO condemned the sneaky move:

The so-called right to work and prevailing wage repeal bills passed (out of committee) today will deny economic opportunities for Kentucky’s working families.
Kentucky’s working families are suffering. They are facing employment, health care access and education challenges. The Kentucky GOP not only ignored their plight, they made them worse with these anti-worker bills.

Kentucky Governor Matt Bevin and House Republican leadership made hurting working Kentuckians their number one priority. They did not advance bills to increase education funding, raise wages, or fund vital services in our community. Instead they chose to give multi-national corporations more power to outsource jobs, cut wages, and reduce benefits at the expense of our workers, small businesses, and the local economy. This is shameful.

The Kentucky labor movement will continue to fight for the rights of Kentucky’s working families, like we have been doing for more than 100 years. We will demand government transparency and accountability. And we will continue to fight for better wages, reasonable hours and safer working conditions. We will take this opportunity to grow the labor movement and organize like hell!

Politicians didn’t create the labor movement and politicians aren’t going to destroy the labor movement.

Other working family advocates agree. Bill Finn, director of the Kentucky State Building and Construction Trades Council, said: “A lot of working people voted for change in this election. They didn’t vote for this. They didn’t vote for a pay cut.”

Learn more at Kentucky State AFL-CIO.

This blog originally appeared in aflcio.org on January 4, 2017.  Reprinted with permission.

Kenneth Quinnell: I am a long-time blogger, campaign staffer and political activist.  Before joining the AFL-CIO in 2012, I 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.  My writings have also appeared on Daily Kos, Alternet, the Guardian Online, Media Matters for America, Think Progress, Campaign for America’s Future and elsewhere.  I am the proud father of three future progressive activists, an accomplished rapper and karaoke enthusiast.

Enormous, Humongous August Trade Deficit Prompts Trade Deficit Bill

Tuesday, October 11th, 2016

dave.johnsonThe U.S. Census Bureau reported Wednesday that the August trade deficit rose 3 percent to $40.73 billion from July’s $39.5 (slightly revised). Both exports and imports rose, with imports rising more than exports. August exports were $187.9 billion up $1.5 billion from July. August imports were $228.6 billion up $2.6 billion.

The goods deficit was $60.3 billion, offset by a services surplus of $19.6 billion.

Imports from China increased 9.5 percent.

Is Increased “Trade” Good If It Really Means Increased Trade Deficits?

“Trade” is generally considered a good thing. But consider this: closing an American factory and firing its workers (not to mention the managers, supply chain, truck drivers, etc affected) and instead producing the same goods in a country with low wages and few environmental protections, then bringing the same goods back to sell in the same stores increases “trade” because now those goods cross a border. This is how “trade” results in a structural trade deficit. Goods once made here are made there, the economic gains move from here to there.

Offshoring production can be a good thing, but only in a full-employment economy. This is because with everyone employed companies can’t find people to do things that need to be done. Meanwhile workers in other countries need the jobs. The people there can afford things made here, and trade balances. Everyone benefits.

But since the 1970s the US has used “trade” and other policies to intentionally drive unemployment up and wages down, to the benefit of “investors” (Wall Street) and executives, who then pocket the wage differential. This pushes the economy’s gains to a few at the top, increasing inequality, which increases the power of plutocrats to further influence policy in their favor.

The US has run a trade deficit since the 1970s. Coincidentally, see this chart:

The stagnation of wages for working people just happens to correspond with the introduction of the intentional “trade” deficit. Again, “trade” in this case means deindustrialization: closing factories here, opening them there and bringing the same goods across a border to sell in the same stores.

Trade Deficit Reduction Act

This week Rep. Louise Slaughter (D-NY) introduced a bill designed to identify and reduce our enormous, humongous trade deficits. RochesterFirst.com has the story, in Slaughter introduces legislation to reduce trade deficits,

On Monday, Congresswoman Louise Slaughter unveiled the Trade Deficit Reduction Act, which calls for a change in how we approach international trade in order to benefit our workers.

The legislation would put a government-wide focus on addressing the most significant trade deficits that exist between the United States and other countries. The U.S. has run trade deficits since the 1970s.

… “The last thing our community needs as we work to reignite our manufacturing base with advanced technologies like optics and photonics is to undo this progress by enacting another NAFTA-style trade deal. We need a whole new direction in our trade policy, which is why I am standing with workers from PGM Corp. today to unveil the Trade Deficit Reduction Act. This legislation will change how we approach international trade and make it benefit our workers and manufacturers,” said Slaughter.

The bill would require the administration to identify the countries with which the U.S. has the worst trade deficits.

The bill also directs the administration to develop plans of action to address the trade deficits with those countries, with strict deadlines and oversight from Congress.

The intentional trade deficit and other policies to drive up unemployment and drive down wages greatly enrich a few, but history tells us the consequences are dangerous to society. For example, the rising support for Trump and other far-right populists like him around the world.

This post originally appeared on ourfuture.org on October 6, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

New Rules Needed to Solve Steel Crisis

Friday, September 9th, 2016

China is gorging itself on steelmaking. It is forging so much steel that the entire world doesn’t need that much steel.

Companies in the United States and Europe, and unions like mine, the United Steelworkers, have spent untold millions of dollars to secure tariffs on imports of this improperly government-subsidized steel. Still China won’t stop. Diplomats have elicited promises from Chinese officials that no new mills will be constructed. Still they are. Chinese federal officials have written repeated five-year plans in which new mills are banned. Yet they are built.

All of the dog-eared methods for dealing with this global crisis in steel have failed. So American steel executives and steelworkers and hundreds of thousands of other workers whose jobs depend on steel must hope that President Barack Obama used his private meeting with China’s President XI Jinping Saturday to press for a novel solution. Because on this Labor Day, 14,500 American steelworkers and approximately 91,000 workers whose jobs depend on steel are out of work because China won’t stop making too much steel.

A new report on the crisis, titled “Overcapacity in Steel, China’s Role in a Global Problem,” by the Duke University Center on Globalization, Governance & Competitiveness flatly concludes that existing policies to stop China from building excessive steel capacity have failed.

steel-overcapacity-table

Since 2007, China has added 552 million metric tons of steel capacity – an amount that is equivalent to seven times the total U.S. steel production in 2015. China did this while repeatedly promising to cut production. China did this while the United States actually did cut production, partly because China exported to the United States illegitimately subsidized, and therefore underpriced, steel.

That forced the closure or partial closure of U.S. mills, the layoffs of thousands of skilled American workers, the destruction of communities’ tax bases and the threat to national security as U.S. steelmaking capacity contracted.

Although China, the world’s largest net exporter of steel, knows it makes too much steel and has repeatedly pledged to cut back, it plans to add another 41 million metric tons of capacity by 2017, with mills that will provide 28 million metric tons already under construction.

None of this would make sense in a capitalist, market-driven system. But that’s not the system Chinese steel companies operate in. Chinese mills don’t have to make a profit. Many are small, inefficient and highly polluting. They receive massive subsidies from the federal and local governments in the form of low or no-interest loans, free land, cash grants, tax reductions and exemptions and preferential access to raw materials including below market prices.

That’s all fine if the steel is sold within China. But those subsidies violate international trade rules when the steel is exported.

These are the kinds of improper subsidies that enable American and European companies to get tariffs imposed. But securing those penalties requires companies and unions to pay millions to trade law experts and to provide proof that companies have lost profits and workers have lost jobs. So Americans must bleed both red and green before they might see limited relief.

The Duke report suggests that part of the problem is that market economies like those in the United States and Europe are dealing with a massive non-market economy like China and expecting the rules to be the same. They just aren’t.

Simply declaring that China is a market economy, which is what China wants, would weaken America’s and Europe’s ability to combat the problems of overcapacity. For example, the declaration would complicate securing tariffs, the tool American steel companies need to continue to compete when Chinese companies receive improper subsidies.

The Duke report authors recommend instead delaying action on China’s request for market economy status until China’s economic behavior is demonstrably consistent with market principles.

The authors of the Duke report also suggest international trade officials consider new tools for dealing with trade disputes because the old ones have proved futile in resolving the global conflict with China over its unrelenting overcapacity in steel, aluminum and other commodities.

For example, under the current regime, steel companies or unions must prove serious injury to receive relief. The report suggests: “changing the burden of proof upon a finding by the World Trade Organization (WTO) dispute settlement panel of a prohibited trade-related practice, or non-compliance with previous rulings by the WTO.”

It also proposes multilateral environmental agreements with strict pollution limits. Under these deals, companies in places like the United States and Europe that must comply with strong pollution standards would not be placed at an international disadvantage as a result, and the environment would benefit as well.

In addition to the family-supporting steelworker jobs across this country that would be saved by innovative intervention to solve this crisis, at stake as well are many other jobs and the quality of jobs.

The Congressional Steel Caucus wrote President Obama before he left last week on his trip to Hangzhou for the G-20 Summit asking that he secure the cooperation of China and pointing out the large number of downstream jobs that are dependent on steel.

Also last week, the Economic Policy Institute issued a report titled “Union Decline Lowers Wages of Nonunion Workers.” It explained that the ability of union workers to boost nonunion workers’ pay weakened as the percentage of private-sector workers in unions fell from about 33 percent in the 1950s to about 5 percent today.steel-overcapacity-table-2

The EPI researchers found that nonunion private sector men with a high school diploma or less education would receive weekly wages approximately 9 percent higher if union density had remained at 1979 levels. That’s an extra $3,172 a year.

Many steelworkers are union workers. If those jobs disappear, that would mean fewer family-supporting private sector union jobs. And that would mean an even weaker lift to everyone else’s wages.

America has always been innovative. Now it must innovate on trade rules to save its steel industry, its steel jobs and all those jobs that are dependent on steel jobs.

This post originally appeared on ourfuture.org on August 25, 2016. Reprinted with Permission.

Leo 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.

Domestic Workers in Ill. Win Bill of Rights: “Years of Organizing Have Finally Paid Off”

Monday, August 22nd, 2016

Domestic workers in Illinois are celebrating a new bill of rights.

Gov. Bruce Rauner signed the bill into law last week, capping a 5-year campaign and making Illinois the 7th state to adopt such a protection.

Sponsored by Sen. Ira Silverstein (D-8th District) in the Senate and Rep. Elizabeth Hernandez (D-24th District) in the House, the Illinois Domestic Workers Bill of Rights gives nannies, housecleaners, homecare workers and other domestic workers a minimum wage, protection from discrimination and sexual harassment and one day of rest every seven days for workers employed by one employer for at least 20 hours a week.

The law amends four other Illinois state laws—the Minimum Wage Law, the Illinois Human Rights Act, the One Day Rest in Seven Act and the Wages of Women and Minors Act—to include domestic workers.

Over the past five years, the Illinois Domestic Workers Coalition has campaigned to demand that domestic workers be provided with the same workplace protections that others have had for decades. Members gathered Tuesday at the Sargent Shriver National Center on Poverty Law in Chicago to celebrate.

“Finally, some of the hardest working people in the state of Illinois will receive the dignity and respect they deserve from their work environment,” said Rep. Hernandez.

Magdalena Zylinska, a domestic worker and board member of Arise Chicago, spoke about how demanding domestic work is.

“I have struggled to get by from low wages, wage theft and disrespect on the job,” Zylinska said. “But today I am here to celebrate that our years of organizing have finally paid off.”

In 2010, New York became the first state to sign such a bill into law. Illinois is now the seventh, joining Massachusetts, California, Oregon, Hawaii and Connecticut. While domestic workers have achieved victory in those states, the fight continues for a national bill of rights for domestic workers.

Worldwide, 90 percent of domestic workers—the vast majority of whom are women—do not have access to any kind of social security coverage, according to the International Labour Organization. In the United States, an estimated 95 percent of domestic workers are female, foreign born and/ or persons of color. They frequently lack protections and face near constant adversity.

“Women are an essential pillar of our society and our families, as you all have seen. The House listened to us. The Senate listened to us, and now the governor has listened to us,” said Maria Esther Bolaños, a domestic worker and leader from the Latino Union of Chicago.

She recalled days where she worked 12 hours and got paid just $12.00.

Grace Padao of AFIRE Chicago echoed Bolaños’ statements with struggles of her own, describing days of being isolated and alone in homes that were not her own, working seven days a week to provide for her family.

“From this day forward, domestic workers in Illinois will never have to face the conditions that I did,” Padao said.

In 2010, New York became the first state to sign such a bill into law. Illinois is now the seventh, joining Massachusetts, California, Oregon, Hawaii and Connecticut. (Parker Asmann)

This article was originally posted at Inthesetimes.com on August 16, 2016. Reprinted with permission.

Parker Asmann is a Summer 2016 Editorial Intern at In These Times. He is an Editorial Board Member for the Chicago-based publication El BeiSMan as well as a regular contributor to The Yucatan Times located in Merida, Mexico. He graduated from DePaul University in 2015 with degrees in journalism and Spanish, as well as a minor in Latin American Studies.

 

Jobs Report: Change Still Needed

Friday, July 8th, 2016

The June jobs report – a cheery 287,000 new jobs, with unemployment ticking up to 4.9 percent – is cause for both relief and concern.

The relief is that jobs creation picked up after the slowdown of April (revised upward to 144,000) and May (revised downward to 11,000). Even subtracting the 35,000 jobs “created” by striking Verizon workers returning to work, the June report suggests an economy that is continuing to grow and generate jobs.

The continuing concern is the pace of that growth. Jobs creation is slowing, down from a monthly average of 229,000 last year, to 196,000 in the first quarter, and now to 147,000 in the second quarter. Yet over 15 million people are still in need of full-time work. The percentage of Americans of working age who are employed or looking for work is at 62.7 percent, still below pre-Great Recession levels. Average hourly wages ticked up by 2 cents in June, and wage growth remains slow – 2.6 percent over the past year – far below the levels associated with previous recoveries.

This is the last jobs report before the political conventions formally kick off the presidential campaign (which already feels like a recurring and unending nightmare). For Clinton and Democrats, the report provides some relief that the economy isn’t slowing dramatically. For Donald Trump and the Republicans, it provides continued evidence that the economy isn’t soaring. Working families are likely to continue to wonder when they will begin to share in the recovery.

For Democrat Hillary Clinton, these conditions pose particular perils. President Obama will want Democrats to tout his success – record months of private sector jobs growth, over 14 million jobs created since 2010, seven years of economic growth, unemployment down by more than half since the Great Recession he inherited, the strongest economy in the industrial world.

But most Americans aren’t sharing in the rewards. Median family incomes haven’t recovered to pre-recession levels. The wealthiest 1 percent captured a staggering 52 percent of the rewards of growth from 2009 to 2015. And now a weaker Europe post-Brexit and a stronger dollar suggest that our trade deficits will worsen, putting more pressure on jobs and wages.

Americans are looking for change, not for more of the same. Trump will be spouting that message, with a mix of bluster and preposterous policy to support it (build the wall, slash trillions in taxes, renegotiate the debt, and so on). Clinton and Democrats need to make a clear case on how they will change this economy to work for the many – generating more good jobs, higher wages, and a better deal for working people. More of the same offers no way out.

This blog originally appeared in ourfuture.org on July 8, 2016. Reprinted with permission.

Robert Borosage is a board member of both the Blue Green Alliance and Working America.  He earned a BA in political science from Michigan State University in 1966, a master’s degree in international affairs from George Washington University in 1968, and a JD from Yale Law School in 1971. Borosage then practiced law until 1974, at which time he founded the Center for National Security Studies.

The War on Workers’ Comp

Wednesday, June 15th, 2016

Stephen FranklinFor nearly a century, millions of workers have endured punishing jobs in construction, mining and factory work—jobs with high levels of work-related disability and injury. As a tradeoff for the dangers, they’ve had the assurance of workers’ compensation if injured permanently on the job. Employers accepted this deal, albeit sometimes grudgingly, because it  removed the possibility of being sued over work-related injuries.

But as labor has weakened and Republicans have won control of more and more statehouses, states have slowly chipped away at workers’ compensation benefits.

Since just 2003, more than 30 states have passed laws that have “reduced benefits for injured workers, created hurdles for medical care or made it more difficult for workers to qualify,” according to a recent investigative series by ProPublica and NPR. Some of the harshest cuts came in California, Arizona, Florida, Oklahoma, North Dakota, Kansas, Indiana and Tennessee. Today, according to the federal Occupational Safety and Health Administration (OSHA), many injured and disabled workers “never enter the workers’ compensation system.” OSHA also estimates that workers’ compensation covers only about 21 percent of the lost wages and medical bills encountered by injured workers and their families.

Illinois, long a union stronghold, could nevertheless join the pack of those closing the doors for some to workers’ compensation if right-wing millionaire Gov. Bruce Rauner gets his way.

Traditionally, when companies hired workers, they bought their work histories. That is, they assumed responsibility for the physical problems employees developed over years of difficult work. But Rauner wants to narrow eligibility for compensation dramatically, requiring an injury to account for at least 50 percent of the claim.

Rauner’s argument is that workers’ compensation was designed for “traumatic” injuries, and that including repetitive injuries which accrue over time, effectively requires employers  to pick up non-workplace injuries. He contends that changing this standard would put Illinois on the same track as many other states.

John Burton, a veteran workers’ compensation industry expert, disagrees.

“What the governor is proposing is to take a lot of cases that have been compensable for the last 50 years and to throw them out,” he said.

One of these is Steve Emery.

The third-generation coal miner rode the wave downward, working in one mine after another as the industry collapsed. Then his hands, once powerful enough to manage the grueling job of breaking up large chunks of coal with a sledgehammer, failed him.

The spiraling numbness in his wrists and hands ended with a doctor saying he would never work in a mine again. He was 50 years old and had spent more than 30 of them in southern Illinois mines.

After a four-year battle with insurance companies arguing that Emery’s injuries were not job-related, he received $1,815 a month in workers’ compensation—enough to live on, but one just about one fourth of what he used to earn

Under Rauner’s proposed rules, Emery might not have received workers’ compensation at all. Democrats asked Emery to tell his story at an Illinois State House hearing last year as an illustration of the workers who would be left out in the cold under Rauner’s plan.

Dave Menchetti, a veteran workers’ compensation attorney in Chicago, adds that the shift proposed by Rauner would be “extremely difficult for doctors,” who are not trained to quantify the causes of injuries. “It would severely prejudice older workers and workers in heavy industries because those are the kind of workers who have pre-existing conditions.”

So what happens when business-minded workers’ compensation reformers get their way?

What the bottom looks like

A federal commission that examined workers’ compensation laws in 1972 was “disturbed” by the wide divergence of rules between states, and an “irrational fear” driving states and employers to search for “less generous benefits and lower costs.”

“We were talking about a race to the bottom,” explains Burton, a Republican, lawyer and economist, who led the groundbreaking study.

The study recommended mandatory federal standards; none were ever put in place.

And the race hasn’t abated, Burton says.

Indiana offers an example of what happens when a state wages the race to the bottom.

Starting decades ago, as Indiana’s leaders sought out factory jobs to supplant the state’s mostly rural economy, they embraced  a low-cost, employer-friendly workers’ compensation system. And it has stuck, as the state’s Senate has largely stayed under control of the GOP.

Workers in Indiana must wait seven days before receiving benefits (as opposed to three in Illinois). While permanently disabled workers in Illinois can receive benefits for life, Indiana caps benefits at 500 weeks, just under 10 years.

To qualify for permanent total disability in Indiana, workers must meet a “pretty high bench.” as Terry Coriden, a former chairman of the Worker’s Compensation Board of Indiana, describes it. “If you can be a greeter at any type of store, then that type of employment could be deemed to be reasonable, which would preclude you from total permanent disability,” he says.

Only 45 workers out of 597,058 who filed claims between 2005 and 2014 received permanent total disability status in Indiana, according to statistics from the Worker’s Compensation Board of Indiana. The rate was twice as high in Illinois, according to data from the National Council on Compensation Insurance provided by Burton. Only 13 percent of the Indiana workers who filed claims over those years qualified even for permanent partial impairment.

And the system simply pays out less.

Consider the case of a steelworker in northwest Indiana who suffered third- and fourth-degree burns over two-thirds of his body after being hit by hot metal and slag from a blast furnace.

In the nine years since, he has undergone 38 surgeries and still has no feeling in parts of his arms and legs.

Before the injury, he was earning as much as $130,000 year because of extensive overtime. Today, he gets $600 a week in workers’ compensation as a totally disabled individual, as well as $2,200 monthly in Social Security Disability income. In order to stay afloat, he has dipped heavily into his savings and his wife has picked up low-wage part-time jobs.

The worker did not want his name used because he feared that the company would retaliate. “I don’t want any blowback from the company until my workers’ comp ends,” he says. “I don’t want them kicking me out of it.”

He is especially concerned, he says, because despite having his employer authorize and provide the majority of his treatment, several recommended procedures were not authorized In Indiana, workers must go to the company’s doctors and follow whatever they prescribe. If they don’t, they lose their benefits.

Steve Emery, in Illinois, saw what happened when he visited a company physician.

His hands were “killing” him when he saw a local Southern Illinois physician of his own choosing in 2010. “The doctor said, ‘We’ll have to do surgery and you’ll never do work again,’ ” he recalled.

Peabody Energy, however, said he had to see the company’s physician in St. Louis. “[The doctor] said, ‘Mr. Emery, did you hurt this way when you was a kid playing baseball or mowing grass?’ ” Emery recalls. “I told him I didn’t play baseball and didn’t push a push mower “ Nonetheless, he says, “They denied my claim ASAP.” Peabody officials in St. Louis did not reply to requests for comment.

Fortunately for Emery, Illinois workers typically have the right to choose their doctor as well as their treatment (unless their employer has set up a “preferred provider” network, in which case they have the right to choose any two doctors within the network). Illinois also allows workers to seek a boost in their payments if they can show that they will suffer from a marked decrease in earnings. Indiana lacks both of these rights.

Low workers’ compensation payouts mean that workers in the state may even have more difficulty getting a lawyer to help them pursue a claim, given that legal fees are set according to the settlements received.

“The well-known truth is that it is hard to make money doing the work,” said Kevin Betz, an Indianapolis lawyer.

The business argument

To justify his plan, Gov. Rauner blames the “high costs” of workers’ compensation with driving jobs to other states, including Indiana.

“Employers are flat-out leaving the state, and they are saying it is because of the workers’ compensation policy,” says Michael Lucci, an official with the Illinois Policy Institute, a conservative think tank that has received financial support from Gov. Rauner and also supports Rauner’s anti-union right-to-work drive.

There’s no disputing that nationwide, the downward race has paid off financially for employers. Workers’ compensation costs as a percent of payroll fell in 2014 to the lowest figure since 1986, Burton notes. Some of the decline has come from improved safety, but some, he says, has come from restrictions on workers’ compensation.

Lucci’s organization has churned out reams of information backing up the argument that Illinois’ workers’ compensation’s costs are uncompetitive as compared to its neighbors, especially Indiana. For Illinois steelmakers, workers’ compensation costs account for about 7.3 percent of their payrolls, for example, as compared to only 1.3 percent in Indiana, according to the Illinois Policy Institute.

That’s just as Indiana intended it. The logic behind its laws is “inducing businesses from other states to Indiana,” explains Coriden.

Experts say that the idea that high costs are actually driving companies to relocate, however, may be little more than a myth.

West Virginia is one of those states that have slashed benefits to drive down costs for employers. But Emily Spieler, a former head of the state’s Workers’ compensation Fund, says it didn’t boost business much in the economically troubled state. Similarly, Spieler, a professor at Northeastern University’s School of Law, says she has yet to see any studies showing a positive financial impact for states. She is also dubious that workers’ compensation is a large enough factor to lead a business to change locations.

Asked for evidence that workers’ compensation costs may be driving firms out of state, officials from the Illinois Governor’s office cited their contacts with employers and site selectors and suggested contacting business groups for more information.

But when In These Times posed that question to the Illinois Chamber of Commerce, which has been outspoken about the need to drive down workers’ compensation costs in order to remain competitive, Jay Shattuck, a contract lobbyist for the group, said he was not aware of any studies specifying that workers’ compensation alone made Illinois noncompetitive. (He also notes that the Chamber, while supporting most of Rauner’s plan, doesn’t see Indiana’s low payout system as the ideal.)

Victor Bongard, a lecturer in Indiana University’s Kelley School of Business, is familiar with Indiana’s pitch about attracting businesses through its low-cost workers’ compensation. He agrees that it is one factor in where businesses choose to settle, but “not a determining factor,” he says. He points to California, which “draws business to relocate there and manages to foster lots of new businesses despite its high workers’ compensation costs.”

Cost-shifting—but to whom?

With employers and the states’ workers’ compensation systems paying less, who picks up the bill?

In addition to workers themselves, the federal government is on the hook. These changes shift injured workers from state workers’ compensation programs to the government’s Social Security Disability Income (SSDI) system, as the federal Occupational Safety and Health Administration (OSHA) pointed out in a June 2015 report. OSHA estimated that in 2010, SSDI picked up as much as $12 billion to cover injured and ill workers.

Looking at the District of Columbia and 45 states, where the ranks of workers receiving compensation fell by 2.4 million between 2001 and 2011, researchers at the Center for Economic and Policy Research said last year that more than one-fifth of the rise in disability income payments appeared to be linked to cuts in workers’ compensation.

The calculations were age-adjusted to take in the growing ranks of elderly receiving the federal Social Security Disability Insurance (SSDI) benefits.

“The logic of cutting back on workers’ compensation is that we’ll be tough on these workers,” says Dean Baker, an economist and co-director of the organization. “But if you are just shifting the cost from workers comp to disability, you aren’t saving public money.”

Shifting the financial burden raises another problem. The workers’ compensation system was created to make employers responsible for the problems encountered by their employees. The shift to SSDI not only frees them from any financial accountability, but makes it harder for public officials to spot troubled workplaces and jobs.

In Indiana, because worker compensation payments are so low, attorney Richard Swanson said that injured workers who can’t return to their jobs “often make SSDI their first choice for income replacement.” That’s especially the case for older factory workers used to higher wages. “That’s their first question if they cannot return to work due to their work injury. You see it constantly,” he says.

Which way Illinois?

In Illinois, the fate of injured workers has become hostage to a larger political squabble that has left the state without a budget since last July.

Reforming workers’ compensation is part of a broad package of anti-union measures from Rauner, policies that have had no traction in the Democrat-dominated state legislature.

Rauner’s workers’ compensation proposal isn’t as draconian as some of his other policies aimed at workers, such as letting communities strip out numerous issues from collective-bargaining arguments, killing the Illinois Prevailing Wage Act, and allowing local communities to set up right-to-work rules. His cost-cutting proposal would mirror  the national downward trend in workers’ compensation—but he isn’t proposing (yet) the squeezes that states like Indiana, Florida and Oklahoma have put on injured and disabled workers.

But state Democrats think it’s only a matter of time.

“There isn’t much support for ending the workers’ compensation system, which is where the governor is going,” said Steve Brown, spokesman for State Rep. Michael Madigan, the powerful speaker for the State House.

The thinking of the Democrats, and the state’s trial lawyers, is that Illinois has already opened the door to reforms and cost cutting for the workers’ compensation system with the 2011 reforms and they should be allowed to roll out.

And the figures reflecting the impact of a 2011 reform by the state are significant, as reported by the Illinois Workers’ Compensation Commission. The state’s worker compensation premiums dropped from the nation’s fourth highest to the 7th highest between 2012 and 2014—the largest decline among all states. So, too, benefits payments fell by 19 percent between 2011 and 2015.

Whatever Illinois’ private carriers lost in premium income seems to have more than offset by the savings on benefit payouts. After losses in 2009 and 2010, state insurers broke even in 2011 and have since seen profits climb steadily, according to data from the National Association of Insurance Commissioners. According to Menchetti, “it seems that some of the decision-makers would like stricter scrutiny [of the industry], evident in a provision in House Bill 1287 that has to do with how the Department of Insurance would regulate excessive premiums.”

So it appears that the new law has been a boon for both employers and insurance companies—if not workers.

And if employers’ costs have been dropping, “Is there really need for more reform?” Menchetti asks.

The wrong kind of reform

There’s a case to be made that workers’ compensation needs to be reformed in a different way—to help workers get on their lives, not to force them down the economic ladder and into a bureaucratic hell.  Even in relatively worker-friendly Illinois, Steve Emery saw firsthand the determination of employers and insurance carriers not to give up a cent they don’t have to.

Before his hands failed him, Emery worked six or seven days a week, 12 to 16 hours a day, and was taking home as much as $80,000 a year. He worked at a number of mines across southern Illinois, and the last was the Willow Lake mine, owned by a subsidiary of the Peabody Energy Corp., which calls itself the world’s largest coal producer. It recently declared bankruptcy.

The company shuttered the mine and laid off 400 workers in the fall of 2012. The shutdown took place soon after a worker died, and the company said it had difficulties meeting safety and performance standards there. The Mine Safety and Health Administration (MSHA) had put the mine on notice in 2010 for repeat safety violations.

After filing for workers’ compensation, Emery fought the company for four years. Despite the fact that his exceptionally punishing job had left his hands virtually frozen, his attorney Steve Hanagan says, the coal company considered his injuries not job-related. It is a “typical dilemma” that applies “to many,” he said. “The battle over causation is very common.”

Emery appealed his case to the Illinois Workers’ Compensation Commission, which found that his his injury was job-related and hindered his ability to work.

“He essentially used his hands more than you can imagine, having bangs and jolts and all kinds of trauma,” said Hanagan. “The causation is quite evident.”

Confronted by money problems as he waded through his workers’ compensation battle, Emery’s marriage broke up. His wife “just couldn’t take it” and they couldn’t keep the house. He moved into a small apartment and started learning how to cope on his $1,815 a month benefits. He never qualified for a pension or had a pension plan despite decades of work in mostly non-union mines.

Emery, whose father and both grandfathers were miners, never expected things to end this way.

“I lost everything, man. My whole life changed.”

This post originally appeared on inthesetimes.com on June 13, 2016.  Reprinted with permission.

Stephen Franklin, former labor and workplace reporter for theChicago Tribune, is ethnic news director for the Community Media Workshop in Chicago. He is the author of Three Strikes: Labor’s Heartland Losses and What They Mean for Working Americans(2002), and has reported throughout the United States and the Middle East.  He can be reached via e-mail atfreedomwrites@hotmail.com.

New Survey Reports Uber Drivers Are Investing Big in the Company But Get Little Stability

Friday, June 3rd, 2016

Don Creery had been driving for Uber in Seattle for several months when in May 2014 the clutch wore out on his Kia Soul. A former music teacher, Creery had enjoyed his work for Uber and said he made enough to live comfortably. So, anticipating much more driving in the future, he took out a $10,000 loan to purchase a brand new Soul with an automatic transmission—a smart investment, he judged, for his career as an Uber driver.

“I never go into debt,” Creery told me, “but this seemed totally logical.”

Initially, everything went according to plan. But soon, Uber would cut the rates it charges customers for rides, effectively slashing the wages of its drivers. The move triggered protests and caused Creery to suddenly second-guess the wisdom of his choice to take out the loan.

“It all of a sudden went from being a good decision to being a bad one,” Creery says. “Before that rate cut, it was a middle-class job as far as money goes, and now it’s not. It’s a lower-class job or in some instances a desperate-class job.

Creery’s experience is not entirely unique, according to a survey of hundreds of Uber Drivers across the country that is being released today. Conducted by the Partnership for Working Families and Coworker.org, an online platform meant to generate worker campaigns, the survey polled more than 300 Uber drivers between March and May of this year and found that a majority of them have, like Creery, made significant personal investments for their future with the service. Fifty-seven percent of Uber drivers have “have bought, leased, or made substantial investments in vehicles to drive for Uber,” according to the report.

Despite having taken on risk to maintain their freelance career with Uber, only 23 percent of the drivers polled see driving for the ride-hailing app as a source of stable income.

“Anecdotally both in and outside the survey, we have heard from drivers who were struggling to make payments on cars that they have purchased to drive with Uber,” says Mariah Montgomery, the Future of Work Strategist for The Partnership for Working Families. “These drivers are investing substantial funds to be able to drive.”

These results appear in tension with survey data that Uber has touted as proving that drivers most often do not rely on the service as their only source of income but see it instead as a convenient, highly flexible way to supplement their existing work. “Uber Fits Around Drivers’ Lives, Not The Other Way Around,” the company declared last year, referring to a survey that states that 88 percent of Uber drivers polled started “driving for Uber because it fits their life well, not because it was their only option.”

Today’s survey, which included drivers who had previously used coworker.org, found that the vast majority (80 percent) of drivers polled identified their wages as a top priority and support raising fares. In recent months, Uber has slashed fares in cities across the country, arguing that the fee reduction will actually benefit workers due to a resulting increase in customer demand. “This survey suggests that drivers don’t necessarily agree,” says Montgomery.

Perhaps in response to such issues, 70 percent of the surveyed Uber drivers—who are independent contractors with no shared setting to naturally meet each other—said they were interested in connecting with one another to communicate about things like maximizing earnings, sharing information and forming drivers’ associations.

In response to a request from In These Times, Uber did not comment on the study’s findings.

Today’s survey also states that it found anecdotal evidence that, after Uber’s announcement in April that it will officially condone drivers receiving tips, the freelancer respondents want the company to go further in facilitating such transactions. Namely, there is no option in the app through which customers can pay a tip via credit card. “Although the survey did not specifically ask Uber drivers about tips, many drivers wrote in that they would like an option for riders to provide tips within the app, like Lyft,” according to the report released today. “One driver wrote: ‘Please put a place [in the app] where people can tip. People want to tip me all the time but do not have cash.’”

The survey’s release coincides with a hearing today where a federal judge in San Francisco will weigh whether or not to accept a proposed settlement in one of the most high-profile legal actions drivers have brought against Uber. In April, the company agreedto pay $100 million to settle two class action lawsuits that alleged the ride-hailing service had wrongfully classified its drivers in California and Massachusetts as independent contractors and thus denied them the rights and benefits of full-employee status.

The proposed settlement infuriated some drivers and advocates, not only because of what appeared to many as a paltry sum for a company valued in the tens of billions of dollars, but also because its terms appeared to have the effect of helping cement in place Uber drivers’ status as independent contractors, the very issue many drivers have most fiercely protested.

As independent contractors, Uber drivers are responsible for paying for their own cars, vehicle repairs, tolls, gas and other inputs necessary for the job. Drivers like Creery, who also sells rides for Lyft and is a leader of an Uber driver association in Seattle, say that being on the hook for such expenses, including interest payments for auto investments, means the job hardly pays a living wage.

Drivers’ own financial borrowing to pay for their vehicles is part of what has propelled Uber’s rapid global expansion. This week, Bloomberg News published a look into Uber’s Xchange program, which offers vehicle leases at subprime rates for would-be drivers with poor credit history—people who often would not otherwise be able to drive for the company. Uber says that Xchange and other financing programs will expand its fleet by 100,000 in coming years.

The company says that Xchange offers a high degree of flexibility by allowing drivers to walk away from a lease at any point after the first month. But several Uber drivers expressed displeasure with the arrangement. One driver told Bloomberg that, like Creer, he could hardly keep up on his vehicle payments after one of Uber’s rate cuts.

“It got to the point that I would drive just to meet my payment,”the driver said. “If you were short on your payment for a week it would roll onto the payment for next week. It starts adding up.”

This blog was originally published on inthesetimes.com on June 2, 2016.  Reprinted with permission.

Spencer Woodman is a journalist based in New York. He has written on labor for The Nation and The Guardian. You can follow him on Twitter at@spencerwoodman and reach him via email atContactspencerwoodman@gmail.com

Verizon Unions Deliver For American Middle Class

Wednesday, June 1st, 2016

Dave JohnsonThe long Verizon strike has ended, and the unions won. This means that the American middle class won, too.

Verizon is an extremely profitable company. But even with massive, astonishing profits the company was demanding that its workers provide givebacks, allow employees to be separated from families for months at a time and on top of that allow the company to send more and more call center jobs out of the country. The workers are lucky enough to have unions to fight this – The Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW). They voted to strike, it was a long, hard struggle, and in the end they won.

Here is a description of what Verizon’s workers achieved for all of us, from the IBEW:

Under the terms of the proposed agreement, Verizon agreed that no additional jobs will be outsourced overseas, while increasing the number of calls routed to domestic call centers. This will result in the creation of 1,300 new call center jobs with 850 in the Mid-Atlantic region and 450 in the Northeast.

“This was the major issue for my members: protecting American jobs and keeping them here at home,” said East Windsor, N.J., Local 827 Business Manager Robert Speer, who represents IBEW Verizon employees in New Jersey. “This agreement makes a lot of progress in reversing the outsourcing trend.”

Verizon also agreed to drop its demand that technicians had to be available to travel outside their home areas for up to two months at a time.

“Our members aren’t just Verizon employees, they’re moms and dads as well,” said Calvey. “We’re glad that we’re able to make sure our members are able to come home to their families every night.”

Also included in the tentative four-year agreement are:

• Wage increases of 3 percent for the first year and 2.5 each year after

• No cap on pensions and three 1 percent increases over the life of the agreement

• Retaining competitive health benefits

• Strong job security language

Why We Need Labor Unions

This shows exactly why we need labor unions.

Verizon did not need to outsource call-center work overseas. Verizon didn’t need to set up highly disruptive work schedules in which workers would be away from their families for weeks at a time. Verizon didn’t need to put a cap on worker pensions. Verizon tried to get these things from their workers anyway, because they are wealthy and powerful. If this sounds like everything you see around all of us with giant corporations trying to snatch more and more away from all of us, just because they can use their enormous wealth and power to do that, you are getting the picture.

Verizon’s workers stood up, banded together in unions, and forced the company back to the drawing board. The company had to come back with a proposal that worked for both the workers AND Verizon’s bottom line. Verizon was hoping to increase its profits even more; but over time the lower-than-hoped-for could likely be overtaken by the increased productivity of a more loyal workforce. (Depending, of course, on whether management follows up with the right strategic decisions and investments.)

This is why all of us need unions. Otherwise we are alone, on our own up against the aggregated wealth and power of giant corporations. Alone we don’t stand a chance. Verizon’s proved that the American middle class can fight back – if they join unions.

This post originally appeared on ourfuture.org on May 31, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

Stakes For All Workers Remain Huge In Verizon Strike

Tuesday, May 31st, 2016

Dave JohnsonNOTE: Shortly after this article was posted, news broke of a settlement in the strike between Verizon and workers represented by the Communications Workers of America and the International Brotherhood of Electrical Workers. Workers are expected to return to their jobs next week. IBEW President Lonnie R. Stephenson issued a statement saying, “This tentative contract is an important step forward in helping to end this six-week strike and keeping good Verizon jobs in America.” Verizon’s unionized workers, he said, “look forward to returning to work serving their customers, working under a strong pro-worker and pro-jobs contract.”

With the strike by unionized Verizon workers going into its seventh week, Campaign for America’s Future’s Isaiah J. Poole conducts a short interview with Sara Steffens, Secretary Treasurer of the Communications Workers of America (CWA).

“The picket lines are incredibly strong,” she says in the interview. The striking workers continue to gain support because more people recognize Verizon, as she put it, is “a corporation that doesn’t need a giveback but wants it anyway.”

This is important not just to Verizon’s workers, but for all of us. The April 14 post, “Verizon Workers Strike To Keep America’s Middle Class,” explains that the union’s fight is about a lot more than just their pay, work location and hours.

This is really about the bigger fight between the corporate-dominated economy that puts workers (all of us except a few) last, entirely looking at what benefits the corporation. Work hours, pay, stability, benefits, all are sacrificed to further corporate “flexibility.” So it you are not a wealthy executive or shareholder your life just gets harder and harder, and you have fewer and fewer rights and options.

Another Verizon Strike National Day of Action is being planned for June 2. By then,

… the working families on strike at Verizon and Verizon Wireless will have gone 51 days without pay and over a month without health insurance.

Let’s show Verizon what this fight is all about – making sure the needs of working families are met and protecting good, union jobs for generations to come for all working people in this country.

Join us for a National Day of Action on June 2. Please RSVP and save the date. We’ll be back in touch about events near you and how you can support the fight online.

This post originally appeared on ourfuture.org on May 27, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

Does Moving Jobs Out Of The Country Affect What People Here Get Paid?

Tuesday, May 24th, 2016

Dave JohnsonEconomists are still arguing over whether moving our jobs out of the country affects what the people still here get paid. Yes, really.

For example, Jared Bernstein in The Washington Post looks at different studies of the effect of moving jobs out of the country. One study, by economists David Autor, David Dorn and Gordon Hanson (referred to by Bernstein as “ADH”), was published in January by the National Bureau of Economic Research. The other, by economist Josh Bivens at the Economic Policy Institute, was published in 2013. Both found that moving jobs out of the country hurt the wages of not just the affected workers but everyone in the surrounding area. The question is, does this wage-depressing effect spread outside the local area?

Bernstein writes, “The analytic question is twofold. First, are American workers really hurt by trade competition, and second, if so, are there spillovers to those not directly in competition with imports?”

To understand the difference … in Bivens vs. ADH, consider two towns, one with two businesses, a factory and restaurant, and the other with just a restaurant. In ADH’s findings, the negative spillover, or diffusion, stays mostly in the first town. The factory takes a competitive hit from cheaper Chinese imports. This, of course, directly hurts the blue-collar factory workers, but it also hurts the restaurant workers, both through demand (fewer factory workers showing up for lunch) and supply (more competition for jobs at the restaurant) effects.

In Bivens’s model, and this is the way most economists think about this (which doesn’t, by a long shot, make it correct), the ADH story holds in town one, but town two also gets hit, even though there’s no factory there facing increased global competition. Displaced workers from town one can’t find enough work there so they head for town two, and the added supply effect puts downward pressure among town two’s restaurant staff members.

It comes down to this. Do laid-off workers stay where they are (ADH), which means the wage-depression stays local? Or do they move elsewhere and compete with people who still have jobs (Bivens), thereby depressing wages there as well?

There’s a simple way to test this. Detroit and Flint are just two examples of cities hit by factories that were closed so employers could pay less in other countries but bring the same goods back here to sell in the same stores (so executives and Wall Street shareholders can pocket the differential for themselves).

So did the laid off workers stay put (ADH) or move (Bivens)? Detroit’s population was 1.85 million in 1950. That fell to 713,777 in the 2010 census. Flint’s population was 196,940 in 1960 and fell to 99,763 in 2013.

They moved. The “effect” did not stay in Detroit and Flint. So everyone else’s wages took a hit, too. Multiply what happened in these two cities nationally and you get the picture. If you don’t get the picture, here is the picture:

OK, it isn’t all that simple. ADH do look at “commute zones,” and there are other factors depressing wages. They cite technology, along with the “decline of unions, eroding minimum wages, the rise of nonproductive finance, and especially the persistent absence of full employment labor markets” as factors reducing worker bargaining power and fostering wage stagnation. Whatever. Bernstein writes the following, which is important especially as we head into an election where Donald Trump is using the costs of trade as a main issue:

Still, the main message from ADH, Bivens, and the rest of us who’ve been trying to raise this cost side of the equation for decades is that these costs are real. They’re acute for many people and places and diffuse to some degree for others. Economic platitudes about how trade is always worthwhile as long as the winners can compensate the losers are an insult in the age of inequality, where the winners increasingly use their political power to claim ever more winnings.

Most of us feel the costs of moving so many jobs out of the country (and calling it “trade”) while a few are making a killing from it. Those few are using their political power to keep the rigged game going.

P.S.: It is important to point out that once again the idea of “trade” in elite discussion is entirely about moving American jobs to places where people are paid less and the environment is not protected, in order to reduce “costs.” They don’t actually mean “trade” as in “they sell us bananas and use the money to buy cars” – because who cares?

This post originally appeared on ourfuture.org on May 12, 2016. Reprinted with Permission.

Dave Johnson has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational applications of personal computers. More recently he helped co-found a company developing desktop systems to validate carbon trading in the US.

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