Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘bonuses’

Union to Southwest: $1,000 worker bonuses don’t make up for years of stagnant pay

Thursday, January 4th, 2018

Southwest Airlines this week announced that it would be awarding its employees with a $1,000 bonus following the passage of the GOP tax bill, which the company’s board of directors said would “result in meaningful corporate income tax reform.”

Union leaders say it hardly makes up for years of unfair treatment.

“We applaud Congress and the President for taking this action to pass legislation, which will result in meaningful corporate income tax reform for the transportation sector in general, and for Southwest Airlines, in particular,” Southwest chairman and Chief Executive Officer Gary Kelly said in a statement on Tuesday. “We are excited about the savings and additional capital, which we intend to put to work in several forms — to reward our hard-working Employees, to reinvest in our business, to reward our Shareholders, and to keep our costs and fares low for our Customers.”

Kelly added that the company was prepared to donate “an incremental $5 million” to charity and increase business investments in Boeing.

Union bosses representing those employees, however, aren’t completely satisfied, saying that many of those same workers have gone without a raise for five years.

“The Aircraft Mechanics Fraternal Association (AMFA) represents more than 2,700 Aircraft Maintenance Technicians (AMT) at Southwest Airlines (SWA). As of today, the Union has been in negotiations with SWA for more than five years (1,966 days), since the contract amendable date of August 16, 2012,” AMFA National Director Bret Oestreich told ThinkProgress in an email. “Although many members are appreciative of the Company’s recent $1000 bonus in response to the newly passed tax bill, this is a small token of appreciation for what the AMTs have endured over the last 1,966 days.”

While Southwest ratified a collective-bargaining agreement with AMFA-represented Facilities Maintenance Technicians (FMTs) in November last year, it still has yet to reach an agreement with its AMTs. Such an agreement would likely award aircraft technicians with protections and benefits similar to the ones awarded to the facility technicians, which currently include a “complete set of work rules, wage scale, ratification bonus, and job protections,” according to a Southwest news release.

“While the Company experienced record profits during this time, our members have not received increases in pay, enhancements to benefits or, most importantly, job security as they threaten to outsource even more work to 3rd party vendors,” Oestreich explained.

He added, however, that he was “optimistic” Southwest and AMFA would reach a “well-deserved, fair and equitable agreement” by the end of the next union negotiation session, which is set for January 18-19 in Washington, D.C.

Southwest spokespersons did not immediately respond to a request for comment.

Southwest is only the latest company to announce worker bonuses following passage of the Republican tax bill. In December, a handful of businesses — including Fifth Third Bancorp and AT&T — stated that they would be doling out one-time bonuses to their employees as a result of the bill, which carves out massive benefits for major U.S. companies by lowering the corporate tax rate to 21 percent. Many companies also announced that they would be “reinvesting” in their businesses, although, as ThinkProgress previously reported, a large portion of that money will likely be used for share buybacks.

Union leaders at the time were equally unimpressed by those announcements.

“Republican leaders have promised that households would receive, on average, a yearly $4,000 wage increase. They also claimed that the corporate tax plan would produce new jobs in the U.S. as companies return work from offshore,” a spokesperson for the Communications Workers of America (CWA), whose workers are employed by AT&T, told ThinkProgress in an email. “[The $1,000 bonus AT&T announced is] a drop in the bucket compared to what was promised.”

UPDATE: In an email to ThinkProgress on Wednesday evening, a Southwest spokesperson addressed the recent bonuses and related AMFA union concerns. “The bonus is to celebrate the tax reform legislation with all of our Employees. It is not in any way meant to address the contract negotiations with AMFA,” they stated. “We’ve had an industry-leading offer on the table that includes raises for some time now.”

They added, “[We] remain committed to negotiating an agreement that sufficiently rewards our Aircraft Maintenance Technicians, while at the same time preserving our competitive edge.”

This article was originally published at ThinkProgress on January 3, 2018. Reprinted with permission. 

About the Author: Melanie Schmitz is an associate editor at ThinkProgress.

Turning the Other Cheek: Illegal Retaliation in the Workplace

Wednesday, October 6th, 2010

Piper HoffmanTurning the Other Cheek: Illegal Retaliation in the Workplace

If someone went to your employer and said you were discriminating against them, wouldn’t you hold a grudge? Wouldn’t you want to get them fired, and if you couldn’t do that, at least make their lives more difficult? Of course you would (and if you honestly wouldn’t even want to, see your parish priest about nomination for sainthood and/or enjoy nirvana). That is why there is more retaliation going on in American workplaces than there is discrimination (and there is plenty of that going on too).

It is illegal under federal law (Title VII § 704) to retaliate against an employee for complaining about workplace discrimination. That applies to everyone from the employee’s supervisor all the way up the food chain to the CEO. But people being what they are, they retaliate anyway. There are many time-honored forms of illegal retaliation, among them firing, demoting, transferring, changing work schedules, cutting bonuses, assigning lame accounts or thorny clients, and general day-to-day hassling.

In the past what was and wasn’t illegal retaliation was unclear, partly because the federal appellate courts disagreed with each other about the definition, and partly because different federal courts within each circuit (i.e. group of states) agreed with each other about how to word the rule against retaliation but disagreed about what it meant. Time was that in many circuits you could get away with retaliation if you did it outside the workplace. That left the door open for prank calls, letting air out of tires, toilet papering, and any other non-work-related harassment that was short of a misdemeanor.

In some circuits, you could transfer an employee to a distant office or put the employee on the graveyard shift, as long as what you did was not a “materially adverse change in the terms and conditions” of employment. In yet other circuits the line you couldn’t cross was the “ultimate employment decision,” meaning you couldn’t fire, cut pay, demote, or take other actions of similar severity, but anything less was okay. Then there were the circuits that said illegal retaliation encompassed anything that was likely to dissuade “a reasonable worker” from complaining about discrimination. Those circuits won when the Supreme Court resolved the whole mess a few years ago in a case called Burlington Northern v. White, which closed the door to retaliation outside the workplace.

In Burlington the employee, Sheila White, filed suit against her employer, Burlington Northern, for discrimination and retaliation. The retaliation she alleged consisted of changing her job responsibilities and suspending her for 37 days without pay, though the company later paid her for those 37 days. The Supreme Court decided that even though the change in her job responsibilities was not a demotion, and even though she ultimately received all of her pay, she had still suffered illegal retaliation. The change in job responsibilities was a change from the relatively clean job of operating a forklift to the much dirtier and more arduous tasks of cleaning up railroad rights of way and carrying heavy loads back and forth. And the 37 days she didn’t receive any pay included Christmas; there was no money for gifts in the White household that year. The Supreme Court said that a reasonable employee could easily look at what Burlington Northern did to White and decide that reporting discrimination to this employer just wasn’t worth it.

So, problem solved – everyone across the country now knows that even actions unrelated to the workplace can constitute retaliation. If only.

The problem with our courts is not judicial activism, but the opposite. I don’t know if it is a question of effort, ability, or just not giving a damn, but somehow courts managed to mess up the Supreme Court’s clear ruling when they tried to apply it in their own cases. One example is Hicks v. Baines, a case in the Second Circuit (which encompasses Connecticut, New York, and Vermont).

The issue that tripped up the Hicks court had to do with what is called the prima facie case, which just means that there is a certain minimum amount of evidence or argument that a plaintiff has to provide just to stay in court. Satisfying that minimum often doesn’t take much, but a plaintiff has to know what exactly to show in order to keep a case alive.

In Burlington Northern the Supreme Court made it crystal clear that you couldn’t sidestep the rule against retaliating by doing your retaliation outside of the workplace. Even if your retaliatory acts had nothing to do with the victim’s employment, they were still illegal as long as they would dissuade a reasonable employee from complaining about discrimination. So what does the Second Circuit in Hicks say that plaintiffs have to show to satisfy the minimal prima facie case and stay in court? An “adverse employment action.”

That’s right. According to the Second Circuit, just to keep the case alive, just to satisfy the bare minimum standard, the plaintiff has to show that the retaliation involved the employer doing something nasty that was work-related. The really jaw-dropping part is that the court laid this out in its written opinion just after a long discussion about Burlington Northern and how the Supreme Court had decided that anti-retaliation protection “extends beyond workplace-related or employment-related retaliatory acts and harm.”

Fortunately for the plaintiffs in Hicks, the retaliatory actions that they alleged were all employment-related, so the Second Circuit’s bizarre mistake did not affect the outcome of their case (for the record, they won part of it and lost part of it).

The important takeaway from Burlington: any retaliation for complaining about workplace discrimination is illegal, whether it is work-related or not, as long as it would dissuade a reasonable employee from complaining about discrimination. The important takeaway from Hicks: it’s not just judges’ political inclinations that you have to watch out for. Take a look at their GPAs too.

This article was originally published on PiperHoffman.com

About The Author: Piper Hofman is a writer and attorney living in Brooklyn with a B.A. magna cum laude from Brown University and a J.D. cum laude from Harvard Law School.  She has professional experience with the laws related to employment, animal rights, poverty, homelessness, and women’s rights.

Outsourced: No Laughing Matter

Wednesday, September 29th, 2010

Sarita GuptaLast week, NBC launched a new show that tries to find comedy in the all-too-real conditions of outsourcing. While the first episode was witty—making light of age-old cultural clashes and stereotypes, there is nothing funny about the reality of outsourcing and the impact it has both on the American worker and their counterparts around the world.

For decades, big companies like the one portrayed in “Outsourced” have been engaged in a global race to the bottom, constantly seeking to maximize their profits by cutting wages, benefits and working conditions.  Corporations have learned to avoid local worker bargaining power by organizing themselves globally and exerting a downward pressure on wages along the supply chain that brings goods from manufacturing to consumers.

Meanwhile, there are currently 15 million unemployed workers in the United States. And the situation is not much better overseas, where many scrape by on substandard conditions and wages that have been outlawed for centuries in the United States.

Going back to the first episode, the angry, American workers who have just been laid off are portrayed only by a stack of bricks thrown through the boss’s window. This is then juxtaposed against the hapless, comedic and cheaper Indian workers who have taken over the call center.

But the bosses are all smiles because by pitting laid-off U.S. workers against workers overseas (and immigrant workers forced to look for work in the United States), companies like the novelty business portrayed in the show get rich while workers around the world, our nation included, struggle to feed their families, access health care and stay in their homes.

Still laughing?

It is hard to find humor in the need for good jobs, fair wages and humane living and working conditions.

So, as not to leave NBC hanging (we at Jobs with Justice are solution oriented, after all), how about another idea for a new NBC sitcom called “Good Jobs, Fair Pay.”  In this innovative new show, U.S. workers would have full and fair employment—all paid for courtesy of a small sales tax on Wall Street, otherwise known as a financial speculation tax.

Workers in other parts of the globe would join U.S. workers in having a standard minimum wage with equal purchasing power.  Multinational corporations would have no incentive of moving from country to country, forcing workers into increasingly lower wages and conditions. And for comedic relief, CEOs would actually pay taxes like the rest of us and share their annual bonus with the workers in the plant.

And the Emmy goes to?

This article was originally posted on AFL-CIO Now Blog.

About The Author: Sarita Gupta is executive director of Jobs With Justice, a national network of more than 40 local coalitions of labor, community, student, and faith organizations, working together to built a broader global movement for economic and social justice.

Rule of Law Makes a Comeback

Monday, August 3rd, 2009

Remember when President Reagan was shot and Al Haig famously burst into the White House and said that he was in charge? Okay, it might not have been as over the top as Howard Dean’s scream, but Haig did become the poster boy for an “Era of Executive Testosterone Overload.” An era that seems to have come to an end. Finally.

Executives-in-charge, no that doesn’t sum it up adequately. Executives as rock stars is more like it. For much of the last decade the line between CEO and celebrity blurred. Some weeks there seemed to be more CEOs on magazine covers than supermodels. And gossip columns were full of tidbits on their lavish lifestyles.

In the future if they try to carbon date the exact moment when the “Era of the Executive” ended, remarkably it didn’t involve a “perp walk,” with a shamed executive being led away in handcuffs.

It ended with Hamdan vs. Rumsfeld. In this Supreme Court case, the justices held that the President of the United States is not beyond the law and must follow certain legal principals and the Geneva Convention—even in wartime.

This case is definitely the icing for the end of the unquestioned executive, but the cake has been rising for a long time. Enron, WorldCom, Tyco—executives learned the hard way—via hard time—that Leona Helmsly was wrong. It’s not just the little people who have to pay taxes. The rules are for all of us.

Consequences. What a concept.

Like it or not, we all need to get ready for more and more restrictions and rules surrounding executive behavior. Sarbanes-Oxley (SOX for short) is just the start. The reason that more regulations and restrictions will be right around the corner? Because people are tired. Tired of guys (yes, mostly guys) who earn millions of dollars in salary, with a boat load of options (backdated of course) and then still manage to justify having employees not covered with health care or on food stamps. Hollywood long ago learned that corporate executives are the perfect movie villain, can politicians be far behind?

Don’t get me wrong, I hate the idea of acres of staff having to be hired to fill out forms for the government. The problem is that SOX is necessary because executives couldn’t police themselves. Just like the Labor Union movement in the first part of last century, once again executives moan about a logical response to their greed run amok. What is always overlooked by executives and the often toothless business press is the wretched excess that preceded Unions, SOX, etc.

Sure there are good guys and gals out there in the executive suites. Warren Buffett immediately leaps to mind. For him to give a gift approximately 5 times the size of Carnegie and Ford is indeed worthy of sainthood. For that alone I promise to take back two-thirds of the Nebraska jokes I’ve made through the years. But it’s not good enough to give back some of the gain, the public is demanding that executives do the right thing from the very start. And I don’t think that’s too much to ask. Even from the Oil Industry.

Enjoy your slice of humble pie, Mr. Corporate Executive. You earned it.

About the Author: Bob Rosner is a best-selling author and award-winning journalist. For free job and work advice, check out the award-winning workplace911.com. If you have a question for Bob, contact him via bob@workplace911.com.

Three Concepts That Need to Be 'Laid Off'

Thursday, February 19th, 2009

It’s time to review three ideas that need to be “let go” in 2009.

1. Credit Checks of Job Applicants. According to the Society of Human Resource Management and Kroll, 43% of employers run credit checks on potential employees, up from 36% in 2004. These checks involve rent, student loans, credit cards and mortgages and can make the difference between someone getting hired or having their application tossed.

In the best of times this is a dubious measurement to use when looking to hire someone. But given the rapidly increasing foreclosure rate, ballooning credit card debt and the general demise of capitalism as we’ve know it, credit checks of job applicants are a joke. A very bad joke.

I’d make an exception for people who handle substantial amounts of money as part of doing their jobs, but for a truck driver, administrative assistant or nurse, this is unnecessary. Personally, I believe that it violates our 4th Amendment right against cruel and unusual punishment and this is coming from a guy with a good credit score.

Let’s stop pouring salt in the wounds of our fellow citizens. Credit checks are wrong in the hiring process and need to be stopped.

2. Bonus Formulas. It seems every day that pigs can fly, at least on Wall Street. One day we hear from the President about $18 billion in bonus payments at companies receiving TARP government bailout bucks. Then the next day the headline is that 700 Merrill Lynch workers

received million dollar bonus payments each.

Clearly this proves that there is a parallel universe, one where pigs party like crazy. I think we need to toss all the old bonus formulas and swap them for calculations that actually don’t reward people when the markets sink by 50%. Is that too much to ask?

I’m all for pay for performance, but Wall Street seems to focus on the wrong “p” in the first part of this sentence at the expense of the second “p.”

3. Retirement. Ouch. Retirement has been pushed back for many of us. Instead of kicking back in our early 60s, many of us will now be working until our 70’s. We’ll have no choice.

We might not have a choice about how long we work, but we do have a choice about where we work. That’s why it’s so important to really focus on what we want to do with our careers, to decide what is meaningful and important to each of us.

And this may be the silver lining of the current mess. That it could push many people into jobs that hold more meaning for them.

As a special guest this week, we’re bringing in the star of the Apprentice, and former high roller, to bid adieu to credit checks, bonus formulas and retirement.

Donald: “You’re fired!”

Rosner: “Thanks Mr. Trump.”

About the Author: Bob Rosner is a best-selling author, award-winning journalist and contributor to On The Money. He has been called “Dilbert with a solution.” Check out the free resources available at workplace911.com. You can contact Bob via bob@workplace911.com.

The CEO Patriot Pledge: Just Say 'No' to More Layoffs

Wednesday, February 11th, 2009

CEO PATRIOT PLEDGE: As an executive my primary motivation is to act for the good of my company, not just my own financial gain. No one at our company will earn a guaranteed base salary more than 40 times of our lowest paid worker and we will offer the same health care and 401(K) matches to employees as we do for executives. We support pay for performance, so when our company’s performance serves investors and employees, we’ll share in the gains. When our company’s performance does not adequately serve our investors and employees, we’ll share in the sacrifice.

These are M.A.D. economic times. That’s M.A.D. as in Mutually Assured Destruction, the old Cold War strategy where no one would be left standing after that first nuke was launched. Economic experts, who agree on little else, agree on this: if our current vicious cycle of “layoffs-driving-down-purchasing-which-increases-layoffs” continues, no one will be left standing.

There is an exit strategy here that no one is talking about; billions of dollars that could be used to address the layoff cycle immediately. This is not a plea for legislation or government funds. In fact, not a penny would come from taxpayers. It’s simple, voluntary, and dare I say, patriotic. The “Chief Executive Officer Patriot Pledge,” see above, is a 95-word call to action for all corporate leaders, not just those in financial services, to rein in their own wretched excesses and voluntarily re-invest part of their lofty salaries and perks to keep employees on the payroll.

Entitlement and greed are the only words I can find to describe $18 billion in bonuses given during the last two months of 2008. At the same time that one million people were being laid off, including at these very firms that were giving bonuses to a select few. Who paid the bill that allowed these corporations to party like it was 1999? U.S. taxpayers, courtesy of former Treasury Secretary Paulson’s inability to ask for any accountability from the corporations receiving $350 billion in TARP funds. Who knew the “free market” could be so expensive? Heckuva job, Paulie!

I’m sure some will scream “socialism,” but socialism isn’t voluntary. No, the CEO Patriot Pledge is pure capitalism, rewarding people when they do well and refusing to grossly enrich failure any longer. I’m not disparaging wealth or begrudging anybody for achieving success, just asking for bonuses that are tied to real achievement.

The Corporate Library examined the paychecks of just the CEOs of the Russell 3000 (the 3,000 largest U.S. companies based on market capitalization) and calculated these executives were overpaid by $14.7 billion annually. This does not include the huge paychecks of COOs, CFOs, etc. It also doesn’t include tens of thousands of executives at smaller firms. My estimate is that up to $40 billion could be found to reduce layoffs just from excess executive pay.

Of course, some executives consider themselves worthy of any compensation, no matter how disproportionate or unwarranted. Just ask John Thain, former CEO of Merrill Lynch, who in a recent interview told CNBC that it was important, even in troubled times, to give top talent over-the-top paychecks.

Well, if these top executives at Merrill Lynch and thousands of other firms are so talented, then how did we end up with 626,000 new unemployment claims filed just last week…with half of our 401(K)’s gone…and with, my personal favorite, a $35,000 executive commode funded from the public trough. Do these corporate “leaders” have no sense of decency?

Fortunately, there are some executives who get it. For example, Thomas A. James, CEO of Raymond James. Sound familiar? They are the sponsors of the stadium of the most recent Super Bowl. Raymond James had almost $3 billion in revenue last year. Yet, Tom James’ guaranteed base salary was only $325,000, less than 20 times the amount of the lowest paid worker at his company. As compared with the average CEO salary, which is 262 times that of the lowest paid worker. [Please note: for every “average” salaried CEO who cuts back his or her base salary to a ratio of even 40 times the salary of the lowest paid worker, almost 200 workers would keep their jobs.]

While the S&P sank 22%, Raymond James had a positive return for its investors. With the bonus he earned, Tom James’ total compensation was slightly over $3 million. But the key word here is “earned.” It is no accident that Raymond James has a conservative compensation philosophy and the company also did well despite the carnage in the rest of the market.

Compare Tom James to Robert Iger, CEO of Disney. According to Graef Crystal, compensation guru, Iger received $51 million during a year when his company suffered losses and layoffs. Or to put it in Disney language, Iger received a king’s ransom for a pauper’s performance.

What is the CEO Patriot Pledge? It’s a plea to encourage American businesses to do what they have always done: lead the way with vision and creativity. Only this time the goal is not to just create a profit, but to keep people employed so there will be a market for our products and services.

In short, our turbulent times require a reversal of a famous quote: today “what is good for the country is good for G.M.”

You can call this initiative naïve, but remember that a similar pledge, the Sullivan Principles, played a key role in ending apartheid in South Africa.

Greed isn’t good, it’s a symptom of poor impulse control and leads us down the path to more Lehman Brothers-style implosions. David beat Goliath and we can put an end to this fat-cat behavior. My single voice can be easily dismissed, but all of our voices can’t. Put the pledge on the bulletin boards of your company, send it to the companies that you own stock in and ask your friends and colleagues to do the same. Also pass on link to the CEO Patriot Pledge video on YouTube. We need to all share in the sacrifice, but isn’t it time that our leaders actually led during tough times?

There is a saying, “To save one life is as if you have saved the world.” Executives, you hold the world in your hands. We can keep people employed and get our economy working again, but only if we work together to stop the madness.

About the Author: Bob Rosner is a best-selling author, award-winning journalist and contributor to On The Money. He has been called “Dilbert with a solution.” Check out the free resources available at workplace911.com. You can contact Bob via bob@workplace911.com.

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