The Wonk Room

It’s Time For The Senate To Confirm Patricia Smith As Department Of Labor Solicitor

On April 20th, President Obama nominated Patricia Smith to the post of Department of Labor Solicitor, the number three spot within DoL and the department’s top law enforcement post. But, nearly seven months later, Smith’s nomination still has not come to the Senate floor for a vote, in part because, in early October, Sen. Mike Enzi (R-WY) placed a hold on it.

Already, one of Obama’s DoL nominees, Lorelei Boylan, withdrew her nomination after a lengthy wait for a confirmation vote. But it’s imperative that Smith’s nomination be brought to the floor and that she get confirmed.

As Solicitor, Smith would be responsible for enforcing all of the nation’s workplace laws, and overseeing the office representing the agency in all enforcement actions. And such actions are clearly necessary, as 16 people die at work every day from employer negligence in America, while 68 percent of low-wage workers report that they have been the victim of wage violations. All told, the typical low-wage worker victimized by wage theft sees an overall 15 percent reduction in pay annually.

Under the Bush administration’s corporate-friendly Labor Department, the solicitor’s office sat on its hands and failed to enforce even the most flagrant labor violations. And Enzi seems to be trying to maintain the status quo. As Thomas Frank wrote, Enzi is coming after Smith “because she is an effective and innovative labor bureaucrat.” Is Enzi motivated by “the dread possibility of a Labor Department that works?” Frank asked. AFL-CIO President Richard Trumka agreed, saying that those in Congress who are holding up the nominees are doing so simply “because they don’t want those positions filled.”

The New York Times has called Smith “one of the nation’s foremost labor commissioners because of her vigorous efforts to crack down on minimum wage and overtime violations at businesses including restaurants, supermarkets, car washes and racetracks.” During her time with the New York State Labor Department, where she is labor commissioner, Smith helped win more than $20 million in back pay for thousands of low-wage workers, including a record $2.3 million settlement with the owner of Ollie’s Noodle Shop and Grill chain in Manhattan.

As David Madland and Karla Walter pointed out, “too often penalties [for labor law violations] are easily reduced or levied for low amounts, and the solicitor’s office has minimized civil and criminal liability for the worst violators.” Smith can change that, if only her nomination could come to a vote.

Same EFCA Opponents Claiming To Defend Democracy Oppose Democratization Of Railway Labor Act

Opponents of the Employee Free Choice Act (EFCA) like to portray themselves as the great defenders of democracy, protecting the “secret ballot” for workers everywhere. “There are sacred principles that epitomize American democracy,” wrote Rep. John Kline (R-MN), the ranking member on the House Ed. and Labor committee, while attacking EFCA. “They have private ballots in America, but not in other countries where there are tyrannies and socialism,” agreed Mark McKinnon of the Workforce Fairness Institute (WFI).

But now that the National Mediation Board (NMB) — which oversees labor-management relations for the airline and railroad industries under the Railway Labor Act (RLA) — wants to issue a rule change making unionization elections in those two industries more democratic, Kline and WFI are singing a different tune.

Currently, under the RLA, employees who choose not to vote in a union election are counted as “no” votes, while under the National Labor Relations Act (NLRA), employees who don’t vote simply aren’t counted at all. So, in practice, this means that employees under RLA must get a majority of employees to vote affirmatively, while those under NLRA must get a majority of voting members to do so, just like in an election for a political office.

The NMB wants to change the RLA’s rules, to equalize the two processes. Kline and WFI reacted like this:

Republican Reps. John Kline (Minn.) and John Mica (Fla.) issued a release that called it a radical proposal that adds “to a troubling perception that federal agencies have embraced a culture of union favoritism.” [...] The Workforce Fairness Institute issued a press release titled “Forced Unionization” in response to the proposed rule change, and criticized the NMB for providing a “bailout” to the AFL-CIO.

The NMB has opened its proposed change up to a 60-day comment period, and with their respective responses, Kline and WFI reveal that their opposition has nothing to do with democracy. It’s about preventing unions from gaining more members, at all costs. After all, in what other election do people who don’t vote get counted for one side or the other?

Much like the push in Congress to bring truck drivers for FedEx under the NLRA, this rule change would eliminate an odd inequity in the system that is the product of the antiquated RLA, which was written in 1934. There is no reason to have the deck stacked against railway and airline workers, simply because they are pulled under an older law. But to Kline and WFI, it seems, whichever rules make it harder to form a union are those that epitomize democracy.

Sen. Lincoln Abdicates Responsibility: Business And Labor Should ‘Work Out’ An EFCA Compromise

Sen. Blanche Lincoln (D-AR)

Harkin is one of a handful of negotiators trying to craft a compromise version of EFCA that will prove palatable to a group of centrist Democrats, among them Sen. Blanche Lincoln (D-AR). But speaking before the Arkansas Chamber of Commerce today, Lincoln “received a round of applause” for saying that business and labor — not Congress — should be crafting the legislation. From the Associated Press:

Sen. Blanche Lincoln says business and labor groups, not lawmakers, should be the ones to work out a compromise on a union organizing bill. Lincoln said that she still opposes the Employee Free Choice Act and doesn’t think the legislation should be considered while lawmakers are dealing with health care and other issues…Lincoln said any compromise would need to come from business and labor groups.

Big Business and its ally, the U.S. Chamber of Commerce, have derided EFCA, calling it “a firestorm bordering on Armageddon,” saying that retailers who don’t oppose EFCA “should be shot,” and telling workers that unionizing means their benefits will be “thrown out the window.” With her approach, Lincoln is not only abdicating her responsibilities as a lawmaker to those special interests, but she is basically giving the business community a veto over any legislation that other lawmakers might craft.

And unfortunately, a stalemate over EFCA would be just fine with the business community, because under our current system for forming a union, employers hold all the cards. For example, they are able to force employees to attend closed-door meetings to hear anti-union messaging, or compel employees to participate in anti-union discussions with their own supervisors. Employers threaten to close plants in 57 percent of union organizing drives, threaten to cut wages and benefits in 47 percent, and ultimately fire pro-union workers 34 percent of the time, while facing penalties that do nothing to deter such behavior, illegal as it is.

Meanwhile, unionized workers in Arkansas make an average of $1.26 per hour more than their non-unionized counterparts, a 7.7 percent increase. If Arkansas were to see unionization merely climb back to 1983 levels, workers there would earn an estimated $166 million more in wages and salaries per year. And consider this: “If Arkansas’ workers were rewarded for 100 percent of their increases in labor productivity between 1980 and 2008…average wages would be $23.29 per hour — 42.4 percent higher than the average real wage in 2008.”

Last month, Sen. Mitch McConnell (R-KY) said that EFCA was unnecessary “because we have very enlightened management in this country.” Is that how Lincoln sees it as well, despite the myriad benefits that EFCA could bring to workers in her state?

Anti-Labor Alliance For Worker Freedom Joins Attempt To Scuttle Labor Department Nominees

As I noted last month, the Labor Department is trying to ramp up its fight against wage theft without two key nominees, whose confirmations have been delayed in the Senate. One of these nominees — Patricia Smith, who has been tapped to fill to position of Department of Labor Solicitor — is being opposed personally by Sen. Mike Enzi (R-WY), who sent a letter to President Obama demanding that her nomination be withdrawn.

And Enzi is no longer alone in his quest. He’s getting an assist from the conservative, anti-labor Alliance for Worker Freedom (AWF), which is sending this to other Senators:

[AWF] urges you to support Senator Mike Enzi’s (R-WY) call for President Obama’s withdrawal of Patricia Smith’s nomination for Solicitor at the Labor Department…Smith has shown an inherit bias towards labor through her management of New York’s Hour Wage and Hour Watch program.

AWF describes itself as an organization “dedicated to combating anti-worker legislation,” but its idea of “anti-worker” is pretty skewed, since it opposes minimum wage laws and the Employee Free Choice Act. AWF also expelled workers attempting to attend a panel that it organized on Capitol Hill last month.

AWF is actually a “special project” of Americans for Tax Reform (ATR), the organization formed by anti-tax crusader Grover Norquist. But Norquist is also virulently anti-union, saying that one of his goals is to “crush labor as a political entity.” Norquist will not disclose AWF’s funders, but ATR itself is funded by Philip Morris and the ultra-conservative Scaife foundations, among others.

And while Enzi and his cohorts are holding up these nominations, wage theft has become an increasing problem. 68 percent of the low wage workers report being subjected to pay violations in their previous work week alone. Of these, 26 percent were paid less than the minimum wage and 76 percent didn’t receive legally required overtime pay.

This rampant wage theft translated into an overall 15 percent loss of pay. Meanwhile, during her time with the New York State Labor Department, Smith helped win more than $20 million in back pay for thousands of low-wage workers, including a record $2.3 million settlement with the owner of Ollie’s Noodle Shop and Grill in Manhattan.

As AFL-CIO Secretary Treasurer Richard Trumka said, those in Congress who are holding up the nominees are doing so “because they don’t want those positions filled.” And for the agenda that AWF is pushing, it makes a lot of sense for the Labor Department to have a lot of vacancies.

McConnell: Zero Republicans Support EFCA ‘Because We Have Very Enlightened Management In This Country’

Yesterday, Senate Minority Leader Mitch McConnell (R-KY) promised that no Republicans will vote for the Employee Free Choice Act (EFCA), should it come to the Senate floor. In order for the bill to pass “the Democratic members will have to do it,” he said.

In a speech before the business organization Commerce Lexington, McConnell explained that the reason for such uncompromising opposition is that workers don’t actually want to join unions due to the “very enlightened management in this country now”:

McConnell said the AFL-CIO wants the measure approved because “private sector union membership has declined from a high of 35 percent in the 1950s to 7.5 percent now.” That has happened “because we have very enlightened management in this country now, treating employees better and employees have decided they don’t want to pay the dues.”

McConnell has already made his personal opinion that EFCA will “Europeanize America” well known, and with this rhetoric, he has officially aligned the entire Republican position on EFCA with that of the Chamber of Commerce (which has said that EFCA is a “no-compromise” piece of legislation). But if McConnell truly thinks that the reason more workers aren’t joining unions is because of “enlightened management,” he hasn’t been paying any attention to the reality of working and organizing in America.

For starters, an AFL-CIO survey found that there are 60 million American workers who say that they would join a union if they could. The reason that they can’t is because employers threaten to close plants in 57 percent of union organizing drives and threaten to cut wages and benefits in 47 percent, while ultimately firing pro-union workers 34 percent of the time.

As Kate Bronfenbrenner, Director of Labor Education Research at the Cornell School of Industrial and Labor Relations pointed out, over the last 20 years “employer opposition [to unionization] has intensified…and the nature of campaigns has changed so that the focus is on more coercive and punitive tactics designed to intensely monitor and punish union activity.”

And in addition to anti-union campaigns, management in this country is engaged in a whole host of other labor violations. Yesterday, a new survey came out in which 68 percent of low-income workers reported being subject to a pay violation in the previous work week alone. This isn’t meant to paint the entire business community with a broad stroke — as there are surely plenty of companies that don’t engage in this sort of behavior — but the problem is far more widespread than McConnell and the rest of the Republican party are evidently willing to concede. And just like with health care reform, the GOP has already decided that it’s not interested in discussing a solution.

Cross-posted on ThinkProgress.

68 Percent Of Low-Income Workers Report Pay Violations

According to a new report — “the most comprehensive examination of wage-law violations in a decade” — labor protections in America “are failing significant numbers of workers.” 68 percent of the low wage workers who were interviewed for the report said they were subjected to pay violations in their previous work week alone. This included 26 percent who were paid less than the minimum wage and 76 percent who didn’t receive legally required overtime pay.

The researchers discovered that “the typical worker had lost $51 the previous week through wage violations, out of average weekly earnings of $339. That translates into a 15 percent loss in pay“:

“The conventional wisdom has been that to the extent there were violations, it was confined to a few rogue employers or to especially disadvantaged workers, like undocumented immigrants,” said Nik Theodore, an author of the study and a professor of urban planning and policy at the University of Illinois, Chicago. “What our study shows is that this is a widespread phenomenon across the low-wage labor market in the United States.”

As Kevin Drum put it, “How many reports of mistreatment do we have to get before we finally figure out that labor violations are rampant in this country?” And the problem has only gotten worse during the recession. “[Wage theft is] definitely on the rise nationally because of the economic crisis,” says Ted Smukler, public policy director of Interfaith Worker Justice. “Employers are desperate to shave corners when their profits are going down, and some are just greedy.”

There are a few things that need to happen to begin to address this problem. First, the Labor Department’s effort to hire 250 more wage and hour investigators should be complemented by the Senate confirming the Labor Department nominees who are still stuck in no-man’s land. This will help put in place people willing to enforce the wage laws that are on the books, but were neglected under former Labor Secretary Elaine Chao.

Furthermore, as David Madland and Karla Walter pointed out, the administration should work with Congress “to increase maximum allowable fines” for labor violations, as “the civil and criminal penalties are simply too low to deter or even adequately punish lawbreakers.”

As Annette Bernhardt, an author of the study and policy co-director of the National Employment Law Project said, “these practices are not just morally reprehensible, but they’re bad for the economy.” And they’re also preventable, if the Labor Department actually makes a commitment to enforcing the law.

Trumka: Those Holding Up Labor Department Nominees Want Labor To Be ‘Commerce Two’

Earlier this month, I noted that the Labor Department is trying to ramp up its effort to combat wage theft without a Wage and House Administrator, whose nomination is stalled in the Senate. Last week, Sen. Mike Enzi (R-WY), ranking Republican on the Senate HELP Committee, asked President Obama to to withdraw his nomination for Patricia Smith to be Department of Labor Solicitor, citing “inconsistent testimony” regarding a program that she launched in New York to monitor wage theft. According to the New York Times, there are currently five Labor Deptartment nominees awaiting Senate confirmation.

Today, the Wonk Room sat down with AFL-CIO Secretary Treasurer Richard Trumka — who is running unopposed for the AFL-CIO presidency. Trumka said that, in his opinion, those holding up Labor Department nominees are invested in the business-centric stance that came to characterize the Labor Department under the Bush administration:

They’re holding up scores of nominees because they don’t want those positions filled. In some cases, it’s because there are Republican holdovers in them, in some cases they just want the department to be slow and they think if they can hamper the President by keeping his people out and not having a full team on the field, that they come out ahead. [...]

They don’t want anybody in the Labor Department that’s actually going to look out for the interests of workers. They think that it ought to be Commerce Two. So you have the Commerce Department and under [former Labor Secretary] Elaine Chao it was Commerce Two, where they took care of business in both places. And we suffered. Health and safety of workers suffered, the lives of workers were taken needlessly.

Watch it:

As David Madland and Karla Walter wrote, “from air pollution to food safety to children’s toys, one of the hallmarks of President George W. Bush’s administration [was] its failure to enforce laws designed to protect ordinary Americans. This failure is perhaps nowhere more evident than at the Department of Labor, where the Obama administration will have an opportunity and an obligation to correct the Bush administration’s inadequate enforcement of important workplace protections.” But it’s going to be very difficult to fulfill that obligation if the administration can’t get its people in place to do the job.

AHIP’s Astroturf Consulting Firm Also Hosts Anti-EFCA Website For Former AFP Affiliate (UPDATED)

Independent Women's Forum president and CEO Michelle Bernard

Earlier this summer, DDC was caught using a front group called ‘Citizens for a Safe Alexandria’ to attack the Obama administration for seeking to prosecute Guantanamo Bay prisoners in Alexandria, VA. DDC also helped to orchestrate “grassroots” support for President Bush’s push to privatize Social Security. And the group is evidently not through helping advocates of anti-worker policies.

Case in point, according to a list of DDC-hosted domains obtained by ThinkProgress, DDC is hosting the website EFCA-info.org, which is chock-full of misinformation regarding the Employee Free Choice Act (in multiple languages, no less). Though EFCA-info purports to be “a website dedicated to providing visitors with factual and up-to-date information regarding the Employee Free Choice Act,” it spreads various falsehoods about EFCA eliminating the secret ballot or destroying small businesses. And it’s no surprise that the site has this slant, once you look at who keeps it going.

The site is supported by the Independent Women’s Forum (IWF) and the HR Policy Association, along with the U.S. Hispanic Chamber of Commerce and the National Black Chamber of Commerce. The IWF, according to SourceWatch, “is an anti-feminist organization predominately funded by conservative U.S. foundations.” IWF is funded by Koch Industries, which also funds Americans for Prosperity (AFP) and FreedomWorks, both of which were instrumental in organizing the anti-Obama tea party protests. [See response from Koch Industries below]

In fact, from 2003 to 2008, the IWF and AFP operated out of the same office space and had the same president — Nancy Pfotenhauer, a consistent member of the Koch Industries family and former spokeswoman for Sen. John McCain’s (R-AZ) presidential campaign. Currently, the IWF is headed by Michelle Bernard, who earlier this month appeared on MSNBC to declare that “quite honestly, a lot of labor unions are what holds America back and keeps us from being as good as we can be.”

This circle of groups — funded by Koch’s petro-dollars — are trying to derail reform on a variety of fronts, under the guise of grassroots lobbying. And they’re doing it with the aid of DDC’s servers.

Labor Secretary Ramping Up Wage Theft Fight, But Wage Enforcement Nominee Stalled In Senate

Today, the Wall Street Journal reported that the Labor Department is “signaling it will soon begin putting in practice the more assertive regulation of business [Labor Secretary Hilda Solis] promised early in her tenure.” As part of that effort, “there will be 150 investigators added in the Wage and Hour division to enforce wage rules and child-labor laws.”

This increase is a smart move. As USA Today reported this week, “complaints of wage theft have risen as the economy tumbled.” In Austin, the Workers Defense Project received 63 complaints in June, compared with 25 it had in June last year, while Chicago’s Working Hands Legal Clinic received 252 complaints in the first half of this year, compared with 161 in the same period last year.

However, the administration’s nominee to run the Wage and Hour Division is still stuck in the Senate. Lorelei Boylan, the Director of Strategic Enforcement at the New York State Department of Labor, was announced as the nominee on April 14 and formally nominated on May 11, but has not even received a confirmation hearing before the Senate HELP Committee. By contrast, President Bush’s nominee for this position was confirmed in less than three months. As Bruce Goldstein put it at Harvesting Justice:

The failure to allow the President to place leaders of his choice in these positions severaly harms the Department’s capacity to enforce farmworkers’ rights and improve the operation of the agency. The Senate’s parliamentary rules (and lack of them) allow individuals substantial power. The failure of the Senate majority to force these long-delayed confirmations over the objection of whoever is stalling is harming the most vulnerable working people in this country.

The Wage and Hour Division was allowed to languish under former Secretary Elaine Chao, and is undeniably a mess, as a Government Accountability Office report from March revealed. To compile its report, the GAO called in some fictitious labor violations to the agency, to see how it responded. The results were not encouraging:

WHD successfully investigated 1 of our 10 fictitious cases, correctly identifying and investigating a business that had multiple complaints filed against it by our fictitious complainants. Five of our 10 complaints were not recorded in WHD’s database and 2 of 10 were recorded as successfully paid when in fact the fictitious complainants reported to WHD they had not been paid.

Boylan’s task force in New York, meanwhile, “flourished into a groundbreaking investigative unit with a high rate of success in resolving wage and hour investigations.” When it comes back from recess, the Senate needs to confirm her, so that the Labor Department has a competent administrator leading its fight against wage theft.

Cato Economist: ‘Irrelevant’ Unions Are ‘A Kind Of Leukemia On U.S. Industry’

Today, Cato Institute economist Daniel Griswold appeared on CNBC as part of a panel discussing whether unions are necessary to build and sustain the American middle class. During the segment, Griswold claimed that unions are “irrelevant” and constitute a “kind of leukemia on U.S. industry”:

Labor unions are becoming largely irrelevant for the vast majority of American workers. In fact, labor unions seem to be a kind of leukemia on U.S. industry. Labor imposes a steep cost, that are higher than their productivity gains.

Watch it:

Like most conservatives, Griswold relies on the example of Detroit’s Big Three automakers to make his point, even though unions were not the driving factor behind their failure. Jonathan Tasini of the Labor Research Association was absolutely right to point out that it’s unsustainable health care costs that are hurting businesses across America — including the Big Three — far more than unionization.

In fact, increased unionization has widespread economic benefits, as higher wages and a more secure workforce lead to increased productivity, demand, and ultimately higher profits for businesses. As David Madland and Karla Walter noted:

From 1947 to 1973, the period when unions were strongest and nearly one-third of workers were organized, U.S. economic output nearly tripled in size, growing at an average of 3.8 percent annually. The strength of unions during this period meant workers were rewarded with increasing real wages, and greater American purchasing power produced more profit for U.S. companies, more investment, and increased labor productivity. In the years since 1973, U.S. economic output grew by an average of 2.9 percent annually, and since 2001, output has grown by an average of only 2.2 percent per year.

Consider, “labor costs in 2005 for partially unionized retailer Costco were 40 percent higher than Sam’s Club, but Costco produced almost double the operating profit per hourly employee in the United States — $21,805 per employee versus $11,615 per employee.” Plus, the Small Business Administration has found that small business bankruptcy rates are lower in states with high unionization rates. So unless Griswold has some odd definition of leukemia that the rest of us are unfamiliar with, I’d say unionization doesn’t resemble it one bit.

Anti-EFCA Group Targeting Sen. Bayh Paid Karl Rove Co. $100K In Consulting Fees

In the last few days, the Economic Freedom Alliance (EFA) has created a website and placed billboards in Indiana pressuring Sen. Evan Bayh (D-IN) to vote against the Employee Free Choice Act. The EFA, which is composed of a variety of business organizations located in the Midwest, claims that its purpose is to make Congress “feel the pressure from our central message about the harmful effect that radical organized labor proposals in Congress will have on job creation in the Midwest”:

[T]he absence of a hard-hitting, district-focused campaign leaves a serious gap in that overall effort. EFA is not encumbered by the need for political correctness and hence its response can be better positioned to fill the critical messaging void in overall Card Check opposition campaign.

Evidently, EFA is also not encumbered by a need to adhere to the facts, as its website is claiming that the Employee Free Choice Act will “cost the U.S. economy 600,000 jobs in 2010,” which is a statistic taken from a thoroughly discredited study by business sponsored scholar Anne Layne-Farrar. As the Institute for Southern Studies put it, “even as a piece of business research-for-hire, Layne-Farrar’s study is shockingly weak — based on a thin set of old and irrelevant data that doesn’t even bear out her own conclusions.”

But EFA’s disclosure and expenditure form provides some insight into why it’s comfortable parading out false talking points. After all, the EFA has paid $100,000 in consulting fees to Karl Rove and Co this year.

This $20,000 fee was paid every month this year, February through June. And given Rove’s penchant for falsehoods, it’s no surprise that EFA has gone down the same road. EFA has also given $5000 to astroturf group Americans for Prosperity to “reimburse for event expense” (with Prosperity misspelled as “Properity” on the disclosure form).

FedEx: ‘We Are An Airline,’ Therefore We Can Take Advantage Of Our Truck Drivers

Currently, due to a legal loophole, Federal Express is allowed to operate under the Railway Labor Act, instead of the National Labor Relations Act (NLRA) that governs other companies like UPS. And as the Washington Times reported today, there is a battle brewing between FedEx and UPS, while Congress considers a change that would pull FedEx under the NLRA.

The Railway Labor Act “poses huge barriers to organizing” compared to the NLRA, and thus FedEx is not very pleased about the prospect of a change:

“We are an airline; [UPS] are a trucking outfit,” said FedEx spokesman Maury Lane. “You can’t put stop signs at 30,000 feet.”

But this is about more than just unionization. FedEx’s resistance to the change is consistent with its strategy of doing all that it can to avoid treating its drivers fairly.

For instance, FedEx constantly misclassifies its drivers as independent contractors, placing them outside of the protection of most labor and employment laws. As American Rights at Work pointed out, “by classifying nearly 15,000 drivers as independent contractors rather than employees, FedEx Ground lowers its labor costs by avoiding payroll taxes and benefits.” Its drivers are responsible for fuel and maintenance of the trucks, and are not provided with paid vacation or sick leave.

Misclassification can ultimately save employers “upwards of 30% of their payroll costs.” And because the drivers are not technically employees, they are barred from unionizing.

FedEx claims that its model “works for the company, the contractors and the customers.” But last week, U.S. District Judge Robert Miller granted a request to bring a class action suit against FedEx, by drivers “who claim they deserve benefits because the company treats them as full-time workers by mandating their clothing, hours and prices.”

In a previous ruling in a similar case, the California Superior Court decided that FedEx drivers were indeed full employees, and that FedEx’s driver agreements constitute “a brilliantly drafted contract creating the constraints of an employment relationship…in the guise of an independent contractor model.” So FedEx needs to do much better than cry “we are an airline” (whose pilots, incidentally, are represented by the Airline Pilots Association) to justify its treatment of its drivers and its resistance to fair labor law.

Chamber Of Commerce: Arbitration Is ‘Poison’ Unless It Favors Us

The Associated Press reported that opponents of the Employee Free Choice Act (EFCA), feeling that they have dispensed with majority sign-up, are starting to “intensify their attack on another major provision [of the bill]: Binding arbitration if a new union and management can’t agree on a first contract within 120 days.”

A popular narrative from these opponents is that majority sign-up was actually just a red herring, meant to distract everyone from the arbitration provision that labor really wanted. “We suspected from the beginning that the binding arbitration was packaged with the elimination of the secret ballot in order to create a straw man they could take down later,” said Sen. Jim DeMint (R-SC). In that vein, the Chamber of Commerce had this to say about EFCA’s arbitration provision:

“Card check is the political poison in the bill, but forced arbitration is the real poison,” said Steven Law, general counsel of the U.S. Chamber of Commerce.

If arbitration truly is poisonous, then the Chamber must have built up quite an immunity over the years. After all, it has consistently favored binding arbitration, when such arbitration helps it avoid litigation in consumer disputes. Here’s some of the Chamber’s prior rhetoric:

– Lisa A. Rickard, president of the U.S. Chamber Institute for Legal Reform, wrote that the findings of an arbitration study “prove that arbitration continues to provide consumers with fair, inexpensive, and unbiased access to justice across the broadest spectrum of consumer disputes.” [3/11/09]

– The data is increasingly clear: for most consumers, arbitration is a better way to resolve disputes than being forced into court. [Chamber Press release, 7/15/08]

– Virtually any type of dispute between private individuals or entities can be addressed by arbitration, including, for example, contract, real estate, employment, and tort disputes. [U.S. Chamber Institute for Legal Reform, “Issues Resource Center”]

Overall, U.S. companies include mandatory arbitration clauses in 75 percent of consumer agreements. The Chamber seems to have no problem with that, but when arbitration translates into workers getting a fair shot at a contract, it’s suddenly poisonous.

Arbitration is a necessary part of EFCA because, all too often, employees vote to form a union, but can’t get a first contract due to their employer’s delay tactics. More than half of new unions still have no contract one year after they are certified, and 37 percent have no contract after two years. A full quarter of new unions wait more than three years to receive a first contract.

Specter: ‘My Views’ On EFCA ‘Have Been Consistent’

On Sunday, the Philadelphia Inquirer’s Kevin Ferris wrote a column describing Sen. Arlen Specter’s (D-PA) tiptoeing around the Employee Free Choice Act (EFCA). Specter is one of the senators working with Sen. Tom Harkin (D-IA) to salvage the bill, and Ferris wrote that Specter — who earlier in the year announced his intention to oppose the bill — needs EFCA to pass, as he “now needs labor support because of the expected primary challenge from U.S. Rep. Joe Sestak.”

In response to the column, Specter wrote a Letter to the Editor claiming that his stance on EFCA has been consistent:

I have no hesitancy in stating my own views. I have voted to have the Senate consider the modification of labor law to reform the way unions are certified and to provide procedures for negotiating first contracts. Earlier this year, I made a floor statement opposing giving up the secret ballot and suggesting the last-best-offer procedure on arbitration. My views on this subject have been consistent, and suggestions to the contrary by those intending to run against me are incorrect.

As Dan Hirschhorn at PA2010.com pointed out, “only Specter knows what his true views are, and while they may be consistent, his actions on the legislation have been anything but.”

Indeed, Specter was a co-sponsor of the bill and voted for cloture when the Senate considered it in 2007. However, earlier this year (before switching parties), Specter took to the Senate floor to announce that he would vote against cloture. Even after the party switch, Specter released a statement emphasizing that “my position on Employees Free Choice (Card Check) will not change.”

But last month, Specter addressed a crowd of union activists and told them “I believe you’ll be satisfied with my vote on this issue.” So the only thing Specter has really been consistent on is a consistent willingness to wobble back and forth on the issue.

Cross-posted on ThinkProgress.

The Chamber Can Dish It Out, But It Can’t Take It On Labor

The Chamber of Commerce threw a tantrum yesterday after President Obama nominated a union attorney to the National Labor Relations Board, a quasi-judicial body with the power to sanction unfair labor practices by employers and recognize newly unionized shops.  In a letter to senators laden with criticism, hyperbole and vitriolic rhetoric, the Chamber claims that SEIU Associate General Counsel Craig Becker represents “one of the most aggressive unions in the United States . . . which has a record of using questionable pressure tactics with the goal of forcing employers and workers to recognize unions.”  It labels Becker’s views of labor law as “extreme,” and warns of his “antipathy to the rights of employers;” and it “raises questions about Mr. Becker’s ability to impartially judge cases that may come before the Board.”

Two years ago, however, when President Bush was still nominating NLRB members, the Chamber delivered a very different letter to senators:

[A]n open and honest debate over the merits of Board decisions is a healthy exercise and should be encouraged. however, in recent years, we have seen a disturbing trend in the tone of the debate. Instead of disagreement, we have ad hominem attacks, instead of criticism, hyperbole, and instead of reasoned discussion, vitriolic rhetoric. Compounding this are reports based on shoddy research and half-truths that have been relied on by policy-makers, including members of this committee, in attacking the Board and its decision.

A month later, when President Bush announced that he was renominating labor-busting attorney Robert Batista to Chair the NLRB, the Chamber repeated these exact words, claiming that Batista’s critics were simply “demonizing” his record as Chair.

Few people have done more to undermine workers than Chairman Batista.  To give just one particularly egregious example, in a case called Oakwood Healthcare Batista stripped millions of American workers of their right to unionize by holding that an employee who provides even minimal direction to their co-workers can be classified as a “supervisor” (The right of actual managers to organize is not protected under federal labor law).  According to the Board’s two dissenting members, Batista’s decision could leave 23.3% of the workforce unable to unionize by the year 2012, even though none of Batista’s newly-minted “supervisors” enjoy any of the privileges normally associated with management.

Rather than pretend that they are the guardians of discourse when President Bush is in office and the defenders of reason now that he is not, the Chamber needs to simply admit that their guy lost the last election, and elections have consequences.  One of those consequences will be that an actual union lawyer will get a single seat on the nation’s most important adjudicator of labor disputes.  President Bush got to stack the NLRB with anti-worker union busters when he was in office.  Now that he is out of office, the Chamber will have to find a new way to break up unions.

The Fight for Labor Law Reform Continues

Our guest blogger is Seth Michaels, Online Communications Coordinator at the AFL-CIO.

Today, the New York Times reported that a half-dozen senators have decided to drop the majority sign-up provision of the Employee Free Choice Act in favor of a requirement for “shorter unionization campaigns and faster elections”:

Several moderate Democrats, including Blanche Lincoln of Arkansas, have voiced opposition to card check, convinced that elections were a fairer way for workers to unionize. They were swayed partly by business’s vigorous campaign, arguing that card check would remove confidentiality from unionization drives and enable union organizers to bully workers into signing union cards.

You have to read almost to the end of the Times piece before learning that lawmakers continue to discuss various details of the bill — it’s not a done deal. There are details to be worked out in the legislative process, and meaningful labor law reform must include the three principles underlying the Employee Free Choice Act:

– Workers must have a free choice and a fair path to choose to form a union, free from intimidation.

– Real penalties must exist for employers who break the law.

– Workers who choose a union must be able to get a fair first contract

– Companies must not be able to engage in endless delays and stalling tactics to deny workers a collective bargaining agreement.

With President Obama’s backing — reiterated on Monday — and the support of the majority in Congress, this is the year to pass the most significant labor law reform since the 1930s. And let’s not forget that 73 percent of the public supports the Employee Free Choice Act, which would level the playing field for workers seeking to form unions.

The reason for such support is understandable. Corporate abuses are all too common, and companies can act with impunity against employees who are trying to form unions. Workers who try to exercise their basic freedom to form a union are faced with mandatory meetings, threats of wage or benefit cuts, threats of firings or plant closings and even illegal firings, because of weak law and negligible penalties. That matters to the lives of workers across the country. And even when workers do get through the company-dominated process, more than half wait more than a year for a first contract, and nearly one-third don’t have a contract two years later.

The Employee Free Choice Act has earned the support of small businesses, faith groups, civil rights groups, leading economists and a wide variety of community organizations, who all agree that a strong, progressive country with a healthy economy depends on the ability of workers to bargain for a fair share. Three-quarters of Americans support legislation to make it easier for workers to bargain collectively.

We can and will pass meaningful labor law reform this year. America’s workers can’t wait.

New Ranking Member On Ed And Labor Committee Continually Acts Against Workers And Students

Rep. John Kline (R-MN)

According to the Duluth News-Tribune, “issues in front of the [Ed and Labor] committee are not those Kline ran on when he got into politics…But he said that in his four two-year terms he has gained education and labor experience.” Well, here’s some of what that experience had led him to do:

– He voted against a minimum wage increase three different times in 2007.

– He voted against lowering interest rates for student borrowers enrolled in the Federal Family Education Loan and Direct Loan programs.

– He voted against the Ensuring Continued Access to Student Loans Act.

– He introduced the Secret Ballot Protection Act, which would “prohibit a union from being recognized” through a majority sign-up process.

– He supported “some system of personal accounts” as “a central component” of Social Security reform.

The National Education Association actually gave Kline an F grade for both 2007 and 2008.

According to the St. Paul-Minneapolis Star Tribune, “in his new role, Kline will be expected to be a leading GOP combatant” against the Employee Free Choice Act. But with his Secret Ballot Protection Act, Kline revealed that he has no idea how union drives even work. He advocated taking the majority sign-up option away from workers, even though, since 2003, half a million workers have organized in this fashion, including employees at AT&T, UPS and Pacific Gas and Electric.

Kline, as he laid out in this Washington Times op-ed, is very concerned with the “coercion, intimidation and bullying” of union organizers (even though there is no evidence that this occurs in states that allow majority sign-up), but he doesn’t spare a word for the coercive and punitive tactics that employers use to prevent employees from unionizing. Instead of leveling the playing field for workers, Kline would simply prefer preserving the anti-worker status quo.

Study: Employers Have Increased Use Of ‘Coercive And Punitive Tactics’ To Discourage Unionization

According to a report today in Politico, Sen. Tom Harkin (D-IA) “is trying to resurrect the Employee Free Choice Act by reaching out to a group of Democrats looking for cover on the politically treacherous bill”:

Sens. Arlen Specter of Pennsylvania, Jim Webb of Virginia, Mark Pryor of Arkansas and Dianne Feinstein of California are participating in preliminary talks to modify the “card check” bill, according to lobbyists and aides. Aides say Harkin is holding daily, closed-door conversations with interested lawmakers, business groups and labor unions.

This is good news. Lost in much of the the EFCA debate, which mostly centered on the kerfuffle over “the secret ballot,” is the simple fact that labor reform is still necessary and has a good chance of getting through Congress. Various methods for reforming the union election process have been floated, including a proposal from Feinstein that would allow workers to mail in their ballots directly to the National Labor Relations Board. Other key provisions — including arbitration to ensure that workers who vote to form a union actually get a contract — are still being negotiated.

Plus, it’s not like the problems that EFCA is meant to address have gone anywhere. In fact, a new study out today from the Economic Policy Institute found that over the last 20 years “employer opposition [to unionization] has intensified…and the nature of campaigns has changed so that the focus is on more coercive and punitive tactics designed to intensely monitor and punish union activity”:

Although the use of management consultants, captive audience meetings, and supervisor one-on-ones has remained fairly constant, there has been an increase in more coercive and retaliatory tactics (“sticks”) such as plant closing threats and actual plant closings, discharges, harassment and other discipline, surveillance, and alteration of benefits and conditions.

The study found that “employers threatened to close plants in 57 percent of the campaigns and threatened to cut wages and benefits in 47 percent,” while firing pro-union workers 34 percent of the time.

Of course, the business lobby has already committed itself to opposing any compromise on EFCA. “Let us be clear and frank on this matter; there can be no acceptable ‘compromise’ on any issue of labor law reform due to the very real threat posed by EFCA,” wrote the Coalition for a Democratic Workforce, a front group composed of the Chamber of Commerce and the National Association of Manufacturers, among others.

Pressure from the business community has also led some senators, such as Blanche Lincoln (D-AR), to try to avoid the issue. Harkin, however, is threatening to bring the original bill to the floor. “We’re trying to get the necessary compromises made to get this through,” Harkin said, but if a compromise cannot be found, “it is my intent that we will put the original bill on the floor and make people vote on it.”