Salon Interview on Resolving the Fast Food Stand-Off

Salon just posted their Q & A with me on the fast food campaign and my proposal to create a workers council at McDonald’s.  The piece provides good background on the campaign, highlights the big issues in play, and explains why a workers council could facilitate a resolution.  The interview questions link the idea of workers councils in the fast food industry to some of the other major contemporary organizing campaigns, including Uber and Wal-Mart.  The interview also points out the connection between my proposal and the ongoing developments at Volkswagen. The full interview is here.  Some excerpts are below:

[Y]ou’ve written a few posts at On Labor recommending both sides embrace a negotiation mechanism that you’re calling a workers council. What will that look like?

In some ways, it’s just amazing — to me, anyway — that we have these huge national corporations with tens of thousands, sometimes millions of workers, and there’s literally no way for management to communicate [with] the workers as a group. That mechanism just doesn’t exist. When there’s a union we do have that mechanism, but we have unions in less than 7 percent of the private-sector today, so for the vast majority of people employed in the United States, there’s just no way for workers to talk to management.

That, in essence, is what a workers council [provides]. It’s a way for workers to elect representatives and to communicate through those representatives with management.

Some of the most successful companies in the world operate with workers councils. Volkswagen is a great example. The management at Volkswagen speaks about its workers councils in glowing terms. They use the phrase ‘constructive cooperation,’ that is to say, a workers council gives management and workers a way to be constructively cooperative with one another about the running of their operations.

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The Philadelphia School Reform Commission & Its Unilateral Teachers Contract (Part 2)

As I wrote in yesterday’s post, the Philadelphia School Reform Commission (SRC) has filed a motion for declaratory judgment in a Pennsylvania appellate court seeking validation of its unilateral imposition of a contract on its teachers.  Here are the steps in the SRC’s argument as laid out in its declaratory judgment brief: (1) §§ 696(i) and 696(k)(5) of Act 46, which is the statute that allowed the SRC to take control of the Philadelphia School District, give the SRC the powers granted in § 693(a)(1) of the Pennsylvania Public School Code; (2) § 693(a)(1) grants governing bodies of distressed districts like the SRC the power to “cancel” contracts when doing so “will effect needed economies in the operation of the district’s schools,” and that is what the SRC did; (3) implicit in this power to “cancel” a contract is the power to unilaterally impose terms post-cancellation, despite the status quo doctrine established by PERA (the Pennsylvania statute governing labor relations for public employees) and cases interpreting it that requires an employer to maintain the status quo terms and conditions post-contract expiration until a new agreement is reached or the parties reach an impasse; (4) therefore once it “cancelled” the teachers’ contract the SRC was entitled to dictate whatever terms it deemed necessary for the district’s budget; (5) whatever the actual statutory law may be, the District really needs revenue, so the court should allow the action to stand because the District needs the revenue so badly.

To borrow an apt phrase used by an honest man in a somewhat different context, the District’s argument is as thin as a soup made from boiling the shadow of a pigeon that had starved to death.  While the argument falters at several points, the most decisive and glaring is that the cited provision for the SRC’s authority to “cancel” the contracts, on which the entire rest of its argument hinges, specifically says the SRC cannot cancel “teachers’ contracts.” Here is the text of § 693(a)(1), on which the SRC relies entirely to justify its actions:

To [the end of meeting a pressing economic necessity] the special board of control [including the SRC] may require the board:

(1) To cancel or to renegotiate any contract other than teachers’ contracts to which the board or the school district is a party, if such cancellation or renegotiation of contract will effect needed economies in the operation of the district’s schools.

693(a)(1) (emphasis added).  This language is clear: the SRC cannot cancel teachers’ contracts.  Period.  To deal with this decisive statutory language, the SRC makes a strained, cringe-inducing effort to argue that the phrase “teachers’ contracts” is a term of art that does not include the collective bargaining agreement between the District and the teachers. This bald assertion is not supported by any source of law, and every indication is that “teachers’ contracts” as used in this statute carries its common, everyday meaning, which would obviously include the Philadelphia teachers’ contract.  For instance, the Definitions section of the Public School Code, in which § 693(a)(1) lies, does not define “teachers’ contracts” at all.  In fact, the SRC does not cite any statute or regulation for its claim because none exists.

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Today’s News & Commentary – October 31

According to POLITICO, the Coalition for Crane Operator Safety plans to ask the Occupational Safety and Health Administration (OSHA) to revise its certification requirements for crane operators. OSHA had previously promulgated its Final Rule on Cranes and Derricks in Construction. The Coalition is made up of major construction companies as well as construction unions. It hopes OSHA will revise the rule so that crane operators only have to be tested on the types of cranes, and not on the capacity of those cranes. The Coalition also wants the federal agency to place the burden on employers to train employees on how to qualify as crane operators. Unions hope the revised rule will enhance the safety of construction workers and the public.

Jared Bernstein argues in The Washington Post that the U.S. should learn from Denmark’s fast food model. Whereas the base pay for a fast food worker is $20 in Denmark, the base pay in the U.S. is about $8. In Denmark, fast food workers also get numerous benefits including five weeks of paid vacation, paid maternity and paternity leave, and a pension plan. Unions represent about 68% of the Danish workforce, while unions have declined in power in the U.S. Currently, only about 11% of American workers are covered by unions. Bernstein argues that economic forces alone cannot explain the stark difference between Denmark and the U.S. According to Bernstein, “a burger is a burger,” and the difference should be attributed to a number of factors, including “union power, profit-margin differences, an acceptance of higher prices in the interest of higher pay, and a cultural/social commitment to paying a living wage.”

An Opinions article in The New York Times discusses “bonded labor” in Bangladesh, a country that ranks tenth on the Global Slavery Index which lists countries with the highest number of enslaved people. Bangladesh is known for its millions of child laborers and for the poor conditions in its garment factories. These conditions led to the collapse of the Rana Plaza factory in April 2013, which killed more than 1,000 people. Garment factory workers in Bangladesh work long hours for as little as $50 per month. The article argues that hazardous conditions in Bangladesh have prompted many to seek work abroad only to be trafficked and exploited in their countries of destination.

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The Philadelphia School Reform Commission & Its Unilateral Teachers Contract (Part 1)

In a 17-minute meeting convened with virtually no public notice on the morning of October 6, the five members of the Philadelphia School Reform Commission (SRC), the governing body of the Philadelphia School District, voted to unilaterally impose new contract terms on District teachers, who are represented by the Philadelphia Federation of Teachers (PFT).  Among other changes adverse to the teachers, (1) teachers would for the first time be required to contribute to their health insurance; (2) the SRC would cease funding the PFT-administered Health and Welfare Fund, which manages dental, prescription drug, and optical benefits for teachers, and would instead start administering these benefits itself; (3) teachers would lose access to legal services provided by an employer-funded, PFT-administered legal services plan; and (4) retired teachers would no longer receive the dental, vision, or prescription drug benefits that the soon-to-be dissolved Health and Welfare Plan had promised them.  Under any reasonable interpretation of applicable law, the SRC cannot unilaterally implement these changes, all of which involve mandatory subjects of bargaining under the Pennsylvania Public Employee Relations Act (PERA).

Prior to 2001, an elected school board governed the District.  District employees retained the same organizing rights as other public employees under PERA, including a somewhat circumscribed right to strike. In 1998, the District’s then-superintendent criticized the state government for failing to adequately fund Philadelphia schools and threatened to close the schools midyear if additional funding was not allocated.  In response, the Pennsylvania legislature, long suspicious of all Philadelphia government, passed Act 46.

Act 46 granted the Pennsylvania Secretary of Education the power to deem the District “under distress” and to then replace the elected school board with the SRC, a body made up of three gubernatorial appointees and two appointees of the Mayor of Philadelphia.  Republican Governor Mark Schweiker ordered his Education Secretary to pull this “takeover trigger” in 2001.  According to Act 46, once the District came under SRC control, District teachers lost the right to strike entirely for as long as the takeover remains in place. Those who strike anyway face decertification.  Employees also lost the right to bargain collectively about certain specifically enumerated matters.  And once in place, the SRC could only be dissolved with the approval of a majority of the difficult-to-remove SRC members themselves.  During its roughly thirteen-year existence, the SRC has negotiated multiple collective bargaining agreements with the PFT and other employee representatives. Continue reading

Fast Food News – October 30

This post is part of an ongoing of series on the fast food organizing movement. You can read all our Fast Food News here.

In response to this week’s this week’s New York Times’ report on fast food wages in Denmark, Vox took a closer look at what the impact of a $20 an hour minimum wage would be in the United States, and according to their calculations the results are not beneficial. According to Vox, the standard of living for American fast food workers would assuredly rise, but roughly 65% of them may loose their jobs. This conclusion is reached based on the number of McDonald’s per million inhabitants – 16 in Denmark, 45 in the United States. In order to remain profitable, the article believes roughly two-thirds of McDonald’s restaurants would need to close, leading to higher wages for those in the industry, but a much smaller number of workers in fast food as is seen in Denmark. The question then is what would happen to those workers and what education, training, labor market, and regulation policies could be made to allow the United States to maintain a low level of unemployment without reliance on low-wage, low-productivity fast food jobs.

However, Vice President Joe Biden’s former chief economist, Jared Bernstein, was more skeptical of the argument that America is fundamentally different than Denmark in his opinion piece for the Washington Post. While conceding that Denmark and the United States are indeed different markets, but the gap between pay in the two countries is simply too large to be explained by market fundamentals. What Bernstein believes is actually influencing this outcome are factors such as relative union power, profit-margin differences, acceptance of higher prices for higher wages, and a cultural commitment to a living wage. In Denmark, where unions cover nearly 70% of all workers, the employer must agree to pay a living wage in order to avoid unrest. That pay comes with a higher price for items like Big Mac’s, but the price differential is dwarfed by the wage difference, as a Danish McDonald’s employee can buy nearly twice as many Big Mac’s than can the American employee. In essence, according to Bernstein, our model supports higher profit and higher inequality, leading to external costs associated with working in poverty, whereas our Danish counterparts internalize that cost by paying a higher wage and higher prices.

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Today’s News & Commentary — October 30

The Wall Street Journal reports that EEOC is suing Honeywell for its “employee wellness program.” Honeywell, like many other companies, recently created a program designed to encourage employees to improve their health, and in the process reduce health care costs for their employer. Wellness programs are not by themselves illegal, and the Affordable Care Act in some ways incentivizes such initiatives as a way to manage health care costs. However, according to the Journal, the EEOC has frequently cautioned business that wellness programs might violate the Americans with Disabilities Act and possibly other laws when “the penalties or rewards become so extreme that employees essentially afford” to not participate in the program. Under Honeywell’s wellness program, employees who decline to undertake various medical screenings could lose up to $4000.

A column in the Boston Globe reports on paid sick leave in the restaurant industry, which has become a major issue in the governor’s race. If voters pass Question 4 on the Massachusetts ballot in next week’s election, a new law will go into effect requiring restaurants, hotels, and retail stores to offer paid sick leave to employees. The Massachusetts Restaurant Association has strongly opposed it, calling it a “rigid job-killing mandate.” But, the Globe concludes, similar laws haven’t caused dire results in the other states.

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A Primer: The Impact of Recent Law on Union Political Participation

With Election Day less than a week away, campaigns efforts’ to mobilize and persuade voters all over the country are in full swing. But it is not just campaigns that are striving to influence voters’ decisions; corporations, individuals, issue-oriented organizations and unions are all weighing in on candidates and initiatives through ad buys, campaign contributions and organized grassroots efforts. While the debate about big money in politics continues, it is beyond dispute that this area of the law has changed significantly in the past decade.

Below is Part One of a primer of recent law that effects union political participation. Check out Part Two for more information about restrictions on the use of dues of workers who object to union political activity, as well as more information about disclosure requirements. Section A of this post covers recent case law regarding political expenditures made by unions and corporations. Section B covers the specific rules of the game and how unions participate financially in the political process.

     A. Unlimited Union and Corporate Political Expenditures

This section discusses how the holdings in Citizens United and have combined to allow unions and corporations to make unlimited political expenditures. These holdings in turn have resulted in the birth of the infamous Super PAC.

Citizens United v. Federal Election Commission

In its 2010 Citizens United holding, the Supreme Court struck down a decades-old federal ban on independent expenditures by corporations and unions. Citizens United allows corporations, unions and other organizations to spend unlimited sums from their own treasuries to fund political advertisements advocating for or against specific federal candidates. In doing so, the Court announced that the First Amendment does not permit a distinction between individuals and corporations when it comes to independent political expenditures. The Court upheld the financial reporting requirements for independent expenditures and electioneering communications, and the ban on corporate and union contributions to candidates.

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