News & Commentary

March 8, 2023

Morgan Sperry

Morgan Sperry is a student at Harvard Law School.

In today’s News and Commentary, the FTC has extended the public comment period for its proposed ban on non-compete agreements, the CFPB and the NLRB have signed an MOU creating a formal partnership to address employer surveillance, monitoring, data collection, and employer-driven debt, Starbucks C.E.O. Howard Schultz will testify before the Senate HELP Committee, the Department of Justice has moved to block a proposed JetBlue-Spirit Airlines merger, and Alabama coal miners quietly ended one of the longest mining strikes in U.S. history. 

The FTC has voted to extend the public comment period on its proposed rule to ban employers’ use of non-compete agreements by one month. In a press release posted on Monday, the FTC extended its comment period until April 19, 2023. The proposed rule would free one in five American workers—approximately 30 million people—from non-compete clauses, which restrict workers from pursuing better employment opportunities. Specifically, the rule would make it illegal for an employer to (1) enter into or attempt to enter into a noncompete with a worker; (2) maintain a noncompete with a worker; or (3) represent to a worker, under certain circumstances, that a worker is subject to a non-compete. The FTC has grounded its rule in empirical data indicating that non-compete clauses reduce competition in labor markets, thereby suppressing earnings and opportunities for all workers (even those who are not directly subject to a non-compete). The FTC notes, too, that non-compete clauses harm innovation and stifle competition in product and service markets by decreasing the flow of information and knowledge among firms.

On Tuesday, National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo and Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra signed a memorandum of understanding (MOU) to create a formal agency partnership on the topics of employer surveillance, data collection, and employer-driven debt. Recognizing that some unfair acts risk violating both the National Labor Relations Act and federal consumer financial protection law, the MOU formally establishes collaboration between the two agencies. General Counsel Abruzzo and Director Chopra hope that new information-sharing and cross-training practices, plus agency partnership on investigations, will prevent bad actors from “escaping oversight by dodging between regulatory gaps and supervisory authorities.”

As Anita reported on Monday and Tuesday, the Senate Health, Education, Labor and Pensions (HELP) Committee has secured an agreement to testify from Starbucks C.E.O. Howard Schultz. Senator Bernie Sanders (I-VT), the Chairman of the Committee, noted last week that Schultz had consistently declined to testify on the topic of Starbucks’s labor law violations, and refused a number of meeting and document requests. A spokesperson for Starbucks Workers United commended the HELP Committee’s efforts in securing the testimony, noting that “Howard Schultz is the architect of Starbucks’s anti-union campaign and should be held accountable for his actions. We are ecstatic to see elected officials, like Senator Sanders, sticking up for workers’ rights and proving that even billionaires, like Howard Schultz, are not above the law.” 

Schultz’s agreement to testify comes on the heels of last week’s tough NLRB ruling for Starbucks. As Michelle reported, a week ago an Administrative Law Judge found that Starbucks committed “egregious and widespread” NLRA violations across 21 stores in Buffalo. Ben notes that the judge’s prescribed remedies—which include a Gissel bargaining order and requirements that Starbucks reinstate seven wrongfully terminated workers, reopen a store closed in retaliation for union activity, and record a video of C.E.O. Howard Schultz and vice president of US operations Denise Nelson reading a notice of the ruling and describing Starbucks’s violations—are “as strong as it gets. These are muscular remedies that are significant and wholly appropriate in this case. Gissel orders have historically been a thing of theory and not so much practice. Under this Board, that could change.”

Next, the Department of Justice on Tuesday stepped in to block JetBlue’s attempted acquisition of Spirit Airlines. Arguing that “this merger will limit choices and drive up ticket prices for passengers across the country,” Attorney General Merrick Garland indicated that the Justice Department will seek to halt it. Previously, unions representing Jetblue and Spirit employees had been split on the deal. Two weeks ago, the Transport Workers Union, which represents 6,800 JetBlue flight attendants, called upon Attorney General Garland and Transportation Secretary Pete Buttigieg to block the proposed merger—at least “until the leadership of the proposed carrier demonstrates their willingness to operate in good faith with their workers and the passengers.” Observing that it had taken T.W.U. bargaining units “years” to negotiate their existing contracts, T.W.U. President John Samuelson expressed concern that “JetBlue management, which will be the successor management team for any combined carrier, has the intent to not fully honor these agreements should they be allowed to acquire Spirit.” Meanwhile, the Association of Flight Attendants-C.W.A., which represents 5,600 Spirit flight attendants, supported the merger as part of a tentative agreement that would also guarantee Spirit workers higher wages and quality-of-life improvements.

Finally, coal miners in Alabama quietly ended one of the longest mining strikes in U.S. history last week. After two years, the United Mine Workers of America ended its work stoppage at the Warrior Met Coal mine in Brookwood, Alabama without a deal. Emboldened by the soaring price of coal, the Warrior Met mine used its ballooning profits to recruit nonunion workers to the tune of $132,000 per year, rather than negotiate with the union miners on strike. Cecil Roberts, president of the United Mine Workers of America, noted that, “[i]ronically, the replacement workers became some of the highest-paid coal miners in the country because of us.” He optimistically stated that he expects union members to start receiving the same pay when they return to work. Notably, the Warrior Met strikers did not earn the same national attention that workers in newly-organized sectors have enjoyed. That being said, the mining strike was a valuable reminder of “old-line labor solidarity amid new organizing efforts across modern industries.”

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