News & Commentary

March 18, 2021

Maxwell Ulin

Maxwell Ulin is a student at Harvard Law School.

In a press release yesterday, district attorneys in both Los Angeles County and San Francisco announced a joint worker protection action against Handy Technologies, Inc., alleging that the housekeeping and home-services company had misclassified tens of thousands of California-based cleaning workers as independent contractors.  The complaint, filed in San Francisco Superior Court, rests on California’s controversial “ABC test” for independent contractor status.  Since services performed by Handy’s cleaners form “the very heart of Handy’s business model,” the complaint argues, they cannot be classified as independent contractors under the law and are instead entitled to the ordinary array of legally guaranteed employee benefits, such as paid sick leave and the minimum wage. While Uber, Lyft, and other rideshare companies managed to exempt themselves from the ABC test last year though the passage of Proposition 22, other businesses remain covered.  Attorneys are asking the court for restitution, immediate reclassification of Handy workers, and civil penalties of up to $2,500 per misclassified employee.  As if the things couldn’t get more difficult for Handy, the California Supreme Court also decided on Wednesday to let stand an appellate ruling applying the state’s ABC test retroactively.

On Tuesday, California Labor Commissioner Julie Su appeared before the U.S. Committee on Health, Education, Labor, and Pensions (HELP) regarding her nomination for Assistant Secretary of Labor.  Republicans on the committee grilled Su over her management of the Golden State’s unemployment system, which reported a 9.7% fraud rate during the pandemic.  As Su noted in her response, several federal emergency unemployment programs initiated during the pandemic proved generally susceptible to fraud, such the Pandemic Unemployment Assistance (PUA) program.  Outside of the Capitol, AFL-CIO President Richard Trumka defended Su, calling the Republican attacks “ugly and baseless.”  Andrew Stettner of the New Century Foundation also endorsed Su on Monday in a Hill op-ed.

Yesterday, Jennifer Bates, an employee of Amazon’s regional fulfillment center in Bessemer, Alabama, spoke before the Senate Budget Committee on the topic of economic inequality and union rights.  Bates—invited by the Committee’s Chairman, Senator Bernie Sanders (I-VT)—highlighted her coworkers own high-profile union drive and denounced Amazon’s efforts to undermine unionization.  “For so long people have been walking away from jobs for disrespect and inequality,” she told the Committee. “Nobody has been standing up and saying it’s time to hold people accountable. We decided to stand up and say something.”  Bates’s remarks come on the heels of increased scrutiny of Amazon’s hard-ball anti-union tactics, particularly in the wake of recent revelations regarding Amazon’s past, legally dubious practices at other warehouses across the country.  As the union vote in Bessemer draws to a close this month, both New York Magazine and the New Yorker have come out this week with profiles of workers and organizers involved in the campaign.  Channeling the blog’s own Kevin Vazquez, Brookings published a piece on Tuesday arguing that the Bessemer unionization drive touches on broader issues of worker dignity and racial justice.

Amazon’s aggressive anti-union campaign in recent months has highlighted the urgent need for broader labor law reform. As a recent report from the Economic Policy Institute (EPI) reiterates, employers’ capacity to exploit weaknesses in the National Labor Relations Act (NLRA) has rendered the law’s organizing protections ineffectual for decades. Yet as both Brandon Magner and Steven Greenhouse wrote this week, most (although perhaps not all) changes to the NLRA is almost certainly contingent on reforming the Senate filibuster.  While President Joe Biden expressed that he was amenable to the idea on Monday, much work remains before the chamber is willing to pair back the chamber’s 60-vote cloture requirement.  Meanwhile, Senate Minority Leader Mitch McConnell (R-KY) threatened to wage a “scorched earth” policy in the Senate should Democrats vote to amend the filibuster and warned of what Republicans would do with a filibuster-less upper chamber once they retook the majority, including passing “nationwide right to work.”

Finally, recent forecasts from the Federal Reserve project that the U.S. economy will grow an estimated 6.5% this year, the highest rate of GDP growth in about four decades, with unemployment declining to around just 4.5%.  Growth is expected to be fueled in large part by increased vaccination rates and financial stimulus from the recently passed American Rescue Plan (ARP).  As EPI notes, ARP crucially avoids repeating the mistakes of the Obama-era stimulus plan by providing billions of dollars in financial support to state and local governments, allowing states and municipalities to avoid harsh public-sector job cuts.

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