Today’s News & Commentary — May 3, 2016

Published May 3rd, 2016 -  - 05.03.161


The Wall Street Journal reported on the declining union influence inside Verizon as the communications’ workers strike continues.  As the telecom industry moved its focus from landline to wireless, the company successfully resisted unionization drives by workers in its wireless division.  “We fought it tooth and nail,” said Denny Strigl, former head of the company’s wireless operations unit. “There’s a mentality that builds up in a unionized workforce that pits the union against its management. And that’s not the kind of culture that you want in a new startup.” Astonishingly, only 160 of the 40,000 striking Verizon workers come from the wireless unit.  Part of Verizon’s success at resisting unionization is historical since it inherited landline workers that had been unionized for years, while the wireless unit started in the 1990s.  Part of it, however, is also cultural and a symptom of current business culture of fissured workplaces, where most of the company’s wireless employees are retail clerks, while the company has contracted out its construction business.  More broadly, just 13% of telecom workers belong to unions, down from 21% in 2005.

After decades of shareholders gaining a bigger piece of corporations’ economic pie than workers, according to the New York TimesModest yet measurable, workers’ pay has increased to 62.6% from 61% in 2013 as a share of the national income while corporate profits have decreased from 14.2% to 12.1% over the same period.  While a large part of the story is the declining profits of the energy industry, part of it also appears to be attributable to rising wages.

In gig economy news, MBO Partners, a professional services firm, has proposed a way for gig services firms and their workers to evade the dreaded worker classification and maintain independent contractor status, according to Forbes.  Under the proposal, workers would sign a certification formally declaring their status as independent contractors and opting out of employees’ rights. “We’re not trying change any laws that exist today,” said MBO CEO Gene Zaino said. “We want to create a safe harbor for people who acknowledge they don’t need the rights of an employee. For those people who don’t want to go through the process, the current laws still exist.”  The only clear distinction between the “new classification” and the workers’ contracts with companies like Uber is that the worker seeks the certification from the state prior to contracting.

The New York Times used a Catholic mass for fallen workers as a frame to examine rising construction deaths and accidents in the city as it experiences another housing boom.  While the city claims that the increase in accidents is attributable to more rigorous inspection procedures catching previously unreported accidents, the unions attribute the increase to their declining influence. “The real tragedy here is that these were almost exclusively nonunion jobs, and a lot of these deaths could have been prevented,” said Larry Amandola, a member of a local construction union.  Of the 16 deaths in the past year, two came from unionized worksites.

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