Today's News & Commentary — October 9, 2015

Published October 9th, 2015 -  - 10.09.152


Details of the proposed four-year contract between Fiat Chrysler and the United Auto Workers have trickled in today after news that the parties struck a tentative deal this morning, as reported by OnLabor here.  The upshot?  Better wage prospects for entry-level workers.  Reuters reports that the tentative deal would gradually eliminate the much-criticized two-tier pay structure, which has been in effect since 2007, that pays new workers about $10 less per hour.  Currently, 45 percent of Fiat Chrysler’s 40,000 workers are classified as second-tier, but under the new plan second-tier workers could earn top pay in a shorter amount of time.  With the new contract, the most experienced second-tier workers could earn $29 an hour, up from $19 an hour, within 8 years.  First-tier workers would also see raises, though substantially smaller ones.  Veteran workers would receive a 3-percent raise in year one and lump payments of 3 percent and 4 percent, respectively, in years two and four.

In other automobile-related news, Karen Higginbottom writing for Forbes argues that the Volkswagen scandal underscores the need for employer-led whistleblowing policies and a work culture that encourages employees “to speak out.” Higginbottom points to a recent survey that reveals that one-third of British employees would be reluctant to divulge illegal or dangerous acts committed by their employer, citing potential discharge and career damage as key considerations.  Two-thirds of the individuals who partook in the survey, however, said they would expose dishonest behavior if they could do so anonymously.  So why might employers want to pay and direct more attention to their whistleblowing policies?  Because, Higginbottom suggests, creating a safe space for employees to complain is good corporate governance.  “Calls to the whistleblowing line might be indicative of something happening in a particular area.”  And by making it easier for rank-and-file employees to flag suspicious behavior, companies are more likely to catch illegal activlity like, for instance, deliberate noncompliance with national emissions standards.

Urban Outfitters, a retail store popular with millennials, is now asking its workers to “volunteer” for extra shifts this October, reports Business Insider.  While asking employees to man unpopular shifts may not be a new phenomenon, requesting employees to work without pay is.  In a recent email to employees, Urban Outfitters’ parent company, which also manages boho-chic Free People and Anthropologie, asked for volunteers to work shifts at an order-fulfillment center in rural Pennsylvania as a part of a “team-building activity.”  While there, the email stated, “you will work side by side with your . . . colleagues to help pick, pack and ship order for our wholesale and direct customers.”  Although the merchandising giant did not plan to pay employee-participants for their time spent “picking, packing and shipping” the email did indicate that lunch would be provided.

Critics of the federal bureaucracy have new ammunition for their continued assault on big government.  The Washington Post reports that a new study by the Cato Institute, a libertarian thinktank, claims that federal employees, on average, make 78 percent more than their private sector comrades.  Titled “Reducing the Costs of Federal Worker Pay and Benefits” the study argues that the federal workforce is a burden on America’s tax dollars.  “The federal government has become an elite island of secure and high-paid employment, separated from the ocean of average Americans competing in the economy,” writes Chris Edwards, the author of the study.  Though many Americans covet federal jobs precisely for the extraordinary stability, benefits, and salaries that those positions provide, Edwards views the disparity as a symptom of wasteful government spending rather than an exemplar of employment policy.  “To find further savings, policymakers should turn their attention to the generous benefits received by federal workers. They should also reduce the overall size of the federal workforce by terminating and privatizing programs.”

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