News & Commentary

March 1, 2015

Jon Weinberg

Jon Weinberg is a student at Harvard Law School.

The New York Times published a feature story on the difficulties Americans with criminal records face in obtaining employment after a conviction.  Given the significant increase in the number of Americans with criminal records, employers have increasingly used background checks in hiring decisions.  Men with criminal records now comprise a significant percentage of the unemployed population, and there is a significant concern that background checks are being used too broadly to unfairly and systematically exclude job applicants.  The article notes that some states and municipalities have passed “ban the box” legislation in response to limit background checks to later in the hiring process.  A New York Times editorial endorsed the efforts to limit exclusion from the labor market and called for action by the federal government.

A new paper from International Monetary Fund economists concludes that lower rates of unionization are strongly associated with more income going to the wealthiest, ThinkProgress reports.  According to the summary of the paper, in advanced economies from 1980-2010 “the decline in unionization explains about half of the rise in incomes for the richest 10 percent and about half of the increase in the Gini coefficient, a measure of income inequality. It’s also associated with less redistribution of income between the best off and the least well off.”

Writing in The Washington Post, Lydia DePillis analyzed Wal-Mart’s recent announcement that it will be raising entry-level wages to $10 an hour by next year.  She argues that the shift is not due just to activist pressure or changes in the labor market, but rather the adaptation of a “invest-in-employees” strategy through which Wal-Mart will better incentivize performance, increase training, and otherwise better invest and commit to employees.  The new strategy will not, however, involve an increase in the proportion of full time to part time employees.

Lydia DePillis also wrote in The Washington Post about the struggle of employees of in-flight catering services to obtain wage increases to match wage rates from before the airline industry suffered significant setbacks after 2001.  While airline profit margins have recovered, the wages of employees of the catering services have not.  Employees are targeting the airlines themselves rather than their catering service employers, asking for minimal surcharges on ticket sales that would go to wages and health care, but the airlines are not responsive.

According to The New York Times, drivers for the shuttle bus company that transports workers to and from large Silicon Valley employers, such as Apple and Yahoo, have voted to join the Teamsters.  The drivers seek to negotiate better wages and working conditions, following drivers for the company that shuttles Facebook workers who joined the Teamsters in November and successfully obtained a contract with wage increases and new benefits.

The Wall Street Journal reports that while food-service employment has surged in the past two years, but that wages in the sector did not correspondingly increase until recently.  The recent wage increases have been driven by “a higher minimum wage in many states, falling unemployment and stronger demand for meals outside the home, fueled by growing disposable incomes.”

According to Reuters, 5,000 people gathered at the Wisconsin State Capitol in Madison to “demonstrate against the impending adoption of a law that would ban private sector workers from being required to join a union or pay dues.”  The law is expected to be enacted.

New York City has reached an agreement on a new contract with the union representing the city’s police sergeants, The New York Times reports.  “The tentative contract with the Sergeants Benevolent Association grants an 11 percent wage increase over seven years, retroactive to 2011, with a series of other benefits. It leaves the Patrolmen’s Benevolent Association as the only police union without a new agreement.” The Daily News notes that two other police unions who settled contracts in December will now seek to re-negotiate for similar terms.

Writing in the Los Angeles Times, columnist Michael Hitzik praised labor unions for their creativity and militancy in the face of criticism that he finds unfounded and unfair.  He cites gains that unions have made for the middle class and efforts by unions to raise wages even beyond their membership, and in the face of defeats.

In another Los Angeles Times op-ed, Daniel DiSalvo argues that California’s public unions have created a situation where public employees are paid generously at the expense of public services.  He calls for reducing what he sees as the union’s political advantages to level the playing field of interest groups and facilitate the passage of pension reform legislation.

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