Weekend News & Commentary — June 2 – 3, 2018

Published June 3rd, 2018 -  - 06.03.185


Boeing pursues an NLRB appeal of the unionization vote of a “micro unit” of plant workers in Charleston, South Carolina; before the vote, the NLRB had made an anti-union reversal a little more likely.  As Bloomberg Law reported on Friday, an ethics official found Member William Emanuel (R) could participate in the Boeing case, despite having previously been an attorney at the law firm that has represented Boeing in a range of employment and labor matters.  It is unclear whether Chairman John Ring (R), who faces similar potential conflicts, has been cleared.  But whether the appeal is heard by a three-member panel or the full five-member Board, with Emanuel’s inclusion, a Republican-majority is guaranteed. In December, the Board abandoned an Obama-era rule expanding so-called micro-unit organizing; Boeing thus maintains that it is unlawful to permit now a smaller unit to organize (in this case, 178-workers in a plant that employs 3,000).  Nevertheless, former NLRB chair Wilma Liebman (D) does not accept that a reversal is a “foregone conclusion” – last week’s vote comports with “decades-old precedent allowing skilled trades and discrete craft workers within an overall production and maintenance unit to organize,” Liebman explained.  Charleston’s The Post and Courier reported on Saturday that many observers and stakeholders perceive that the small organizing unit would be a “boon” to all the plant’s workers; Mike Evans, lead organizer for the International Association of Machinists, who will represent the unit, predicts that every plant worker would enjoy “enforced protections, more fairness in the workplace and better wages and benefits.”

And those who fly planes are also making moves with regard to union representation, although in a contrary direction.  Pilots at Flexjet, LLC, a Cleveland-based provider of “private aviation” services,  voted to end representation by the Teamsters, Josh Eidelson reported last week.  The Teamsters have alleged that the ousting arises from an “aggressive campaign by management” to demean the worth of collective bargaining; management has hailed the vote as “an historic moment,” marking a new break from union stronghold on the airline industry.  After the vote, management sent pilots a 1,000-dollar bonus to “enhance” “celebration” of the result.

Eidelson also reported on UNITE HERE’s allegations against United Airlines for engaging in a “broad[] campaign against the union.”  In the kitchens and loading docks in which 2,700 of United’s employees prepare and transport in-flight food, TVs blast anti-organizing messages, warning of the intractability of union representatives, the cost of dues, and the loss of existing benefits.  “They’re trying to wash people’s brains,” employee Maria Villarroel told Eidelson.  On Wednesday, UNITE HERE, which is hoping to represent the kitchen staff, filed a complaint with the National Mediation Board; United, in turn, alleged the union has committed fraud and misrepresentation. NMB decided to delay the union vote indefinitely as it investigates these latter allegations – a “rare move” that may provide United with more time to react to stockholders’ “acute pressure” to remediate unsteady profits. United’s kitchen workers are unique among the airline’s frontline employees because they are not unionized, and United is unusual in the industry for maintaining its own kitchen workforce, rather than contracting with catering services. (As Eidelson notes, UNITE HERE already represents the workers at the two companies available should United decide to abandon in-house operations.) Pro-union workers are seeking a fairer attendance policy and higher pay.

Toys “R” Us, which filed for bankruptcy in September 2017 and in March 2018 announced it was closing or selling all 800 stores, has not paid severance to the 30,000 workers losing their jobs, Washington Post reports.  Toys “R” Us’s collapse has been described as “the latest failure of financial engineering,” an illustration of the risks inherent in buyouts by private equity firms, who promise to overhaul operations, but saddle struggling companies with dramatic debts. Toys “R” Us’s 2005 leveraged buyout by real estate company Vornado Realty Trust and private equity firms Kohlberg Kravis Roberts and Bain Capital led to a 5 billion-dollar debt that ballooned to a 7.9 billion-dollar debt set against 6.6 billion dollars of assets. Vornado, KKR, and Bain turned profits as the toy retailer paid 470 million-dollars in advisory fees and strained to satisfy its debts with upwards of a 100 million-dollars in monthly payments.  But employees left with nothing are fighting to be compensated fairly, and are enlisting the support of lawmakers in New Jersey, where the retailer is based, to regulate leveraged buyouts and restrain private equity strategies.  Senators Cory Booker (D – N.J.) and Robert Menendez (D – N.J.), and Congressmen Bill Pascrell, Jr. (D – N.J., 9th), wrote an open letter to “urge” the three firms to “do right by the company’s workers.”  The workers also will be seeking fair compensation by filing a claim in U.S. Bankruptcy Court in Richmond, Virginia.

In Saturday’s paper, Pennsylvania’s Post Gazette asked “Could minimum wage hike be part of [Pennsylvania] budget?”  In Harrisburg, where the state legislature is working to finish the budget by the June 30 deadline, the proposal of a boost is gaining ground. With 21 other states, Pennsylvania’s current wage is set to the federal minimum of 7.25 an hour – guaranteeing that work for some is not a “pathway out of poverty” but rather “just another form of it,” in the words of Rev. Liz Bidgood Enders, who rallied for an increase last week. Gov. Tom Wolf (D) proposed 12 dollars an hour (tempered from his past proposals of 15), and recently called upon lawmakers to serve workers in a move that is “well past time.”  Republican candidate for governor state Sen. Scott Wagner (R – York) has supported a more modest raise.

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