Experts warn GM strike not likely to be resolved anytime soon

From NBC News Online:

On this General Motors and the United Auto Workers agree — the strike that sent 50,000 workers out on the picket lines Monday is not likely to be over anytime soon.

Both sides are talking, but both sides are bracing for a long and costly fight as workers dig in on their fight for better wages, health care benefits and job security, union representatives and auto industry experts said.

“It will go on as long as it’s going to take to achieve our bargaining goals,” Chuck Browning, the UAW’s Region 1A Director, told MSNBC. “The bottom line is this company has been extremely profitable for a long period of time. Those profits have been made off the sweat and the hard work of our members, and our members want a fair agreement.”

Erik Gordon, a business professor at the University of Michigan and an auto industry maven, said the leadership of the UAW needs to take a stand against GM not just for the rank and file — but for its own survival.

UAW President Gary Jones and other top union officials are currently under investigation by federal authorities for allegedly embezzling member dues and blowing thousands of dollars on everything from fancy vacations and golf equipment to $400 bottles of Louis Roederer Cristal Champagne.

“I think the union leadership wanted a strike because they’re under attack, and when you feel like you could be losing your grip on power the age-old tactic is to go to war,” Gordon said.

And because they need to be seen as taking a hard line against GM management, union negotiators won’t seek a swift solution even though rank-and-file workers will start feeling the financial pain almost immediately.

Read the complete article here.

Opinion: You Call It the Gig Economy, but California Calls It “Feudalism”

From today’s New York Times:

Labor leaders cheered in the balcony and lawmakers embraced on the floor of the California Senate on Tuesday as it passed a landmark measure that defines employees, a move that could increase wages and benefits for hundreds of thousands of struggling workers.

Image result for uber

But the bill is as much a starting point as an endgame: It will drive a national debate over how to reshape labor laws fashioned in the industrial era of the 1930s to fit a 21st-century service and knowledge economy.

With the measure, which Gov. Gavin Newsom says he will sign, California will lead in a shift that will likely redefine the roles of governments, unions and worker organizations. Just as federal labor laws were promulgated to help the country recover from the Depression, the imperative to extend basic guarantees like a minimum wage stems from the staggering income inequality in California, the state with the highest poverty rate in the country.

The new paradigms will need to fit not the relatively stable industrial work force of the last century but a gig economy in which workers are increasingly likely to hold multiple jobs or report to no workplace at all. California lawmakers took a major step in constructing the foundation of such a model with the new measure, which presumes workers are employees, entitled to all concomitant protections and benefits, unless they meet strict criteria as truly independent contractors.

Read the complete article here.

Uber drivers are contractors, not employees, U.S. labor agency says

From today’s Reuters News Service:

Drivers for ride-hailing company Uber Technologies Inc are independent contractors and not employees, the general counsel of a U.S. labor agency has concluded, in an advisory memo that is likely to carry significant weight in a pending case against the company and could prevent drivers from joining a union.

The recommendation by the office of general counsel Peter Robb, who was appointed to the National Labor Relations Board by President Donald Trump, was made in a memo dated April 16 and released on Tuesday.

The general counsel said in the memo that Uber drivers set their hours, own their cars and are free to work for the company’s competitors, so they cannot be considered employees under federal labor law.

A ruling on the case is to be made by an NLRB regional director. Advisory memos from the general counsel’s office are generally upheld in rulings. Any decision could be appealed to the NLRB’s five-member board, which is also led by Trump appointees but is independent of the general counsel.

Read the complete article here.

Labor Department moves to ease franchise liability for wage violations

From today’s Reuters News:

The U.S. Department of Labor on Monday issued a proposal that would make it more difficult to prove companies are liable for the wage law violations of their contractors or franchisees, a top priority for business groups.

If adopted, the rule would likely help fast-food companies and other franchisors who have been sued by workers in recent years for wage-law violations by franchisees.

The department in 2017 had already repudiated legal guidance issued by the Obama administration that had expanded the circumstances in which a company could be considered a so-called joint employer under the federal Fair Labor Standards Act (FLSA).

Labor Secretary Alexander Acosta in a statement said Monday’s proposal would reduce litigation under the FLSA and provide clarity to businesses and courts. The FLSA mandates that workers be paid the minimum wage and overtime, among other requirements.

Publication of the rule kicked off a 60-day public comment period.

Under the proposal, companies would be considered joint employers only if they hire, fire, and supervise employees, set their pay, and maintain employment records. That would likely exclude many franchisors and companies that hire contract labor.

Read the complete article here.

McDonald’s Announces It Will No Longer Lobby Against Minimum Wage Hikes

From today’s CNBC News Online:

McDonald’s will no longer take part in efforts to lobby against raising the minimum wage at the federal, state or local level, the fast-food giant told the National Restaurant Association Tuesday. 

Genna Gent, McDonald’s vice president of U.S. government relations, said in a letter to the association that the company believes wage increases “should be phased in and that all industries should be treated the same way.”

“The conversation about wages is an important one; it’s one we wish to advance, not impede,” Gent wrote. The fast-food chain also stated that outlets owned by the company have an average starting wage that exceeds $10 per hour while franchisees pay “likely similar” wages in their own restaurants.

A McDonald’s spokeswoman declined to comment further to CNBC. Politico was the first to report the news of the letter. 

The move from McDonald’s, one of the largest employers in the world, could boost House Democrats and their efforts to raise the minimum wage. Earlier this month, the House Committee on Education and Labor advanced a bill to raise the U.S. wage floor to $15 per hour by 2024. Currently, the minimum wage is $7.25.

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This workplace perk could make it easier to save for emergencies

From today’s CNBC News:

If your car breaks down or you get sick, do you have enough money saved to cover the unexpected expense? If you’re like many Americans, the answer is probably no.

A recent survey from personal finance website Bankrate found that just 40 percent of Americans have enough saved to cover a $1,000 unexpected expense. Research from Prudential found that 60 percent of families have experienced some kind of financial emergency in the past year.

What’s more, the median American household’s liquid net worth is just about $813, according to Prudential. When faced with a cash crunch, individuals tend to turn to their retirement accounts through loans or hardship withdrawals, credit cards or payday loans.

“If you don’t have that buffer, it could be a time of enormous stress. And in that time of stress, often people will tap sources that are not ideal for them,” said Phil Waldeck, president of Prudential Retirement.

That has prompted Prudential to launch a new option for emergency savings that can be added alongside its retirement plans. The savings is an after-tax contribution that allows employees to automatically put money away in low-cost investments such as money market or so-called stable value funds.

Read the complete article here.

First teachers’ strike in 30 years leaves half a million L.A. students in limbo

From today’s Los Angeles Times:

With umbrellas in one hand and picket signs in the other, Los Angeles teachers braved cold, drizzly weather Monday morning as they walked off the job in their first strike in 30 years to demand smaller class sizes, more support staff at schools and better pay.

L.A. teachers go on strike

“Let’s be clear, educators don’t want to strike,” United Teachers Los Angeles President Alex Caputo-Pearl said to a crowd of supporters during a morning news conference at John Marshall High School in Los Feliz. “We don’t want to miss time with our students. We don’t want to have less money for the car payment or less money for the school supplies that we always end up buying ourselves.”

The strike became inevitable when negotiations broke off late Friday afternoon between the L.A. Unified School District and the teachers union after more than 20 months of bargaining.

Schools are open during the strike, but it’s not clear how many students will head to classes in the nation’s second-largest school system. Staffers at some schools said attendance appeared to be low Monday, but official numbers were not immediately available.

During the last teachers’ strike, about half of the district’s students went to school. The plan at many schools for this strike is to gather students into large groups so they can be supervised by fewer adults. It’s not clear how much learning will be going on outside of the real-time civics lessons happening on the sidewalks.

Read the complete article here.

Amazon announces it’s raising minimum wage for U.S. workers to $15 per hour

From today’s Los Angeles Times:

Amazon is boosting its minimum wage for all U.S. workers to $15 per hour starting next month.

The company said Tuesday that the wage increase will benefit more than 350,000 workers, which includes full-time, part-time, temporary and seasonal positions. It includes Whole Foods employees. Amazon’s hourly operations and customer service employees, some who already make $15 per hour, will also see a wage increase, the Seattle-based company said.

Amazon raising minimum wage for U.S. workers to $15 per hour

Amazon has more than 575,000 employees globally. Pay for workers at Amazon can vary by location. Its starting pay is $10 an hour at a warehouse in Austin, Texas, and $13.50 an hour in Robbinsville, N.J. The median pay for an Amazon employee last year was $28,446, according to government filings, which includes full-time, part-time and temporary workers.

Amazon said its public policy team will start pushing for an increase in the federal minimum wage of $7.25 per hour.

“We intend to advocate for a minimum wage increase that will have a profound impact on the lives of tens of millions of people and families across this country,” Jay Carney, senior vice president of Amazon global corporate affairs, said in a statement.

Read the complete article here.

The stock market boom has given CEOs a raise. What about average workers?

From today’s PBS News Hour:

Over the past few years, many economic indicators have returned to where they were before the Great Recession — among them, the unemployment rate, which has dropped below the 5 percent mark of 2007, housing prices and the stock market, which has nearly doubled its pre-recession peak.

Another, buoyed by rising stock prices: the enormous pay difference between CEOs of the largest U.S. companies and their employees, who earn more than 300 times less than those at the top, according to new data.

Here’s a closer look at the issue.

How has CEO compensation changed?

In 2000, the average CEO was paid 343 times more than the average worker, according to the liberal-leaning Economic Policy Institute. That number dropped to about 188-to-1 in 2009.

It has since rebounded to 312-to-1 last year, according to a report from the Economic Policy Institute.

From 2016 to 2017, the average pay of CEOs from the top 350 publicly traded firms increased 17.6 percent — to $18.9 million — even after being adjusted for inflation, the group found.

How to close the gap

The reason for the pay disparity between CEOs and employees is relatively simple. Closing the gap is much more complex.

A number of methods have been proposed to close the gap, including a cap on compensation, clawbacks for poor performance or executive misconduct, and, as mentioned previously, mandatory publishing of CEOs’ salaries.

James Galbraith, the director of the University of Texas Inequality Project who also served as an adviser to Sen. Bernie Sanders’ presidential campaign, said U.S. companies should look to other countries where laws encourage business leaders to reinvest in their tangible products instead of their stocks.

Read the complete article here.

Americans Want to Believe Jobs Are the Solution to Poverty. They’re Not.

From today’s New York Times:

U.S. unemployment is down and jobs are going unfilled. But for people without much education, the real question is, Do those jobs pay enough to live on?

These days, we’re told that the American economy is strong. Unemployment is down, the Dow Jones industrial average is north of 25,000 and millions of jobs are going unfilled. But for people like Vanessa, the question is not, Can I land a job? (The answer is almost certainly, Yes, you can.) Instead the question is, What kinds of jobs are available to people without much education? By and large, the answer is: jobs that do not pay enough to live on.

In recent decades, the nation’s tremendous economic growth has not led to broad social uplift. Economists call it the “productivity-pay gap” — the fact that over the last 40 years, the economy has expanded and corporate profits have risen, but real wages have remained flat for workers without a college education. Since 1973, American productivity has increased by 77 percent, while hourly pay has grown by only 12 percent. If the federal minimum wage tracked productivity, it would be more than $20 an hour, not today’s poverty wage of $7.25.

American workers are being shut out of the profits they are helping to generate. The decline of unions is a big reason. During the 20th century, inequality in America decreased when unionization increased, but economic transformations and political attacks have crippled organized labor, emboldening corporate interests and disempowering the rank and file. This imbalanced economy explains why America’s poverty rate has remained consistent over the past several decades, even as per capita welfare spending has increased. It’s not that safety-net programs don’t help; on the contrary, they lift millions of families above the poverty line each year. But one of the most effective antipoverty solutions is a decent-paying job, and those have become scarce for people like Vanessa. Today, 41.7 million laborers — nearly a third of the American work force — earn less than $12 an hour, and almost none of their employers offer health insurance.

Read the complete article here.