Austin union members rally for jobs and help for the unemployed

A spirited group of about 70 union members and their supporters marched from Austin City Hall  to the downtown Chase Bank building where they rallied to urge Texas US Senator John Cornyn and other lawmakers to support the Emergency Unemployment Compensation Act, which extends unemployment benefits past the 26-week limit.

Without passage of this bill, 2.1 million unemployed workers, including 102,000 in Texas, by February will lose benefits that support them and their families while they look for work. More than 6.1 million will lose benefits by the end of 2012.

The march and rally was organized the Occupy Austin Labor Outreach Committee and endorsed by the Texas AFL-CIO and the Austin Central Labor Council. “We want good, union jobs that put people back to work,” said Snehal Shingavi, Occupy Austin labor magnet. “In the meantime, Congress needs to stop the cuts to unemployment benefits.”

“This is a humanitarian issue,” said Becky Moeller, president of the Texas AFL-CIO. “If this law doesn’t pass, more people will slip into poverty,  more people will go hungry, and more people will spend winter without heat in their homes or on the street with no place to live.”

Finding work in the US has become much more difficult since the Great Recession began in 2007. There are about 6.5 million fewer jobs in the US than there were in 2007 and 4.1 unemployed workers for every available job in the US.

Testifying before the US Senate on December 8, Christine Owens of the National Employment Law Project explained why extended unemployment benefits are needed. “The long-term unemployed can’t find jobs because the jobs aren’t there—not because they are not looking or are unwilling to accept pay cuts or relocate,” said Owens.

The lack of jobs is affecting people who have never been out of work for a long time. “I’ve been in the United States for 27 years and never been on unemployment before,” said Miguel Arellano through an English translator at the Austin rally. “I want to work, but the work is not there. If unemployment benefits are cut, it won’t be just workers who suffer, it will be our families too.”

While workers struggle to find work, banks like Chase Bank, where the demonstrators rallied, have done quite well. Chase is owned by JP Morgan Chase, the largest banking corporation in the US. In the first three-quarters of 2011, JP Morgan Chase reported net income of $15.3 billion. In 2010 it reported $17.4 billion in net income.

After the 2008 market crash, JP Morgan Chase received a $25 billion bailout from the US government, which it subsequently repaid with about $2 billion in interest.

Despite its flush bottom line and the assistance it received from US taxpayers to help it manage its own hard times, JP Morgan Chase has been slow to reciprocate the favor. USA Today reported recently that “(JP Morgan Chase) has been cited for rejecting people who were eligible for mortgage modifications three times (by the Treasury Department) since June.” Of the 290,000 people who have tried to work with the bank to modify their mortgages, fewer than half have been successful. The Treasury Department has subsequently refused to pay the subsidy that the bank was supposed to receive for helping people avoid foreclosure.

“The 1 percent like Chase make their profits off the pain of people in the US and all over the world,” Shingavi said.  They have taken away our jobs, cut out health care, looted our pensions, foreclosed on our homes, and their representatives in Congress now want to take away people’s unemployment benefits.

While the December 31 deadline for HR 3346 draws near, Senator Cornyn’s Republican colleagues in the House continue to block passage of the bill.  

The do-nothing Republicans in Congress continue to block anything that will create jobs and get our country back on track, and now they are shrugging their shoulders and holding up important legislation to help the jobless,” said Gerald W. McEntee, AFSCME president in a statement made in Washington DC.

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Take Back the Capitol shuts down K Street, demands jobs and new priorities

More than 1,000 people On December 7 converged on K Street, the home of lobbyists who represent corporations from all over the world in Washington DC. They were demanding a new set of priorities for the US–priorities that address the needs of the 99 percent, such as jobs, health care, and protection from corporations that cut benefits and wages for workers while spending lavishly on executive compensation and dodging their responsibilities to the public.

“We are unstoppable; another world is possible,” chanted some of the demonstrators as they blocked traffic and shut down K Street for more than an hour. More than 60 people, who refused to leave K Street after they were ordered onto the sidewalk, were arrested.

Demonstrators targeted the lobbying offices of corporations that pay more for executive compensation and lobbying efforts than they do in taxes. Verizon was one of their targets. Demonstrators chanted, “Shame on Verizon, pay your fair share.”

Verizon, whose effective tax rate over the last three years according to Citizens for Tax Justice has been -2.9 percent, received a 2010 federal tax refund of $705 million. During the same year, it paid its now-retired CEO Ivan Seidenberg $18.1 million.

Verizon, however, has been much less generous with its workers. Verizon is seeking to cut its union workers’ health care and pension benefit and outsource more of their work.

In 2004, Verizon and other corporations received a tax holiday that allowed to repatriate funds that they were holding overseas without paying taxes. For Verizon, the tax holdiay meant that it didn’t have to pay taxes on $2.2 billion. The rationale for the tax holiday was that corporations would use the money that they brought back to the US to create more jobs. Since then, Verizon has laid off 39,000 workers.

Other targets included General Electric and the American Bankers Association.

The K Street demonstration was one of the events that are part of the Take Back the Capitol week of action, organized by a group of labor and community organizations. On Tuesday, hundreds of people who came from all parts of the US went to the Capitol to press their case for Congress to support a jobs bill that puts people back to work.

People also talked to Members of Congress about the need to maintain Medicaid and Medicare funding and to give distressed homeowners foreclosure relief. They were angry that Wall Street bankers who profited from the housing bubble that they created were bailed out by the federal government when the bubble burst, but workers like themselves, who lost jobs, health care benefits, and sometimes their homes as a result of the recession that followed, have received no such comparable help.

A group of about 20 workers lined up outside the office of Rep. Darrell Issa (R-CA) on Tuesday. They had come from California to urge him to support President Obama’s jobs bill and other legislation designed to help the 99 percent, but Rep. Issa refused to see them.

When asked why she had come to see Rep. Issa, Tami Orr, Vice-Chair of California United Homecare Workers in Shasta County, said that she wanted to tell Rep. Issa about the recent 20 percent cut to funding for home care services for the state’s elderly and disabled. Reduced funding for this vital service is the result of state budget cuts, some of which can be avoided if Congress passes the jobs bill proposed by the President.

Mariana Anaya said that she wanted Rep. Issa to know about the struggle she went through to hold on to her house. Anaya, a single parent, used up all the money in her 401(k) account to keep her house. She tried to get the bank to agree to a mortgage modification, but the bank stalled until there was no more money left in her savings account and then foreclosed on her.

Martha Rodriguez, an eligibility worker who helps people in need get help, said that her caseload has grown as more people are out of work. Many of her clients are immigrants who came to this country to work, but there aren’t enough jobs. “These people need jobs,” Rodriguez said. “They’re seeking public assistance not because they want to but because they have to.”

Upper Big Branch settlement results in financial penalty but no criminal charges

The US Justice Department on December 6 announced that it reached a settlement agreement with Alpha Natural Resources of Virginia in which the corporation agrees to pay $209 million to clear itself of further responsibility for the deaths of 29 miners who died in the 2010 explosion at the Upper Big Branch mine in Montcoal, West Virginia. The US Mine Safety and Health Administration (MSHA) on the same day issued a final report on the explosion saying that the explosion that killed the miners was “entirely preventable” and that the company “promoted and enforced a workplace culture that valued production over safety.”

Upper Big Branch at the time of the explosion was operated by Performance Coal Company, a subsidiary of Massey Energy, which since then has been acquired by Alpha Natural Resources. Massey has subsequently changed its name to Alpha Appalachia Holdings.

United Mine Workers President Cecil Roberts called the settlement “a mixed bag.” Part of the settlement requires Alpha to invest $80 million in safety improvements in all of its underground mines. It also requires the company to pay  families of the dead miners and two miners injured in the explosion $1.5 million each for a total of $46.5 million.

Roberts called the investment in safety improvements a good first step  and noted that the settlement requires the company to report implementation progress to the US Attorney’s Office.  He said the reporting requirement was welcomed news “as long as the reporting duty has some teeth, so that corporate leaders are personally held accountable in a way that hasn’t happened before.”

He also said that he was glad that those who lost loved ones or were injured in the blast will receive some financial help toward meeting their ongoing financial burdens caused by the explosion and that the settlement allows them to pursue litigation against the company.

But Roberts said that he was disappointed that no criminal prosecution resulted from the investigations conducted by the MSHA and the US Attorney’s Office; furthermore, the settlement absolves the corporation of any criminal responsibility for the explosion.

“I must  say that we are very disappointed that the settlement apparently  includes a ‘non-prosecution’ clause, which means that neither Massey nor  Alpha admit to any criminal wrongdoing, and the US Attorney has agreed  not to pursue criminal charges against them,” Roberts said.

He noted that the agreement does not preclude charges from being filed against individuals who violated the law while working for Massey. “We remain hopeful that responsibility will be placed where it belongs–on upper level management at Massey who created the safety-last culture at the company,” Roberts said. “Until someone goes to jail, there will be no justice done here.”

The report by the MSHA finds that the explosion was caused by a dust explosion that started as a methane gas ignition. “The physical conditions that led to the explosion were the result of a series of basic safety violations at Upper Big Branch, and were entirely preventable,” reads the report. The report cites lack of equipment repair, poor ventilation, and the lack of safety work that would have prevented the dust buildup.

The report goes on to say that Massey “promoted and enforced a workplace culture that valued production over safety, including practices calculated to allow it to conduct mining operations in violation of the law.” Massey also used the threat of retaliation to prevent workers from reporting unsafe conditions to MSHA or the state mine safety office.

After learning of the settlement, United Steelworkers President Leo Gerard issued a statement saying that the $209 million settlement was “a significant step by the US government,” but that criminal charges need to be pursued.

“Executives, who personally profit from violating safety regulations, must be held criminally liable,” Gerard said. “Any executive who decides lining his pockets and those of shareholders is more important than the life and limbs of workers must be held to account criminally.”

Gerard said that the US should follow the example of Canada, which after a deadly mine explosion in 2003 passed a law known as the Westray law that holds corporations, their executives, and their directors criminally liable for negligence causing worker deaths. “The United States needs a Westray law because decisions to disregard safety regulations come from the top,” Gerard said.

Cooling-off period extensions avert rail strike

The Brotherhood of Maintenance of Way Employees Division of the Teamsters (BMWED) announced on December 2 that it reached an agreement with the National Carriers Conference Committee (NCCC) to extend a 30-day cooling-off period implemented in November and set to expire on December 6. As a result, a nationwide rail strike that could have begun on December 6 will not take place.

Two other railroad unions, the Brotherhood of Locomotive Engineers and Trainmen and the American Train Dispatchers Association on December 1 announced that they reached tentative agreements on contracts with the NCCC, which represents more than 30 rail freight carriers in the US. Nine other unions reached tentative agreements in mid-November shortly after a Presidential Emergency Board (PEB) appointed by President Obama recommended terms to settle a two-year contract dispute between 12 rail unions and US rail freight carriers.

BMWED President Freddie Simpson said that its agreement with NCCC would extend the cooling-off period, required by the Railway Labor Act after a PEB announces its recommendations, until February 10, giving the union more time to negotiate a settlement that includes an increase in away-from-home expenses for members who travel on railway business.

“The BMWED did not take this action because it was afraid to strike,” Simpson said. “We took this action because we believe it gives our members the best opportunity to resolve this issue quickly and fairly and avoid an interruption to commerce and avoid a wage loss to our members and other union members who would honor our picket lines.”

Simpson also said that an increase in away-from-home expenses was essential for a fair settlement of the contract dispute because there has been no away-from-home expense adjustment for 15 years. Local BMWED bargaining committees will reach out to various railroads no later than January 9 to begin bargaining directly with them on this issue. If the issue cannot be resolved by the end of the cooling-off period, the union will take the next appropriate action.  BMWED represents 35,000 workers who build, maintain, and repair rail tracks, buildings, bridges, and equipment,

Meanwhile, the Brotherhood of Locomotive Engineers and Trainmen (BLET) and the American Train Dispatchers Association said that they had resolved issues concerning changes to their health care benefit and would send the tentative agreement to members for a ratification vote.

Dennis Pierce, president of BLET, said that his union, the dispatchers’ union, and the NCCC had agreed to extend the cooling-off period so that members could vote on ratification.

Pierce said that the tentative agreement includes the PEB health care benefit recommendations that closely mirror concessions  that the NCCC wanted and that the United Transportation Union agreed to in June. Back then, BMWED estimated that the health care concessions sought by the NCCC will shift $77 a month worth of health costs from the carriers to rail workers. Moreover, the concessions shift even greater costs onto workers who either have health problems themselves or who have family members with health problems.

Pierce said that he was reluctant to accept this change because some of his members had agreed to local wage settlements based on the assumption that their health care costs would not increase.

However, he decided not to issue a strike order and, instead, to allow members to vote on the tentative agreement because he thought that if a strike occurred, Congress would impose a settlement that would be worse than the tentative agreement. House Republicans had already introduced a resolution to impose a settlement and Senate Democrats and Republicans had initiated similar action.

Under the Railway Labor Act, Congress has the authority with president’s concurrence to halt strikes in transportation labor disputes. In April 1991, the last time rail workers struck, Congress, which at that time was controlled by Democrats, halted the strike after less than a day and authorized President George H.W. Bush to appoint a three-member panel to impose a settlement, which the panel did in June. Unions complained that the imposed settlement favored the carriers.

American Airlines files bankruptcy to reduce labor costs

After being unable to reach an agreement with its pilots’ union during contract talks, AMR, the parent company of American Airlines and American Eagle, on November 29 filed for Chapter 11 bankruptcy protection in federal court.

“(AMR’s action) is not a defensive move, but an offensive bankruptcy where they go after their labor groups to reduce costs,” said Avondale Partners airline analyst Bob McAdoo to the New York Times. “They have a great franchise and lots of cash. They have a cost structure that they want to tackle here.”

“The federal bankruptcy courts are being used to bail out a failed management strategy for a company with lots of money in the bank,” said James C. Little, president of the Transport Workers Union, which represents American and American Eagle workers who maintain, repair, and service the airlines’ fleets.

The Allied Pilots Association has been in contract negotiations with AMR since 2008. The talks are being mediated by the National Mediation Board. Back in 2003, the pilots and AMR’s other unions, TWU, the Association of Professional Flight Attedants (which represents flight attendants at American Airlines) and the Association of Flight Attendants-CWA (which represents flight attendants at American Eagle), agreed to big concessions to help the company recover from the steep decline in air travel resulting from the terrorist attacks on New York City and Washington DC. For some pilots, the concessions meant that their pay rates declined by 33 percent.

The pilots were trying to regain some of the ground they lost in 2003, but the company, which was seeking to cut labor costs by $800 million, offered two options that fell far short of what the pilots were seeking.  AMR’s offer also did not address concerns about AMR’s plan to outsource some work at American.

The APA board voted 17 to 1 not to submit the company’s proposal to members for ratification. After rejecting the offer, APA wrote a letter to AMR saying that the union wanted to continue negotiating for a fair settlement, but the company filed for bankruptcy instead.

Despite filing for bankruptcy, AMR is hardly destitute. It has $4.1 billion in cash and cash-like assets on hand. The company has also been generous to its top executives. The Fort Worth Telegram reports that compensation packages for AMR’s top executives are ten times their base pay.

Back in 2009, top executives received bonuses worth $6.5 million even though the company lost $375 million. APA at the time estimated that in the previous four years, executive bonuses totaled $300 million.

Shortly after announcing the bankruptcy filing, former AMR CEO Gerald Arpey announced that he was resigning and left with pension benefits worth $4.7 million.

In a report on AMR’s financial health before the bankruptcy filling, Gimme Credit analyst Vicki Bryan wrote that “the main culprit (for AMR’s financial troubles)  has not been AMR’s labor costs. It was spiking fuel  expense, which is up 187 percent from $2.8 billion per year in 2003 to the  current $7.96 billion.”

American has an aging fleet of airplanes that are not fuel-efficient. The company only recently has taken steps to replace its older stock with more fuel-efficient new airplanes.

In filing for bankruptcy, AMR may be following the lead of its competitors including United Continental, Delta, and US Airways all of which used bankruptcy as a vehicle for shedding their traditional pension plans. If the bankruptcy court agrees, AMR could unload its four traditional pension plans onto the Pension Benefit Guaranty Corporation, a federal agency.

If that happens, PBGC Director Josh Gotbaum estimates that “American Airlines employees could lose a billion dollars in pension benefits promised by their employer. Unfortunately, when the (PBGC) assumed (other) airline (pension) plans, many people’s pension plans were cut, in some cases dramatically,” Gotbaum said.

All four unions representing AMR workers said that they will play an active role in the bankruptcy proceedings to protect members benefits and jobs. TWU President Little said that “our union will fight hard to make sure that front line workers don’t pay an unfair price for management’s failings.”

Vera Shook, AFA-CWA president said, “AFA will continue to defend the jobs, pay and benefits for the over 1,500 flight attendants at American Eagle. . . .  Today’s filing does not change pay, benefits or working conditions for flight attendants as their contract remains intact.”

APFA annonced that it has scheduled base visits to provide members with information about the bankruptcy.

The Wall Street Journal reports that APA is close to hiring Lazard Ltd, a financial advisory firm, to negotiate on its behalf during the bankruptcy proceedings.

IAM and Boeing reach surprise tentative agreement

IAM District 751  on November 30 announced that it had reached a tentative agreement with Boeing on a new contract. Members will begin voting on the agreement next week. The agreement, which came as a surprise, includes what the IAM negotiating team calls “an unprecedented commitment” to job security by the company for workers in the Puget Sound area of the State of Washington and Portland, Oregon.

The negotiating team also said that the pact will require members to pay higher out-of-pocket health care expenses, but it preserves the defined benefits pension plan for current workers and new hires, increases pension payments, and protects medical benefits for retirees.

Negotiations on the new contract began in October when Boeing officials contacted union leaders and asked them to talk about issues that were going to come up when negotiations for a new contract begin in 2012. During the talks, the company asked if the union would be willing to extend the current contract with some important changes.

After the initial talks, the union agreed to discuss a contract extension, and the talks proceeded in secret. The union negotiating team explained that the secret talks were necessary because “in the past, we’ve gone through negotiations with media, politicians, and bloggers second-guessing our moves and trying to determine the outcome while we work against a looming deadline. To make a big public splash this time would have undermined what we were doing and would have gone against the reasons why we agreed to meet with the company in the first place.”

As a result of the new agreement, which if ratified will expire in 2016, Boeing agrees that all of the work on its new 737 MAX airliner will be done in the Puget Sound area and Portland. The 737 MAX is the latest version of the 737, which has become the airline industry’s most widely used single-aisle passenger jet. Boeing currently has commitments from airlines to purchase more than 700 new 737 MAXes, which will come into service in 2017.

Work on other Boeing airplanes currently performed by union labor in the Puget Sound and Portland will continue, and new work may be transferred to the plants.

When the plants that build the 737 MAX are fully staffed, there will be about 20,000 workers employed building the jet, which the IAM estimates will pump $5.5 billion of related economic activity into the communities near the plants.

The airplane itself will be built at Boeing’s Renton, Washington plant. Boeing plants in Portland, Oregon and in the Puget Sound that build parts for the current 737 will build parts for the 737 MAX. Boeing also agreed to phase out outsourced work done by contractors that inspect supplier parts.

For the most part, the union avoided making concessions, but it did agree to higher out-of-pocket health care expenses for members. Union members will still have access to a number of health care options, but in general their deductibles will increase as will their monthly premium payment. If a generic drug is available, workers will pay the difference between the cost of a generic and non-generic drug.

The company agreed to increase monthly pension payments. Starting in 2013, the formula for calculating pensions increases from $83 times years of service, to $85 and continues to increase by $2 a year until 2016. In the past, Boeing tried to exclude new hires from the defined benefits plan, which pays a guaranteed monthly amount for the life of a retiree. The new agreement keeps new hires in the defined benefits plan.

Workers also will get a 2 percent pay raise each year of the contract, quarterly cost-of-living adjustments will continue at the same rate, workers will be eligible for incentive payments that could raise pay by as much as 2 percent to 4 percent of yearly gross earnings, and they will receive a $5,000 signing bonus.

Boeing’s and IAM’s relationship has often been contentious. A two-month strike in 2008 created widespread industrial disruption. The union alleges that the strike led Boeing to relocate some work on its 787 Dreamliner to a non-union plant in South Carolina.

The union subsequently filed a complaint with the National Labor Relations Board charging that the move was made by Boeing to retaliate against the union for the strike. The NLRB heard testimony on the charge this summer. After the tentative agreement was reached, the union said that it would ask the NLRB to drop the charges.

Two million UK public sector workers strike

Two million public sector workers in the United Kingdom walked off their jobs on November 30 to protest government plans to reduce their pensions and take home pay. Morning Star called the mass action “the strongest show of union strength in a generation.” Thirty unions took part in the historic one-day strike that included teachers, health care workers, social workers, care givers, police staff, and many other public sector workers.

“The government is carrying out a massive raid on pensions, which is a reflection of its unrelenting mismanagement of the economy,” said Mark Serwotka, general secretary of the Public and Commercial Services Union (PCS), one of the unions supporting the strike.

“Working people are being asked to pay for the economic mess caused by the greedy City elite whose behavior this spineless government has repeatedly failed to tackle,” said UNITE general secretary Len McCluskey.

“The living standards of millions of low- and medium-paid public service workers are being hammered in the name of reducing the deficit,” said Brendan Barber, president of the Trade Union Congress, which coordinated the strike.

Barber added that the British government has done little to make the bankers who caused the crisis that led to the deficit pay their fair share to reduce it.

The proposed pension and pay cuts are part of the government’s austerity program. Among other things, the government wants workers making 15,000 pounds (US$21,105) or less to contribute 3.2 percent more for their pension, which amounts to a cut in take-home pay.

Barber says that higher worker pension contributions won’t go toward improving the fiscal soundness of the pension fund; instead, they will be used to reduce the deficit. While the government is demanding more money from its workers, it decided not to tax banker bonuses.

“This is really just another way of making public sector workers pay for the bankers’ recession (which caused the deficit), said Phil Mason, a local leader of UNISON, another union participating in the strike.

The proposal to increase worker pension contributions comes at a time when public sector wages have been frozen for three years. “Our members are on a three-year pay freeze and people are not going to be able to afford to pay more for their pensions,” said Jane Health, a UNISON branch secretary in Staffordshire.

In addition to raising worker pension contributions, the government is also proposing that the age for drawing a full pension be increased over a period of time to 66 years old, then to 67 years old, and finally to 68 years old for those 40 years old or younger.

The government also proposes that the formula for calculating pensions be changed so that future pension payments are lower. It also wants to change the way the cost-of-living increases are measured, which will lower future cost-of-living adjustments to workers’ pensions.

Despite news reports to the contrary, public sector pensions for the most part are already quite low. “Let’s nail the lies that are peddled about public service pensions,” Barber said. “They are not gold-plated. Half of public service pensions in payment today are less than 5,600 pounds (US$6,200) a year. In local government, half of pensioners get less than 3,000 pounds (US$4,120).”

Furthermore, public sector workers agreed to changes five years ago that helped stabilize the pension fund. “(Public pensions) are not unsustainable or unaffordable. Big changes were accepted only five years ago to reduce the cost,” said Barber.

“As the National Audit Office, the Public Accounts Committee, and even Lord Hutton in his report have shown, the costs – as a share of our national wealth – are actually set to fall over coming decades, not to increase. There is no justification either for the higher contributions demanded by the Chancellor. If you need to raise extra money what about tackling the 10 billion pounds given out each year in pensions tax relief for the richest one per cent of the population?”

Union leaders said that government austerity proposals to reduce pensions and pay coupled with the layoffs of thousands of public sector workers is part of government effort to weaken the public sector and reduce services. “Suffering and misery are the price the government wants us to pay–this is an all out attack on public services,” Serwotka said.