NLRB upholds workers’ right to form minority unions

The National Labor Relations Board on January 7 affirmed that workers have the right to form minority unions as long as the unions meet a long-established criteria for determining what constitutes an appropriate collective bargaining unit.

The ruling resulted from an appeal by Macy’s department store regarding a decision by the NLRB’s general counsel.

The general counsel last summer upheld a ruling by the NLRB’s Region 1 that 41 sales people in the fragrance and cosmetics department of Macy’s store in Saugus, Massachusetts constituted an appropriate bargaining unit even though the employees in the fragrance and cosmetics department were a minority of the store’s sales force.

Macy’s appeal was a response to an organizing campaign at its Saugus store.

United Food and Commercial Local 1445 had tried unsuccessfully to organize the sales staff at the store.

After the union suffered a union representation election defeat, it decided to continue its campaign by seeking bargaining status for a minority union in the store.

The fragrance and cosmetic department in the store was one department where the union thought it had a solid base of support.

The workers in that department subsequently petitioned for a union election.

The company asked the NLRB’s Region 1 to reject the petition because the fragrance and cosmetic department wasn’t an appropriate bargaining unit; the only appropriate bargaining unit, according to Macy’s, was the entire sales force.

Region 1 disagreed. According to Region 1, the sales personnel in the fragrance and cosmetic section were a distinct department within the store managed by a supervisor who didn’t manage other sales departments. As a result, the employees within the department were a readily identifiable group who shared a community of interests, which made them an appropriate bargaining unit.

After Region 1 made its ruling, the union representation election was held, and the workers voted to join Local 1445.

After the victory, the workers thought that Macy’s would sit down with them and bargain for a first contract.

Instead, Macy’s refused to bargain, which led the union to file an unfair labor practices charge with the NLRB.

In its response to the charge, Macy didn’t deny that it refused to bargain with the union, but argued that the minority union wasn’t an appropriate bargaining unit; consequently the company shouldn’t be required to bargain with it.

The NLRB’s General Counsel and the board itself subsequently upheld the ruling of Region 1.

In its ruling handed down on January 7, the board said that Macy’s “has violated Section 8(a)(5) and (1) of the (National Labor Relations) Act” and ordered the company “to bargain on request with the union.”

In making its Macy’s ruling, the NLRB applied the same standard about minority unions that it made in 2011 when it ruled that nursing assistants at Healthcare Specialties in Mobile, Alabama constituted an appropriate bargaining unit even though the nursing assistants were a minority of the workforce at Healthcare Specialties, a company that operates assisted-care living centers.

The NLRB’s Healthcare Specialties decision raised the hackles of business interests and caused them to launch a concerted public relations campaign to overturn the board’s decision on minority unions and to discredit the board.

Among other things, business lobbied successfully to get legislation introduced in the US House of Representatives that would nullify the board’s decision on minority unions.

Business argues that allowing minority unions will lead to a proliferation of fragmented bargaining units that will have to be dealt with separately creating a nightmare management problem that will result in higher administrative costs, which, of course, will have to be passed along to customers.

But there may be another reason that business is so perturbed about the possibility of dealing with minority unions: if minority unions successfully negotiate a fair collective bargaining agreement, other workers in the same company may decide that they want to join a union too.


Big tent coalition fights fast track for unfair trade deal

At a January 8 media conference in Washington DC, a broad coalition of groups announced that they would work together to prevent Congress from granting the Trans Pacific Partnership (TPP) trade deal fast track authority.

TPP, a trade agreement between 12 countries in the Pacific Rim, is in the final stage of negotiations, and once the negotiations are complete, President Obama will ask Congress to grant itself fast track authority, which means that there will be little opportunity for members of Congress to carefully review the terms to the complex deal or to offer amendments to it.

Robert Reich, former Secretary of Labor under President Clinton and now economics professor at the University of California Berkeley, recently called TPP an impending disaster designed to expedite “a global race to the bottom” by “giving big corporations and Wall Street banks a way to eliminate any and all laws and regulations that get in the way of their profits.”

The coalition opposing fast track authority for TPP, which Communications Workers of America President Larry Cohen called “a big tent coalition,” includes more than 100 labor, community, religious, gay and lesbian rights, consumer, and environment groups that represent tens of millions of Americans.

“All these diverse viewpoints are united,” said Rep. Rosa DeLauro at the media conference. “They are united in their opposition to fast track, a policy that is designed to ram trade deals through the Congress without serious debate or opportunities to amend.”

At the media conference, representatives of some of the coalition members explained why they opposed fast track authority for TPP.

“We know from Catholic sisters in Central America and Mexico that these trade deals (such as NAFTA and CAFTA) create a huge imbalance (in these countries) especially in rural communities,” said Simone Campbell of the Catholic Social Justice Lobby and organizer of the Nuns on a Bus social justice tour.

Campbell said that these imbalances have destroyed local economies, which in turn has led to a breakdown in social cohesion and increased misery.

Negotiations for trade deals “are often fixed on business interest, and they don’t think of the rest of the impact on society,” said Campbell. “The faithful way forward is to have a full disclosure where other points of view, not just those of business and economic interests are heard.”

“TPP if rushed through Congress will threaten our air, water, and communities,” said Debbie Sease of the Sierra Club.

One of TPP’s mechanisms for settling disputes is an example for how the deal could degrade our environment.

Corporations that think that environmental and other regulations may hurt future profits can sue national governments to recover damages. Their suit would be heard by a secret tribunal at the World Trade Organization.

The threat of such suits may prevent countries from passing laws that protect their environment and may cause countries to weaken existing laws, such as laws in the US that protect clean water and air.

Tony Corso of Food and Water Watch said that TPP will make it more difficult to inspect imported food. The US’s food inspection system for both internally produced and imported food is already overburdened, and an influx of imported food resulting from TPP will completely overwhelm the system, said Corso.

CWA’s Cohen said that over the last 30 years wages in the US have stagnated and that NAFTA and other trade deals are partially to blame for this stagnation.

TPP, which will be the largest trade deal ever negotiated, will encourage more US corporations to ship good paying jobs abroad and that will make it harder for workers here to get the kind of wage increases they need to maintain or in many cases recover a decent standard of living.

Workers don’t deserve another “raw deal” like NAFTA, which resulted massive job losses and caused the decline of local communities such as Detroit, whose auto industry was especially hard hit by NAFTA, continued Cohen.

Cohen also said that unions are prepared to work with its coalition partners in every Congressional district in the US to demonstrate the broad opposition to TPP.

We won’t be acting separately as labor or environment or consumer groups; we’ll be acting together as concerned citizens who want a global economy that works for all of us, not just a few of us, said Cohen.

The coalition’s first action will be nationwide call in on January 26 where supporters will be calling their members of Congress and urging them to oppose fast track authority for TPP.

Social Insecurity by James Russell: A review

Last year, Boeing workers in the states of Washington and Pennsylvania voted to eliminate their pension plans. As a result of the vote, vested Boeing workers will see their pensions frozen. The Boeing pension plan was replaced with a 401(k) type savings plan.

In exchange for giving up their pensions, workers in Washington were promised steady work through 2024, and workers in Pennsylvania received a substantial wage increase.

The scarcity of good paying, steady working class jobs may explain why Boeing workers chose to trade their pension for immediate benefits.

But as they get older and their retirement grows closer, they may come to regret their decision.

That’s how James Russell felt when he began thinking about retirement.

Early in his career, Russell, a sociology professor at Eastern Connecticut State University, had a choice to make about which retirement plan to choose.

He could enroll in a defined benefits plan that would pay him a guaranteed amount for life based on salary and years of service when he retired, or he could enroll in an individual savings plan similar to a 401(k) plan.

He chose to enroll in the 401(k) type plan.

When he started to consider retirement in the 1990s, he did the math, and realized that he had made a mistake.

“I was shocked to find out that even in a bull market, I would receive less than half of what people in (the State of Connecticut’s public employee) pension plan would receive, and my employee contributions were more than double theirs,” writes Russell.

According to Russell, disingenuous sales pitches and a plethora of misinformation about 401(k) and similar individual savings plans caused him to make his bad decision.

Russell writes critically about his own experiences with 401(k) type plans and their shortcomings in his book, Social Insecurity: 401(k)s and the Retirement Security Crisis published by Beacon Press.

Russell wasn’t the only one dissatisfied with their 401(k) type plan, and many of these dissatisfied Connecticut public employees banded together to launch a movement that succeeded in getting the state to allow them to convert their savings plans into one of the state’s defined benefit pension plans.

Social Insecurity also tells the story of this successful movement, which Russell played a key role in building. Russell’s account of this movement contains some useful lessons for anyone engaged in fighting for economic justice.

Russell’s book is divided into three sections. The first five chapters provide background about the rise of 401(k) plans and the misleading way that they’ve been sold to the public.

He like many others chose a 401(k) type plan based on what he says were “manufactured myths.” According to Russell, people were told erroneously that 401(k) plans produce higher rates of return than traditional pensions or Social Security, that 401(k) plans are cheaper than traditional pensions, that Social Security is going broke, and that public pensions are unsustainable.

Furthermore says Russell, the rise of 401(k) plans had nothing to do with making working people’s retirement more secure and everything to do with diverting secure retirement fund money into revenue streams for private insurance, investment, and financial services firms.

The second part of the book focuses on how the rosy narrative about 401(k) plans began to unravel.

To tell this story, Russell traveled to Chile, a country which during the Pinochet dictatorship, replaced its social security program with a 401(k)  type plan called AFP.

According to Russell, who interviewed Chilean pension experts critical of the conversion, the weaknesses of Chile’s AFP became evident in the early 2000s as people began to retire under the plan and their expectations of retirement security failed to materialize.

Russell cites the findings of a study published by Chile’s National Center for Alternative Development (CENDA, its Spanish acronym).

According to the study, growth rates for individual AFP accounts were much lower than projected, retirees on average were receiving about half of what they would have under the old social security system, many, especially those working in the informal economy, had no AFP savings, and women who retired under AFP received much less than men.

The shortcomings of the AFP led to reforms in 2008. While AFP accounts were kept in place, the government created a fund that makes payments to retirees whose AFP annuity was inadequate. Those without an AFP account also received basic pension payments.

In all, about 60 percent of Chileans now receive some kind of government payment either to supplement their AFP or because they had no AFP account.

The third part of Social Insecurity, describes how some Connecticut public employees succeeded in converting their individual savings plans into a defined benefit pension plan.

Russell played a key role in building this movement. Here are some important lessons about movement building learned from Russell’s account of the struggle for conversion.

  • Persistence pays off: It was a long time between when Russell first started talking to people about converting to a defined benefits plan and the birth of the movement to do so. It took the financial crash of 2008 to get people to listen to and act on what Russell was saying, but his persistence paid off.
  • Good research is important: Before Russell started talking to people about conversion, he researched the subject rigorously.  His research gave him credibility among his peers and was key to getting his union to back his cause. Most important though, special interests that wanted to prevent conversion were never able to refute his research.
  • Build a broad base: By reaching out to his fellow employees, Russell was able to transform his outrage about retirement insecurity into a movement that made real change possible.
  • Communicate and listen to the base: Russell kept in constant touch with employees who signed up for his e-mail list. This contact was an important factor in rebutting misinformation. It also provided him with a way for recognizing and responding to concerns of his supporters.
  • Don’t be afraid to practice union democracy but don’t assume that union leaders are your enemy: It took Russell and the voices of other rank and file union members to get their unions to make conversion a bargaining priority. Union leaders weren’t always ardent supporters of conversion, but once conversion became a bargaining priority, the leadership fought hard to achieve it.
  • Learn to deal with setbacks: When the state finally agreed to allow conversion, a last-minute glitch postponed the conversion and almost derailed it. Those who had fought for conversion dealt with this setback and continued to push for it. Their tenacity resulted in victory.