Senators file bill banning states from enacting anti-union law

Three US senators–Elizabeth Warren (D-Mass.), Sherrod Brown (D-Ohio), and Kirsten Gillibrand (D-NY)–have introduced a bill that bans  state right-to-work laws.

The bill entitled Protecting Workers and Improving Labor Standards repeals section 14(b) of the Taft Hartley Act which gives states the authority to pass right-to-work laws.

To be clear, right-to-work laws have nothing to do with guaranteeing a job or protecting a person’s right to a job.

The purpose of so-called right-to-work laws has always been to weaken unions by limiting their funding.

“So-called right-to-work laws give corporations the ability to trample workers’ rights and dismantle unions. I refuse to let that happen,” said Sen. Brown. “At a time when Americans are working harder and earning less for the time they put in, we should be making it easier for workers to raise their voices and bargain for better wages and safer working conditions. Right to work is really right to work for less.”

Instead of protecting people’s right to work, these state laws protect free riders who enjoy the benefits and protections of a union-negotiated collective bargaining agreement but don’t want to pay union dues or a fair-share fee to help defray the cost of union representation.

The Economic Policy Institute reports that the impact of right–to-work laws is clear–workers in states that have right-to-work laws are paid 3.1 percent less than their counterparts in non-right-to-work states.

That means that when you take into account all the variables including cost-of-living differences among states, the average worker in a right-to-work state makes $1558 less a year than the average worker in a state that doesn’t have right-to-work laws.

Twenty-eight states have made it harder for workers to have a union by passing right-to-work laws. Sen. Gillibrand said that by making it harder for workers to have a union, those states have lowered wages.

“More and more states are passing harsh laws that make it harder for workers to negotiate for better wages and better treatment. Over the last few decades, this has done enormous damage to our country’s middle class and the communities where they live,” said Sen. Gillibrand. “The Protecting Workers and Improving Labor Standards Act would block so-called state ‘right-to-work’ laws, which have been used to systematically attack and weaken workers’ hard-earned right to have a voice in the workplace and negotiate as a group with their employers. When unions are weak, corporations have enormous negotiating power over their workers, and can keep wages so low that their full-time employees are living in poverty. It’s time to stand up for our workers and push back.”

Sen. Warren said that right-to-work laws have lowered labor standards and the that impact of those lower labor standards will be a topic of discussion during the negotiations on revising the North American Free Trade Agreement (NAFTA).

“The (US) is in the middle of renegotiating NAFTA, which was a bad deal for American workers,” said Sen. Warren. “If we want to protect workers and expect a level playing field in international trade deals, we need to start at home – and that means banning states from imposing restrictions that prevent workers from joining together to fight for their future.”

In addition to Warren, Gillibrand, and Brown, other senators have signed on as co-sponsors of the Protect Workers and Improve Labor Standards Act. They are Maggie Hassan (D-NH), Jeff Merkley (D-Ore.), Edward Markey (D-Mass.), and Tammy Baldwin (D-Wis.).

Rep. Brad Sherman (D-Calif.) said that he plans to introduce similar legislation in the House of Representatives.

“States with ‘right-to-work’ provisions have a stated goal of taking away jobs from other states by weakening unions and therefore lowering wages, only by ending so-called ‘right-to-work’ nationwide can we stop this race to the bottom.  That’s why I have introduced legislation in the House five times over the past decade to end ‘right-to-work’ laws nationwide, and in 2016 secured 48 House cosponsors,” said Rep. Sherman.  “There has never been a more critical time to pass this legislation because working families need a raise.”

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Executive order puts retirement security at risk for some

After meeting with a dozen chief executives of hedge funds and banks, President Trump on February 3 signed two executive orders that Wall Street cheered.

The first one directs the Secretary of the Treasury to recommend a plan for dismantling the Dodd-Frank Wall Street Reform and Consumer Protection Act, which provides the public with some protections against the kinds of reckless speculation and fraud that caused the financial crisis of 2008.

The other effectively eliminates a regulation designed to protect retirees from predatory financial advice. The regulation being eliminated is known as the fiduciary rule, and it requires financial professionals giving retirement advice to act in their customers’ best interest.

“Donald Trump talked a big game about Wall Street during his campaign, but as President, we’re finding out whose side he’s really on,” said Senator Elizabeth Warren in a statement about the executive orders. “Today, after literally standing alongside big bank and hedge fund CEOs, he announced two new orders: one that will make it easier for investment advisers to cheat you out of your retirement savings, and another that will put two former Goldman Sachs executives in charge of gutting the rules that protect you from financial fraud and another economic meltdown. The Wall Street bankers and lobbyists whose greed and recklessness nearly destroyed this country may be toasting each other with champagne, but the American people have not forgotten the 2008 financial crisis, and they will not forget what happened today.”

Before the executive orders were signed, Sen. Warren issued a report on the pernicious practices of some financial professionals who put their own interests ahead of their customers.

According to the report, some agents who call themselves financial advisers routinely steer customers to invest their retirement savings in annuities and other financial instruments offered by companies that reward the advisers with kickbacks such as high fees, fancy vacations, and other incentives.

The Consumer Federation of America also has weighed in on the necessity of protecting retirees from so-called financial advisers who are in effect sales people with a vested interest in steering customers to companies that offer what amount to kickbacks for selling their products.

“Investors who unknowingly rely on biased salespeople as if they were trusted advisers can suffer real financial harm as a result. It is estimated, for example, that retirement savers lose $17 billion a year or more as the result of the excess costs associated just with conflicted retirement advice,” reads a report published by the federation.

Writing for Think Progress, Bryce Covert tells the story of one retiree who trusted a financial adviser with his retirement savings and ended up getting burned.

Phillip Burns, writes Covert, was offered a buyout to retire from his employer. Burns sought financial advice from an agent who said Burns could get rich by investing his $355,000 in a variable annuity.

But the agent didn’t tell Burns that she received commissions from the seller of the variable annuity or that the commissions she received from the annuity company and others totaled $900,000 a year.

The variable annuity that Burns purchased was in fact a risky investment that ended up losing most of its value and costing Burns his retirement security.

Thanks to the work that Sen. Warren had done to shine a light on the kickbacks and other incentives that so-called financial advisers receive from annuity companies and other financial institutions, the Labor Department drafted the fiduciary rule to protect retirees and their retirement security.

After the long vetting process required to enact such regulations, the fiduciary rule was set to go into effect in April; however, President Trump’s executive order indefinitely delays its implementation and instructs the new secretary of labor to review the rule, which means that there is no chance that the fiduciary rule will be implemented.

While Wall Street seemed pleased with the rollback of the fiduciary rule, others were wary of the consequences.

“For many Americans, today’s executive order means they will continue to get conflicted financial advice that costs more and reduces what they are able to save for retirement,” said Nancy LeaMond, executive vice president of the American Association of Retired People to Business Insider.