Labor Relations Insight by Phil Wilson
The 2018 Outlook for Unions
I think this year will be one of the most important in the history of the labor movement. That may sound like hyperbole. But hear me out.
2018 already started out weird. January
petition activity is
dramatically lower than the same period last year (around 20% as a write this). Please take that with a huge grain of salt, because it’s not a final number. The brief shutdown impacts the numbers a bit and when you look at 3 weeks of data all kinds of things can skew the totals.
That said, we are comparing petition activity this year against the post-election hangover numbers from 2017. If you compare the first three weeks of 2018 to the same period in 2016, RC petition activity is
down about 30%. It is safe to say that unions are not shooting out of the gate doing a lot of new organizing in 2018. At least not yet.
On the ground, however, there is a bit of a different story. Pre-petition activity is happening in some unusual places, and in unusual workplaces. Unions are trying all kinds of new ways to attract attention of workers. Not all of these efforts make a lot of sense. I spend a lot of time these days scratching my head and asking, “what’s going on here?”
Here’s a few big picture guesses.
- Unions are preparing for a post-Janus world:Soon the Supreme Court is expected to deal a huge body blow to unions by cutting off the forced-dues spigot for public sector workers. Notwithstanding all the gnashing of teeth over NLRB decisions, this one decision will have the biggest negative impact on Big Labor than anything. Unions still represent over 1/3 of public sector workers (versus 6.5 percent of private sector workers).
- Unions are preparing for mid-term elections: Related to item one, I think unions are banking heavily on big wins in the November mid-term elections. Big Labor is hugely important to the fate of Democrats. If they can wrest control of the House and Senate from Republicans (and given the 2016 Presidential election I don’t think any election outcome is out of the question) then perhaps things look different. Their goal will be to make Trump a one-term President, consider this Administration a “blip,” and then start reversing everything in sight. I’m not sure this necessarily gets them very far, since unions didn’t really make a lot of progress under a very favorable Obama-era NLRB. But they certainly would prefer that outcome to one in which the Republicans remain in effective control of all three branches of government.
- Unions are focusing on state and local efforts: With all the pixels spilled on what’s happening (or not happening) at the national level, unions are making significant gains at the state and local ballot box. Missouri has a huge vote its new Right to Work law coming up. Paid leave, minimum wage, pay equality, and many other employment regulations are getting passed in states and local communities everywhere. And unions and their supporters are also banking on backlash against the general economic trends here and around the world. While wages are rising along with the stock market it is not clear that either of these will have a big impact on the income gap. It’s not hard to imagine the same populist wave that brought Trump to the White House taking a hard-left turn.
Why do I think this year is going to go down as a big one for organized labor? Janus will create a huge financial reckoning for unions. All of the so-called leaders of the union movement who are just hanging on, hoping to get to retirement will face the music. Some of that already happened when Trump arrived, but Janus will be a whole other order of magnitude. Unions are about to be forced to change in a way they never have before. The bottom is dropping out.
But every action gets an equal and opposite reaction, and the pendulum just seems to swing wider and faster every year. Desperate times will create a lot of opportunity for entrepreneurial (#ironic) organizers and true leaders of organized labor. Unions aren’t going away. I don’t know exactly what that means. But I’ll definitely be watching it carefully.
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Union Bailout Update
In our November INK Insight article, Phil highlighted key areas that he either expected the newly constituted board to focus on or suggested that they should. As retiring board member Miscimarra’s term rolled to an end, several of those wish-list items can be checked off the list.
In mid-December, the NLRB
overruled Lutheran Heritage, a 2014 decision involving workplace civility rules, and issued a new test. When analyzing attacks on handbook rules and policies, the board will now seek to “ensure a meaningful balancing of employee rights and employer interests.”
Although the Supreme Court
declined to weigh in on joint employer, the NLRB announced that the 2015 test implemented by the Obama board would be dropped, and the
board will revert to requiring a finding of direct and immediate control in order to claim that two entities are joint employers
The board also dealt with
employer stability after the expiration of a collective bargaining agreement, confirming that merely continuing a past pattern of unilateral changes following the expiration of a CBA neither disturbs the
status quo nor creates an obligation to bargain with the union.
The board also
killed the “micro-units” organizing tactic, overruling the 2011
Specialty Healthcare decision.
Looking forward, the board opened for comment the rule giving workers’ contact information to unions, signalling its
intent to rewrite or rescind it.
Peter Robb, the new General Counsel for the board, signaled his commitment to continue the trend, issuing a 5-page memorandum directing Regional Offices to submit cases to his Division of Advice for review that impact “significant legal issues.” Included in the definition of such issues were Obama-board decisions that either overruled precedent or involved one or more dissents. The memorandum provided 26 examples, and this
article from Jackson Lewis highlighted some of the key ones:
- A finding of joint employer status based on evidence of indirect or potential control over the working conditions of another employer’s employees.
- Concerted activity where the employee engaged in “obscene, vulgar, or other highly inappropriate conduct.”
- Handbook rules regulating or prohibiting: disrespectful conduct, use of employer trademarks and logos, use of cameras and recording devices in the workplace, and confidentiality of workplace investigations. (Robb also signals his overall disagreement with the NLRB’s analysis of employer rules and policies. He directs submission to the Division of Advice “[o]ther rules where the outcome would be different if Chairman [Philip] Miscimarra’s” alternative rules analysis test was applied.)
- Requiring employers that allow employees to use their email systems to allow employees to use those systems to engage in protected concerted activities under Section 7 of the National Labor Relations Act.
- Requiring employers to offer to bargain with the union before imposing discretionary discipline where the union and the employer have not executed an initial collective-bargaining agreement.
- Establishing that the dues check off obligation survives the expiration of the collective bargaining agreement.
- Broadening the circumstances under which witness statements must be disclosed to a union.
- Finding unlawful the failure to give a company-wide wage increase to newly represented employees during initial contract bargaining.
- The range of permissible conduct by union representatives during Weingarten interviews and the application of Weingarten in the drug testing context.
- Cases broadening the circumstances under which an employer may be found to be a “perfectly clear successor.”
And if your company has had an
NLRB charge filed against it, help is on the way. Robb has signaled his intent to reverse the deferral to arbitration restriction imposed by former GC Richard Griffin. The board will need to weigh in on the deferral standard in some future case, but in the meantime it may benefit a company to reference Robb’s intent. Robb is also determined to overturn the 2011 mandate regarding “default” language relating to the violation of a settlement agreement, which triggered a default judgment relating to the underlying charges. This will make settling NLRB charges much cleaner.
In an interesting development, Robb announced to the boards regional directors that he is considering a
restructuring of the field operations of the NLRB, resulting in a smaller number of offices that report directly to the general counsel. Full board approval would be required for such a move, and the merits of such centralization may need to be justified.
Capping off NLRB news, Phil Miscimarra’s replacement appointee has been announced. President
Trump announced John Ring as his nominee to fill the vacancy. Ring now faces Senate confirmation. Ring is a
former partner at Morgan Lewis, where he worked alongside former board member Miscimarra.
Link & Comments
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A Revealing Admission
The possibility of a pro-employee ruling in the
Janus vs. AFSCME case has evoked this
admission from a pro-union media outlet:
"But what if you’re caught in a union that hasn’t been doing a good enough job? What if your union doesn’t communicate much with members, or is mostly invisible, or only reaches out to you when there’s a crisis, or doesn’t fight hard for good contracts, or is too cozy with the boss? Tragically, there are many union locals like this."
The article then goes on to plead with those who “know that workers are better off with a union” to attempt to reach out to their fellow employees, to stem the tide of the disaffected wanting to jump ship. After providing a four-step strategy, the article provides this “fair warning:”
"This approach to bottom-up problem-solving on the job might fly in the face of your union’s way of doing things. Most of our unions have spent decades focused exclusively on collective bargaining and processing grievances. A lot of that work was done by a few “experts,” often behind closed doors, so of course the majority of members don’t feel the union is theirs. In the worst cases, some of our unions don’t even do the minimal job of enforcing contracts. If this doesn’t change, it will be easy for members to quit without a second thought."
The spate of recent right to work laws, the
Janus case, the avalanche of major union corruption stories (see below), and a pro-employee NLRB are forcing some in Big Labor to admit weaknesses in their model (ie. truth) and seek for a way to remain relevant to workers. From the noise coming from labor pundits, expect to see two camps of pro-union activity: one looking for new and innovative ways to be perceived as relevant, and the other focusing on becoming more aggressive at old-school tactics. Neither side will admit there isn’t much use for unions anymore.
As an end cap to this story, the
union membership stats from 2017 show a flat-line picture, with total unionization remaining at 10.7%. Since public employees are the bulk of this total (34.4% of public vs. 6.5% of private-sector employees), an employee-favorable outcome of
Janus could portent a severe decline overall.
Link & Comments
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Follow The (Dues) Money
Each month we provide a tally of new union embezzlement stories (our Sticky Fingers feature), and in recent months we’ve touched on some of the larger scandals, such as
millions siphoned off in the UAW training center charade. A recent Town Hall article pointed to documents that The Detroit Free Press obtained from the Department of Labor listing over
300 union locals in which fraud has been detected in the last two years. The crimes are usually committed by the
local’s bookkeeper, president or treasurer.
Fortunately, unions are subject to a higher level of financial scrutiny at the Federal level than most enterprises, and their own internal audit systems ironically detect most malfeasance. Unfortunately, union officials and members have devised ways to receive illegal financial benefit beyond kleptomania. In Kansas City, Kansas, firefighters
bilked the taxpayers for almost $1 million in pay for hours they did not work through a practice known as “shift trading.” Prominent among the recipients of this largesse are firefighters who receive time off for “union business.” According to the article,
"One fire department captain last year received 52 weeks of paid time off and made nearly $65,000, according to the UG’s [Unified Government] study.
However, the captain is a top official for the firefighter’s union. He said the record 'reveals no abuse as written to and agreed to by' the union and the UG."
As bad as stealing dues money for personal benefit is, spending what is extracted from employees’ paychecks for something that would be blatantly against those employees wishes is equally abusive. Yet every year, unions spend lavishly on a politics and special interest groups that only represent the liberal/left agenda in the U.S. Since 2010, Big Labor has
spent over $1.1 Billion on Democratic candidates and such groups as the Democratic Governors Association, the Center for American Progress, Planned Parenthood and the Clinton Foundation. Since
40% of union members historically vote Republican (and one would assume hold conservative values), spending 99% of such contributions on the opposite side of the ideological spectrum is a travesty, and theft by any other name.
Congressional Republicans are making an attempt to correct Big Labors theft of this type with a bill called the Employee Rights Act (ERA) that would force union officials to secure employee opt-in before their dues are spent on such purposes. Latest reports indicate up to 80% of union members support such a bill, but you can bet Big Labor (and Democrats) will fight it tooth and nail. Much of the AFL-CIO Martin Luther King conference was spent
gearing up for 2018 politics, and in the Iowa governor’s race, almost $2 million has flowed to the Democratic candidate from the SEIU and many of its
out-of-state affiliates. Nothing like
taking the money from hard-working Americans in states other than Iowa to pay for Iowan politics!
Link & Comments
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It’s All Academic
More than a year after the initial election, the NLRB has finally completed a conclusive count in the vote to organize graduate students at Harvard University. The results came out as 1,526 students against and 1,396 in favor.
Despite the fact that more students voted against forming a labor union, the University is
required to hold a new election. This, due to an earlier NLRB ruling that found that Harvard “did not provide a complete list of eligible voters prior to the election.” We should expect the new vote to be held in the coming months.
Link & Comments
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SCORE BOARD
Who are the winners (and losers) of the labor movement? Don't guess, just check the LRI Scoreboard
View this month's scoreboard (archives also located here).
Download a PDF of this month's scoreboard
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SEIU Watch
Things aren’t so hot right now for the Service Employees.
We’ll start with Local 73. After being under a trusteeship for the past year and half, members of the local have filed a
lawsuit against Mary Kay Henry, SEIU President. The lawsuit asks that the trusteeship be removed and that the 25,000 members of the local be allowed to elect their own leadership again. This move came just weeks before Henry reportedly
fired 10 members of the union’s staff after they announced their decision to run for the union’s executive board and top officer jobs.
Dave Regan’s passing out leaflets again for the first time in 20 years. Apparently Kaiser Permanente has announced their decision to
exclude SEIU-UHW from their upcoming negotiations. Who would have thought these two entities could have a more dysfunctional relationship...
And then of course there’s SEIU’s unfortunate involvement in the #MeToo movement. One source from inside the organization says that we should expect more top SEIU officials to lose their jobs over
sexual misconduct allegations.
Link & Comments
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Alt-Labor
Traditional union organizing hardly works anymore. We’ve known this for a while. That’s why we’ve seen the development of worker centers and an increased interest in low-wage (namely, fast food) employees.
But what’s interesting is that, in their efforts to reach their bottom line, unions are doing exactly what they proclaim to rally against. That is, taking advantage of labor laws.
From
a recent Forbes article:
“The term sounds innocuous enough, but it’s legally significant. Worker centers aren’t bound by the same behavioral restrictions and transparency requirements as labor unions–allowing them to operate in a similar fashion to a union while dodging rules that were put in place to rein in excesses. Secretary Acosta has said he wants to examine this labor loophole, and the scrutiny couldn’t come soon enough.”
It will be interesting to watch how these alt-labor endeavors develop over the course of the next year as we continue to have a conservative majority sitting on the NLRB Board.
For anyone interested in a pro-labor perspective on the changing approaches to union organizing, check out
this podcast interview with David Rolf, one of the most well-known union organizers of our time.
Link & Comments
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Teamster Beat
Rome Aloise, IBT International Vice President, has been found guilty of accepting bribes from companies to
negotiate “sham” contracts. That is, to not represent the members that provide the means with which to pay his salary. Aloise has been banned from engaging with the union in any capacity for two years.
In California, Silicon Valley is gearing up “send delivery robots onto sidewalks.” And the Teamsters want to build them. And they want to be the only ones allowed to do so. Go figure.
Read more here.
Link & Comments
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Fight for $15
On January 1, 18 states and 22 U.S. cities
raised their minimum wage. These increases are expected to affect roughly 3.9 to 4.5 million workers nationwide. They will not, however, boost U.S. salaries more broadly, economists say.
What will? Well the answer to that is complicated. That’s why it’s important to acknowledge that there’s more to it than just increasing the minimum wage.
For example, economists expected much more wage growth in general over the last 8 years (post the 2008 financial crisis and recession). But we’ve stagnated. Roberto Pinheiro, senior research economist at the Cleveland Federal Reserve Bank, believes the main reason for that is because
labor productivity hasn’t increased. Unemployment can go down. And wages can go up. But if “firms are not getting more in output per hour from workers,” the pie itself doesn’t grow.
In international news, Korea and some Canadian provinces recently increased their minimum wages. Read about how that’s working out
here and
here, respectively.
Link & Comments
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Auto Workers
The UAW is promising a healthier work environment and better work-life balance to the Tesla employees it is attempting to organize in California. Those employees would be wise to pay attention to the various lawsuits the union is facing across the country.
In Chicago, a Ford plant manager has been accused by 33 women of sexual harassment, and have also claimed that though they repeatedly reported the harassment to company and union officials, they saw nothing done and in fact
experienced retribution for their efforts to expose the predator. When the claim was finally settled, the FBI widened the probe to include all of the Big Three automakers, to examine corruption between the companies and the unions in the form of exchanging money for labor peace.
Two additional lawsuits against the UAW and Fiat Chrysler reiterate the corruption. The lawsuits point to
union officials accepting bribes (or extracting them) for laying off and locking out employees, in violation of the collective bargaining agreement.
Link & Comments
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Labor Around the World
The union outlook in France isn’t much different than the one here in the U.S. One of the country’s biggest unions, Confederation Generale du Travail (CGT), for example, used to be able to bring the country to a standstill when they rallied the troops. Now, their failure to change with the times is creating a discord between the union agenda and the younger generation. Millennials and members of the gig economy don’t appear to be buying what the unions are selling.
Read more here.
Meanwhile in Germany, more than half a million automotive and machinist workers have taken part in
protests organized by IG Metall. They’re calling for a pay increase and fewer mandatory working hours. And when we say “fewer mandatory working hours,” we mean no more than 28. Per week.
We find bigger problems in India where a Hugo Boss supplier is being accused of
forced labor; and millions of workers aren’t acknowledged as employees, but rather
“volunteers.”
Link & Comments
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Sticky Fingers
Current charges or sentences of embezzling union officials:
- Richard D’Antuono – OPCMIA: $300,000
- Russell Gloeckl – Boilermakers: $1,500,000
- Wendy Buch – TCU: $11,957
- Jason Richard – USW: $40,000
- Dana Cope – SEANC: $500,000
- Anthony Edmunds – UAW: $130,000
- Douglas Morin – USW: $7544
- Keith Franzese – SPFPA: $233,334
- Henry Clay Green, Sr. – UNITE HERE: $171,455
- Danny Woodcock – CWA: $300,000
- Brenda Schaefer – NRLCA: $11,595
- Roderick Bennett – ILUNA: $141,335
