Subject: Labor Relations Insight: Shawn Fain Hopes Southern Auto Workers Never See This Chart: LRI INK

February 7, 2024

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Labor Relations Insight: Shawn Fain Hopes Southern Auto Workers Never See This Chart

By Phil Wilson

This is the first Insight article Phil has written for INK in a while, and it's a doozy.

I’m not burying the lead. Here’s the chart right up above.


There is a pervasive myth about unions: union workers make more money. This myth is pushed in every organizing campaign. It is the key selling point in Shawn Fain’s “moon shot” to double the size of the UAW by organizing auto workers in the South.


The problem with this myth? It’s false. It’s especially false for manufacturing jobs, the ones Fain desperately needs to organize to save his failing union.

Every year, the Bureau of Labor Statistics publishes its survey of union membership. This year showed that, after two years of “historic” union organizing efforts, unions have managed to shrink their overall union density. In the private sector, union density remained flat at 6%.


Unions predictably blame employers for their inability to move the needle on growing their density. This ignores the fact that the full weight of the federal government, including the President himself, are doing all they can to promote unions.


Unions win nearly 80% of the elections they participate in. This doesn’t count the number of cases where employees don’t ever get a chance to vote because unions coerce companies into recognizing them without an election. After the NLRB’s recent Cemex decision, that win rate is likely to increase since that decision guarantees that even more unions will be imposed without an election.

Why aren’t unions more successful in manufacturing, which is historically the UAW’s bread and butter? The chart above explains a big reason why.


Over the last 15 years, the average non-union worker has made more money than the average union-represented worker. Over the last five years, the wage advantage non-union workers have over unionized ones has accelerated. While the gap shrank slightly this year (more on that below), the fact is clear: non-union manufacturing workers make a LOT more than unionized ones.


In 2023, non-union manufacturing workers made 15.7% MORE than their unionized counterparts. And these non-union workers didn’t have to pay dues. If you back out union dues (the typical UAW private sector member pays 2.5 hours per month, or about 1.5% of their monthly pay), the advantage grows to OVER 17%.


By the way, these numbers understate the advantage non-represented workers have over unionized ones. Why? Because represented workers are concentrated most heavily in larger cities on the East Coast, upper Midwest, and West Coast, where the cost of living is higher than the rest of the country. This means when you compare average wages, union wages get a boost simply because you’re looking at a smaller population (only 6% of the private sector workforce) living in these regions where all workers make more money.


If there is any silver lining, it’s that unions actually gained ground in 2023. That’s a function of bargaining cycles, and it’s not that great news for union members in the long term. One reason the gap between non-union and union workers widened in 2021 and 2022 was because the labor market massively shifted. This was due to the Great Resignation that occurred as we emerged from the pandemic. 


One feature of union contracts is that they are rarely re-opened during the term of the agreement (although a lot of labor agreements were negotiated downward as companies entered the pandemic). This meant that non-union workers, whose companies have a lot more flexibility to adjust as conditions change, were able to quickly benefit as employers raised wages to compete for talent in an increasingly competitive and inflationary labor market. Unionized workers, on the other hand, were mostly stuck in place.


Over the last two years, as these agreements have reopened for new negotiations, unionized employers have needed to catch up to their non-unionized competitors in the labor market. While that accounts for the wage gap tightening in 2023, all it really means is that unionized workers are catching up to the increases that happened 2-3 years earlier for non-union workers. They won’t ever regain the wages they lost to non-union workers in those years, and they continue to fall behind even under these new contracts. Notice that although the non-union pay advantage shrank this year, average union wages still decreased over the gains from last year. Unionized workers are not catching up.


What about the “historic” agreement the UAW achieved last summer after striking Ford, General Motors, and Stellantis? That agreement still leaves UAW members 17% behind non-represented workers. Not only that but tens of thousands of UAW members were encouraged to strike and lost a substantial amount of pay while Fain was trying to make a name for himself as the next Walter Reuther. 


It’s important to remember that the automakers were offering huge pay increases before the strikes. Based on most reports, the strike may have netted UAW workers an additional 5% more than what was on the table before they walked. They undoubtedly could have gotten that without a strike if Fain had spent more time bargaining and less time grandstanding.


The myth that unionized manufacturing employees make more than non-represented ones is just that, a myth. Southern auto workers should take a long, hard look at the chart above before they choose to jump onto the UAW’s sinking ship. They already receive pay and benefits packages that far outpace what the UAW has been able to bargain for its own members. 

Negotiations Grounded: The Boeing 737’s Ripple Effect On Labor Issues

By Kimberly Ricci

We have talked plenty about obstacles that grind union contract talks to a halt. Often, these issues impact initial negotiations after workers vote to be unionized. However, contract renewal efforts have been grounded for a very different reason at a major airline manufacturer. As a result, labor fervor stoked by Shawn Fain’s theatrics during the 2023 UAW negotiations could take a drastic turn, creating a potentially severe labor problem at a time when they least need it.

 

Let’s back up a moment and discuss how Boeing Co. got here.

 

You have undoubtedly seen the headlines about the Boeing 737 Max 9 door problem tied to supplier Spirit AeroSystems. That ominous chain of events began with a January 5th midair door-plug blowout on an Alaska Airlines flight. As of January 6th, the Federal Aviation Administration ordered the grounding of all 737 Max 9s with a plug door while the agency conducts a rigorous process for inspection and maintenance.

 

The last FAA update on January 17 stressed that these aircraft would remain grounded until further notice, and the agency declared, “the safety of the flying public, not speed, will determine the timeline for returning these aircraft to service.” Further, the FAA limited production increases on the 737 until the investigation into the manufacturing process is complete. And this week, the National Transportation Safety Board's (NTSB) preliminary findings pointed toward missing bolts as a critical cause of the incident.

 

It’s only one of several headaches: Boeing is also facing a potential strike by 31,000 Seattle-area machinists represented by the International Association of Machinists and Aerospace Workers (IAM). Contract renewal negotiations between the company and the union were due to begin in early February. As a result of the ongoing investigation, Boeing requested to push talks back to March 8, with the current contract set to expire on September 12.

 

These discussions were already expected to be contentious, given that the union has been grousing for ten years over 2014 negotiations that led to pension freezing. Fast forward to 2024, and the union is demanding 40% pay raises, increased benefits, and improved working conditions.

 

How could this affect negotiations?  

Unfortunately, the door-plug blowout issue adds to tension for a company that has already been dealing with labor shortages in this increasingly weird market. As a result, the incident could give the union more bargaining leverage when talks do begin.

 

Could we see a strike? IAM District 751 President Jon Holden insists, “We don’t take going on strike lightly. But we’re willing to do it.” If that strike does happen, assembly lines for 737 jets will shut down in Washington and Oregon. The IAM is also said to be considering a copycat “UAW stand-up strike” by progressively walking out at more locations.

Amazon's Stance On Labor Law Reporting: Navigating Legal And Regulatory Changes

By Michael VanDervort

In a significant legal move, Amazon has challenged the Department of Labor's (DOL) interpretation of the Labor-Management Reporting and Disclosure Act (LMRDA), specifically regarding "persuader" reports. Historically, the LMRDA requires employers to report if they hire third parties to influence workers' opinions about unions. A longstanding exemption has spared a company’s managers from these reporting obligations, a consensus respected by administrations for over six decades.


However, the DOL's Office of Labor-Management Standards (OLMS) has recently shifted its stance, asserting that internal management activities to discuss unions must also be disclosed. This reinterpretation demands that employers report expenses related to such internal persuasions. Amazon argues this move goes against the clear exemption in the LMRDA and defies a practical understanding of workplace communications.


Amazon's opposition brief, filed on January 31 in the U.S. District Court for the Western District of Washington, contests the DOL's authority to enforce subpoenas for these reports. The company argues this enforcement change is arbitrary and lacks procedural legitimacy, potentially infringing on First Amendment rights and raising privacy concerns. Furthermore, Amazon posits that it has already complied with reasonable information requests, making the subpoena redundant and overreaching.


The crux of Amazon's argument is that the OLMS's new interpretation creates unnecessary burdens for employers, straying from the act's original intent and established practices. This case highlights the tension between regulatory bodies' interpretations of labor laws and companies' operational realities.


Implications for Employers and U.S. Labor Law

Amazon's legal challenge underscores a potentially significant shift in the landscape of employer reporting requirements and labor law interpretation in the U.S. Should the OLMS's interpretation stand, it could broaden the scope of reportable activities, imposing new administrative and operational burdens on employers. This would mark a departure from traditional practices, affecting how companies navigate unionization efforts and communicate with their workforce about such matters.


Moreover, this case may set a precedent for future interpretations of labor laws, signaling increased scrutiny and regulatory expectations for employer-employee interactions regarding unionization. Employers nationwide will be watching closely, as the outcome could redefine the balance between transparency, privacy, and free speech in the workplace.


In conclusion, Amazon's dispute with the DOL over persuader reports is more than a legal battle; it's a pivotal moment that could reshape employer obligations and labor relations in the United States. As the case progresses, its implications for labor law, employer reporting requirements, and the broader regulatory landscape will become clearer, potentially affecting a wide range of stakeholders in the labor market.

Yum or Yuck?

By Phil Wilson

Here's an excerpt from Phil's upcoming book on the Hero Assumption for your reading pleasure.


I’ve told my wife Janet she should put “demotivational speaker” on her LinkedIn profile. “If you’re not cryin’, you’re not tryin’,” she used to prod our daughter when she was growing up–while she was in tears. But it’s not Janet’s fault. She comes by it naturally. She learned her coaching style from her dad.


Some people think the lemonade glass is always half-full. Others see the glass as half-empty. Then there was my father-in-law; may he rest in peace. He was more of an “Is that lemonade or a urine sample?" kind of guy.


When Janet and I found out we were pregnant with our daughter, we were excited to tell her mom and dad. They lived in Florida, so we had to deliver the news by phone. We figured Janet should be the one to tell them. That was our first mistake—she was nervous, and her parents weren’t always the easiest to talk with. Her dad answered the phone. Starting with him was our second mistake. He was an engineer and really smart but sometimes a little slow on the uptake when it came to people stuff.


Janet jumped right in. She made sure her mom was in earshot so they could both hear at the same time, which made things a little awkward from the start. Then she got right to it—sort of. “Well, Phil and I wanted to let you know that I took a pregnancy test. And it came back…,” followed by an awkward silence.


I’ve only had one chance to do a pregnancy reveal, but if I had to do it over again, I wouldn’t bury the lead by talking about the pregnancy test. Because at the end of the awkward silence, Janet just blurted out, “POSITIVE!” Her mom, who was listening in the background, immediately figured out what was happening and started screaming. Her dad confusedly asked, “Positive for WHAT?”


I’m not sure what other conditions her dad thought pregnancy tests identified, but he was definitely thinking more about the urine sample than the full glass!


Some leaders are a lot like my father-in-law, always looking at the glass half-empty (or worse). It’s easy to do. Leaders today–especially frontline leaders–often feel powerless. Squeezed between demands from above and below, they don’t believe they can make a real difference in the lives of those they lead.


Frustrated, stretched-thin, and often burned out, they assume the worst about their teammates. They watch their team like a hawk, waiting for a screw-up they know is bound to happen. They habitually look at the glass half-empty. Some days, it’s lemonade, and other days…well, you get the picture.


Most leaders don’t want to be glass-half-empty types whose approach reinforces a terrible “race to the bottom” culture. They want something more. They want to reap the benefits of their hard work and see their teammates thrive. They want to feel like they matter. And they do.


Yum and Yuck
"There are only two mantras, yum and yuck. Mine is yum."
Tom Robbins 


Novelist Tom Robbins offers a great way to describe the difference between glass-half-empty and glass-half-full leaders. Before I started writing my last book, The Approachability Playbook, I spent a couple of years asking anyone who would listen to me this question (nerd alert): “What do you think is the one leadership ring to rule them all?”

One day, one of my friends replied, “You know, I’m not sure this is the one ring, but a mentor of mine taught me this test he used that would immediately tell him whether someone would be a good manager.” I was all ears.


“He would have the potential manager imagine that a coworker comes up and makes a factual statement they know is flat out wrong,” she explained, “something every employee should know. And then he’d ask them, ‘what’s the first thing that comes into your head?’”


Take a second and imagine this for yourself.


What comes up? Is your first instinct to correct their mistake? To tell them what they got wrong? Did you wonder how they could be so off-base? Deep down, did you think they might not be that bright? That’s the mantra of yuck. That’s what I call the Villain Assumption.

Leaders who make the Hero Assumption believe everyone on their team wants to be great and to do great work. They choose the mantra of "yum." They handle situations like these with curiosity. They wonder, "What are they seeing that I'm not seeing?" They ask questions. “Does this person have the facts right?” They are open to the idea that maybe they’re the one who needs to adjust something. They try to learn.


They see a world of possibility and abundance, not a zero-sum world of limitation and scarcity. Their assumption is ALWAYS that their teammates are smart, capable, and on top of things. When they look at their teammates, they think "yum," not "yuck."


This is a chance to remind your teammates of their talent and how they’ve overcome obstacles in the past. It’s a time to remind them that you believe in them and then pitch in to help in any way you can. Leaders who think "yuck" see this as a failure of someone who just doesn't “get it.”


A boss who makes the Villain Assumption sees someone going above and beyond and thinks, "Yuck, this go-getter is going to show me up or expect some favor in return.” A leader making the Hero Assumption thinks, "Yum," and makes sure this contribution is noticed, celebrated, and appreciated. They make a mental note to remind their teammate of this success in the future when an obstacle gets in their way.


The key to being a great leader? Don’t think “Yuck,” think “Yum.”

Tipping The Balance On Tipping Culture: A Contradictory Perspective From Unions

By Kimberly Ricci

There is no shortage of opinions on the practice of tipping in the U.S. The subject can grow quite heated, and the debate – which has included customers feeling conflicted over prompts to tip for carryout food – has introduced "tipping culture" into the lexicon, sometimes as a pejorative.


We are not here today to question why full-service food servers prefer the tipping system. That seems obvious, and in some states, servers have even pushed back on legislation to raise the tipped wage because this would reduce their tips and overall take-home pay. The tipping of servers is so customary that the practice is here to stay, although some restaurants have attempted to reverse the trend without much success. We will, however, discuss why unions are eager to spread tipping elsewhere.


Tipping is a complex issue that should be treated with nuance, yet it's not all roses and sunshine, as unions would love to claim.

The ugly U.S. history of tipping: The origins of tipping are actually rather awful and have been summarized within the New York Times as a "legacy of slavery." Similarly, progressive publication New Republic has called tipping "immoral," while Labor Notes has noted how tipped workers are more vulnerable to sexual harassment by clientele.


Unions appear to ignore such history, and in fact, they aim to expand the practice far beyond full-service restaurants:

Why the support from unions? Tipping is a no-risk ask from unions, who will claim credit for the "win." Unions could also benefit, depending on how dues are structured, from workers' higher overall pay as a result of tips. That detail is tricky, too, because it's unclear how much Starbucks Workers United (an SEIU affiliate) benefits from tips, given that the union's website states that dues are calculated differently by region. Some unionized cafes might pay dues at flat rates from full-time vs. part-time workers, whereas some SEIU locals in various industries take a percentage of earnings as dues. In the latter case, tips would certainly increase dues revenue for unions.


And the red tape: The Department of Labor holds a complex set of rules for employers to follow for tipped workers regarding reporting and taxation. Granted, these protections should exist to protect against wage theft, an accusation from Waffle House servers who have joined a class action lawsuit to claim that the restaurant hasn't compensated servers for non-tipped work hours to bring them up to minimum wage.


This Waffle House controversy aside – the company is also a target of the fledgling, SEIU-affiliated Union of Southern Service Workers, who have lobbied for $25 per hour wages plus tips for servers – it's clear that unions are not acting selfless in attempting to spread tipping around as much as possible. They intend for tips to improve recruitment, which adds up to more union dues.

February 2024 Leadership Development Carnival

By Michael VanDervort

Hey everyone, welcome to the party! LRI INK is super excited to be your host for the February 2024 Leadership Development Carnival. It's like a festival of ideas here, with leadership gurus from across the globe dropping in to share their two cents on everything cool and critical – leadership, productivity, development, making team magic happen, and more! So, pull up a chair, and let's dive into some seriously good reads that'll get you thinking, doing, and maybe even changing the game at your place. Let's get this carnival rolling!

Yum or Yuck? - by Phillip Wilson

Some leaders are a lot like my father-in-law, always looking at the glass half-empty (or worse). It’s easy to do. Leaders today–especially frontline leaders–often feel powerless. Squeezed between demands from above and below, they don’t believe they can make a real difference in the lives of those they lead.

4 Strategies to Remove Fear from Your Leadership - by Randy Conley

A recent survey reported that 33% of managers lead with fear. Is that you? In this post, Randy Conley shares four strategies you can use to remove fear-based tactics from your leadership.

What is Values Leadership and Why Do We Need it More Than Ever? - by Naomi Caietti

Five generations in the workforce today. Organizations have an opportunity to improve productivity, retention, and satisfaction from their team members working in a virtual/hybrid environment. Learn more about the importance of values leadership for your leaders and how it will benefit your business goals and outcomes.

How to Strengthen the Mind to Deal with Uncertainty - by Marcia Reynolds

You can help others be more comfortable with an unknown future. Ask these seven questions to relieve stress when the fear of not knowing takes over.

 

Sub-Optimized - by Julie Winkle Giulioni

In our quest for constant productivity, it's easy to overlook the quieter moments that spark true innovation. Explore the concept of strategic sub-optimization and how making room for the unexpected can enrich our professional and personal lives.

Why it Matters that "Authentic" is Merriam-Webster’s Word of the Year - by David Grossman

With the rise of artificial intelligence, the quest for authenticity has only grown. But people’s understanding of authenticity naturally varies quite a bit, driving people to search for official definitions. Read on to see how this impacts leaders.


"Learning in the Flow of Work" for Leaders - by Sara Canaday

Sara Canaday highlights the power of "learning in the flow of work," a vital approach for today's dynamic business environment. She explains, "It’s not just about acquiring new skills; it's about transforming how we absorb, process, and use knowledge in the heat of our daily tasks." This piece encourages leaders to blend learning directly with their daily challenges, promoting a hands-on, adaptive style that enhances growth and leadership in real time.


How Do You Run a Business without Good Data? 5 Ways to Change That - by Jon Verbeck

While it may seem surprising for someone to run a business without looking at numbers, it’s not all that unusual. And while some business owners LOOK at the numbers, they don’t study them in a way to benefit from the information.

Here are some reasons why owners don’t look carefully at the numbers.


Is This the Year You Build a Respectful Culture? - by Chris Edmonds

Your work culture might suck, but even if your work culture is “OK,” changes are on the horizon with demands on business leaders to build and sustain purposeful, positive, and productive work cultures that attract and retain talented, engaged staff.


7 Ways To Improve Your Professionalism - by Bill Treasurer

Professionalism is not just a trait; it’s an art form that can dramatically elevate both individual and organizational success. Learn the 7 characteristics and practical tools designed to elevate your and your company’s professionalism to new heights.


The Psychology of Decision-Making: How to Make Better Choices - by Ray Frohnhoefer

Decision-making is integral to our daily lives, shaping our actions, relationships, and overall well-being. We literally make tens of thousands of decisions every day. However, the decision-making process is complex and influenced by various psychological factors. Let’s explore the cognitive processes, external influences, and personal biases that shape our choices. Moreover, we will explore psychology-based strategies to empower individuals to make better decisions in diverse aspects of life.


4 Ways to Convert Values into Behaviors - by Mary Ila Ward

Set Expectations Based on Values: Design your employee development and evaluation tools around your values and specify observable behaviors that are needed in order to meet and/or exceed expectations. If you are having trouble getting behaviors down or understanding how to put behavior into language, Brown’s reference list of behaviors may help you.


Turning Life's Trials into Triumphs - by John Spence

Life doesn’t get easier or more forgiving. We grow stronger and more resilient. But how do you do that? Here are three practical techniques to help you deal with the challenges and tribulations that you may be facing.


What's More Important, Perception or Reality? - by Frank Sonnenberg

Your character is in your hands. Your reputation is in the hands of others.


This is not the End - by Marcella Bremer

With a new year, we make new resolutions. What are yours? Why is change not easy? Let's start with inspiration from the book, This Is Not the End, by philosopher Jan Drost.


21 Inspiring Quotes About Being Coachable to Make You More Effective - by Sean Glaze

Being coachable is the key to continuous improvement.


Whatever level of success you have achieved, it is likely because you have BEEN coachable in the past… and benefitted from that learning and development.


But where you are now – what you will be dealing with in the future – requires that you (and your team) be able to unlearn and relearn and move beyond complacency.

Finding Solutions to Burnout - by Brenda Yoho

Burnout is not a sign of weakness; rather, it's a testament to the passion and dedication we bring to our roles. It's a signal that we've been pushing ourselves to our limits in pursuit of excellence. Acknowledge this moment not as a setback but as an opportunity for growth and self-discovery. The relentless pursuit of positivity in leadership circles often leaves individuals feeling unseen, invalidated, or even deficient when faced with challenges or expressing genuine concerns.


AI Needs EI: It's About the People - by Priscilla Archangel

AI technology will improve in the future, and we’ll all be able to increasingly use it in a variety of ways. But the uniqueness of emotional intelligence remains unparalleled in fostering genuine human connections. Organizations must integrate EI to effectively manage AI applications. Even in the realm of technology, it is still all about the people.


How do you defeat the power of apology: Explanations or excuses? - by Diana Peterson-More

We all make mistakes. According to the University of Texas, at least three, and usually five to seven an hour. This post explores how the power of a simple apology does the trick, and by adding an explanation, it's frequently read as an excuse. And excuses are like putting a "but" in the middle of a sentence. It negates the preceding comment.

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About Labor Relations Institute

LRI exists to help our clients thrive and become extraordinary workplaces. We improve the lives of working people by strengthening relationships with their leaders and each other. For over 41 years, LRI has led the labor and employee relations industry, driven by our core values and our proven process, the LRI Way.

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