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The Missing 3 Million

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jonathan-tasiniI remain in the camp of people who are entirely unimpressed by the economic figures raved about by most pundits, economists and The White House. We all know that pay is not growing. But, there’s another thing to be concerned about: the missing 3.1 million workers. The rebound fans:

The American job market rebounded in April, the government said on Friday, helping to ease worries that the economy was on the brink of another extended slowdown after a bleak winter in which the overall economy stalled. But the growth in jobs failed to translate, once again, into any significant improvement in pay.

Uh, but wait a minute. What about a whole bunch of people who are off the radar screen? The Economic Policy Institute is hunting for the “missing workers”:

In today’s labor market, the unemployment rate drastically understates the weakness of job opportunities. This is due to the existence of a large pool of “missing workers”—potential workers who, because of weak job opportunities, are neither employed nor actively seeking a job. In other words, these are people who would be either working or looking for work if job opportunities were significantly stronger. Because jobless workers are only counted as unemployed if they are actively seeking work, these “missing workers” are not reflected in the unemployment rate.[emphasis added]

What’s the number today?:

Total missing workers, April 2015: 3,140,000 Unemployment rate if missing workers were looking for work: 7.3%[emphasis added]

Which would mean the real unemployment rate–and I’m even leaving out the people who would like full-time work but can’t find it (but are counted as “employed”)–is double what the official number tells us. – See more at: http://www.workinglife.org/2015/05/08/the-missing-3-million/#sthash.m22tUoHe.dpuf

This blog was originally posted on Working Life on May 8, 2015. Reprinted with permission.

About the Author: The author’s name is Jonathan Tasini. Some basics: I’m a political/organizing/economic strategist. President of the Economic Future Group, a consultancy that has worked in a couple of dozen countries on five continents over the past 20 years; my goal is to find the “white spaces” that need filling, the places to make connections and create projects to enhance the great work many people do to advance a better world. I’m also publisher/editor of Working Life. I’ve done the traditional press routine including The Wall Street Journal, CNBC, Business Week, Playboy Magazine, The Washington Post, The New York Times and The Los Angeles Times. One day, back when blogs were just starting out more than a decade ago, I created Working Life. I used to write every day but sometimes there just isn’t something new to say so I cut back to weekdays (slacker), with an occasional weekend post when it moves me. I’ve also written four books: It’s Not Raining, We’re Being Peed On: The Scam of the Deficit Crisis (2010 and, then, the updated 2nd edition in 2013); The Audacity of Greed: Free Markets, Corporate Thieves and The Looting of America (2009); They Get Cake, We Eat Crumbs: The Real Story Behind Today’s Unfair Economy, an average reader’s guide to the economy (1997); and The Edifice Complex: Rebuilding the American Labor Movement to Face the Global Economy, a critique and prescriptive analysis of the labor movement (1995). I’m currently working on two news books. My organizational life has brought me the gift of working with many talented, committed people over the past 30 years, principally during the 13 years I had the honor to serve as president of the National Writers Union (UAW Local 1981). Aside from that, it’s baseball, and counting the winter days until pitchers and catchers report.


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Your Manicurist is Likely Being Paid Illegal Starvation Wages

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Ariel ZiontsAfter investigating 150 nail salons over 13 months, New York Times reporter Sarah Maslin Nir found that “manicurists are routinely underpaid and exploited, and endure ethnic discrimination and other abuse.” The findings are presented in a long-form multimedia story and offered in English, Spanish, Korean and Chinese.

Nir followed manicurists who, after leaving their cramped living arrangements, hop into vans that shuttle them to nail salons in the city and even into different states. When they first begin work, many are forced to pay a training fee of around $100-$200, sometimes more. Many remain unpaid during an “apprenticeship period” until they can prove they are skilled enough to deserve payment, but this payment is usually below minimum wage.

Twenty-one-year-old Jing Ren’s story illustrates this process. She paid $100 in a training fee, then worked three months without pay before earning a wage of less than $3 an hour.

Because nail salon workers are considered “tipped workers” under state and federal labor laws, they can be paid below the state’s $8.25 minimum wage; employers are required to make up the remainder of the worker’s pay if their hourly rate comes out to below minimum wage. The investigation found that bosses rarely provide that legally mandated supplemental pay. Overtime pay is similarly rare for manicurists, who may work up to 12 hours a day, seven days a week.

Nir also found that manicurists’ pay is often taken away for minor transgressions. When 47-year-old Qing Lin spilled a drop of nail polish remover on a client’s Prada sandals, she was forced to pay for damages and fired from the salon she worked at for 10 years. “I am worth less than a shoe,” she stated.

Pay also can correlate to ethnicity. Nir found that Koreans are paid the most, followed by Chinese and Latino workers. Non-Korean workers Nir spoke with are sometimes prohibited from speaking and forced to eat in a separate location. Other documented abuses include workers being monitored on video, physical and verbal abuse and poor safety standards that lead to cancer and miscarriages caused by exposure to chemicals and dust.

Nail salon owners are rarely investigated or punished for their labor violations. New York’s Department of Labor investigates a few dozen—around 1%—of the over 3,600 salons in the state per year. When investigated, the department finds wage violations 80 percent of the time. The Times said all but three of the more than 100 workers they interviewed have had wages withheld in illegal ways.

Because many manicurists are undocumented and are often unaware of labor laws and speak limited English, many do not report on their bosses’ illegal activities.

Nir is hosting a Facebook chat on Monday, May 11 at 1 PM EST. Participants are asked to submit questions ahead of time. If you want an ethical manicure, the Times has tips on that.

This blog was originally posted on In These Times on May 7, 2015. Reposted with permission.

About the Author: The author’s name is Ariel Zionts. Arielle Zionts is a Spring 2015 In These Times editorial intern and freelance reporter. In August she will join the Interfaith Voices radio show as a producer. She studied anthropology at Pitzer College and radio at the Salt Institute for Documentary Studies. Arielle loves to ride her bike and listen to public radio. She tweets at @ajzionts and her website is ariellezionts.com.


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New York wage announcement is a bold step forward, will strengthen economy for all of us

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Mary Kay HenryGovernor Cuomo announced yesterday that he’ll use state law to impanel a Wage Board to examine the minimum wage in the fast-food industry.

The fast-food cooks and cashiers who started the Fight for $15 movement are showing how ordinary people make change happen when they stick together.

Governor Cuomo’s move to set a dramatically higher standard for how people who work in fast food are paid is a bold step forward. It shows that a $15 wage floor can be a reality. It’s an inspiring change not just for working New Yorkers, but for working people across the country.

More and more Americans and our elected representatives are standing up to say that it’s time to stop profitable corporations from paying wages so low that they trap people in poverty.

By using our strength in numbers, the workers and families of the Fight for $15 movement are sending a message that raising wages to $15 will boost the economy, create more opportunity, and build a more balanced economy.

This blog was originally posted on seiu.org on May 7, 2015. Reprinted with permission.

About the Author: The author’s name is Mary Kay Henry. Mary Kay Henry serves as International President of the Service Employees International Union (SEIU), which unites 2 million workers in healthcare, public and property services. Henry has devoted her life to helping North America’s workers form unions and strengthen their voice at work about the quality of the goods and services they provide, and the quality of care they are able to deliver.


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For Women In This State, Getting Pregnant Will No Longer Mean Losing A Job

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Bryce Covert

On Tuesday, the New York State legislature passed a bill aimed at shielding pregnant women from workplace discrimination, which the governor has said he will sign. The new law will require employers to give pregnant workers accommodations so they can stay on the job unless the employer can show it would create an undue hardship. Those changes can be as small as a stool to sit on or more frequent bathroom breaks, and can also include light duty for women with lifting restrictions or other work transfers. Across the country, an estimated quarter million women are denied these requests every year, which means they often end up pushed onto unpaid leave, fired, or experience health complications including miscarriage. Many more women don’t even ask for accommodations because they fear retaliation.

Existing laws, the Pregnancy Discrimination Act and Americans with Disabilities Act, should in theory protect pregnant women from discrimination. And in fact, the Supreme Court recently ruled in favor of Peggy Young, a woman suing UPS over its refusal to give her light duty when she became pregnant. That ruling helps bolsters women who need accommodations, but its impact is likely to be limited. “To get an accommodation under the Supreme Court’s standard in Young v. UPS, pregnant workers must navigate a long, convoluted, and costly process to prove discrimination,” Dina Bakst, co-president of advocacy group of A Better Balance, told ThinkProgress. “Most women simply don’t have the luxury of time or the resources to make that happen.”

Instead, laws like New York’s make things clear from the outset, before women are pushed onto leave or fired. Women “just need clear law when they ask for a minor adjustment at work so they can stay healthy for a few months,” Bakst explained. More and more women will need these adjustments, as the share of first-time mothers working while pregnant has shot up from less than half in 1960 to two-thirds today, and 80 percent keep working into their last month.

New York’s new law could come to the aid of women like Betzaida Cruz Cardona, who lives in Henrietta, New York and is suing Savers, her former employer, for firing her from her cashier job hours after she handed in a doctor’s note stipulating she couldn’t lift more than 25 pounds even though she was never required to do so. She says she has since become homeless. While she argues that the company violated existing federal law, things could have been easier if she lived in New York City, which already has a Pregnant Worker Fairness Act on the books that would have made it clear that her employer had to accommodate her needs.

Eleven other states have also implemented laws requiring reasonable accommodations for pregnant employees. A federal bill that would cover all women has been introduced in Congress multiple times, but it has yet to advance.

This blog originally appeared on ThinkProgress.org on May 6, 2015. Reprinted with permission.

About the Author: The author’s name is Bryce Covert. Bryce Covert is the Economic Policy Editor for ThinkProgress. She was previously editor of the Roosevelt Institute’s Next New Deal blog and a senior communications officer. She is also a contributor for The Nation and was previously a contributor for ForbesWoman. Her writing has appeared on The New York Times, The New York Daily News, The Nation, The Atlantic, The American Prospect, and others. She is also a board member of WAM!NYC, the New York Chapter of Women, Action & the Media.

 


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Joan Would Have Lost Her Sexual Harassment Suit Against McCann Erickson

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millhiser_ian_bioThe following contains spoilers from Sunday night’s episode of Mad Men. The big reveal in Sunday night’s episode of Mad Men was that Sterling Cooper, a company where racist jokes are frequently thrown about and where the company’s only female partner literally earned that partnership because she was prostituted out to a client, is actually a progressive employer by the standards of its era. The episode is the first after Sterling Cooper is absorbed into the advertising behemoth McCann Erickson, and it begins with an African American secretary telling her casually racist boss that she won’t be going over to McCann with him because “advertising is not a very comfortable place for everyone.” Yet the highlight of the episode is Joan’s sexual harassment at the hands of a senior member of her new firm, and her eventual decision to take a buyout worth only half of her partnership stake in the now defunct Sterling Cooper rather than take McCann to court. (Joan, of course, is the partner who agreed to an indecent proposal from a client). In response to Joan’s fictional experience with sex discrimination, the real-life American Civil Liberties Union (ACLU) urged Joan to contact them in a tweet announcing that “sexual harassment has no place at work!” Yet the sad truth is that, had Joan actually pursued a lawsuit against McCann in 1970, the year when the final half-season of Mad Men takes place, she would have almost certainly lost.

Sunday’s episode focuses on Joan’s increasingly terrible interactions with three male colleagues. Early in the episode, Joan is matched with Dennis, an account executive who botches a call with a client and then dismisses Joan’s feedback (“Who told you you got to get pissed off!”) when she calls him out on his incompetence. Fearful that Dennis will destroy the client relationships that are her only capital within the firm, she approaches Ferg, a more senior colleague, seeking help.

Though Ferg initially presents himself as a lifesaver — he takes Dennis off Joan’s business and promises that she will report directly to him – he soon makes it clear that his real interest in Joan is sexual. Ferg suggests that the two of them travel together to Atlanta to meet the client Dennis upset and tell her that he’s “not expecting anything more than a good time.” Once Joan goes over Ferg’s head, she’s informed that Ferg is a high-status player at McCann and that she needs to fall in line. At first, Joan threatens to bring in the Equal Employment Opportunity Commission (EEOC), Betty Friedan and the ACLU to press her sexual harassment claim, but she ultimately takes what amounts to a settlement offer consisting of only half of what McCann owes her for her stake in Sterling Cooper.

Had Joan sued McCann, she would have relied on a legal theory that wasn’t even in its infancy in 1970. The ban on sexual harassment in the workplace flows from Title VII of the Civil Rights Act of 1964, which forbids employment discrimination because of “race, color, religion, sex, or national origin.” Six years after the law’s passage, however, the courts had only barely begun to grapple with how sex discrimination actually manifests in the workplace, and the term “sexual harassment” didn’t even exist yet.

According to the National Organization for Women, “Cornell University activists coined the term sexual harassment in 1975,” five years after Joan’s fictional harassment took place. The first successful sexual harassment suit was decided in 1976, and that was only the decision of a single federal district judge. The EEOC did not issue guidelines targeting sexual harassment as a kind of sex discrimination until 1980. And the Supreme Court did not recognize Title VII’s prohibition on sexual harassment until its 1986 decision in Meritor Savings Bank v. Vinson.

Had Joan filed suit against McCann, her lawsuit would have preceded all of these legal developments. For that reason, despite her threat to get the ACLU involved, it is unlikely that top-notch civil rights lawyers would have wanted to use her case as the vehicle to try to blaze a new legal trail. When lawyers bring a “test case” seeking to create new law, they typically choose their plaintiff or plaintiffs very carefully, selecting someone with an especially compelling case who is likely to win the sympathy of judges or justices. Bad facts make bad law, and a lawyer who offers a novel legal theory on behalf of a client who experienced subtle or uncertain harassment is likely to not only lose their case, they are likely to create a bad precedent that will harm future plaintiffs.

Here, for example, are the allegations in Vinson, the first Supreme Court case to recognize that sexual harassment suits are viable:

Respondent testified that during her probationary period as a teller-trainee, Taylor treated her in a fatherly way and made no sexual advances. Shortly thereafter, however, he invited her out to dinner and, during the course of the meal, suggested that they go to a motel to have sexual relations. At first she refused, but out of what she described as fear of losing her job she eventually agreed. According to respondent, Taylor thereafter made repeated demands upon her for sexual favors, usually at the branch, both during and after business hours; she estimated that over the next several years she had intercourse with him some 40 or 50 times. In addition, respondent testified that Taylor fondled her in front of other employees, followed her into the women’s restroom when she went there alone, exposed himself to her, and even forcibly raped her on several occasions.

Though Vinson recognized that this egregious level of harassment-becoming-assault violates the law, it set a very high bar for future sexual harassment plaintiffs. “For sexual harassment to be actionable,” Justice William Rehnquist wrote for the Court, “it must be sufficiently severe or pervasive ‘to alter the conditions of [the victim’s] employment and create an abusive working environment.’” The Court also cited favorably to a racial harassment case establishing that the “‘mere utterance of an ethnic or racial epithet which engenders offensive feelings in an employee’ would not affect the conditions of employment to sufficiently significant degree to violate Title VII.”

Ferg’s advances, though clearly inappropriate, did not even approach the egregious level of discrimination that allegedly occurred in Vinson. He began his conversation with Joan by excusing Dennis’s sexism, but ultimately promised to give Joan the professional “respect you desire.” And he propositioned Joan more through innuendo than through the direct demands that allegedly occurred in Vinson. There’s little doubt what kind of “good time” Ferg was looking for, but it would be difficult for Joan to prove that this one incident constituted the kind of “severe or pervasive” harassment Vinson demands.

That’s not to dismiss the reality of Ferg’s harassment of Joan, or to suggest that the working conditions that she faced were anything less than disgusting. But sexual harassment claims are notoriously difficult to win, and even our modern, more developed sexual harassment law is inadequate to combat the kind of harassment women like Joan continue to face in the workplace.

Had Joan filed suit against McCann, she would have been a true pioneer, bringing a novel legal case years before the term “sexual harassment” even existed. She also would have almost certainly lost her case in a legal system that was not the least bit prepared to hear it.

This blog was originally posted on Thinkprogress.org on May 4, 2015. Reprinted with permission.

About the Author. The author’s name is Ian Millhiser. Ian Millhiser is a Senior Fellow at the Center for American Progress Action Fund and the Editor of ThinkProgress Justice. He received a B.A. in Philosophy from Kenyon College and a J.D., magna cum laude, from Duke University. Ian clerked for Judge Eric L. Clay of the United States Court of Appeals for the Sixth Circuit, and has worked as an attorney with the National Senior Citizens Law Center’s Federal Rights Project, as Assistant Director for Communications with the American Constitution Society, and as a Teach For America teacher in the Mississippi Delta. His writings have appeared in a diversity of legal and mainstream publications, including the New York Times, The Los Angeles Times, U.S. News and World Report, Slate, the Guardian, the American Prospect, the Yale Law and Policy Review and the Duke Law Journal. Ian’s first book is Injustices: The Supreme Court’s History of Comforting the Comfortable and Afflicting the Afflicted.

 


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Obama is a step closer to expanding overtime, but for how many American workers?

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Laura ClawsonThe Labor Department is moving ahead with President Obama’s eagerly awaited overtime pay expansion. That’s good news, but we don’t know yet how good. Currently, workers who make as little as $24,000 a year can be denied time-and-a-half if they’re considered managers—even if most of the work they do isn’t managerial. Obama has promised to raise that threshold to cover more salaried workers, but hasn’t said how high it will go, and the fact that the Labor Department has finalized a plan doesn’t change that. Yet:

The full proposal is now under review by OMB officials and won’t be made public for at least several weeks. After it is published, there will be a review period during which interested parties can comment on the proposed rule. The details of the rule are eagerly awaited by employers and worker advocates — not to mention overworked Americans — since they will ultimately determine who receives time-and-a-half pay when they work more than 40 hours in a week.

Just 11 percent of salaried workers qualify for overtime under the current rules. To cover the same proportion of workers who were eligible for overtime in 1975, the threshold would have to be raised from $23,660 to $69,004 ($58,344 if you adjust for increased education). To adjust for inflation since 1975, the number would be $51,168. Any increase will be an improvement that means overtime eligibility for millions more workers—meaning employers can’t save on wages by hiring salaried “managers” and expecting them to stock shelves 10 hours a day—but here’s hoping the Obama administration has chosen a number that will get us back to 1975 by one measure or another.

This blog originally appeared in Daily Kos Labor on May 5, 2015. Reprinted with permission.

About the Author: Author’s name is Laura Clawson. Laura Clawson has been a Daily Kos contributing editor since December 2006. Labor editor since 2011.


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Inside the Case That Could Hold McDonald’s Responsible for Union-busting

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Andrew ElrodThe National Labor Relations Board’s (NLRB) complaint for unfair labor practices against the McDonald’s corporation inched forward in a Manhattan courtroom last month.

Lawyers representing the company, its franchisees, the Service Employees International Union (SEIU) and the government met to discuss the future of a case that could lay the groundwork for union representation and collective bargaining at the country’s largest fast food brand.

McDonald’s “entire business model is put at risk” by the litigation, Jones Day’s Willis Goldsmith told Administrative Law Judge Lauren Esposito during the three-hour hearing. If Esposito finds that the company’s oversight and workforce management policies make it a “joint employer,” as the charging parties contend, it could be held responsible for the working conditions in its franchised stores. Nation-wide, 90 percent of McDonald’s stores are owned by franchises.

During the hearing Esposito required McDonald’s to deliver over 700 documents relating to the structure of the corporation to the government and the union.

“The evidence will show that McDonald’s directed or helped direct how to deal with employees at the franchised facilities in response to protected activities,” said Jamie Rucker, General Counsel for the NLRB.

If the judge found coordination that established joint-employer status, the Board would be able to hold McDonald’s liable for illegally retaliating against workers who engaged in activity protected by the National Labor Relations Act in the Fight for 15 protests and organizing campaign, and eventually to be named as a party in collective bargaining for those stores.

But before that can happen, the board must prove that both McDonald’s and the owners of its franchised stores “share or codetermine those matters governing the essential terms and conditions of employment” or “meaningfully affect” employment issues such as hiring, firing, discipline, supervision and direction of work. The Board believes it can prove joint employer status with information from the shift scheduling software the company provides to its stores, as well as communications between company and individual locations. Evidence and testimonials are to be presented beginning May 26.

“McDonald’s is a complicated company”

While forcing McDonald’s to produce information about the management of its franchised stores, Judge Esposito did revoke subpoenas for information about a corporate-owned restaurant in Illinois. The Board and SEIU had sought the information to compare with management practices at franchised stores, where the company says corporate directives are considered “optional.” If management at both the franchised and non-franchised stores were sufficiently similar, Rucker argued, the “optional” suggestions from McDonald’s could be shown to establish joint-employer status.

Asked about the exact relationship between McDonalds Illinois, the subpoenaed store, and McDonalds USA, the national company, Goldsmith explained that “McDonald’s is a complicated company.”

The Board and the unions also requested details about McDonald’s USA’s corporate structure. But Jonathan Linas, also of Jones Day, explained that finding that information would not be so easy. “There’s no one organizational chart,” Linas said.

“The entire organizational structure of McDonald’s USA will not be produced,” he said. “I don’t know [if] it exists. We’ve been looking a long time and we don’t have one.”

Credible Allegation

The stakes of the proceedings are high and McDonald’s has hired the law firm Jones Day, which oversaw the bankruptcy and restructuring General Motors and the City of Detroit, to lead its defense.

McDonald’s business model in part rests on its exemptions from liability for the working conditions at its franchised stores. But even if these exemptions were to change, it is unclear what the implications for the rest of the fast food industry would be.

First, a finding of joint-employer status would have to survive in federal court, an institution notoriously unfriendly to workers’ collective action. And then it would only apply to the specific locations and conditions named in the complaint.

“As soon as there is some kind of a determination that an employer is a joint employer, the company just restructures the relationship,” says Michael Duff, a law professor at the University of Wyoming who worked at the NLRB for nine years. “And then you get another round of litigation.”

Because the joint-employer status would only apply to franchises named in the consolidated case, Duff explained, organizing campaigns through the NLRB could only occur at those stores. However, he added, an expanded joint employment standard could facilitate organizing at other similar franchises in the future.

“Once you have a broader way of thinking about the employment relationship, it opens up more kinds of workplaces to the credible allegation that this is a joint-employer relationship,” said Duff.

The charging parties are skeptical that McDonald’s workforce management systems can be restructured. Citing an April 2014 statement by then-CEO Dan Thompson, they allege the company has responded to falling profits with a “reset” plan that requires the company to take greater control of staffing and scheduling to maximize in-store revenues.

Guarded Campaigns

In its defense, the McDonald’s is arguing that any coordinated response at its franchised stores against protected activity was lawful-employer free speech, protected under the NLRA.

Under the 1947 Taft-Hartley amendments to the Act, Goldsmith explained, McDonald’s has “the absolute unfettered right to engage in non-coercive free speech in response to attacks on the brand.” Coordination on these grounds, he argued, does not constitute joint-employer status.

To establish its case, McDonald’s subpoenaed information on the internal workings of SEIU’s campaign, including internal documents from the union, the public relations firm Berlin Rosen and two investigative firms.

“We are entitled to find out who they talked to and what they spoke about,” Goldsmith said, referring to one of the investigative firms hired by the SEIU which may have spoken to workers. The union countered that revealing the insides of its campaign would have a “chilling effect” on organizing, as the fast food corporation could threaten those revealed with retaliation.  On Thursday, April 10, Esposito revoked the subpoenas against SEIU and the third parties.

Open-ended future

The pace of the proceedings since workers began protesting in 2012 also gives some sense of the scope of the campaign drive being led by SEIU.

Since November 2012, at least 310 charges of illegal retaliation against workers engaging in protected activity have been filed by workers and their representatives. Over 100 of these charges have been found to have merit, and as of February 13, the Board had filed 19 complaints across 14 administrative regions across the country—offices in Los Angeles, San Francisco, Phoenix, Minneapolis, Kansas City, St. Louis, New Orleans, Chicago, Detroit, Indianapolis, Pittsburgh, Atlanta, Philadelphia and Manhattan. As the protests have continued, so have the unfair labor practice charges filed by the union.

If McDonald’s is found to have coordinated a national response to protesting workers, as the Board is arguing, that could prove that the company exercises more control over the workers in its stores than it claims.

Such a finding would be initially limited and establish a legal basis for collective bargaining at just a handful of stores. However, the finding could facilitate traditional NLRB organizing across the heavily franchised service sector, forcing the company to bargain with workers who opt for union representation.

SEIU has made a considerable investment (“over $18 million at least,” said Goldsmith) in an open-ended campaign with little promise of immediate returns. The current case in front of the NLRB shows that the union is far from guaranteed from obtaining new dues-paying members any time soon, making the union’s investment an incredibly risky gamble—something most unions would be loathe to even consider.

The campaign has sparked a nation-wide movement that has already won minimum wage increases and raised entry-level pay for workers across the retail and fast food industries. Whether that momentum will translate into joint-employer status or fast food worker union membership may depend on the ruling handed down in Judge Esposito’s courtroom.

This blog originally appeared in In These Times on April 29, 2015. Reprinted with permission.

About the Author: The Author’s name is Andrew Elrod. Andrew Elrod is a writer living in New York. He is a contributor and former intern at Dissent, and his work has also appeared in Labor Notes. He is from Texas. Follow him on Twitter at @andrewelrod or reach him at elrod.andrew@gmail.com.


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Democrats Propose Most Ambitious Minimum Wage Bill Yet

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Bryce CovertSen. Patty Murray (D-WA) and Rep. Robert Scott (D-VA) are introducing a minimum wage bill on Thursday that would raise the federal floor from its current level of $7.25 an hour to $12 an hour by 2020, eliminate the lower tipped minimum wage that currently stands at $2.13 an hour, and automatically increase it as median wages rise.

Much of that plan is brand new. Previously, Democrats had set their sights on a minimum wage increase to $10.10 an hour, indexed to inflation thereafter, and only raised the tipped minimum wage to 70 percent of the regular minimum wage.

Sen. Murray said she took inspiration from the state she represents in deciding to get rid of the lower tipped wage. “Tipped workers are most exposed to the ups and downs of the economy. The unpredictability of wages makes it even more difficult to make ends meet, on top of trying to scrape by on low wages. So eliminating the tipped wage is long overdue,” she told ThinkProgress in emailed statements. “Washington state has led the way in this, and we’ve seen that it works for restaurants, businesses, and workers.”

Murray also told ThinkProgress that Washington inspired her to target a higher wage level. “There has been great work done in Washington state and across the country to increase wages even further to help the families and businesses in those communities, and I support those efforts,” she said. Washington has long had the highest wage in the country, which is currently $9.47.

A $10.10 wage would have brought it in line with about where it would have been if it had kept up with inflation since its peak in 1968. But this was, according to economist David Cooper with the Economic Policy Institute who has worked with lawmakers on crafting the $12 wage bill, “the lowest possible threshold for where you could be aiming.” He added, “What you’re saying is that low-wage workers should have seen no material improvement in their standard of living over the last 50 years.” That’s despite the fact that there has been significant economic growth, driven in part by rapidly increasing worker productivity.

Even though the Republican-led Congress is unlikely to take such a bill up, Democrats have recently decided they need to take the debate around the minimum wage further. The new benchmark, Cooper said, is to “return the minimum wage to where the distance between the lower paid worker and typical worker is no greater than it was back then.” If lawmakers use a ratio of the minimum wage to the median wage for all workers, which was 52 percent back in 1968, then a $12 wage by 2020 makes a lot of sense, as it would bring the minimum up to 54 percent of the median wage, which today stands at just over $17 an hour. “It’s essentially returning the minimum wage to the same value it had in 1968 in relative terms,” he said.

Real-life experiments beyond Washington state also help give a higher wage level credibility. The majority of states have now raised their minimum wages above $7.25, and evidence shows that critics of a higher wage who worry about job losses may not have a reason to fear an increase. Last year, job growth wasactually stronger in states that raised their wages than in those that didn’t, and economics have generally found that minimum wage increases have little impact on job growth. Even fears that Seattle’s increase to $15 an hour were making businesses close were overblown. “Places are pushing minimum wages into territory that we haven’t done before, and the sky hasn’t fallen,” Cooper noted.

Democrats may also have been pushed into a higher wage by low-wage workers who organized and staged repeated strikes demanding a $15 minimum wage in the fast food, retail, home care, and adjunct professor industries. “I think the Fight for 15 [movement] started to recalibrate people’s thinking in terms of what the minimum wage could be,” Cooper said. “From a political standpoint and also from a national awareness standpoint, the Fight for 15 just did a fantastic job highlighting how low pay is in a lot of these industries.”

That kind of national movement has paved the way for lawmakers to reach higher. “I think the Fight for 15 has created space for Democrats, for any politician, to come out in favor of a minimum wage in the $12 range and look reasonable,” he noted. While Congress isn’t looking at a federal $15 minimum wage at this point, some cities and states have taken up the call. Seattle and San Francisco have passed wage hikes to that level, and many other cities and even some states are considering doing the same.

This article originally appeared in thinkprogress.org on April 30, 2015. Reprinted with permission.

About the Author: Bryce Covert is the Economic Policy Editor for ThinkProgress. She was previously editor of the Roosevelt Institute’s Next New Deal blog and a senior communications officer. She is also a contributor for The Nation and was previously a contributor for ForbesWoman. Her writing has appeared on The New York Times, The New York Daily News, The Nation, The Atlantic, The American Prospect, and others. She is also a board member of WAM!NYC, the New York Chapter of Women, Action & the Media.


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Malpractice Lawsuit Alleges Flawed Defense Strategy in SOX Whistleblower Case

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jason zuckermanPlayboy has sued Sheppard Mullin for malpractice and is seeking $7.6M in damages for losing a Sarbanes-Oxley whistleblower case at trial “in spectacular fashion.” The complaint alleges that Sheppard did not properly evaluate, or inform Playboy of, the true damage exposure and missed several opportunities to settle the case for a fraction of the policy limits of Playboy’s employment practices liability insurance policy. The SOX whistleblower case was brought by Catherine Zulfer, a former accounting executive who alleged that Playboy terminated her employment for raising concerns to Playboy’s Chief Financial Officer and Chief Compliance Officer about accruing discretionary executive bonuses without Board approval.

The complaint alleges a flawed approach to potential settlement that, in my experience, is fairly typical in employment litigation.

  • About two weeks before trial, Sheppard predicted a 75% chance of defeating Zulfer’s SOX whistleblower claim.
  • At trial, the jury returned a verdict of $6,000,000 in compensatory damages and a finding of malice, oppression or fraud after deliberating only 1 hour and 45 minutes.
  • Playboy’s insurance policy afforded $5,000,000 of coverage above a $500,000 self-insured retention.
  • In August 2013, Zulfer offered to settle for $1M and Sheppard failed to put any pressure on the insurer or on Playboy to settle.
  • Following depositions in November 2013 that were damaging to Playboy, Zulfer’s attorney reiterated the demand of $1M with a willingness to negotiate downward. Sheppard again neither informed Playboy of the increased exposure in excess of policy limits nor advised Playboy to insist that its insurer accept a demand within policy limits.

Sheppard had the misfortune to lose in “spectacular fashion” largely because Zulfer was represented byDavid DeRubertis, a preeminent trial lawyer who has obtained large verdicts in several employment cases.  But the approach to potential settlement Playboy alleges is typical of what I see in hard-fought whistleblower cases.  The playbook usually consists of offering only nuisance value pre-litigation, digging up dirt about the whistleblower that is wholly irrelevant to the merits of the case, making misleading accusations about the whistleblower’s job performance, using discovery to harass the whistleblower, trying to focus the case on the after-acquired evidence defense, and withholding damaging documents until the whistleblower prevails on a motion to compel. The super-charged version of this playbook includes bringing SLAPP suits against the whistleblower and threatening to file a frivolous Rule 11 motion.

While in my experience these tactics often backfire and do not benefit the employer, such tactics generate hefty fees for defense counsel. As big firm attorneys are under increasing pressure to meet high billable-hour requirements, there is little incentive to perform a realistic case assessment or to lean on a client to settle. And in whistleblower cases, the employer often resents the whistleblower and is far more inclined to vigorously defend the claims than to make a good faith effort to settle.

While this malpractice case against Sheppard was probably widely read in the employment bar, the typical defense playbook is unlikely to change. In-house counsel, however, would be well advised to assess employment cases through the perspective or eyes of the jury

rather than rely solely on outside counsel assuring the company that the whistleblower will never win at trial.

 Reprinted with permission.

About the Author: Jason Zuckerman is Principal at Zuckerman Law (www.zuckermanlaw.com)  and represents whistleblowers nationwide.  He is the author of the Whistleblower Protection Law Blog (www.whistleblower-protection-law.com).


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