LaborPains.org

You’d be hard pressed to miss the news that organized labor suffered one of its largest one-year losses in membership in years. While the AFL-CIO is out spinning, our executive director, Rick Berman, weighed in at the Washington Examiner:

The updated membership number is 11.3 percent of the total workforce—the lowest it’s been since the 1930s. In 34 states, union membership tumbled. Among those is Michigan, which has yet to feel the effect from becoming a right-to-work state.

Across the country, state governments are starting their legislative sessions and are filing bills that would reform labor law. Pennsylvania lawmakers will be mulling a package of reforms, including right-to-work. Colorado is doing the same. Even Kansas, already a right-to-work state, is looking at labor law changes: Its legislators are looking at a public sector union paycheck protection bill.

NBA Players Association Releases Report On Union Director

For example, the report noted problems of self-dealing—such as when Hunter accepted $1.3 million from the union for vacation time that was not adequately tracked—and nepotism—notably his hiring of his daughter and other relatives.

The NBA players should continue digging into their executive director’s activities—or at least announce that being their union executive director is the greatest job in the world.

The president of United Food and Commercial Workers (UFCW) Local 5, Ron Lind, is the newest board member of CalPERS, the state agency that handles state employee pensions. Lind is the sixth board member, out of a total of 13, who is a current or former government union employee. Lind is particularly notable, however, because his union led a strike against the grocery store, Raley’s, in November.

The Hill reports that at least nine labor unions have donated to President Obama’s second inauguration, which took place today. Those ponying up include:

If you had been paying attention to labor’s pronouncements in August, you might be confused by the last-minute donations. Labor made it clear that it planned not to donate to the Democrats’ Charlotte convention and even staged its own “shadow convention” in Philadelphia. Nonetheless, when the clarion call went out that funding for the inauguration was coming up short, labor delivered. The Democrats’ reliable piggybank of organized labor is back.

Although plenty of politicians are effectively on labor’s payroll thanks to the massive amount of money that unions funnel into political campaigns, two Rhode Island state senators have taken things to a whole new level. Senate Majority Leader Dominick Ruggerio and Senator Frank Ciccone both pulled in six figures from the Laborer’s union, with Ruggerio taking home almost $233,000 and Ciccone’s salary and benefits totaling roughly $197,000. As New Jersey union members know, it helps to have organized labor controlling the state house.

Wisconsin’s Collective Bargaining Law Survives Seventh Circuit

A three-judge panel sitting in Chicago has ruled that Scott Walker’s collective bargaining reform in Wisconsin, Act 10, is constitutional. The Wisconsin Education Association Council (WEAC) had sued the state to stop enforcement of the law that limits public sector employee collective bargaining. WEAC argued that the exemption for public safety unions was unconstitutional. If the WEAC’s appeal is not heard by the entire panel, then the current injunction will be lifted and Wisconsin’s labor reforms can finally take full effect.

NY1 is reporting that New York City bus company owners have filed a complaint with the National Labor Relations Board (NLRB) to stop its drivers and matrons from continuing the strike that began on Wednesday. Until then, the companies were responsible for getting 152,000 kids to school—at the cost of almost $7,000 per student. The city’s Department of Education wants to open up competitive bids for the routes to save taxpayer money, but the union is insisting that the city impose job protections that New York courts have declared illegal. John Podhoretz of the New York Post says that we shouldn’t be surprised by this strike and that unions will only intensify their strikes over the next decade as old deals collapse under their own financial burden.

For years, we’ve contended that laws and other measures said to be “pro-worker” are in reality, only benefiting labor union bosses. It turns out that the last four years were the experiment that proves our hypothesis.

With President Obama in the White House, and pro-union leadership at the Department of Labor and National Labor Relations Board, unions have faced a greater decline than in the eight years of the Bush administration, says Diana Furchtgott-Roth of the Manhattan Institute. In her opinion piece at Wall Street Journal’s MarketWatch, she makes the case that Obama’s first term has been disastrous for organized labor:

The latest data continue a trend of steadily declining union membership over the past 30 years. Yet during Obama’s first term, the decline in union membership has accelerated. The unionization rate declined by 1.2 percentage points, compared to 1.1 percentage points during the eight Bush years. Public sector unionization rates fell by nine-tenths of a percentage point during Obama’s tenure, compared with seven-tenths of a percentage point during Bush’s two terms.

No matter how pro-union a president, an anti-business agenda results in lost jobs for non-union workers and union members alike. While Obama has championed union causes, his tax and regulatory policies have systematically discouraged business investment and job creation in America.

Furchtgott-Roth makes a compelling case that the same politicians that labor unions have supported have helped to accelerate labor’s decline.

So as unionization rates decline, what’s the loss to the average employee? Mark P. Cussen of Investopedia, via the San Francisco Chronicle, asks “Are Labor Unions Effective?” and then provides a roundabout answer. Cussen says that “[o]f course, labor unions were created for the benefit of their members,” but then fails to provide much support for what they’ve been up to since they began. Groups that were formed exclusively to support women’s suffrage were also very effective—the 19^th Amendment became law. But if those groups didn’t change their mission, they folded. Likewise, the victories that are attributed to labor unions were won generations ago.

So what have unions been pressing for since they pushed for the five-day work week? Cussen writes:

Unions can convince workers to join them as a means of preserving the unions’ clout in industries (such as the U.S. auto industry). But history shows that this can cripple an industry, especially over time.

The best that Cussen can argue is that unions “will likely continue to impact our industries and other sectors of the economy one way or another for decades to come.” Unions certainly “impact” the economy, but for the worse.

Nonetheless, organized labor will continue to prop itself up. And Democrats, both at the state and federal level, who rely on labor leaders directing political support their way will continue to support unions. But this is blind support: politicians are willing to hear, see, and speak no evil of labor despite tactics that oppose their principles, such as forced association. And as Furchtgott-Roth argues, unions support politicians whose policies inflict greater harm to organized labor.

It’s hard to understand why this cycle continues. Unions are happy to play the political power brokers, but to what end? It certainly hasn’t supported their declining membership. Furchtgott-Roth says that “[u]nion bosses may be doing better under President Obama, but rank-and-file union members are not,” and she’s right. Because labor leadership is benefitting financially from this arrangement, it will continue, for now, even if it isn’t sustainable.

For years, the most notorious and important labor unions were in the private sector. But power within the labor movement has shifted from the private sector to the public sector, if only because public employee unions have taken the lead in raw membership numbers. Luke Rosiak at the Washington Times reports that government now pays the salaries of the majority of union members in America.

The public sector had a late start — the first instances of collective bargaining didn’t arrive until the late 1950s. Allowing collective bargaining in the public sector was a line that even Franklin D. Roosevelt didn’t want to cross. But they appear to have made up for lost time by adding on incredible numbers in recent decades. From 1991 to 2011, the number of unionized employees in the public sector rose from 18 million to 20.4 million.

As our Managing Director J. Justin Wilson tells the Times, public employees were traditionally seen as the last ones who needed collective bargaining:

“Anyone would have a difficult time arguing that in the public sector there’s a conspiracy to abuse the rights of workers. We have oversight mechanisms in place” and numerous forms of recourse, he said.

Furthermore, it’s the public sector unions that are allowed to fly under the radar, as they are not required to make as many disclosures as their private sector counterparts.

“[The Labor-Management Reporting and Disclosure Act is] a transparency bill:  Union members should be able to see this for themselves so they can make decisions. But public employees are exempted,” Mr. Wilson said.

One look at that information available thanks to the LMRDA, which is available at UnionFacts.com, makes it apparent why public sector unions would want to avoid the disclosures. It details all significant spending by the union and breaks down what it costs for every promotional item, every “member education” mailing, and all of the salaries for the labor bosses. Nonetheless, the Office of Labor-Management Standards at the Department of Labor admitted in its own self-assessment in October that its current practices do “not assess whether union financial integrity, democracy or transparency have actually increased.”

It’s also clear to see why many private sector workers might be turned off by their unions: some have become family dynasties. Rosiak also reports this morning that local unions are run and almost entirely controlled by kin. His lead example: One Ohio Laborers chapter has its purse strings held by members of the Mayle family, who take up five of the groups 14 leadership positions.

There is also little turnover in labor union officers from term to term. There are “elections” held on a regular basis, but rarely is an incumbent tossed from office. It’s often safe to say that if a leader doesn’t return to office, it’s a position that’s been yielded to an anointed successor.

The lesson learned is that the more things change, the more they stay the same.  There are serious problems at the local level when union members might prefer some real democracy and choices, but get cronyism and nepotism instead. And on the macro level, the changing of the guard from private sector unions to the public sector will do little to change organized labor’s tactics or agenda. The only difference is that now, labor leaders can hide behind the lack of transparency.

New York City’s yellow school bus drivers are taking the concept of wanting what they can’t have to a whole new level.

The Amalgamated Transit Union (ATU) Local 1181 has authorized a strike that it says will begin on Wednesday morning. The ATU is demanding that the city include special employee protections in the competitive bidding that it recently opened up for 1,100 of the 7,700 school bus routes. These 1,100 routes serve 22,500 special needs children that attend the city’s public schools.

There’s just one problem: The city isn’t legally allowed to grant those employee protections. The New York Court of Appeals (the highest level court in the state) in 2011 said that the rules, known as Employee Protection Provisions (EPPs) are not permissible because they can harm the public when they are a required part of a competitive bidding process.

Despite the impossibility of meeting their demands, Local 1181 will be stranding most of the 152,000 New York City students that take the bus to school each morning. (Ironically, NY1 reports that buses for special needs students will still run during the strike.)

The NYC Department of Education (DOE) is legally barred from appeasing Local 1181. The battle over EPPs is an old one — one that was at the heart of the last school bus strike in 1979. As the Court of Appeals’ June 2011 decision explains, the city’s DOE moved to eliminate seniority practices in its bid solicitations, prompting the ATU to walk off the job for three months. In the wake of the strike, the DOE accepted EPPs. As the Court said, “the EPPs established a master seniority list, requiring contractors with the Board to give priority in hiring to employees on the list when such employees become unemployed because of reassignment of busing contracts.” When the DOE wanted to include EPPs in the competitive bidding for new Pre-K busing contracts, transportation vendors sued the DOE, saying that EPPs were anticompetitive and harmed the public.

The Court agreed, siding with the vendors over the DOE and Local 1181, which intervened in the case. Rejecting the claims that EPPs were similar to the permissible Project Labor Agreements (PLAs), the Court stated that the two were only comparable “in their status as atypical, patently restrictive, comprehensive pre-bid specifications and in their potential for anticompetitive consequences.”  The Court even noted that the DOE provided no examples of any other school districts in the country that included provisions akin to the EPPs.

It wouldn’t take a great leap of faith to see how EPPs and ATU Local 1181’s contracts have affected the cost of busing. At $1.1 billion for the entire contract, the cost comes to approximately $6,900 per student. Los Angeles estimates its per pupil cost at $3,100.

Consider that a 2-mile taxi ride from Union Square to Times Square—right through the heart of Midtown Manhattan—would cost roughly $4,600 for an entire school year. And that includes a generous 20 percent tip for the cabbie. If students paid the full fare for a subway or public bus trip each way to school, the cost would be only $810 per year.

Of course, Local 1181 knows all of this, and at the heart of this debate is the union’s distaste that the city dare to consider more cost-effective alternatives. When the city submitted the Pre-K busing contract for competitive bidding, the city saved $95 million over five years.

Instead of facing these realities, the 9,000 drivers and matrons of Local 1181 will likely strike tomorrow morning, all for the sake of preserving seniority rules the city can’t legally give them.

Chicago Teachers Union President Karen Lewis was a big hit at the Illinois Labor History Society. As the keynote speaker at the Society’s “Salute to Labor’s Historic Heroes from the History Makers of Today” event, Lewis recalled the labor days of yore by saying, “[W]e are in a moment where the wealth disparity in this country is very reminiscent of the robber baron ages. The labor leaders of that time, though, were ready to kill. They were. They were just–off with their heads. They were seriously talking about that.” Minor applause ensued, along with a few laughs. But Lewis, who’s already known for her jokes, thankfully cleared things up: “I don’t think we’re at that point.”

Whew.

Jon Ortiz at the Sacramento Bee’s State Worker blog reports that Assemblyman Roger Hernández has introduced a bill that would re-institute a state holiday on the second Monday of October, one of the two holidays that were eliminated in 2009 (Lincoln’s Birthday was the other).

Most people call this “Columbus Day,” but Hernandez’ bill renames the new holiday “Native American Day.” It would also be a paid holiday for state employees. California public employees already enjoy greater compensation than their counterparts in the private sector. Although the two holidays were replaced with two “professional development days” in 2010, Ortiz reports that Hernández’s bill would not amend that change.

The National Labor Relations Board’s (NLRB) decision in D.R. Horton condemned mandatory arbitration agreements barring class actions as a part of the Board’s larger goal of broadening the definition of “concerted activity.” In other words, the NLRB is trying to expand its power. As Allison Frankel’s “On the Case” explains, a three-judge panel in the Eighth Circuit Court of Appeals was “utterly dismissive” of the NLRB’s analysis and granted the Board no deference. Importantly, the judges noted that most court decisions since D.R. Horton have not used the NLRB’s reasoning.

Teamsters President Jimmy Hoffa Jr. knows a thing or two about steamrolling the opposition. So it’s no surprise that Hoffa supports “reform” of the Senate filibuster, which allows the minority party to stop a bill if it cannot garner 60 votes in its favor. Hoffa explains that if not for the filibuster, EFCA would be the law of the land. Naturally, both parties find the rules afforded the Senate minority abhorrent—but only until that party is in the minority. We’d guess that if the partisan tables were turned and the Employee Rights Act was up for a vote, Hoffa would be singing a different tune.