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State Of The Labor Movement In USA

By Joanne Knight

02 February, 2014

In his State of the Union speech, President Obama tackled the question of inequality in the US today.

“Today, after four years of economic growth, corporate profits and stock prices have rarely been higher, and those at the top have never done better. But average wages have barely budged. Inequality has deepened. Upward mobility has stalled. The cold, hard fact is that even in the midst of recovery, too many Americans are working more than ever just to get by, let alone to get ahead. And too many still aren’t working at all.”

He announced a wage increase for Federal contract workers to $10.10 per hour by executive order.

Bob Herbert, distinguished senior fellow with Demos, responded that a lack of union organization has resulted in nearly 50 million people who are officially poor in the United States.

“One of the reasons American workers are in such a deep state of distress is because they have no clout in the workplace. They are not organized, and they are not represented, so they cannot fight for their own interests.”

Coming from Australia with its proud history of labor representation, the sense of labor being an integral part of the economic and political system reflected in a liveable minimum wage of $15 per hour and a reasonable welfare system, it was a big shock to be exposed to the disempowered position of labor in the US. Jeremy Scahill called the corporate takeover of the US a “silent coup”. The history of labor in the US is one of attempting to avoid its complete annihilation by capital.

According to the US Department of Labour, the minimum wage in America stands at $7.25 per hour (effective July 24, 2009) and those earning the minimum wage are generally not in full time work. The Organization for Economic Cooperation and Development has rated the United States near the bottom of advanced nations when it comes to the ratio of the minimum wage to the median wage. US States can pass legislation to increase this rate. California has one of the highest minimum wages in the country and has recently increased it from $8.00 to $9.25 per hour, implemented over the next three years. UC Berkeley Centre for Labor Research and Education defines low-wage work as a job paying $12 an hour or less, which puts about a third of U.S. workers below the poverty threshold, defined by the US Census Bureau as a family with two adults and two children who earns $22,811 a year or less.

Union power globally has drastically declined in the last 68 years. In 1945, the United Automobile Workers, the largest union in the US, the Steelworkers and the CIO went on strike for higher wages. The UAW strike continued for 113 days. With the support of the White House, they won a wage increase of 18.5c per hour (15 per cent). General Motors’ Chief Executive, Charles Wilson, proposed a formula in 1948 for union wage increases he called ‘progress sharing’. An ‘annual improvement factor’ would pass to workers the benefits of increased productivity by raising hourly wages with GNP growth and a cost of living adjustment which corrected wages for inflation. This practice spread throughout the auto and steel industries and to other large firms. This capital-labour accord came to be called the entent cordiale.

However, the future was already in motion. In 1946, Republicans gained majorities in both houses of Congress. Republicans tapped into business and public hostility against labour’s strength and passed the Labor-Management Relations (Taft-Hartley) Act in 1947. This act outlawed most forms of mass picketing and secondary boycotts, created legal rights for employers to sue unions for damages, increased the difficulty of the union certification process, banned closed shops and required all union officials to sign affidavits stating that were not members of the Communist Party. It allowed the Federal government to declare a strike ‘against the national interest’ and created the framework for states to pass ‘right to work’ laws, which disallowed union shops. This act marks the point of decline of the union movement in US.

Since that time, corporate power has increased in the US to the point where even the sacred American right to free speech no longer applies in the work place. Bruce Barry of Vanderbilt University argues that US employment law gives tremendous power to employers in all areas. Employees work at the will of their employers which means “You can be fired for a good reason, a bad reason, or for no reason at all.” Employers have the right to take action against any employee who engages in political speech that the company finds offensive and can even force workers (under threat of dismissal) to contribute time and money to the company’s favored political candidate (where there is no state law prohibiting it. Only eight states and the District of Columbia have laws protecting employees from such mandates).

Not only are unions in the US generally viewed with repugnance by legislators and corporations; in addition, Walmart has a history of aggressive union-busting and, as a megacorporation, it can take the consequences on the chin.

The Human Rights Watch 2007 report “Discounting Rights” details Walmart’s hostility to unions and unionizing. HRW describes Walmart’s Labor Relations Team which has been deployed into a store within a few days of receiving news of union organizing efforts. The LRT and store managers required employees to watch videos critical of union formation, were told that they did not need third-party representation and were warned of possible negative consequences of organizing, such as dismissal and discipline. Union representatives and supporters had little if any opportunity to present contradictory views. The report concluded:
“Together, these tactics created a workplace climate so hostile to union formation and so devoid of alternative views about self-organizing that workers were no longer able to choose freely whether to organize.”

As one employee put it, Walmart “had everybody scared to death if you even mentioned union.”

Walmart even used unlawful tactics that included spying on workers' union activity and on union organizers outside the stores; threatening workers that they would lose benefits if they organized; discriminatorily firing key union supporters; failing to discipline union opponents for harassing pro-union workers; applying company policies discriminatorily against union supporters; coercively interrogating workers about union activities; and banning discussion about unions.

Between 1998 and 2003, almost 300 unfair labor practice charges were lodged against Walmart, accusing the company of interfering with its employees’ freedom of association. Among the National Labor Relations Board complaints were 41 charges of terminating employees for union activity, 59 charges of surveillance of union activity, 59 charges of interrogation, and 47 charges of unlawful promises or benefits to dissuade workers against organizing. Of these charges, at least 94 resulted in formal complaints brought against Walmart by the NLRB. The agency’s prosecution of unfair labor practices resulted in only 11 rulings against the company and 12 settlements. The weakness of the NLRB means that employees have no effective protection against union-busting activities by corporations.

Even if the NLRB cracks down harder on anti-union practices, the remedies the agency could impose for such violations are toothless. When the NLRB determined that Walmart had illegally fired workers, it merely ordered Walmart to pay the employees’ back pay for wages lost (minus any earnings since they were fired), and post a notice in the workplace stating that it would not violate the law. Gordon Lafer of the University of Oregon Labor Education and Research Center has concluded that the lack of punitive damages under the National Labor Relations Act renders the NLRB ineffective.

Walmart is not operating alone. Capital in the US has a coordinated campaign to prevent workers from improving wages and conditions. Since the 2010 elections Republican majorities in State houses, like Wisconsin, Michigan and Ohio, passed legislation to restrict collective bargaining rights for public sector employees and instituted ‘right to work’ laws. Under these laws, employers can prevent unions from requiring workers to pay union dues. Advocacy groups, such as the Center for Media and Democracy and Progress Missouri, have identified that much of this anti-union legislation can be traced to ‘model’ bills from American Legislative Exchange Council (ALEC). ALEC holds three annual conferences where corporations, such as the tobacco company Reynolds American, Exxon Mobil Corp and drug-maker Pfizer, can meet with legislators to develop model acts and reach agreements for their passage (similar to the World Economic Forum).

Gary Ruskin’s recent report Spooky Business: Corporate Espionage against Nonprofit Organizations released November 2013, details the extensive use of private security agencies by corporations to spy on and disrupt non-profit groups criticizing their activities. He states:

“In effect, corporations are now able to replicate in miniature the services of a private CIA, employing active‐duty and retired officers from intelligence and/or law enforcement.”

The weakness of labour and the constant undermining of civil society by corporate spying has resulted in levels of inequality which are difficult to understand in such a wealthy country. Corporations so dominate the political landscape that workers are unable to assert their rights to fair pay and conditions. Many keep their heads down in the hope of clinging to a job which barely sustains them. There are stirrings of new movements in the fast food industry but even these workers have suffered from retaliation from their employers such as cuts in hours and conditions. Without a strong union sector to represent their interests, just as Mexican workers cross the border into the US to access relatively better working conditions and wages, it seems that US workers should consider their options for a better life in Canada.

Joanne Knight writes about corporate corruption of political processes and our daily lives. She has a Masters of International Relations.



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