A Great Week for American Workers
Over the past 50 years, you can count on the fingers of one hand the number of weeks that have actually been great for American workers. It was just under half a century ago that California gave collective-bargaining rights to farmworkers (which at the time meant Cesar Chavez’s United Farm Workers) for the first time, since they’d been excluded from coverage under the 1935 National Labor Relations Act (NLRA). Fast-forward to 2018, when teachers in Republican states like West Virginia and Kentucky went on strike (with parental support) to successfully compel their states to increase school funding and decrease class sizes; and 2019, when a handful of Senate Democrats, chiefly Ohio’s Sherrod Brown, succeeded in amending a rewrite of NAFTA that actually gave workers a modicum of power. In the past couple of years, the new rank-and-file-elected regimes at both the Teamsters and the United Auto Workers won historically good contracts at, respectively, United Parcel Service and the Big Three automakers.
Those are the high points. In general, however, it’s pretty much been disaster after disaster for five decades: Reagan busting the air traffic controllers’ union, four failed congressional attempts to make the NLRA more functional, even more failed attempts to raise the federal minimum wage (stuck at $7.25 for the past 15 years), the passage of NAFTA, the enactment of permanent normal trade relations with China, and the relentless, sickening decline in the share of American workers who belong to unions, which now stands at 10 percent, and a bare 6 percent among private-sector workers. That decline correlates well with the shrinking of the American middle class.
However, the seven days between Friday, April 19, and Thursday, April 25, saw a succession of worker victories that was almost breathtaking in its scope.
Two of those victories were the direct result of worker mobilizations. On Friday, the UAW won a recognition election at Volkswagen’s Chattanooga factory by a 73 to 27 percent margin, in an election where fully 84 percent of the eligible workers voted. Workers evidently viewed the UAW’s landmark victory in its strike several months earlier against General Motors, Ford, and Stellantis as proof positive that the union could raise their wages and benefits. They ignored the pleas of six Southern governors that the union would subvert “Southern values,” which most workers apparently understood to mean “low-wage work sustained by a lack of worker power.”
The new UAW leadership, headed by president Shawn Fain, had made sure to keep the strike against the Big Three and the unprecedented contract they won in the public eye, and that leadership then appropriated $40 million to unionize factories in the South—historically, the graveyard of unionization efforts.
Last Thursday also saw the first bargaining session between the union of Starbucks baristas and their employer. In a joint statement, both sides said they made “significant progress” toward a model contract for Starbucks stores. Just as the new leadership at the UAW had mobilized thousands of its members to strike the Big Three, so the Starbucks baristas had mostly self-organized the more than 300 outlets that have voted to go union, despite the determined opposition of the company, which illegally fired a number of its employees for their involvement in the organizing campaign. Eventually, the grit and determination of those baristas to stick with their campaign, along with the company’s scorched-earth resistance, threatened to give Starbucks the kind of bad name that could alienate its clientele. Earlier this year, the company announced it would finally commence bargaining with its workers over a national contract.
Both these worker-led campaigns will only take on truly historic significance, however, if they lead to further victories. If the UAW can roll its VW victory on to encompass other foreign-owned auto factories in the South (the next factory to vote will be the Mercedes plant in Vance, Alabama, the week of May 13), it can put an end to our own domestic version of offshoring to low-wage production, which has exerted downward pressure on living standards throughout industrial America. And if the baristas can win a national contract with Starbucks that raises wages and benefits and creates livable scheduling standards, it’s likely that the baristas at the more than 8,000 Starbucks outlets that have yet to go union will vote to go union, too—adding perhaps 200,000 workers to the labor movement’s thinned-out ranks.
But the other dimension of workers’ historic week comes straight out of the Biden administration’s regulatory agencies. Last Tuesday, the Federal Trade Commission banned noncompete agreements—a vestige of indentured servitude that has somehow managed to extend its life from 17th-century colonial America straight through to the 21st. Under these noncompetes, roughly 30 million American workers were contractually forbidden to leave their current employer if they took a new job in the same field or dared to start a company of their own in that field. Violating these contractual terms could compel them to pay major fines to their employer.
The business world’s justification for these noncompetes is that they stop workers from taking trade secrets with them when they switch jobs—though there have long been laws, not just contractual provisions, that forbade the theft or appropriation of trade secrets. Moreover, the number of Americans privy to trade secrets is nowhere near 30 million (much closer, actually, to 30,000). Nonetheless, noncompetes are widespread in such occupations as hairdressing, hash slinging, and car parking—not to stop the spread of trade secrets, of course, but simply to limit competition and suppress wages. A 2019 study by the Economic Policy Institute found that roughly 30 percent of workplaces where the average yearly pay was less than $22,500 subjected all their employees to noncompetes.
On the same Tuesday, the Department of Labor issued a rule raising the minimum salary threshold for workers who presumably make so much that they’re exempt from overtime pay. For decades, one’s eligibility for overtime ceased if that person’s annual salary exceeded a level set in 1975 that went unchanged for decades. In 1975, according to yet another EPI study, 63 percent of salaried workers were entitled to collect overtime if they worked more than 40 hours weekly, but by 2023, as that 1975 cutoff level remained in place, only 9 percent were covered. The DOL’s new standard—raising the bar to $58,656 in two steps, to be adjusted every three years—will entitle approximately four million more workers to be paid at overtime rates for time on the job that exceeds the 40-hour weekly standard.
On that same Tuesday, the DOL also issued a new rule that protected workers saving for their retirement from being victimized by advisers who promote retirement vehicles that disproportionately reward those advisers. The new rule requires those advisers to promote only those plans that are in the best interest of the retirees and prospective retirees.
One day earlier, last Monday, the Centers for Medicare & Medicaid Services issued a new rule that requires nursing homes to provide a minimum number of staff hours per resident, and to have a registered nurse available at all times. This not only sets a long-overdue standard for patient care but will also lead to the hiring of many tens of thousands of new workers. According to the Kaiser Family Foundation, only 1 in 5 nursing homes currently meet the new standard.
And last Thursday, the Biden White House announced a $6.1 billion grant to Micron to make semiconductors, under terms of the CHIPS and Science Act that the administration steered through Congress. In accord with administration preferences, Micron has agreed not only to project labor agreements, effectively ensuring that its plants (to be located in upstate New York and Idaho) will be built by union workers, but also to recognize the rights of the workers it hires to run those factories to join a union and bargain collectively. To that end, the Communications Workers of America will hold talks with the company to create a “labor peace” agreement, which ensures Micron will not oppose unionization efforts.
In addition, Micron has also committed to a comprehensive apprenticeship program in the school districts near its factories, which will develop an advanced manufacturing curriculum in cooperation with the American Federation of Teachers.
Why all these new rules now? As Prospect intern Gerard Edic has pointed out, the Congressional Review Act‚ passed in 1996 when Newt Gingrich’s Republicans hoped to overturn whatever progressive rulings had been promulgated by Bill Clinton’s administration, gives Congress the power to suspend or overturn any agency rulings made in the final 60 days of a president’s term that Congress is in session. Since the actual number of days in a year that Congress is in session is way fewer than 365, those final 60 days kick in sometime around late May. By finalizing these rules now, Biden’s various agencies effectively keep them on the books for a number of years. Were Republicans to control both Congress and the White House next year, they could consign any rules finalized after the deadline to Donald Trump’s dustbin.
Despite this flurry of Biden agency rulings, and despite the breakthroughs in unionization by the autoworkers and the baristas, there was still one cloud in labor’s sky last week, which came, not surprisingly, from the Supreme Court (R-DC). One of the oral arguments the Court heard last week—one that received a great deal less coverage than its consideration of Trump’s claims of immunity and of whether a pregnant woman in need of emergency care can still get it in a state that’s banned abortion—directly concerned workers’ rights under the NLRA.
Due in part to the determination of NLRB General Counsel Jennifer Abruzzo to restore the NLRA to its original purpose of affording workers the right to form unions and bargain collectively, the Board has occasionally gone to court to seek injunctions requiring employers to promptly rehire workers they illegally fired for their pro-union activities. Minus injunctions, it can take months or even years before the employer actually rehires that worker, and restores his or her back pay. By that time, of course, if the key union activists have been banished, the unionization campaign has almost surely fizzled, which is why anti-union consultants and law firms tell employers to go ahead and sack those troublemakers, particularly since the legal penalties are negligible.
Should the NLRB win an injunction (they’re called 10(j) injunctions) for immediate rehiring, however, the workers’ right to unionize—which the NLRA was written to guarantee—might continue unabated.
Starbucks, which was on the receiving end of a 10(j) after firing eight union activists from one outlet in Memphis, took the case to the Supreme Court, arguing that while other federal agencies generally require four stipulations to be met before issuing the injunctions they seek, the NLRB only requires two. However, that’s because courts have almost always found the NLRB’s initial two findings of employer lawbreaking to be dispositive in themselves. What’s changed is that Abruzzo has emphasized to Board attorneys that to adequately ensure workers’ right to unionize, an employer’s actions to delay unionization by illegal firings is tantamount to denying workers’ right to go union, so that injunctions that curtail such delays can sometimes be required.
Starbucks asked the justices to require four stipulations, which may mean the kind of prompt reinstatement that’s possible under a 10(j) injunction may not be so prompt after all, though that’s somewhat unclear. (It’s also unclear why Starbucks, which brought this suit when it was adamantly opposing its baristas’ organizing and has since reversed course and is now negotiating a contract with them, is still pursuing this case.) In any case, the Court’s conservatives appeared only too happy during Tuesday’s oral arguments to do anything that might make unionization more difficult.
Ironically, Section 10(j) was enacted as part of the 1947 Taft-Hartley Act, the landmark anti-union legislation passed by Republicans and Southern Dixiecrats over Harry Truman’s veto. More ironically yet, at the time the bill was before Congress, 10(j) was actually opposed by unions, which feared that employers would seek court injunctions under the section to break strikes. In time, however, employers found innumerable other ways to break strikes, and 10(j) largely lay fallow until Abruzzo realized it could stop some employer lawbreaking in its tracks. (This history comes to you courtesy of my friend Rich Yeselson, who is one of the very few labor scholars who knows chapter and verse about Taft-Hartley.)
The Court (as usual) notwithstanding, last week saw more victories for American workers than any week in memory. May there be many such weeks in their future.
HAROLD MEYERSON
Harold Meyerson is editor at large of The American Prospect.