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Auto mechanics vote on union, await appeal

By L.M. SIXEL 

Auto mechanics at Mike Calvert Toyota voted Wednesday on whether they would join the Machinists Union, but it could be months before they learn the outcome. Holding up the vote count is an appeal by the dealership to the National Labor Relations Board questioning which workers should be allowed to vote. Once the appeal is resolved, the vote count could go forward. The International Association of Machinists and Aerospace Workers opened the election to mechanics, oil changers and pre-delivery inspectors, said Mark Hammond, an organizer with the union's District 37. But the company wants to include mechanics from Davis Chevrolet, a dealership next door owned by the same firm that owns Mike Calvert Toyota, Hammond said. On Sept. 9, the regional director of the labor board in Fort Worth ruled the Davis mechanics should not be included in the election. The two groups don't work together and don't share common supervision or cross-train, ruled Curtis A. Wells, the board's regional director. Robert Bekken, a lawyer from Fisher & Phillips in Irvine, Calif., representing Mike Calvert Toyota and Davis Chevrolet, argued that other district NLRB directors have ruled that all mechanics should be included in one group even if they work on different types of cars.

 Copyright 2002 Houston Chronicle

Employees' lives transformed in aftermath of Enron collapse

By HARVEY RICE and BILL MURPHY

When her father had a stroke in upstate New York four years ago, Theresa Connor-Smith, an Enron office supervisor, couldn't afford to fly there.

Hearing of her situation, Chairman Ken Lay had her flown there on an Enron jet.

"That made a great impression on me," she said.

The impression did not survive Enron's bankruptcy and her ensuing layoff. She has lost all faith in Lay and now scoffs at his message that Enron was a family.

"It took me a long time to believe that Ken Lay was part of this," said Connor-Smith, a former office manager. "It's like you've got the greatest father in the world, and you find out he's an ex-con."

Enron's collapse stunned everyone at the company, especially the 4,500 who were laid off and the thousands who lost most or all of their retirement savings. Most have tempered their bitterness, moved on to stable companies and resumed their careers.

But for Connor-Smith and a few others, the debacle has completely changed the way they look at the world. Disillusioned with corporate America, they are no longer interested in climbing the ladder to big salaries and stock options.

Besides Connor-Smith, they include a senior administrative assistant who now works for the AFL-CIO; a human resources manager who wants to write and be an airport screener; and a public relations executive who has sworn off big business.

"I'm not sure it's an exaggeration to suggest some of these reactions amount to post-traumatic stress syndrome," said Steven Currall, a professor of management and psychology at Rice University's Jones Graduate School of Management.

"We don't pay enough attention to how people are affected by decisions by corporate hot shots in their executive suites."

Two years ago, Enron asked Connor-Smith to transfer from Houston to its office in New York to work as an executive administrative assistant.

"I adored New York City," she said.

For a while, everything went well. She said she was making more than $100,000 a year, counting overtime and bonuses. She saw a solid future and firmly believed the Enron message that it employed only "the best of the best."

Her vitality has given way to fragility. On Sept. 11, 2001, she and co-workers watched as the second jet crashed into the World Trade Center. Laid off in January, Connor-Smith, 49, suffered a nervous breakdown within weeks.

She so deeply admired Lay, seeing him as a quasi-father figure, that she had difficulty believing he had any real role in the company's collapse. She now says she detests him.

"I trusted him as much as I do my husband and my parents," said Connor-Smith, who has a bachelor's degree from the University of Texas and an associate's degree in accounting. "I feel betrayed.

"I want to get Enron out of my mind," she said. "I go through my closet, pulling out my suits and giving them away. I hate what they did. They took my whole world and turned it upside down."

Her husband, Keith Smith, also was without a job in January, so the two had no income, she said. In February, Smith, an Army Reserve sergeant, was sent to Afghanistan. He has returned but will soon be sent back. They now live on base at Fort Bragg, N.C.

Connor-Smith, who is on anti-depressants and anti-anxiety pills, is training to become a dog groomer, hoping to open her own shop someday.

"I have three dogs, a poodle and two Yorkies. I groom them all the time," she said. "I trust animals. They are not going to rob you."

Debbie Perrotta, 54, an executive administrative assistant, liked the way things were going at Enron and planned on retiring there.

"My pay was good, they were treating us good, the bonuses were great," she said. "We had everything we would need as far as the working environment."

Her transformation from corporate acolyte to labor activist began one day in December, when she and hundreds of others were gathered in a room and fired.

"I was flabbergasted and I was angry," she said. "It felt like we were a herd of cattle in a pen."

Many current and former employees suffered huge losses in retirement accounts loaded with Enron stock, though Perrotta said she had done better than most because she had diversified her holdings.

And nearly all fired workers felt cheated by a $4,500 severance payment. Though Enron was not obligated to pay anything at all, the existing company policy would have paid most workers multiples of that.

In January, she met the Rev. Jesse Jackson, who had come to Houston to take up the cause of fired Enron employees.

"Never in my life had I expected to go to a meeting with Jesse Jackson," Perrotta said. "I told him, and I told him straightforward, `I don't believe in everything you did, but if you are going to do something to help Enron employees, then I will back you 100 percent.' "

Won over, Perrotta became one of a half-dozen ex-employees working closely with Jackson and his Rainbow Coalition on Enron issues. In January, they made a bus trip from Houston to Washington, D.C.

The AFL-CIO hired a lawyer to help ex-employees fight for severance pay. It paid off when U.S. Bankruptcy Judge Arthur Gonzalez agreed in August to let Enron pay laid-off workers up to $13,500 each.

The union then offered Perotta a job as an organizer for the Texas Federation of Teachers, at $18,000 less than her Enron earnings of $48,000, counting bonuses. She took it because it allowed her "to be involved in something I truly believe in and where I think I can do good."

"This whole thing has changed me completely."

Milton Brown was so proud to work at Enron that he bought several shirts with the company logo.

"I used to sport the colors very proudly," said Brown, 41. "I really enjoyed the work and the people. There were some components of my job that I loved."

As a human resources manager, he didn't mind putting in long hours, he says, but the Sept. 11 terrorist attack got him thinking about whether his career at Enron was purposeful. The scandal and his abrupt December layoff finished the process.

"At every company I've gone, I've seen hints of unethical behavior," Brown said. "But until I experienced the magnitude of the Enron scandal, I had doubts about whether that was woven into the fabric of corporate America."

His unemployment benefits exhausted and his savings nearly gone, he's thinking about moving to Jackson, Miss., where he is on the list to become an airport screener. He'd be making between $23,000 and $35,000, about half his Enron salary.

Acting on a long-time ambition to write, he is working on a book that "chronicles my post-Enron traumatic syndrome," said Brown, who worked at the company from 1993 to 1996 and again from 1998 until December.

"I want to be able to share with my nieces and nephews that there is a right way of doing things in the workplace and you can do the ethical thing in corporate America," he said. "But I can't tell them that when greed and scandal and corporate fraud are becoming the rule rather than the exception."

In her 26 years at Enron and its predecessors, Marge Nadasky came to have an abiding faith in Enron.

"I thought it was a great company and we did great things, and we had the best of everything, great computers and a great building," said Nadasky, 53. "It was just me, living a naive existence."

When the corporation fell apart, Nadasky was manager of corporate identity and branding for Enron public relations. Initially she dismissed the news about the company's accounting schemes.

"It took me a long time to come to the conclusion that there were things going on at Enron that brought it down," she said. "It was not an easy sell. I was one of those who hung on."

But continuing revelations slowly eroded her confidence in corporate America. It crumbled upon learning that Morgan Stanley executives may have abetted Enron's financial finagling.

"I just saw where some folks ended up caving in because we were a huge account," she said. "To me, that was that kind of defining moment."

She lost about $1 million in her retirement fund, and her earnings now fall far short of what she made at Enron, but she considers herself lucky because she can rely on her husband's income and health insurance.

She now has a small marketing consulting business and is not interested in working again for a big company.

"Having been burned in a big way, I'm a bit wary of going into that environment," said Nadasky. "Greed has definitely taken over corporate America."

 Copyright 2002 Houston Chronicle

Pay issue persists

States, cities fill in as Congress lags on minimum wage

By LEIGH STROPE

Associated Press

WASHINGTON -- Diane Cunningham, a home health care worker in Chicago, is thankful she didn't have to rely on Congress to raise the minimum wage, or even to consider the idea. She'd still be waiting.

"They don't want to do what they need to, to help poor people," said Cunningham, 41, who got a raise after a living wage ordinance passed in Chicago. "They think more about rich people."

The last federal minimum wage increase was in 1997, when it jumped 40 cents to $5.15 an hour from $4.75.

Democrats had hoped to wrangle passage of a minimum wage increase this year by pairing it with tax cuts to win Republican support. But even that incentive hasn't broken through the Senate's political bottleneck, and state and local governments are increasingly trying to take up the slack.

The Democratic measure, introduced by Sen. Edward Kennedy, D-Mass., would have raised the wage to $5.75 an hour this year, $6.25 next year and $6.65 in 2004.

"Millions of minimum wage workers are living in poverty, and the minimum wage has not been increased in six years," Kennedy spokeswoman Stephanie Cutter said. "Senator Kennedy is eager to get this bill passed to provide some needed relief to these working families."

President Bush had signaled that he might accept a small increase, but only if states were allowed to opt out.

Opposition from some powerful business lobbies, including the National Federation of Independent Business and the National Restaurant Association, have dimmed prospects for a wage increase anytime soon.

"For our members, this is the worst time possible to increase the minimum wage," said Susan Eckerly, chief Senate lobbyist for the National Federation of Independent Business. "We're in the middle of an economic slowdown coupled with double-digit increases in health insurance premiums that our members are facing."

Even coupled with tax cuts, an increase just isn't palatable, Eckerly said.

"Our members philosophically oppose mandating what their wage and benefit structure should be," she said.

Congress' inaction has fueled a groundswell of action at the state and local level. Ten states and the District of Columbia have raised their minimum wages higher than the federal government's. A nationwide movement has resulted in over 90 "living-wage" ordinances, and more than 70 other campaigns are under way.

"There would not be a living wage movement if not for Congress," said David Swanson, spokesman for the Association of Community Organizations for Reform Now, or ACORN, which has led the effort. "They almost automatically give themselves a cost-of-living raise every year, but not low-income workers."

Living wage ordinances vary, but generally they set a rate of pay that would enable a local wage-earner to support a family of four above the federal poverty level. Usually, ordinances apply to companies that do business with a city or county government or get local government subsidies.

Some workers now are paid as much as $12 an hour if they work for a company with a city or county contract.

Cunningham was making just 15 cents more than the minimum wage and could hardly make ends meet. Chicago's living-wage ordinance, which took effect in 1999, won her a raise to $7.60 plus back pay. That helped her buy a home.

"It was very hard on me every day trying to perform my duties, knowing that when I got paid there's no money there," said Cunningham, who cares for five elderly disabled people.

Of the 72.5 million U.S. workers paid by the hour, 2.2 million -- about 3 percent -- are paid at or below the minimum wage, according to 2001 Bureau of Labor Statistics figures.

Some analysts argue that boosting the wage would raise salaries of as many as 11 million workers who earn up to $6.65 an hour, because they too would see pay increases.

Supporters of an increase argue that the minimum wage is worth much less today than it was decades ago. For instance, throughout the 1960s and 1970s, the minimum wage was worth more than $5.50 an hour in today's dollars, based on inflation.

Opponents say businesses would have to cut jobs and benefits to pay for the raise. The Employment Policies Institute, a business-supported think tank, contends that a majority of minimum-wage earners are teenagers or young adults without families to support.

But the Economic Policy Institute, a labor-supported think tank, says 60 percent of the workers who would benefit from an increase are women, 68 percent are adults, 18 percent are black and 14 percent are Hispanic.

Bill Samuel, legislative director for the AFL-CIO, the labor federation of 65 unions, said he hopes Congress will take up the issue after its midterm election recess.

"The history of it is, it's hard to pass on its own, and that's just a fact," Samuel said. "But we're not giving up."

 Copyright 2002 Houston Chronicle