Labor in the News

LABOR IN THE NEWS

July 5, 2004, 6:40PM

VIEWPOINTS

Shaw triggers labor debate

Unions' declining ranks

In his July 2 Outlook article, "Forming unions a freedom that's still denied," Richard C. Shaw made several claims:

• "Workers have lost the ability to form unions and bargain collectively across this state." Shaw should know that the right of employees to form a union is protected under the federal legislation that created the National Labor Relations Board. Notice, it is federal legislation.

• "Employers routinely resort to intimidation tactics, evading the law so they can deny workers this basic right." Providing information about union agendas, techniques, discipline practices and dues collections is hardly coercive in nature. And if any such practices occur, the union would not hesitate to lodge a formal complaint with the NLRB. By the way, the NLRB can certify a union without a vote if the unfair practices are serious enough.

• "One employer has not yet reached an agreement with the union even after nine months of negotiation." Is there a time limit within which an agreement must be reached? No! As long as the parties are bargaining in good faith, there is no breach of law. And again, the union can appeal to the NLRB if it deems it necessary.

• "Workers face intimidating one-on-one and group meetings with supervisors." What is so horrible about management trying to communicate with the workers?

It is no coincidence that such an article was written by a high-ranking member of the union movement. In my experience, however, the primary result of unionism is the ascendancy of mediocrity in the workplace.

The paramount reason for organizing workers is economic: i.e., the economic survival of the union through collection of dues.

Finally, Shaw fails to address the issue of the decline in union membership as a percentage of the total work force.

As recently as 50 years ago, union membership approached 30-35 percent of the work force, and today it approximates 10 percent. Why is this?

Can it be that employees no longer feel the need to organize? Have workers finally realized the lack of altruism on union leadership? Or have they become upset over the use of their dues to further the liberal agenda? This is certainly food for thought.

J.W. Adie, Houston

Prosperous 50-year history

I agree wholeheartedly with Richard C. Shaw that the labor union movement has taken a severe beating over the past 30 years and is under severe attack today. Texas workers are in an especially weak position as far as equality, justice and fairness in the workplace due to the tremendous influence of immigrants — both legal and especially illegal.

In the petrochemical industry, during plant turnarounds for example, there are many unskilled, semiskilled and skilled workers who hold Social Security cards "with wet ink."

I am not racist. There is nothing wrong with people from foreign lands seeking employment in the United States. But they must be legal. And jobs should first be filled with native-born Americans.

Further, Texas workers are especially at the mercy of notoriously anti-union Republican lawmakers, which is a sad situation for unions.

In Texas, with its climate of extremely anti-union legislators, [I believe] the future of labor unions in Texas is quite bleak. This is unfortunate because a clean labor union environment is good for society at large.

Let the anti-union forces answer these questions: How did the United States attain such a large middle class in the first place? How did so many U.S. workers purchase single-family homes since 1950?

They won't like the answers.

Bob Cabirac, Houston

July 7, 2004, 12:16AM

Low wages keep working poor in poverty

Barely making it becoming the rule for more families

By CHRISTINA HOAG
Knight Ridder Tribune News

"According to the Labor Department, union members earn an average of 26 percent more than their nonunion counterparts and enjoy more benefits, such as paid vacations, health insurance and pensions."

MIAMI - John and Kelly Delgado moved their family to Homestead, Fla., from Indiana last August, thinking that John's native South Florida was their land of opportunity. They now regret the move.

"We never have any money," said Kelly, 32. "Every month, we're robbing Peter to pay Paul and then figuring out how to do it again. It's so expensive to live here. I can't afford to buy uniforms for school. My son had a field trip; it cost $8. He used the birthday money, $12, my mom sent him. It's been a very rough year."

The problem: John, 34, earns $6 an hour as a nursery laborer while Kelly, a medical administrative assistant with two associate's degrees, earns $8.50 an hour at a doctor's office. It's just not enough without food stamps, help from social service agencies and emergency cash from their parents.

The Delgados are part of a vast second-class economy of working poor people who cannot live on their salary alone.

"These are people who are playing by all the rules of the game," said Oren Wunderman, executive director of the nonprofit Family Resource Center of South Florida, which helped the Delgados find an apartment. "They've got jobs; they're working. But they can't make ends meet."

Trend doesn't look good

They've been dubbed the invisible work force. Because these people are working, they don't qualify for many government benefits. But they don't make enough — typically less than $10 an hour — to lift a family out of poverty.

And there will be more of them. Of the 20 occupations that the U.S. Labor Department expects will see the biggest growth between 2002 and 2012, 17 are considered low-wage jobs. Only three require college degrees.

In Florida, expanding industries such as retail and food service pay 15 percent less than contracting industries, such as manufacturing and information technology, reflecting a nationwide trend.

"It's not a lack of work ethic," said Bruce Katz, vice president of the Brookings Institution, a Washington think tank. "It's the structure of the economy that is creating jobs that don't pay enough to make ends meet."

Lower taxes, training

Treasury Secretary John Snow said the administration has implemented several policies that help low-income workers, including tax cuts and more training programs.

"The tax proposals the president pushed through Congress had a number of benefits for low-income people," Snow said. "It took 4 to 5 million people off the tax rolls. The other major area where the administration is taking steps is improving the availability of job-based training skills, often through community colleges."

But liberal economists said the federal government is underestimating the problem because it doesn't classify many low-wage workers as poor, due to unrealistically low poverty standards. The poverty rate rose from 11.7 percent in 2001 to 12.1 percent in 2002 — the latest statistic available.

For example, a family of four with an annual income of about $18,500 — an hourly wage of $8.89 — is poor, according to the federal government. In reality, that family is extremely poor, according to the Economic Policy Institute, a Washington think tank.

"A good measure of poverty is twice the poverty line," said Jared Bernstein, the institute's senior economist. "A family of four with income below $30,000 in any city in this country is going to have trouble making ends meet." A $30,000-a-year income requires an hourly salary of $14.42.

Maids and teacher's aides

The working poor encompass everyone from hotel maids and clerical workers to teacher's aides and construction workers. They are not just unskilled labor, said Harriet Spivak, executive director of South Florida Workforce. "Many of these jobs require an associate's degree or some training. They're not low-skilled."

But they typically don't pay a wage sufficient to live on. About 24 percent of workers earn less than $9 an hour, the federal poverty line for a family of four, according to the Economic Policy Institute.

Stella Williams, a 55-year-old single mother of four in Miami, works 64 hours a week at two nursing-home jobs paying $8 and $9 an hour. If she works less, she cannot come up with the $850 rent, put food on the table and pay the bills.

"I work that second job so I can go to Winn-Dixie and buy what I want," she said. "I try to save $50 a month with the credit union, but many times I have to go into it and get $20. I'm living paycheck to paycheck. You think if people work, they wouldn't have to live like this."

Shifts in economy

The growth in low-wage jobs essentially results from sweeping shifts in the U.S. economy: from manufacturing to services, from domestic to overseas production, from unionized to nonunion workers, from humans to automation. Add to that a highly competitive marketplace where low-overhead giants such as Wal-Mart drive costs down across the board.

The dilemma of low-wage earners looks as if it will worsen because of other factors in the economy, say economists and labor-market analysts.

Although inflation has slowed in recent years to nearly negligible blips, the nation has undergone a housing boom that has brought skyrocketing rents and home prices.

Housing costs in South Florida are up 45 percent since 1999. The median price for a home in Miami-Dade and Broward counties hovers around $235,000.

South Florida's medical expenses climbed this year by 15.4 percent and pharmacy costs by 18 percent, outpacing national averages of 13.4 percent and 14.4 percent, respectively, according to Aon Consulting. And many low-wage jobs do not provide medical insurance.

Turning to social services

To make ends meet, more working people are seeking help from social service groups and the government.

Nonprofit organizations report a huge increase in demand from housing to child care.

A year ago, the Society of St. Vincent de Paul in Broward, Fla., typically received requests for food donations from 25 to 30 families a week. Now, 35 to 40 are coming in — each day. In Miami-Dade County, the number of people approved for food stamps has more than doubled from 2001 to 2004.

To be sure, some of those seeking help are on welfare or have disabilities that prevent them from working, but many are employed, agencies said.

"There are homeless folks who actually have a job," said Doug Weber, president and chief executive of the United Way of Broward County.

Chantres Moody, a teacher's aide who earns $6.50 an hour at a day-care center, said she would not be able to get by without a generous child-care subsidy for her three small children from the nonprofit Family Central of Broward County, plus $80 a month in food stamps.

"I have just enough to pay for Pampers and Pull-Ups," said the 26-year-old, who is separated and lives with her parents. "Baby formula is $2.47 a can. The car's acting up. I have to find more money to keep it going. It's actually very stressful."

Seeking a lasting solution

Solutions are far from easy. Social-policy analysts said the government must devote more resources to the needs of the working poor — universal health care, more grants and loans for higher education, more slots for subsidized child care.

Some economists call for a bump in the $5.15-an-hour federal minimum wage, which hasn't budged in seven years. That would boost incomes for 10 million low-rung workers, according to the Economic Policy Institute.

Labor unions, which have seen their membership dwindle from 20.1 percent of the work force in 1980 to 12.9 percent last year, said they need changes in 1930s-era laws to make it easier to organize workers and fight employer opposition.

According to the Labor Department, union members earn an average of 26 percent more than their nonunion counterparts and enjoy more benefits, such as paid vacations, health insurance and pensions.

Some employers are taking measures to help their low-wage work forces. Bank of America reimburses a portion of child-care expenses to workers earning less than $34,000; Home Depot awards bonuses to hourly employees based on store sales goals; Wachovia and Kraft Foods offer flexibility in schedules.

More will be needed if the United States wants to maintain its upward mobility and high living standards into the future, said Katz of the Brookings Institution.

"We need to make work pay," Katz said. "What is required is a new compact between firms, workers and government. I don't think that most people would disagree that if you work, you shouldn't be poor."

Aug. 19, 2004, 1:16AM

Pension bailout proposed

City would float bonds, hock hotel and cut benefits to help ease crisis

By RON NISSIMOV and DAN FELDSTEIN

The city of Houston and its main municipal pension system announced a tentative agreement Wednesday to slash a $2 billion pension shortfall by requiring employees to make larger contributions to their pensions, increasing retirement ages and reducing several other lucrative pension benefits.

For the first time, the city would issue long-term debt to help cover its payments to the pension fund instead of using the current year's tax revenue.

It would issue $99 million in bonds over the next three years — giving the cash to the pension fund — and create a $300 million mortgage on the city-owned Hilton Americas-Houston, payable to the pension over a long term.

The city estimates the actions would reduce the projected shortfall to $850 million.

The plan must be approved by the City Council, which delayed a vote on it Wednesday because several members said they wanted to study it. The board of the Houston Municipal Employees Pension System approved the plan Wednesday.

"This provides a more secure future than the city employees had before," Mayor Bill White told council members.

But a union that represents some municipal workers criticized the proposal because it would cut retirement benefits.

"This is a sad day," said Kimbal Urrutia, executive director of the American Federation of State, County and Municipal Employees Local 1550.

As White has promised, the proposed changes, which would take effect Jan. 1, do not affect retirement benefits that employees already have accrued.

White said the remaining $850 million shortfall, which would be spread over 30 years, would be manageable.

He said that an improved stock market could help reduce the shortfall and that the proposed changes also could help by encouraging employees to stay on the job longer.

Fred Holmes, chairman of the municipal pension system board, said the proposal would "protect not only the city, but the employees."

White said that benefits the city negotiated with the municipal pension system in 2001 were "too good to be true" and would lead to large layoffs or increased property taxes if the city were forced to pay them.

The City Council approved the benefits at the time because it was reassured by the municipal pension system that the city could afford the changes.

But in February, White announced that the city faced a crisis because of large shortfalls in the municipal and police pension systems.

Residents expressed outrage about the generous pension benefits, which were outlined in a Houston Chronicle report.

White thanked voters Wednesday for passing a referendum May 15 allowing the city to renegotiate pension benefits.

Urrutia said the city and the municipal pension system should have negotiated changes before the referendum, because its passage leaves employees defenseless to future change in pension benefits.

While the city contributed $58 million to the main municipal pension last year, the figure could have risen as high as $230 million this year without changes to the city's agreement with the pension board.

Now the city will pay $66 million in fiscal 2005, $69 million in 2006 and $72 million in 2007 from tax revenue and special bonds. It could pay more on the hotel mortgage but has the ability to defer those payments.

Anthony Hall, White's chief administrative officer, said the details of the deal involving the Hilton Americas-Houston Hotel, which is next to the George R. Brown Convention Center, are being worked out.

In discussing the agreement with the municipal pension board Wednesday, White asked the police pension board to address the police pension shortfall, estimated to be around $800 million, "in the same businesslike fashion."

Amy Beberniss, spokeswoman for the police pension system, said negotiations with the city are ongoing, but the system will not back down from its demand that the city contribute $53.8 million to the pension system this year.

The police pension system has sued the city over its proposal to contribute $36.5 million.

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