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Trump attacks workers and the labor movement in the US

Von: Steven Hill04.05.2018

Amidst all the sensationalist news about porn stars and special prosecutors, Donald Trump’s administration has been waging a quiet war against US workers. The impact is lowering global labor standards, and could affect German and EU workers and rights of co-determination.

In the ongoing circus of Donald Trump’s presidency, the media spotlight has focused on alleged dalliances with porn stars, investigations by a special prosecutor and the misuse of 87 million Facebook profiles to target voters in the 2016 US presidential election. But beneath the radar of all that media and Twitter noise, in a more quiet fashion the Trump administration has been slowly dismantling protections for workers enacted under the Obama administration. This has the impact of lowering the global standards for labor markets, affecting German workers and those in other EU member states.

During his presidential run, Donald Trump repeatedly proclaimed that he would help workers. He even boasted, “I have great relationships with unions.” In a bid to supposedly help workers and create employment, President Trump has withdrawn from the 12-nation Trans-Pacific Partnership trade pact (that he said would hurt American factory workers), he has cracked down on imported steel and aluminum, and he has made reviving the coal industry a crusade. He also keeps threatening to tear up the North American Free Trade Agreement and return factory jobs from Mexico and Canada to the US.

But these initiatives come with serious downsides. His announcement of tariffs on steel and aluminum imports has spurred Chinese retaliation against other American industries, which will surely cost jobs. Tariffs on imported steel and aluminum will drive up the domestic costs for those two metals, harming industries like automobiles and appliances that use these inputs. Many more communities depend on industries that use steel or aluminum than on industries that make it. When President George W. Bush imposed emergency tariffs on imported steel in 2002, prices shot up and industries that use steel lost 200,000 jobs. That was more than all the jobs in the steel-making industry itself.

Trump rollbacks, in addition to deep cuts to the Labor Department's budget, have been devastating to US workers and are not business as usual.

Other actions taken by the Trump administration have more directly hurt workers and labor unions. Typically when the US government shifts from a Democratic administration to a Republican one, such as the previous one of Barack Obama to Trump, a certain amount of pro-business policies and erosion of labor rights is expected. However, many labor experts say that the presidency of Donald Trump has led to a repeal of Obama administration regulations that is unprecedented, and proceeding faster than is typical under a new GOP administration. Celine McNicholas, labor counsel at the Economic Policy Institute in Washington DC, says the Trump rollbacks of various pro-labor rules and regulations, in addition to deep cuts to the Labor Department's budget, have been devastating to US workers and "are not business as usual.”

Trump’s anti-labor takeover of federal agencies

The anti-labor attack gained full momentum in the last weeks of 2017. President Trump had to wait until his two nominees to the five-member National Labor Relations Board were confirmed. Those new members flipped the board’s majority from Democrat to Republican. And then the NLRB, which oversees collective bargaining law and enforcement of US labor laws and standards, quickly issued a number of key decisions that rolled back many worker- and union-related reforms.

In one of the most important changes, the NLRB reversed a 2011 ruling that helped workers form smaller unions within a single larger workplace. The precedent set during the Obama years allowed the holding of a union election without including all the different types of jobs and occupations within that business who don’t share similar job duties, wages and working conditions. Employers complained that it led to “micro unions.” In this specific case, after 100 welders unionized at a large manufacturing plant, the NLRB ruled that the smaller organizing unit was illegitimate since any union election would have to include all 2,500 workers at the company, spanning 120 job classifications. The board ruled 3-2 along partisan lines.

Another consequential case was decided in a way that will hurt low-income fast food workers. The Trump board overturned a major 2015 decision that had ruled employers are responsible for bargaining with workers, even if they have only indirect control over those workers’ employment. Fast-food companies like McDonald’s license smaller franchise businesses to run most of their restaurants. For decades, franchise employees who wished to bargain collectively were caught in a vicious trap. Their immediate boss, the franchise operator, could insist that McDonald’s controlled the terms of their employment. But if they tried to bargain with McDonald’s, the company would insist that the franchise operator was their true employer.

Obama’s NLRB solved this problem by clarifying that companies like McDonald’s are, jointly with franchise operators, employers of these workers and can be forced to the bargaining table. That ruling on joint employers would have improved dramatically the collective bargaining rights in the fast-food industry but the GOP majority on the NLRB scrapped this newer standard. Instead, the policy returned to one that requires employers to exercise “immediate and direct” control in order to be responsible under labor law.

Other damaging decisions by Trump’s NLRB include:

  • reversing a 2004 decision bolstering workers’ rights to organize free from employer interference;
  • reversing a 2016 decision safeguarding unionized workers’ rights to bargain over changes in employment terms.
  • overturning a 2016 decision that required settlements between employers and employees to provide a “full remedy” to aggrieved workers, instead of partial settlements;

All of these were 3–2 decisions, with Republicans in the majority and Democrats dissenting.

Trump’s blizzard of decisions will hurt millions of workers and weaken their abilities to unionize and bargain collectively.

Trump’s anti-Labor Department

Besides the NLRB, Trump’s Labor Department also has reversed several rules and executive orders that the Obama administration issued to protect workers. Those include the Fair Pay and Safe Workplaces rule, which required companies bidding for large federal contracts to disclose and correct past labor and safety violations. Another rescinded rule established guidelines for when states can drug-test applicants for unemployment insurance benefits. Also reversed was the "persuader rule," which required law firms to publicly disclose any work they do for employers trying to fight against union organization efforts. In addition, the Trump administration has proposed $2.6 billion in budget cuts – an enormous 21 percent -- to the Department of Labor, including cuts to training for worker-safety, migrant farmworkers and disadvantaged youth. Dimitri Iglitzin, a labor attorney in Seattle, says that “Of all of the ways that the Trump administration has been crushing labor, the most important has been the neutering of the Department of Labor. On a day-to-day basis, the agency that should be fighting for working people is doing so no longer.”

Meantime, the federal agency Occupational Safety and Health Administration has delayed three workplace safety rules issued during the last year of Obama's presidency. Those required certain employers to submit injury and illness data electronically to OSHA for publication on the agency's website; tightened exposure standards for crystalline silica dust, which is often breathed in by certain construction workers and linked to lung disease; and lowered workplace restrictions on exposure levels to beryllium, an industrial mineral linked to lung cancer.

Another significant workplace issue, which is pending before the US Supreme Court, is whether employers may require workers to sign arbitration agreements that waive their rights to file class or collective action lawsuits. Last June, Trump's acting solicitor general filed a brief with the court that took the opposite stance from the Obama administration, asserting that mandatory arbitration agreements do not violate federal law.

Trump’s Labor Department also has reversed several rules and executive orders that the Obama administration issued to protect workers.

Still another important ruling from the Obama administration had to do with which workers were eligible to receive overtime pay. The Obama rules required nearly everyone paid less than $47,476 a year to be eligible for time-and-a-half overtime pay when they worked more than 40 hours a week. That was a big jump from the $23,660 threshold in place since 2004, and a cornerstone of the Obama administration's efforts to lift wages. But a federal judge in Texas blocked that rule a week before it was scheduled to take effect, and Obama's Labor Department appealed. However, Trump's Labor Department filed a brief in federal appellate court indicating it will not advocate for these overtime changes, which likely will fatally undermine the appeal.

So in just over a year as president, Donald Trump has wiped away the modest policy gains that workers and organized labor made during the Obama years. Taken together, Trump’s blizzard of decisions will hurt millions of workers and weaken their abilities to unionize and bargain collectively.

German leadership thru co-determination

Which is a tragedy, because it does not have to be like this. Germany shows another path that is better for workers and that creates a stronger relationship between businesses, employees, and trade unions.

Germany has stronger labor laws than in the US, and consequently more influential trade unions. In addition, the German economy benefits from works councils and worker representatives on the supervisory boards of major corporations, which together create a “culture of consultation” and a degree of economic democracy. US labor attorney Thomas Geoghegan from Chicago has proposed that US states should try out codetermination. Geoghegan says states should offer tax breaks to companies that allow rank-and-file employees to elect a third to a half of its corporate board of directors. Doing so, says Geoghegan, would allow U.S. companies to test drive an alternative model to the current dysfunctional stockholder model. 

Three US Senators (Democrats Tammy Baldwin, Elizabeth Warren and Brian Schatz) have introduced legislation that, if passed, would require that US companies allow workers to elect one-third of their corporate board. The bill is not expected to pass easily, and while the AFL-CIO has endorsed this legislation, historically US trade unions and labor advocates have not taken up this cause. One nationally known yet uninformed labor leader even told me that co-determination “just leads to company unions.” Yet labor leaders don’t seem to have any other proposals that might stop the hemorrhaging of union members to fewer than 7 percent in the private sector and 11 percent overall.

The quality of jobs continues to deteriorate and that will continue to put pressure on European and German labor markets.

Certainly such progressive proposals are going nowhere at the federal level under the administration of Donald Trump. So the landscape for political change has shifted to certain states and to cities where Democrats and progressives are more dominant. Still, even when Democrats have been in control, whether at the federal level under President Obama or in heavily Democratic states like California, Maryland and Massachusetts, there has been little appetite to push the boundaries of ways to support labor unions or progressive labor reform..

Which is tragic, and not just for US workers. Even in Germany, where the economy is seen as going well, still most job creation in recent years has been for part-time, temporary and solo self-employed type jobs. Increases in bogus self-employment and the number of Germans working more than one job have been worrisome. Those developments have been even more pronounced in many EU member states. Despite low unemployment in the US, the quality of jobs continues to deteriorate under the Trump administration, and that will continue to put pressure on European and German labor markets.

Steven Hill

is the author of “Die Startup Illusion: Wie die Internet-Ökonomie unseren Sozialstaat ruiniert” and “Europe’s Promise: Why the European Way Is the Best Hope in an Insecure Age.” He is a former senior fellow at the New America Foundation in Washington DC. Contact him @StevenHill1776.

For the Mitbestimmungsportal, Steven is writing a column on the digital economy and its impacts on jobs, the labor force and society.