Raising Wages from the Bottom Up – part 2

By Harold Meyerson

$15DSAThree ways city and state governments can make the difference.

This article appears in the Spring 2015 issue of The American Prospect magazine.

THE FIRST STRATEGY, PIONEERED by the Los Angeles Alliance for a New Economy (LAANE) and copied in multiple cities, is to condition city approval of new projects seeking tax abatements, public funds, or other municipal assistance on those projects meeting labor criteria that benefit the city’s residents: the payment of living wages, the hiring of women and minorities, the adherence to environmental standards—and the ability of workers in the project to join unions.

No one has done more to foster unionization through such policies than Madeline Janis, LAANE ’s founding director and now the head of Jobs to Move America, which seeks to bring the manufacture of rail cars and buses—an industry almost entirely offshored in recent decades—back to the United States and back to unionized American workers. In 2008, Los Angeles voters levied a tax increase on themselves to fund the construction of an ambitious rail system. When L.A.’s transit authority began looking for a rail-car manufacturer, however, virtually all were overseas. Even more problematically, the federal Department of Transportation conditioned its considerable financial support for such transit projects on conventional lowest-bidder criteria. Janis managed to persuade the department to add a “best value” criterion that gives points to bidders who hire veterans and workers from neighborhoods with high poverty rates. Able to choose a bidder by those criteria, the L.A. agency selected a Japanese manufacturer that pledged to build a factory in L.A. County and, with further prodding from Los Angeles Mayor Eric Garcetti, not to oppose its workers’ efforts to unionize. Transit agencies in Chicago and Maryland have now adopted contract criteria similar to those in Los Angeles.

LAANE and its many offshoots have most often been founded and, initially, funded by their cities’ hotel unions—locals of UNITE HERE. Beginning in the 1990s, that union succeeded in conditioning many city governments’ approval of new hotel projects that sought some form of financial assistance on the hotels agreeing to let their workers choose whether to join a union. A new wrinkle in this strategy appeared in 2005, when the East Bay Alliance for a Sustainable Economy (EBASE) won the approval of voters in Emeryville—a small city wedged between Berkeley and Oakland—to require a minimum wage, higher than California’s, for employees of that city’s hotels, on the theory that the local taxpayers’ support for public infrastructure around the Bay Bridge was really the key to the hotels’ success and, indeed, existence. LAANE followed up in 2007 by persuading the Los Angeles City Council to enact a similar ordinance for the hotels lining Century Boulevard, the approach road to LAX, and again last year, when it convinced the city council to set an hourly wage of $15.37 for workers at every hotel in the city with at least 150 rooms.

Each of these statutes contained one crucial “supercession” (or escape hatch for employers): They allowed hotels that reached collective-bargaining agreements with their workers to waive the wage requirement if their employees, through their contracts, agreed to it in return for other benefits. With this option clearly serving as an incentive to unionization, UNITE HERE was able to organize the large hotels of Emeryville and five of the 12 hotels on L.A.’s Century Boulevard. The citywide Los Angeles ordinance, which covers 63 hotels, many of them already unionized, takes effect later this year.

Such “carve-outs,” as they are also called, not only can pressure owners and managers but also give workers some choices in the bargaining process. “Collective bargaining supercession cuts both ways,” says Ken Jacobs, who chairs the Center for Labor Research and Education at the University of California, Berkeley. The waitstaff in some Bay Area hotels, he says, made enough in tips to trade away a higher legislated wage in return for better benefits. When unions are strong, supercession can work to employees’ advantage; when unions are weak, it may not.

When San Francisco enacted the nation’s first Retail Workers Bill of Rights late last year, requiring managers to provide their employees with their work schedules two weeks in advance, the city’s leading unions of retail workers, for instance, chose not to lobby for an exemption for retail establishments that had union contracts. For one thing, the vast majority of the city’s retail outlets had no such contracts and the union, even with a carveout, believed it lacked the capacity to organize them. For another, a number of the union’s existing contracts contained no such provision for advance scheduling; many of its own members would plainly benefit from a straight-up application of the law. The bill was enacted with no supercessions. “If your union doesn’t have much leverage,” says one labor lawyer, “you usually want just a law that sets a standard.”

Jacobs argues that even without carve-outs, such laws still advantage unions. “From an organizing perspective, setting a $15.37 wage for all large hotels reduces the differential between union and nonunion hotels, which has grown very large as the cost of health benefits has gone up. You have to raise wages across the board to narrow the difference in labor costs between union and nonunion establishments. Legislating labor standards can be a way to reduce one of the barriers to unionization.”

THE SECOND FORM OF CITY or state policy that enhances worker power is giving worker organizations the authority and funding to monitor and educate workers about the labor-standard laws that those governments enact. In 2007, San Francisco passed an ordinance requiring employers to provide their employees with health insurance and paid sick days. Last year, the council established advance scheduling for retail workers, and city voters enacted a $15 minimum wage. The city’s office of labor standards enforcement, says Donna Levitt, its manager, has recognized that “workers feel more comfortable going to a community group than a government agency” when they experience mistreatment on the job, and has contracted with and funded a range of community-based organizations, most of them rooted in particular minority communities, to augment the office’s own outreach and monitoring efforts.

The most notable success these efforts have achieved came at Yank Sing in Chinatown—the James Beard Award–winning establishment considered one of the nation’s foremost (and highest-dollar) dim-sum restaurants. In 2013, some Yank Sing workers, who were protesting pervasive wage and hour violations, approached the Chinese Progressive Association (CPA), one of the groups with which the city had contracted to monitor labor standards. Interviewing workers in their homes, CPA identified a number of worker-leaders who persuaded nearly 100 of the restaurant’s 280 employees (virtually all of them Chinese immigrants) to file legal claims for back pay and to pressure management to end other abusive labor practices. The workers established a committee to negotiate with the owners, and the following autumn, in a process overseen by Levitt’s office, won a settlement awarding them more than $4 million in back pay and providing them health insurance (as required by city law) and vacations. Though they were already functioning in the manner of a union, the workers chose not to form one.

In fact, while there are a number of worker centers that organize workers to help monitor ordinances, and even collect dues from some of their members, few if any have been able to take the crucial step of helping workers form unions. The problem is that once workers’ organizations elect representatives to bargain over pay and working conditions with private-sector employers, they fall under the not-very-protective jurisdiction of the NLRA—and thus become easy prey for employers seeking to retain nonunion status.

What’s the most, then, that worker organizations helping enforce labor standards can do?

Harold Meyerson, Harold Meyerson writes a weekly political column that appears on Wednesdays and contributes to the PostPartisan blog. Meyerson is also executive editor of The American Prospect, a liberal magazine based in Washington. A Los Angeles native, Meyerson was the executive editor of the L.A. Weekly from 1989 to 2001.  He is a Vice Chair of DSA.

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