Labor Day: The Beginning of a Breakthrough

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Labor Day: The Beginning of a Breakthrough

(Photo: flickr / cc / EricGoldhagen)

This Labor Day, working families do not have much to celebrate when it comes to wages and job security. But we can celebrate the fact that the deteriorating conditions of work are finally breaking through into broad political consciousness.

Item. Last week, the board of directors of Market Basket, one of the last of the independent supermarket chains, agreed to restore the fired CEO, Arthur T. Demoulas, who had treated workers decently rather than just milking the enterprise for dividends as another faction of this family-owned company has sought to do. An uprising by salaried managers and workers had brought the business to a halt. More on Market Basket in a moment.

Item. On August 27, the U.S. Court of Appeals for the 9th Circuit, issued a blistering ruling on the long running dispute involving FedEx's policy of classifying its employees as independent contractors. This saves them costs on health care and other fringe benefits, cuts FedEx's taxes, and puts all the burden of schedule shifts on drivers.

Writing for the majority, Judge William Fletcher wrote:

The drivers must wear FedEx uniforms, drive FedEx-approved vehicles, and groom themselves according to FedEx's appearance standards. FedEx tells its drivers what packages to deliver, on what days, and at what times. Although drivers may operate multiple delivery routes and hire third parties to help perform their work, they may do so only with FedEx's consent.

FedEx is one of a growing number of companies who disguise regular employees as temps and independent contractors. The corporate desire to squeeze wages, and not technology, is driving this trend.

Item. In late July, Richard F, Griffin, Jr. the General Counsel of the National Labor Relations Board, held that McDonald's Corp. is jointly responsible for the wellbeing of McDonald's employees, along with the local franchisees who are nominally the employers of record. If upheld, this ruling will facilitate both organizing of fast food workers and going after a range of shabby practices for which the parent corporation disclaims responsibility, holding that the franchisee did it. Of course, everything about McDonald's, from the menu to the décor to the cooking procedures is dictated by the parent company. Even if it's not upheld, the action raises the profile of this issue.

Item. After the New York Times ran a series detailing the impact on families of on-call scheduling practices making it impossible for working parents to plan more than a few days in advance, Starbucks did an about face and promised to give its workers at least a week's lead time. Until it was outed, Starbucks claimed it had a national policy of giving decent notice, but in fact local managers often required employees to work split shifts, working late into the evening and then coming in early the next morning.

Even so, the concession of a week's notice for split shifts still stinks. How do you build family life around that? Who picks up the kids? Try finding child care that adjusts to the boss's whim?

All of these stories are variants of the same story. The true employer imposes ever-worsening conditions on workers, and then hides behind the fiction that they are someone else's employee, or blames the pressure of the stock market.

Of these events, the Market Basket story is particularly instructive, because it represents how so-called shareholder capitalism puts pressure on managers to destroy job security and decent earnings for working people. People who followed this episode casually saw it as the good cousin versus the bad cousin, and somehow, miraculously, the good cousin won.

But the larger story is how shareholder capitalism puts pressure on even benign bosses to squeeze workers ever harder in order to maximize returns for owners. The good cousin, Arthur T. Demoulas, had to borrow half a billion dollars to buy out the bad cousin, Arthur S. Demoulas, and it remains to be how Arthur T.'s need to pay back that loan will eventually squeeze wages.

There is no policy breakthrough on the near horizon to improve the security of work, but there is the beginning of an important shift on consciousness.

Radical reform often begins with such shifts, as when African Americans insisted in mass numbers, beginning in the late 1950s, that the racial caste system had to be destroyed; or when feminism evolved from the fringe cause of a few brave pioneers to a generalized, mainstream claim that women deserved the same opportunities as men; or when gays and lesbians began coming out and demanding recognition of their humanity. The shift in consciousness came first -- the political and then the policy revolution came later.

How could these trends be changed? I can think of five ways, and they could be mutually reinforcing.

First, more union organizing to regularize work.

Second, more regulations and enforcement of regulations to prevent corporations from disguising regular employment as contingent employment. The idea of time and a half for overtime, for instance, seems like just a natural concept but it was not handed down by God on Mount Sinai. It took federal legislation, in 1938, in the Roosevelt era. We need similar rules, to fit the modern economy, to regularize work.

Third, full employment would help. If workers, rather than jobs, were scarce, employers would be more likely to treat employees decently.

Fourth, more worker-owned firms. If the shareholder is king, a worker-shareholder has a better chance of reaping the rewards of his or her hard work, and of not being treated as just another cog in a wheel.

Fifth, citizen-dividends, modeled on the Alaska Permanent Fund, so that Americans get a share of the total product not just as employees but as members of a functioning social contract. Peter Barnes has written a smart book on this, With Liberty and Dividends for All.

This Labor Day, more people are conscious of the fact that precarious work needn't be the norm. As citizens, we need to politicize an issue that until now has been seen mainly as people's private problems -- I was born at the wrong time; I didn't get enough education; I should have been an entrepreneur.

Sorry, but people just like you, in an economy with different rules, were able to get a much fairer shake from the system. We need a fair economy back. It begins with consciousness and consciousness has to lead to politics.

Robert Kuttner

Robert Kuttner is co-founder and co-editor of The American Prospect magazine, as well as a Distinguished Senior Fellow of the think tank Demos. He was a longtime columnist for Business Week, and continues to write columns in the Boston Globe and Huffington Post. He is the author of A Presidency in Peril: The Inside Story of Obama's Promise, Wall Street's Power, and the Struggle to Control our Economic Future, Obama's Challenge, and other books.

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