1. School of Management and Labor Relations The Evolution of Worker Centers and the Emergence of Coproduction of Labor Standards Enforcement in the United States January 29, 2016 UCLA Janice Fine Associate Professor Rutgers University Center on Innovation in Worker Organization (CIWO)

2. School of Management and Labor Relations Overview of my talk Worker Centers initial thinking How the movement has evolved since then Two potential pathways to renewal of worker organizing Catalyzing an organizing spurt Enforcement Co-production Theory Co-production Cases Locating Co-production in American Political Development

3. School of Management and Labor Relations Stipulating to dramatic changes in the nature and organization of work… Globalization Technological advances Shifting markets Rise of network supply chain model/vertical disaggregation of firms across many sectors “gloves off” arrangements: subcontracting, independent contracting, temporary employment, fissuring NAFTA Migration of unskilled with extremely limited access to legal status Rise of service sector in part fed by changing role of women, demographic shifts

4. School of Management and Labor Relations Decline of traditional working class institutions: Unions Political Parties Fraternal and Mutual Aid Associations … Once played an important role in immigrant economic and political incorporation.

5. School of Management and Labor Relations Source: unionstats.com; EPI.

6. School of Management and Labor Relations Which Organizations Will be the New Fixed Point in the Changing World of Work? –Building Economic Power in Industries and Workplaces –Defending Workers’ Rights –Creating Communities of Interest –Job Placement /Hiring Halls/Representation with Employers –Training/Skills Development –Benefits: Health Insurance, Pensions, Financial Services –Legal Clinics –Building Political Power: Passage of Public Policy/Electing Officials –Political Education –Cultural activities –Connecting to workers globally

7. School of Management and Labor Relations What is a worker center? Worker centers are community-based mediating institutions that provide support to low-wage, primarily immigrant workers. The centers pursue this mission through a combination of programs: service delivery: legal representation to recover lost wages and dealing with immigrant issues, English classes and job placement advocacy: speaking on behalf of low wage workers to local media and government, and developing allies organizing: building an organization of workers who act together for economic and political change. These are what set them apart from other immigrant service organizations

8. School of Management and Labor Relations Rise in Worker Centers and Foreign Born Population* *Foreign Born Population includes Mexican, Central American, Chinese and Korean immigrants in 3 Major Metropolitan Areas (Chicago, LA, NY) Source: US Census 2000

9. School of Management and Labor Relations Dramatic Increase in Worker Centers In 1992, there were fewer than 5 centers nationwide. In 2007, there were 155 worker centers in over 80 U.S. cities, towns and rural areas (34 states) in 2013, 217.

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11. Characteristics of Worker Centers Hybrids Multiple identities: Strong ethnic and racial identification Place-based Collective action not collective bargaining Organizing Services Small and involved membership Leadership Development and Participatory Culture Popular education Identification as part of a global movement Broad agenda Coalitional

12. School of Management and Labor Relations Worker Centers Play a Unique Role They have emerged as central components of the immigrant community infrastructure and are playing an indispensable role in helping immigrants and other low wage workers of color navigate the world of work They are gateway organizations that are providing information, training, services and acting as mediating institutions between workers and broader society They have attracted workers who are often the hardest-to-organize Unencumbered by restrictive labor laws, they are free spaces of experimentation, acting as “organizing laboratories” creating and testing new and innovative strategies

13. School of Management and Labor Relations How do worker centers play a role in immigrant integration? They are among a set of possible institutions that provide a way for low wage foreign born workers to press for rights. These institutions, in combination with workers’ social capital, open the way for integration or incorporation.

14. School of Management and Labor Relations Strengths: STEPPING IN FOR UNIONS Vehicle for Collective Voice Leadership development Winning back-wages Targeting individual employers Calling attention to exploitative industry practices Changing the debate/climate Labor market intervention via govt. admin action and public policy STEPPING IN FOR THE STATE: Monitoring and enforcement of minimum wage, overtime, health and safety, workers’ comp and other regulations Pioneering campaigns, experimentation Weaknesses: Small membership base, not institutionalized Labor market intervention via direct economic action Hiring Hall functions are relatively weak at most centers Lack of detailed economic/industrial research and analysis Electoral mobilization Sustainability Isolation Not connected to Labor unions, unaware of those models and histories

15. School of Management and Labor Relations Janice Fine fine@smlr.rutgers.edu Golden Era of Immigration Immigrant Workers Fraternal Organizations/ Mutual Aid Societies Settlement Houses Charitable Organizations Other Ethnic Associations Religious Institutions UnionsParties Informal Networks

16. School of Management and Labor Relations Janice Fine fine@smlr.rutgers.edu Today at Comparable Levels of Immigration Immigrant Workers Other Ethnic Associations Religious Institutions Worker Centers Home Town Associations Informal Networks

17. School of Management and Labor Relations Worker Centers invite us to re-imagine old tropes of immigrant integration and urban politics Political participation before citizenship (“non-citizen citizenship,” “grassroots citizenship,” “urban citizenship”) Asserting political and economic rights regardless of immigration status Class and ethnicity are not pulling against each other, ethnicity does not thin class—the two march hand in hand

18. School of Management and Labor Relations Revisiting some of my conclusions… Some of the shortcomings I identified now seem to have been indicative of a broader challenge faced by all worker organizations as they confronted employment relations in the age of neo-liberalism Also, I was looking at them during a particular developmental phase In the past ten years, worker centers and their networks have evolved and matured: institutionalizing themselves through unique funding streams and substantially expanding their strategic capacities

19. School of Management and Labor Relations Steady Decline of Unionization Even in Non-Footloose Sectors 19901995200020052010 Construction23.920.320.41515.3 Manufacturing/Non- Durable 201714.813.212.6 Manufacturing/Durable23.820.116.214.111.2 Transportation and Warehousing 42.639.135.333.130.5 Retail76.65.25.95.4 Hospitals17.816.515.915.416 Nursing homes12.411.311.29.17.7 Hotels and Motels11.71211.79.59

20. School of Management and Labor Relations Increasing Reliance on Public Policy Smart political strategies anchored by large union campaign contributions and political operations are what seem to have enabled much of the organizing of public sector workers or those whose positions are paid through public funding streams Homecare, childcare, nursing home workforces have gained collective bargaining rights through union political and policy interventions Fight for Fifteen so far much more successful at policy than worker organizing (although some of the private sector targets have raised wages to $10/hr: McDonalds, Walmart, Target, Starbucks)

21. School of Management and Labor Relations Increased inability to exercise significant economic power over employers is not just a weakness of worker centers, it is widely shared by labor unions organizing private sector workers… Until the recession and the coordinated political assault on the public sector workforce, both unions and worker centers had been looking to the state as their most viable option for securing improvements

22. School of Management and Labor Relations 22 As unskilled workers in plentiful supply in the labor market they have limited power over employers and modest resources limit their organizations’ ability to pressure firms: Low wage workers cannot control entry into the occupation Industries with high level of sub-contracting nominal employers have difficulty amassing the power to improve conditions and it requires resources to bring pressure higher up the food-chain (however there have been important exceptions: Garment Workers Union, Coalition of Immokalee Workers, CTUL) Retention of the workforce is not valued as much as with skilled workers--there is little incentive for firms to take the high road

23. School of Management and Labor Relations In Politics… Low levels of voter turnout and active political engagement mean that to win on a public policy issue, a community organization often just needs to mobilize a dedicated minority The multiplier effect: when a legislator receives fifty calls, the assumption is they are representative of a much larger number Strategic capacity of the organizations in targeting and having workers tell their stories which casts the issue in moral terms 23

24. School of Management and Labor Relations Question of Power…(Lukes, Gaventa, Jasper, Chun) Policy forum, particularly at state and local legislative levels much more porous to interventions, voter contacts, visits, actions, media go a long way (first face of power) Elected officials more vulnerable to pressure that worker centers and unions can bring to bear…(first face) Unions still wield considerable political power (votes, money, relationships, to be able to support working in second and third faces of power—SEIU’s Fight for Fifteen good example) Worker centers have moral/symbolic power that can arouse allies to take up the fight and bring in other kinds of power (wage theft, domestic workers bill of rights, carwash, living wage)

25. School of Management and Labor Relations Strengths revisited: Vehicle for Collective Voice Leadership development Winning back-wages Targeting individual employers Calling attention to exploitative industry practices Changing the debate/climate Labor market intervention via govt. admin action and public policy Monitoring and enforcement of minimum wage, overtime, health and safety, workers’ comp and other regulations Pioneering supply chain campaigns and connection to the global anti- sweatshop movement Experimentation/ “Bottom-upness” Weaknesses Revisited: Small membership base, not institutionalized Labor market intervention via direct economic action Hiring Hall functions are relatively weak at most centers Lack of detailed economic/industrial research and analysis Electoral mobilization Financial Sustainability? Isolation: No Longer the Case due to National Federations Forging alliances with unions

26. School of Management and Labor Relations New Trends in Worker Center World: Federation: A Growing Trend Strong individual centers joining existing national networks or “going national” and spawning new locals or affiliating existing organizations National Day Laborer Organizing Network (NDLON) National Domestic Workers Alliance ROC National Guest Workers Alliance Coalition for Popular Democracy (CPD) Taxi Workers Black Worker Center Network

27. School of Management and Labor Relations Why does Federation matter? Diffusion of tactics and strategies National campaigns (policy as well as employers) Greater financial support because they are viewed as significant Greater respect from labor, political class, media (cf Skocpol, Swartz on federation)

28. School of Management and Labor Relations Greater industry sophistication on the part of some centers: strongest growth in industry-specific organizations and networks (day laborers, domestic, taxi, restaurant)… Common issues Common industry structures Common regulatory structures Common experiences Growing interest among these actors in achieving ongoing collective bargaining arrangements, growing interest in union models and sense of hope that they might find willing partners among national unions Mimetic isomorphism (craft and industrial unionism?)

29. School of Management and Labor Relations Institutional Partnerships with labor National AFL-CIO executive committee statement on worker centers recognizing their role and authorizing Certificates of Affiliation with State Federations and Central Labor Councils (since 2006 limited #) AFL-CIO and Worker Center Partnerships, signing of formal agreements with: 2007-National Day Laborer Organizing Network (NDLON) 2007 2007-Interfaith Worker Justice 2007 2011-National Domestic Workers Alliance 2011 2011-National Guest Workers’ Alliance 2011 2011-National Taxi Workers Alliance organizing charter applied for 2011 2013-LIFT Fund founded in partnership with Ford supports union/worker center organizing efforts

30. School of Management and Labor Relations Consumer/Producer Alliances and Employer Alliances ROC with diner guides, Behind the Kitchen Door, media appeals and creating high road employer alliance Domestic Workers, Age of Dignity, working to organize groups of employers becoming much more rigorous in certain places

31. School of Management and Labor Relations Monitoring and Certification regimes— CIW and the Fair Food Standards Council CIW just rolling out Fair Food label for tomato Workers Defense Project and Better Builders CTUL and Target **how to learn lessons of ineffectual global monitoring, certification regimes?

32. School of Management and Labor Relations Emergence of Black Worker Centers Los Angeles Baltimore DC Chicago San Francisco New strategies on local hiring, taking on what Skrentny calls “racial realism” in construction where employers have explicitly favored immigrant workers, now foreign- born Latinos, and excluded Black workers (as Waldinger and Tilly have documented in their work)

33. School of Management and Labor Relations Two Roads to Worker Power in Private Sector: Betting on spurts and Building Participatory Enforcement Regimes

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35. What is a spurt??? A concentrated episode of union growth Unionism generally grows in discontinuous upticks or spurts rather than gradually (by contrast, absent periods of spurt, US history is characterized by gradual erosion of union density) Key is Employer/employee conflict over organization (conditions plus vehicle) Richard B. Freeman, “Spurts in Union Growth: Defining Moments and Social Processes” Working Paper 6012, National Bureau of Economic Research, April 1997

36. School of Management and Labor Relations Five spurts in union density in the US: »1880-1886 »1897-1904 »1916-1921 »1934-1939 »1942-1945

37. School of Management and Labor Relations Two ways aggregate unionism can increase rapidly during a spurt Existing unions with given jurisdictions could greatly increase their representation New or existing unions could expand into previously non-union sectors

38. School of Management and Labor Relations How can unions prepare for a spurt? -Communications strategy: who’s to blame, efficacy of collective action -Nest fights in larger ones that show unions standing for the whole -Pick big fights, Catalyze and support people in motion without knowing the end game

39. School of Management and Labor Relations Can a bureaucracy ignite a movement and then…turn it into an organization? bureaucracy Unions today movement Fast Food/Fight for $15 Our Walmart Paid Sick Minimum/Living Wage organization Membership- based Dues-paying

40. School of Management and Labor Relations Labor standards enforcement as second possible pathway to power and organization

41. School of Management and Labor Relations Non-compliance with minimum standards is at historic levels 26% of low wage workers in the nation’s three largest cities suffered minimum wage violations in the week prior to a 2009 national survey by Bernhardt, DeFilippis, Milkman and Theodore 76% of low wage workers who labored more than 40 hours in the prior week were not paid according to overtime laws according to the same survey Regional non-compliance levels over 50% in nursing homes, poultry-processing, daycare, restaurants and healthcare according to USDOL’s own surveys

42. School of Management and Labor Relations Recent Study by Eastern Research Group for USDOL Between 3.5 and 6.5% of all wage and salary workers in California and New York are paid less than the minimum wage. More than 300,000 workers in each state suffered minimum-wage violations each month. Labor Department officials said that even if one assumed a violation rate half that nationwide, that would mean more than two million workers across the nation were paid less than the federal or state minimum wage.

43. School of Management and Labor Relations Occupational Safety and Health The number of fatal injuries in 2007 was estimated to be more than 5,600. The number of nonfatal injuries in 2007 was just below 8,559,000. In 2012, 4,628 workers were killed on the job. On average, that is 89 a week or more than 12 deaths every day. 748 Hispanic or Latino workers were killed from work- related injuries in 2012–on average, more than 14 deaths a week or two Latino workers killed every day. Fatal work injuries involving contractors accounted for 15 percent of all fatal work injuries in 2012

44. School of Management and Labor Relations Re-governing the market from below… Since 1994, over 120 municipalities have passed living wage ordinances Since 2003, 15 cities and counties have passed minimum wage laws Growing number of city, county and state wage theft ordinances

45. School of Management and Labor Relations But how will they be enforced?

46. School of Management and Labor Relations Could participatory enforcement regimes… Provide a dedicated financial stream for enforcement work for organizations Drive organization/representation back into the workplace

47. School of Management and Labor Relations Co-production Enforcement where there are high levels of capacity and strong linkages between government and civil society organizations Co-production shifts from conceptualizing state capacity for enforcement as arising primarily from regulators with coercive powers, to state capacity as a process of negotiated interdependence between regulators and societal organizations

48. School of Management and Labor Relations Literatures: Co-production “The process through which inputs used to produce a good or service are contributed by individuals who are not ‘in’ the same organization.” Ostrom argued that all public goods and services are not only potentially produced by the regular producer, who is often government, but also by those who are the consumer of the service, often referred to as the client and that the production of a service is frequently difficult to carry out without the active participation of the client. -Ostrom, “Crossing the Great Divide,” 1996.

49. School of Management and Labor Relations Ostrom continued Ostrom argued that credible commitments needed to be made by both parties so that each could expect the other to continually provide inputs and increase them when the other did so. Strikingly, Ostrom found that these coproduction projects were most likely to succeed if they were formalized with clear and enforceable contracts. - Ostrom, “Crossing the Great Divide”

50. School of Management and Labor Relations Joshi and More J&M described institutionalized coproduction as “the provision of public services (broadly defined to include regulation) through a regular, long-term relationship between state agencies and organized groups of citizens, where both make substantial resource contributions.” In contrast to Ostrom’s requirement of formality, Joshi and More argued that institutionalized coproduction could be contractual or non-contractual and informal and that it could be renegotiated almost continuously as long as it was of a long-term nature.

51. School of Management and Labor Relations Amengual and Fine Ostrom, Joshi and More and other scholars, mostly studied coproduction in the context of public service delivery and advanced it as a strategy in countries where state authority is weak. Coproduction can also be a useful way of thinking about labor standards enforcement, and not only in countries where state authority is weak, but also where it is strong but capacity is weak—capacity understood not only with respect to the ratio of inspectors to firms but also the level of trust in government and willingness to share information with state officials.

52. School of Management and Labor Relations Co-production of Labor Standards Enforcement: Amengual and Fine (Ayres and Braithwaite, Cohen and Rogers, Fine and Gordon) Those closest to the action, with the most information and greatest incentives partner with government to enforce the law. Workers, unions, worker centers and high road firms in relationship with inspectors, play an active role in monitoring their labor markets so that government can investigate and punish businesses engaged in unethical and illegal practices Along with the government regulator and the firm, a public interest group such as a union, worker center or other community organization is given a formal role in the regulatory process.

53. School of Management and Labor Relations Recognize and leverage the unique capabilities of state and society… “non-substitutability” State Regulators: - Power to investigate -Conduct on-site inspection -Demand information -Power to punish: fines, suspensions, close down firms -Know complexities of the laws -Enforce regulations where worker organizations are weak -Ability to identify retaliation against complainants/informants and provide protection through heightened enforcement presence -Legitimate worker organizations’ campaigns -Ability to empower worker organizations by giving certain rights and privileges

54. School of Management and Labor Relations Non-substitutable Capabilities Workers: Tacit Knowledge of the work process Information about what the employer is doing Experience of the work conditions and changes in employer behavior over time Relationships with other workers Presence at the worksite every day

55. School of Management and Labor Relations Non-substitutable Capabilities Worker Organizations: Communities of interest among dispersed labor force Trust of Workers/Relationships with workers Organizing capacity Access to information Language capacity Availability beyond 9-5 Sources of expertise on industries and employer schemes Ability to build cases, expand complainants Ability to cast issue in moral terms and mobilize political support for agencies Countervailing power to employers Enduring presence to ensure compliance

56. School of Management and Labor Relations Non-substitutable capabilities: High Road Firms Power to establish a set of best practices at their own firms regarding wages, working conditions, benefits and scheduling Power to use their buying power to require these practices of firms throughout their supply chains backed up by strong market consequences for violators. Power to join with like-minded businesses to advocate for high road practices in their sectors Power to strengthen enforcement of minimum standards through working with government agencies and worker organizations as well as Power to finance private monitoring and watch dog organizations to patrol labor markets for unfair competition.

57. School of Management and Labor Relations Co-Production in Practice Workers Defense Project (WDP) and the Austin Police Department, the City of Austin and OSHA National Guest Workers Alliance (NGA) and OSHA Community Labor Environmental Action Network (CLEAN) Carwash Campaign, the California Division of Labor Standards Enforcement, the Underground Economy Unit of the State Attorney General and the LA City Attorney San Francisco Office of Labor Standards Enforcement (OLSE) and “the Collaborative” (of worker Centers and non-profit legal advocacy groups) LA Black Worker Center (LABWC) and the Metropolitan Transit Authority (Metro)

58. School of Management and Labor Relations Coproduction cases Coalition of Immokalee Workers (CIW), and the Fair Food Standards Council, Corporate Tomato Buyers and the Florida Tomato Growers Exchange LA Unified School District and LA Building Trades US WHD and the Carpenters MCTF and Janitorial Enforcement Team (JET) at DLSE

59. School of Management and Labor Relations 1-Deep Collaboration and Trust Have Been Instrumental to the Success of Co-production Efforts. Ongoing public relationships between worker organizations and government bodies are at the center of each of the cases. Agency leaders and investigators find that access to workers and their willingness to come forward greatly increased when they were in relationship with organizations the workers trusted. Likewise, when they felt they could trust organizations, government officials articulated strong advantages to working closely with them.

60. School of Management and Labor Relations 2- Organizations Playing a Formal Role Have Enabled More Effective Monitoring and Enforcement of Labor and Employment Laws in Low Wage Sectors Government officials are largely positive about what organizations are bringing to the table. Concern on an agency’s part that close collaboration with civil society organizations could lead to charges of cronyism, favoritism or breaches of confidentiality reinforces the importance of formalization of the relationship with a clear set of rules and procedures. However, while formalization may be necessary, it is not sufficient when the commitment to the collaboration on either side is weak.

61. School of Management and Labor Relations 3-Co-production Is Building Institutions and Making Gains Sustainable Development of effective enforcement models has become increasingly urgent as more labor mandates are being passed at the local and state levels. Cities are considering expanding the enforcement role of existing agencies, the establishment of new institutions, and formal contracts with worker organizations and legal non-profits to assist enforcement. In regions and sectors where public agencies have historically been weak, innovative place-based and sectorally specific private monitoring regimes linked to strong market consequences have emerged.

62. School of Management and Labor Relations 4-Co-production Leads to New Approaches to Building Worker Power and Raising Standards Organizations are finding new pathways to worker power through representation in public and private inspection regimes, settlement agreements, direct action, worker- to-worker education and public policy.

63. School of Management and Labor Relations 5-These models challenge long-held assumptions in the US about the proper role of worker organizations and government in enforcement Deputized union business agents doing inspections on public worksites Cities requiring companies to have organizations train workers on their rights and monitor worksites Police Departments delegating investigations and arresting business owners for wage theft charges brought by worker centers Investigators being trained by advocates and briefed by worker centers prior to going out to the worksite Government actively promoting unionization in a sector Growers fields and financial practices being monitored by a full-time worker-led enforcement agency

64. School of Management and Labor Relations Bursting Assumptions about Roles Worker organizations and legal advocacy groups being funded by government to assist in enforcement and collection of settlements Growers paying workers for the time spent learning their rights in the fields Government empowering worker organizations to oversee PLA’s, convene stakeholders, monitor jobs numbers, attend pre-jobs meetings Workers and worker organizations participating equally with management in worksite walk-arounds Government and worker organizations formally investigating a sector together

65. School of Management and Labor Relations Where do these models fit in American Political Development?

66. School of Management and Labor Relations What a Local Regime Could Look Like… Step 1-Create Office of Labor Standards Enforcement for all low wage sectors but with dedicated staff by sector (important to have investigators who really grasp the particularities of the sector). Funded by tax on employers in high non-complying sectors or licensing fee. Must have detailed administrative procedures. 24 hour complaint hotline with triage Step 2-Baseline sectoral studies of wage and hour and health and safety compliance. Prioritize specific sectors based on % of non-compliance found in the sector (triggers) Step 3-Sectoral tables that bring together high road employers, unions, worker centers, government to devise and implement strategic approach Step 4-Collaborations with worker centers, unions and community orgs that can apply for funding not only to do training and education but have a role in each stage of the enforcement process

67. School of Management and Labor Relations When non-compliance is found to be above a certain threshold in a sector, the agency would take the following steps: 1-Convene a sectoral table that brings together high road employers, unions, worker centers with government to devise and implement strategic approach 2- Establish a licensing and registration regime that requires employers to register with city or state and renew every year and connects registration and licensing to wage and hour and health and safety compliance 3-Require firms in highly non-compliant sectors to fund heightened enforcement/penny per hour to enforcement fund or to post high bond as part of licensing with an exception for those firms that have a CBA 4-Create a sectoral employer association that regularly convenes discussions and trainings (as a strategy for establishing new norms and communities of compliance).

68. School of Management and Labor Relations Local enforcement regime cont’d. 5- Establish mechanisms for worker voice both at the workplace and across the sector e.g. elected workplace reps who receive training and have authority to provide training and assistance for co-workers 6- Fund worker organizations to do training, education and enforcement, give broad mandate and standing to engage in each stage of the enforcement process. 7-Investigators work with employer association and worker organization to investigate complaints. 8-Strive for parity between worker organizations and firms with respect to information-sharing and settlement negotiations.

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70. “Regulatory Unionism” as a Public Good The National Recovery Act of 1933 drafted industrial “codes of fair competition” which hoped by establishing enforceable price and production standards, to shake out marginal and cutthroat firms. Accordingly, the NRA organized both wage and hour standards and bargaining rights around the industrial codes. -Colin Gordon

71. School of Management and Labor Relations National Recovery Act created National Recovery Administration to oversee codes of fair competition through the setting of maximum hours and minimum wages by industry. By including a collective bargaining clause that guaranteed workers the right to organize and participate in the setting of codes, NRA supporters were trying to provide labor with the means to ensure that businesses complied with the wage and hour codes.

72. School of Management and Labor Relations The theory: In urban labor markets leading employers and unions had a common interest in taking wages out of competition in order to discipline the cutthroat edges of locally competitive markets Leading employers saw collective bargaining agreements as way of achieving competitive stability through the complete organization of urban markets If employers were not competing on the basis of wages they would have to compete on the basis of productivity and quality and price (but not labor) But the strategy rested on an “all or nothing” logic…

73. School of Management and Labor Relations If the best scenario was total organization, second best scenario was NO union presence whatsoever because partial organization meant that some would be paying union wages while others were not—placing most of them at an untenable competitive disadvantage…

74. School of Management and Labor Relations Since total organization was very hard to achieve, the idea of regulatory unionism was to combine public policies that established minimum levels by sector with bargaining rights and incentives for employers not to fight unionization ….This is what worker centers, unions and sympathetic state actors are attempting to do today.

75. School of Management and Labor Relations Contemporary Example of Regulatory Unionism: the Car Wash Worker Law in California The new Car Wash Worker Law that went into effect on January 1, 2014, continues to require all California car washes to register with the State Department of Labor Standards Enforcement (DSLE). Registration is important because pirate car washes lower standards, go in and out of business, law brings them out of the shadows Got rid of sunset clause. No car wash can register or renew its registration (as required annually) unless it has “obtained a surety bond issued by a surety company admitted to do business in this state. The principal sum of the bond shall be not less than one hundred fifty thousand dollars ($150,000).

76. School of Management and Labor Relations Car wash law continued The purpose of the bond requirement is to ensure that workers who are not paid in accordance with law can be compensated if their employer disappears or is otherwise unable to pay wages or benefits owed the employees. The law creates an exception to the bond requirement for car washes that are party to collective bargaining agreements containing terms that protect workers against nonpayment of wages. The law provides that the bond requirement “shall not apply to [a car wash] employer covered by a valid collective bargaining agreement, if the agreement expressly provides for all of the following: (A) Wages. (B) Hours of work. (C) Working conditions. (D) An expeditious process to resolve disputes concerning nonpayment of wages.”

77. School of Management and Labor Relations Organizing Victories 25 UNION SHOPS 22 under contract Over 200 workers now members of the USWA

78. School of Management and Labor Relations Co-production hearkens back to the original logic of FLSA enforcement envisioned by the Second New Dealers…

79. School of Management and Labor Relations What was the original logic of enforcement? While much of the debate about the Fair Labor Standards Act and its subsequent amendment had to do with the impact of minimum wage on employment levels, exclusion of particular industries and occupations and increases in the wage itself at the time of its drafting there were major debates about institutional design and modes of enforcement…

80. School of Management and Labor Relations The Second New Dealers and the Fair Labor Standards Board “public control of competition, rather than protection of work conditions would be more effective in establishing fair work standards. A quasi-judicial agency, in which enlightened employers and unions could band together and help police sweatshop employers, who would then be tried by the FLSB, would be the most effectual type of agency…” Ruth O’Brien They had a logic of how enforcement would work but the debate about institutional design was lost…

81. School of Management and Labor Relations The original wage and hour bill: 1-Would have regulated the employer’s freedom to contract by establishing substantive rights—the rights to a fair wage and reasonable hours 2-would have established a Fair Labor Standards Board that would not have been impartial—it would have been an enforcement arm that would exist to ensure that individual workers secured their rights from employers 3-enforcement would have gone beyond the administrative apparatus of the agency and proposed that unions, other types of labor organizations and trade associations could adopt an informal role in the enforcement of these rights. Promoted organized labor as a partner in setting and enforcing wages and hours to benefit the marginal workforce

82. School of Management and Labor Relations Using the unfair trade practices within the Commerce Clause Second New Dealers recommended that the Court’s emphasis on freedom to contract could be undermined by attacking unfair trade practices which had been accepted since the formation of the Fair Trade Commission (FTC) in 1913. “No one can call this regimentation. It is protection. Since it does not fix wages or hours but prohibits an unfair method of competition in interstate commerce it can readily be defended as an extension of the commerce power…” “This is not a wage or hour fixing bill…It is an unfair competition bill prohibiting the obtaining of a competitive advantage by unfair labor practices, i.e. child labor, excessive hours, low wages—sweatshop conditions generally.”

83. School of Management and Labor Relations Original bill was modeled after the one that established the FTC Section 9 of the bill provided that the FLSB’s orders were “supported by cases upholding the power of Congress to eliminate unfair methods of competition in interstate commerce.” Established an extremely powerful Fair Labor Standards Board (modeled on the NLRB).

84. School of Management and Labor Relations What happened to the original “logic”? Others in the Roosevelt Administration wanted to write a bill that had no chance of being overturned by the Supreme Court for violating the Interstate Commerce Clause so unfair trade provisions were dropped Pressure from Southern Democrats and Western Republicans for a watered down bill Opposition from AFL and CIO who feared wage-fixing powers would weaken private collective bargaining agreements …Meant that this approach was dropped before the bill was ever finalized and sent to congress

85. School of Management and Labor Relations Sidney Hillman: Dissenting Voice in Favor of Regulatory Unionism “I am speaking from my experience of the many industries…such as the garment industry, the shoe industry, textiles and others” that were unstable and had profited from regulatory unionism in the past.” “It is difficult to induce employers to enter into collective bargaining agreements when the unions are not in position to protect the employers from undercutting labor costs in other areas.” The absence of unfair trade provisions, which would have made organized labor a partner in the implementation and enforcement of the wage and hour bill, he said, would “emasculate” it.

86. School of Management and Labor Relations When FLSA finally passed, cont’d: Appointed inspectors through the civil service rules which gave WHD administrator little control over them WHD given no authority to issue cease and desist orders against employers Set fines that were extremely low The FLSA provided that the Labor Department Solicitor would bring non-compliant employers before the federal courts. The federal courts would then determine an employer’s innocence or guilt. Contrast this to the NLRB which has the authority to investigate, try and judge those suspected of violating its standards Litigation is so cost-prohibitive that the WHD litigates only 1% of all complaints for non-compliance—seeks settlements on the rest.

87. School of Management and Labor Relations When FLSA finally passed the congress… One overall minimum wage as opposed to industry and geographically specific wage standards Unfair trade provisions were removed Provided no regulatory role to unions or firms Established a weak quasi-legislative body under the DOL Made the Wage and Hour Division dependent upon funds from the general budget of the DOL

88. School of Management and Labor Relations When FLSA finally passed, cont’d: Appointed inspectors through the civil service rules which gave WHD administrator little control over them WHD given no authority to issue cease and desist orders against employers Set fines that were extremely low

89. School of Management and Labor Relations Portal to Portal Act 1946 Further weakened organized labor’s attempts to help enforce FLSA by repealing the provision in the law that gave workers the capacity to have a representative sue on their behalf. Also, to be included in a class action lawsuit, the Portal to Portal Act mandated that each person provide her written consent. (opt in instead of opt out) The result was that the Act dramatically increased the difficulty of filing and joining class action suits and eliminated the ability of unions to bring such suits on behalf of members.

90. School of Management and Labor Relations The “Bureaucratic Neutrality” Issue United States Independent regulatory agencies have developed into legal tradition and organizational culture that makes collaboration difficult

91. School of Management and Labor Relations The Politics/Administration Dichotomy: Woodrow Wilson (1887) Wilson’s essay: “The Study of Administration” established a series of concepts in public administration such as the role of science, business-like management, efficiency and professionalism as methods of reform in government.

92. School of Management and Labor Relations Different interpretations of the proper role of a government bureaucrat Progressivism Espoused total separation between politics and administration Science, expertise and management would solve the problems of government—leave it to the experts Parties, urban political machines and unions seen as special interests Ultimate objective: non- partisanship, expertise, civil service -Grant McConnell New Deal A servant of political interests backed by voters, not an administrative neutral fulfilling scientific objectives Civil Service as protection from mindless victimization of partisan politics but not protection from the responsibility of serving the political aims of those in power, not intended to be above political judgment and control Barry D. Karl

93. School of Management and Labor Relations Bureaucratic Neutrality versus Bureaucracy Viewing Organization as a Public Good “We are not neutral…We are here to enforce the labor code and that is to protect workers…” Julie Su, Labor Commissioner “Law enforcement doesn’t mean you are neutral, it is not ‘let’s see both sides of the story…we have allegations you have broken the law and unless you prove us wrong, you are in trouble and you have to pay.’” -Julia Figueroa, DLSE

94. School of Management and Labor Relations “This is something that requires a culture shift in the agency: If the agency’s job is to enforce laws that were put on the books to help working people and working with outside organizations whose purposes is to work with working people to protect themselves and their rights, it seems like a natural alliance that doesn’t imply any partiality…we are both doing the same thing.” –Julia Figueroa, DLSE