Sunday, 14 December 2014

The political effect of general strikes

On Monday 15 December, a national strike will be held in Belgium, against the government’s austerity plans and for social justice. The action is consistent with a European trend: as the number of ‘normal’ strikes declines, the number of general strikes is growing. Since 1980, 130 general strikes (including 13 credible strike threats) have taken place in Europe, including as many as 36 in the period 2010–2012.

And those general strikes appear to be successful, researchers Kerstin Hamann, Alison Johnston and John Kelly (via Kurt Vandaele) conclude. Not only can general strikes force governments to change their policies; in addition, government parties that are confronted with a general strike tend to get fewer votes in the next election. After a general strike, voters punish not only left parties; centre and right governments suffer the same fate.

With this type of correlations it’s difficult to demonstrate causality, although the authors have of course corrected for a number of relevant variables. In any case, government parties that are confronted with a general strike should be worried about the next election.

Wednesday, 26 November 2014

Dutch unions approve merger on 1 January

Today, the Congress of FNV Bondgenoten voted overwhelmingly in favour of a proposal to merge with other FNV-affiliated unions. The merger, which will take effect on 1 January 2015, involves the following organisations: Abvakabo FNV (public sector), FNV Bondgenoten (private sector), FNV Bouw (construction), FNV Sport and the former FNV Federation.

The merger was supported by over 90% of the union’s elected industry representatives (the proposal narrowly failed to get the required two-thirds majority at a previous congress in October). Members of the other unions involved in the merger had already approved the plan. FNV Kiem, representing artists and workers in the printing industry, will decide on 20 December on joining the new union, while a number of smaller unions have decided to remain affiliated to the FNV without participating in the merger. Currently, all FNV-affiliated unions have 1.1m members

Chairman Ton Heerts said the merger will strengthen the FNV in its fight against employers who exploit workers and against the austerity policies of the government.

Sunday, 23 November 2014

As trade unions consider merger, the Dutch want their unions to take a much tougher stance

A plan to create a new Dutch union with over 1 million members was put on hold in October, when the plan just failed to get a two-thirds majority at the convention of FNV Bondgenoten, one of the unions involved in the merger plans. A new vote will take place on 26 November.

Representatives of employers’ organisations expressed disappointment at the initial rejection of the merger. They had been hoping the merger would result in a stable trade union that will play a constructive role in the elaborate social dialogue institutions of the Dutch «polder model».



In fact, that’s exactly what Dutch unions have been doing over the past decades, as evidenced by their low strike rates. But with growing inequality and an erosion of the welfare state going on, doubts arise whether social dialogue is enough. Some groups of workers, like cleaners and health care workers, have successfully resorted to more assertive campaign methods to fight for decent pay and better working conditions.

Since 2007, researchers of the University of Tilburg have been asking a panel of about 6,000 respondents what they expect of unions. More specifically, they have asked respondents whether they agree that «Trade unions should take a much tougher political stance, if they wish to promote the workers’ interests». In the latest edition of the study, 44% (strongly) agree and only 13% (strongly) disagree.

If anything, support for tougher unions seems to have grown over the past years. Surprisingly, even among the self-employed and among people who voted for neoliberal parties like VVD and D66 in 2012, more respondents agree than disagree that unions should take a much tougher stance. High-income respondents are among the few groups that are not so keen on tougher unions.

Last weekend, chairman Ton Heerts explained the position of the FNV to the Telegraaf newspaper: “I think we’ve proven over the past year that it’s quite possible to combine substance, dialogue and action. With the current wave of right-wing policies, the emphasis will be more on actions. That’s fine.”

An earlier version of this analysis was published here

LA: Map shows which neighbourhoods will benefit from hotel workers’ pay rise

Steven Greenhouse of the NYT has written an extensive analysis of the campaign that resulted in a $15.37 minimum wage for hotel workers in Los Angeles. As part of the campaign, the Los Angeles Alliance for a New Economy (Laane), a pioneering coalition that campaigns for social justice, has created a map of LA that shows where hotel workers live and how much they would benefit from a $15.37 minimum wage in the sector. The map also shows the total economic benefit the measure would bring to these neighbourhoods.

While the Chamber of Commerce opposed the minimum wage rise, Laane demonstrated that many business owners disagreed. Volunteers knocked on the doors of small businesses to seek their support. 750 small-business owners signed a petition for the higher wage and hundreds placed “Raise L.A.” stickers in their windows.

Monday, 20 October 2014

How to achieve membership growth? Ask the union!

Trade unions are often associated with membership losses, but not the German metal workers’ union IG Metall. The Christian Democrat party CDU, who have lost about ten percent of their members since the beginning of the decade, have invited Christian Kühbauch of IG Metall to explain how the trade union has managed to achieve membership gains.

Sunday, 12 October 2014

Unions and private equity

Private equity firms use borrowed money to buy companies, restructure them, and try to sell them at a profit. While there’s considerable diversity in how these firms operate, they often have a negative impact on workers (and on other stakeholders). Private equity firms tend to invest in healthy companies with job growth and decent wages. They may sometimes help these companies grow further, but often their business model will involve cutting jobs and wages.

A new book by Eileen Appelbaum en Rosemary Batt explains how private equity operates. Private equity firms create investment funds, raise money from pension funds and rich individuals and use that money in combination with huge bank loans to buy portfolio companies. They may replace the management of these companies and they’ll make sure management has strong incentives to act in the interest of its new owners. The new management will typically write an initial 100-day plan to restructure the company, manage its debt and meet its targets. After 3-5 years, or sometimes longer, the fund will exit the investment, for example by selling the company or taking it public.

Appelbaum and Batt not only discuss how private equity operates; they also analyse how workers and their unions respond. Often, unions try to limit job losses and reductions in wages and benefits through negotiations. These negotiations are more likely to have a degree of success when the workers are specialists who are difficult to replace.

There are also examples of unions that have taken a more offensive approach. An example is Ormet Aluminium, which had a fiercely antiunion CEO and was taken over by private equity in 2004. After steelworkers’ union USWA refused to make the concessions demanded by the employer, the company had the labour contract voided. 1300 workers went on strike; they engaged support from pension funds with investments in the private equity fund; protests were held across the country and road warrior teams showed up at events of the bosses of the company and the private equity. Eventually, the antiunion CEO was replaced and a new contract was signed in 2006.

Appelbaum and Batt also discuss the role of pension funds with investments in private equity. They suggest the managers of these funds should ask themselves some questions, for example:

  • Pension fund managers have an obligation to act in the interest of current and future beneficiaries. Can they meet that obligation given the limited transparency of private equity?
  • Are investments in private equity funds really that profitable compared to other investments with similar risk profiles?
  • And how about the unequal relationship between investors and the private equity firm (which receives high rewards, runs limited risk, and may have incentives not to act in the interests of the investors)?

Eileen Appelbaum en Rosemary Batt (2014), Private Equity at Work: When Wall Street Manages Main Street. Russel Sage Foundation.

Monday, 6 October 2014

Google to take security guards inhouse

Google plans to hire more than 200 security officers as its own employees rather than through an outside contractor. They will get the same benefits as Google staff.

The move comes after a series of actions by trade union SEIU urging Google to take repsonsibility for working conditions and organizing rights of the security guards working at its offices. This summer, a report revealed that local security guards earn $14 per hour, compared to a median wage of $63 per hour for software developers.

Google says the protests didn’t influence its decision to insource security. A spokesperson told WSJ they are ‘excited’ to insource the security services. WSJ says that Google’s move may well have an impact on other companies like Apple and Facebook. Apple is currently using the same security firm as Google and faced a protest at its Apple Store in San Francisco in August, resulting in 12 arrests. Silicon Valley tech companies are under increasing scrutiny over the working conditions and pay of outsourced staff.