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.

Sunday, 5 October 2014

Week of actions against workfare

The British ‘Boycott Workfare’ campaign has revealed an email in which ‘unpaid employees’ are marketed to potential employers. Unemployed workers can be used for free in various roles including English language teachers and receptionists. “If you are in paid work, that list of potential roles should worry you: at the moment these are paid jobs”.

Boycott Workfare points out that resistance against workfare can have an impact. As a result of actions, various employers have withdrawn from workfare programmes. Starting on Monday, a week of actions will be held across the UK and abroad, including an action in Amsterdam.

Bus drivers and passengers join forces

“Community groups, often calling themselves bus riders unions, are popping up all over the country”, Labor Notes reports. Organizers ‘jump on buses’ to talk to to passengers about bus service. Increasingly, they join forces with bus drivers to fight against cuts that lead to fewer busses running a route or entire routes being cancelled. Sometimes, bus operators try to pit drivers and passengers against each, for example by cutting services and blaming union wages and benefits.

Saturday, 20 September 2014

‘Right to collective action extends to the unemployed who are forced to do unpaid work’

Unemployed people who are required to work without a receiving wages still have fundamental labour rights like anyone else, including to the right to take collective action. This was confirmed by Amsterdam alderman Arjan Vliegenthart in response to a question from council member Maureen van der Pligt.

The question was prompted by reports about intimidation of participants in a work programme who wanted to join a protest against unpaid work.

The organisation Doorbraak argues:

In principle, the right to collective action includes the right to strike. However, until now, welfare recipients have been punished with benefit cuts or ending their benefit when they refuse to perform forced labour. Of course, such a punishment is at odds with the right to strike. Historically, strikes have always been one of the most powerful forms of action of the labour movement. People who perform forced labour could use the same form of action to support their demands.

Incidentally, the Amsterdam government has announced it will end the requirement for the unemployed to work below the minimum wage.

Tuesday, 9 September 2014

Advice to unions: ‘Stop complaining, start organising’

Hotel cleaners in Manhattan earn $28.50 per hour; three times as much as their British counterparts, Aditya Chakrabortty of the Guardian reports. Why? Because hotel staff in Manhattan are organised and have a unionisation rate of 70%.

Unions in the UK (and elsewhere) complain that many new jobs are low-paid service jobs. “Graduates are becoming not barristers but baristas – and not just for a few weeks but for years.” Chakrabortty argues this criticism is justified but no excuse for fatalism:

First, for the labour movement to recognise that Britain’s major growth industries are in poverty-pay sectors, and then not to try organising those sectors, amounts to little more than an early call for its obituarists to get typing. Second, workers in those sectors can not only organise – they can take serious industrial action.

He points to a strike of care staff in Doncaster and to cleaners who won a living wage after a campaign at University of London.

Over the past weekend, Chakrabortty has been talking to workers at InterContinental Hotels Group. He heard stories about low pay, intimidation and discrimination. This can change, he argues. What it takes is ‘committed, deft organising’.