Xerox class action certified

Law.com has this from the New York Law Journal (Leigh Jones): "Class Status Granted in Bias Suit Against Xerox":

A federal civil rights lawsuit filed by Xerox sales employees alleging that the company assigned them to unprofitable territories and failed to promote them because they are black has received class action status. . . .

The ruling in Warren v. Xerox Corp., 01 CV 2909, means that all black Xerox sales employees who worked for the company in the United States from Feb. 1, 1997, to the present or to the date of a judgment are included in the class. While the decision allows the plaintiffs to go forward as a class on injunctive and declaratory claims, it requires them to proceed individually in the damages and remediation phase. . . .

The lawsuit . . . claims that Xerox initiated a sales restructuring program in 1997 that . . . systematically assign[ed] black sales employees to inferior sales territories, often in low income or minority neighborhoods.

It also claims the company refused to promote black sales people or transfer them to more lucrative territories regardless of their performance and that the company denied sales commissions to those employees who rightfully earned them. . . .

Apparently persuasive to the judge and the magistrate judge was a report issued by the plaintiffs' expert that, according to the recommendation, "reveal[ed] a statistically significant disparity between the earnings of black and white salespersons at Xerox."

Xerox had argued that the report failed to establish a nexus between the territory configurations and the alleged income disparities. But the court was not convinced that Xerox's cited reason for the disparity, individual performance, could undermine the plaintiffs' claims that they had common experiences to warrant class action status.

"Indeed, if an assertion of inferior performance were sufficient to defeat a certification motion, few, if any, classes would ever be certified in employment discrimination cases," Mann wrote in a footnote. . . .

These employment class actions against large companies have become rather popular. Unfortunately, many companies have caved in to huge settlements because of the burdensomeness of defense costs, which just encourages the plaintiff's bar to keep filing them.

It is certainly possible with salespersons like these that there was a (conscious or unconscious) racial matching of employees to territories, which could have impacted sales and thereby commissions.

Analysis of performance measures for salespersons can be tricky. Sales numbers seem to be very objective measures of ability and effort, so that commissioned earnings disparities are not discriminatory but based on ability and effort. But the assigned territory and its existing and potential customer base can have a huge impact, even to the point that higher earners are actually less hard workers, not more, because the business opportunities they have are so superior.

Continued . . .

Various harassment items

Here are a number of things I collected recently relating to harassment claims.

First, the latest Hooters case.

Over the weekend, CNN reported: "Police: 200 Hooters applicants taped undressing"

WEST COVINA, California (AP) -- Nearly 200 women who applied for jobs at a Hooters restaurant were secretly videotaped in a trailer while they undressed to put on a Hooters uniform . . . Authorities raided the trailer last month and seized a computer that held 180 digital videos of the women, ages 17-25 . . . .

Hooters is a national chain known for its scantily clad waitresses, who wear low-cut tank tops and shorts.

Justin Johl, a lawyer for Hooters, said the company was outraged and was conducting its own investigation.

Like night follows day, by Wednesday the inevitable civil lawsuit was reported: "Hooters sued for spying on women; Five job applicants sue after police find videos manager took of women changing into uniforms" (CNN/Money - Reuters)

Five women who say they were secretly videotaped naked or undressing while they applied for jobs at a Los Angeles area Hooters sued the restaurant chain Tuesday.

The lawsuit comes as police in the Los Angeles suburb of West Covina investigate 180 video files seized from the personal computer of a former Hooters manager that show job applicants changing into the chain's body-hugging uniforms. . .

[The suit] claim[s] invasion of privacy and employment discrimination.

Mike McNeil, a spokesman for Hooters of America, Inc., said that the surreptitious taping was "clearly an instance of an individual acting outside the scope of the company's policies as well as the law."

McNeil said Hooters was not a target of the investigation and had been commended by police for their cooperation, adding that he did not understand what lawyer Gloria Allred, who represents the plaintiffs, hoped to gain by the lawsuit.

"Thanks to our cooperation and policies and swift movement in this case, these images were not published," McNeil said. . . . He added that the West Covina restaurant was a franchise and not owned by Hooters of America.

Hooters of America seems like it would be fairly well insulated from this outrageous alleged conduct. Clearly it was not authorized and not within the scope of the manager's employment. The franchise relationship should provide further legal insulation.

But there is a lesson here about the "slippery slope" of sexual harassment. Hooters has had problems in this area before (though not so severe, to my knowledge); see Hooters of America, Inc. v. Phillips, 173 F.3d 933 (4th Cir. 1999) (indicating unsuccessful effort to channel harassment complaint to mandatory arbitration).

It is scarcely surprising that individuals inclined to engage in inappropriate sexual behavior are attracted (as employees as well as customers) to a company that sells hot young bodies and pretty faces as much as -- or more than -- great food. I would hope and expect that for this reason the company has an aggressive posture towards harassment prevention and response.

But it seems that it would be hard to avoid sending a double message -- women are sex objects when it comes to attracting business ("where would Hooters be without our world-famous Hooters girls?"), but don't treat them as sex objects.

Next, Newsday.com (Carrie Mason-Draffen) reports a big harassment award on Long Island: "$1.6M award for LI women"

[The] lawsuit detailed a pattern of sexual harassment by [a] manager . . . that included lewd remarks, groping and pressure for dates and sex. The women said when they complained, the company did nothing or retaliated. . . .

Judge Arthur Spatt is almost certain to reduce the $980,000 in punitive damages, which are covered by Title VII of the Civil Rights Act. That act limits plaintiffs' punitive-damage award based on a company's size.

But the jury, with its sizable award, including about $620,000 in compensatory damages, showed that it largely agreed with the plaintiffs about what took place . . . . [actually, both compensatory and punitive damages combined are subject to limits based on the company's size]

[The defense attorney] said "We believe that the jury was incorrect," [and] . . . the company's anti-sexual harassment policy "showed that we don't condone any inappropriate behavior."

But the jury award reflected the outrageous behavior, according to the plaintiffs' co-counsel . . . .

This is typical -- juries are likely to focus on the severity of behavior, and may ignore the fine points of the law when it comes to determining whether the employer should be liable for such behavior (which is far from automatic).

On the other hand, it is not likely the judge would have let the case go to trial had there not been some basis for employer liability, most likely significant evidence of the company's failure to respond appropriately to complaints.

It's just not enough to have a policy that shows a company does not condone sexual harassment, it must show this through its actions, particularly when it learns there may be problems.

Finally, this bizarre case from Reuters: "Workers Suing Over Man in See-Through Shorts"

SANTA FE, N.M. (Reuters) - Former employees of Whole Foods Market have sued the natural foods supermarket operator, saying it did not take proper action to prevent a male customer from parading through a Santa Fe store wearing white, see-through biking shorts with no underwear.

Maria Bautista and seven other plaintiffs are suing under New Mexico's Human Rights Act, saying the store fostered an environment of discrimination and sexual harassment that caused them emotional distress. . . .

They . . . claim the store ignored their complaints about a middle-aged man in the see-through, body-hugging shorts and fired one of them in retaliation for her complaint.

This sounds like probably a loser for these women, though I guess it depends on how see-through those shorts really were, and how often the customer visited in such attire. There's a difference between the sexes -- I doubt you'd find men suing because a female customer wore excessively revealing clothing.

Seriously, it does point out that an employer has a responsibility for protecting employees against harassment by customers and other third parties, not just other employees.

Continued . . .

Very confusing case on vacation pay upon termination

This Illinois case illustrates how complicated lawyers and courts can make a seemingly simple question: here whether an employee is entitled to vacation pay upon termination, and if so, how much.

In People ex rel. Department of Labor v. General Electric Co., No. 1-02-3372 (Ill. App. 1st Dist. 3/9/04), the Illinois Court of Appeals held that employees were entitled upon termination to payments not only for unused vacation that was to be taken during the current year, but also for a pro rata share of the vacation they would have been entitled to take the following year.

This outcome was based on analysis of a particular Illinois statute and the regulations and case law applying it. It is potentially of broader interest, however, for several points.

First, and most fundamentally, entitlement to vacation pay consists of two conceptually distinct aspects: unused vacation for the current year, and pro rata vacation being earned for the next year. Many employers give no consideration to the issue faced by General Electric in this case -- whether there is an obligation to pay the latter aspect of vacation pay upon termination. Depending on state law and the employer's policies and practices, as well as any applicable collective bargaining agreement, there may not be any such obligation, but it can be a significant issue, as General Electric discovered in Illinois.

Second, it matters how a vacation policy is worded. I have too often seen employee handbooks with carelessly thrown together and ambiguous vacation policies.

Third, entitlement to vacation pay is a matter of state law, and there is some variation among states on this issue. Employers with multi-state operations should either be acquainted with each state's law on this and comply with it or take a least-common-denominator approach, adopting the most generous possible interpretation in order to have a single nationwide policy that complies with all states' laws. Otherwise, there is a risk of trouble in an employee-friendly state such as Illinois.

Continued . . .

Continued good numbers on new jobless claims

Reuters reports: "An optimistic job signal? With average weekly claims at 3-year low, there's some sentiment big employment gains are coming."

New jobless claims were little changed last week, the government said Thursday, coming in near Wall Street forecasts and raising some hopes for a strong monthly jobs report next week.

The Labor Department said 339,000 people filed new claims for state unemployment benefits in the week ended March 20, compared with a revised 338,000 the prior week. . . .

The closely watched four-week moving average of initial jobless claims, which irons out weekly fluctuations, declined for a fourth straight week, to 341,500 from 344,500.

That was the lowest reading for average claims since 336,500 in January 2001.

The lack of job growth, despite other indications of an improving economy, has become a major concern of economists and investors, as well as an issue in this year's presidential election. Thus the report on March payrolls and unemployment, due April 2, will be closely watched. Read more

Continued . . .

Big labor peaceful in March

Reuters reports: "No big U.S. strikes in March-Labor Department": "ftp://ftp.bls.gov/pub/special.requests/ee/Tables/strike.txt."

There were no large strikes by American workers in March, the Department of Labor said on Friday, after a 20-week-long grocery store action in California ended in late February.

Economists said the return of the striking grocery workers during the reference period used to calculate the department's payroll number for March is likely to boost the job growth figure for the month.

Good news. It doesn't make much sense to strike when the job market's as weak as some of the numbers (and the Democrats) suggest. And the UFCW's experience should be a sobering lesson. It may even be this decade's equivalent of the 1980's PATCO strike (air traffic controllers -- anyone remember that?) in terms of suppressing labor's urge to strike.

Continued . . .

Supreme Court to decide age discrimination disparate impact issue

Findlaw (AP-Gina Holland) reports: "Court to Examine Age Bias in Workplace"

The Supreme Court said Monday it would consider . . . whether [federal agediscrimination law (ADEA)] . . . permits lawsuits on grounds that an employer's action has a disproportionate impact on older workers. Justices already have settled that impact suits are allowed under the 1964 Civil Rights Act, which bans discrimination based on a worker's sex, religion or race.

Thomas Goldstein, the Washington lawyer representing the [plaintiffs], said that the two laws have the same wording, and the same purpose. . . .

"Because the act covers so many employees, the question presented is of great importance to the national economy," Goldstein said in a filing.

Washington lawyer Glen Nager, representing the [defendant], agreed that courts around the country are divided over the standard for lawsuits. "All parties to the litigation," he wrote, "are better served by obtaining final clarification from this court."

The case is Smith v. City of Jackson, Miss. Read more

Without having read the opinion below, it seems there is no reason in principle not to allow disparate impact suits under the ADEA on the same terms as under Title VII. Fear of opening the floodgates of litigation is tempered by the fact such suits have not been tremendously successful under Title VII, in general, and have kind of fallen out of fashion. Plus statistical analyses -- the heart of disparate impact cases -- have long been used as supporting evidence in age cases anyway -- under a disparate treatment analysis.

Continued . . .

D.C. area grocery negotiation update

washingtonpost.com (Michael Barbaro)
reports: "Grocery Contract Talks Near Deadline"

Negotiators for the region's two biggest supermarket chains and the union representing their 18,000 Washington area workers met through the evening yesterday to try to agree on a new contract before a Tuesday night deadline.

With their current contract set to expire Tuesday night, Giant and Safeway workers are scheduled to vote on their employers' final proposal beginning tomorrow at 8 a.m. If employees reject the contract, they could vote to strike, triggering a walkout Wednesday at 350 area grocery stores.

"We're hopeful," said the chain's negotiator, Harry Burton. C. James Lowthers, the president of the United Food and Commercial Workers Local 400, declined to comment. . . .

If there is a strike, Giant and Safeway say they will operate stores on a normal schedule, relying on a combination of managers and more than 3,000 temporary workers. . . .

Even if workers at just one of the two chains vote to strike, both are expected to end up on the picket line. Giant and Safeway have signed an agreement to lock out workers if the UFCW attempts, as it did in California, to strike only one of the supermarkets at the bargaining table.

Read more

washingtonpost.com (Michael Barbaro)also had this more in-depth and human-interest type story relating to these negotiations: "Grocery Workers Try to Keep the Good Life;Middle Class Could Be Out of Reach Under New Safeway, Giant Contract"

This article profiles a very long-term Safeway cashier with a very middle-class lifestyle(Glennis T. Mitchiner). An interesting part of this lifestyle is that even his wife shops at Wal-Mart: "'I can get more for our money,' she says, as her husband buries his face in his hands."

Even more interesting:

Economists describe Mitchiner's line of work as unskilled. But not Mitchiner. Before he could ever run a cash register, he had to memorize hundreds of product names and price codes, which he easily rattles off:

Banana, 4011. Red Delicious apple, 4016. Granny Smith, 4017.

Behind the register, wearing a black Safeway smock and cap, the 6-foot-6 Mitchiner says it often feels like he operates his own small business, with customers who rely on him to solve their problems.

"Slide your card across like that," Mitchiner explained to a middle-aged man on a recent morning. "No, like this," he says, showing him again. Behind him, shoppers grow irritated. Eyes begin to roll, but Mitchiner just smiles.

Shoppers pepper Mitchiner with questions all day. Where is the low-fat salsa? When are chicken thighs going on sale? Why are pre-cut canned peaches out of stock?

He answers them all. As he sees it, he is what keeps customers coming back.

But as the grocery chains see it, Mitchiner, or at least costly employees like him, are part of their financial problem. Safeway pays Mitchiner $17.66 an hour and $35.32 for work on Sundays. Wages there are up to three times those of nonunion stores. . . .

So how hard will he fight? He says his family can probably go about two months without his paycheck. Looking at the California strike, he said, "Shoot, if I were out five months, I would take a contract like that." Read more

The last comment supports my prediction: this and the other grocery contracts will be settled without a strike because of the impact of the California strike on both parties' attitude towards bargaining.

The discussion of the skills and customer-service role -- and obvious corporate loyalty -- of the profiled employee suggests that perhaps the way for these stores to compete, instead of the much-ballyhooed "race to the bottom" led by Wal-Mart, is to work really hard on getting the most benefit from the skills and experience of such employees.

I'm not sure how they can best do this, but reading about this guy, and contrasting him to the low-wage, customer-service-oblivious employees one encounters in so many businesses today, makes me feel there ought to be a way to make sure he provides enough value to the Company -- and its customers -- to justify his current pay and benefits.

Continued . . .

Weirton Steel contract ratified

Findlaw (AP-Vicki Smith) reports: "Weirton Steel Workers OK Pact With ISG"

Employees at bankrupt Weirton Steel Corp. represented by Independent Steelworkers Union ("ISU") voted overwhelmingly Monday to ratify a collective-bargaining agreement with the mill's prospective new owner, International Steel Group, Inc. ("ISG")

"We are ready to embrace a new way of making steel, and we are preserving the steel industry in Weirton that has been here for nearly 100 years," said ISU President Mark Glyptis. "We welcome the partnership with ISG and are prepared to make this partnership profitable, proud and long term."

The contract vote was one of the union's most important decisions since 1983, when employees decided to buy the mill from its previous owner, now-defunct National Steel Corp. . . .

The contract would save about 2,000 jobs in Weirton and is packed with incentives, including bonuses and quarterly profit-sharing. Workers would be required to perform more tasks than in the past, with the number of job categories shrinking from 32 to five. However, the pay system would reward them for increased productivity.

Starting wages would range from $14 to $19.50 per hour, with raises 12, 30 and 46 months into the contract.

The contract also would provide traditional benefits such as vacation time, bereavement and sick leave, health and vision coverage, and a 401(k) savings plan. It also includes a defined-contribution pension plan. Read more

Sounds like not a bad deal for the employees, particularly the traditional benefits, as health coverage is now so often a major disputed issue in negotiations.

A defined-contribution pension plan as a better deal for the employer than the defined-benefit plans which have been problematic to fund. Reduction in the number of job categories provides much-needed flexibility for management, and the incentives sound like a good move towards pay-for-performance.

Continued . . .

Supreme Court oral argument next week on sexual-harassment constructive discharge -- important issue or much ado about nothing?

The term "constructive discharge" refers to a resignation that courts treat as the legal equivalent of an involuntary termination. It has been applied where working conditions would lead a reasonable person to feel they have no choice but to quit. It also obviously applies to resignations which are thinly veiled terminations ("you're fired, but to ease the pain a bit, we'll allow you to resign").

This coming Wednesday, the Supreme Court will hear oral arguments on whether in a harassment case involving constructive discharge an employer may assert the affirmative defense that it took reasonable steps to prevent and correct harassment whereas the employee unreasonably failed to take advantage of preventive or corrective opportunities provided by the employer or to avoid harm otherwise. If this defense is not available, and if the harassment was by a supervisor of the employee and meets the legal standard for actionable harassment, the employer is strictly liable.

Marcia Coyle writes in the National Law Journal [free regis. req'd.]: "High Court Set to Mend a Split on Job Suits; Circuits diverge on 'constructive' firing"

"This is a very, very important case," said Debra Katz of Washington's Bernabei & Katz, who represent employees in discrimination cases. "There are a lot of constructive discharge cases litigated. If an employer creates a work environment so intolerable that an employee is forced to leave, it should be treated no differently than an out-and-out discharge."

But quitting and being fired are different, said Pennsylvania Chief Deputy Attorney General John G. Knorr III. Allowing strict liability in constructive discharge situations "will increase the scope of an employer's liability in an area where supervisors may be misbehaving in a way that employers have no real control over," Knorr said.

The 3rd U.S. Circuit Court of Appeals agreed with the plaintiff's side and with the 8th Circuit's view that a constructive discharge constitutes a tangible employment action, such as a firing, demotion or cut in pay. The 2nd and 6th circuits have disagreed. . . .

At the heart of the Supreme Court appeal are two sexual harassment rulings by the justices in 1998: Burlington Indus. Inc. v. Ellerth, 524 U.S. 742, and Faragher v. City of Boca Raton, 524 U.S. 775.

In a sexual harassment suit under Title VII of the Civil Rights Act of 1964, the court held, an employer will be vicariously liable for a hostile work environment created by a supervisor with immediate or higher authority over a worker.

If the harassment results in a tangible employment action, such as firing, failure to promote, reassignment or a decision causing a significant change in benefits, the employer is strictly liable for its supervisors' actions.

If the harassment did not result in a tangible employment action, the employer may raise an affirmative defense to avoid liability or damages. The defense is that the employer "exercised reasonable care to prevent and correct promptly" the harassing behavior, and that the employee "unreasonably failed" to take advantage of opportunities provided by the employer to correct or prevent the harm. . . .

The state and its supporters argue that a constructive discharge lacks the signs of official action that typically mark tangible employment actions. The latter, they say, involves "an official act of the enterprise," which generally causes direct economic harm. . . .

Allowing strict liability for harassment resulting in constructive discharges would make having a complaint procedure and a remedial policy pointless, wrote Ann Elizabeth Reesman of Washington's McGuiness Williams & Norris, counsel to the business organization.

The Bush administration argues that a constructive discharge standing alone should not produce a categorical rule of strict liability. The Faragher/Ellerth affirmative defenses should be available, the government says, "unless the constructive discharge was triggered in significant part by an 'official act' of the employer.

"An employer has far less ability to control a supervisor's workplace harassment when it is unaccompanied by an official act, and agency principles therefore do not support a rule of strict liability in such cases," the U.S. solicitor general and Equal Employment Opportunity Commission (EEOC) argue. . . .

But Suders' supporters and counsel, Donald Bailey of Bailey, Stretton & Ostrowski in Harrisburg, Pa., contend that their opponents ignore a history of court treatment of constructive discharges. Courts for decades have recognized that a constructive discharge, when proven, "is the legal equivalent of an actual discharge," Susan Grover of the College of William & Mary School of Law wrote in an amicus brief for the Lawyers Committee for Civil Rights Under Law, the National Employment Lawyers Association and other civil rights groups. . . .

[T]here is a high standard of proof for employees claiming constructive discharge. Read more

The topic is treated more thoroughly from a legal (and predictably feminist and well-spoken) perspective by Findlaw commentator Joanna Grossman: "How Should Harassment Victims' Claims of "Constructive Discharge" Be Treated? A Question the Supreme Court Soon Will Confront"

The Court, I will argue, should treat hold that strict liability is appropriate. . . .

What are the arguments in favor of counting "constructive discharge" as a "tangible employment action" -- in essence, a firing -- in the sexual harassment context?

First, outside the harassment context, the Supreme Court has repeatedly recognized that constructive discharge -- that is, a situation where quitting is the only solution -- is legally indistinguishable from actual discharge. And the EEOC has taken this position. It makes sense to apply this general legal rule -- a rule favored by the agency charged with enforcing the relevant law -- in this particular context, just as we do in other contexts.

Second, constructive discharge fits the Supreme Court's own definition of a "tangible employment action." The touchstone is whether the action constitutes a "significant change in employment status." Also, most such actions will "inflict economic harm."

Being forced to resign due to intolerable conditions plainly significantly changes employment status: The employee is now out of a job. It also plainly inflicts economic harm: Because the employee is out of a job, she loses salary and benefits.

Third, this interpretation fits well with other sexual harassment doctrines. To show constructive discharge, an employee must show she was compelled to resign--that any reasonable person in her situation would have walked off the job. And if this is truly the case, then strict liability makes sense.

Exceptions to strict liability are crafted to penalize the unreasonable non-complainer. And typically, that is not the person who is constructively discharged. It's hard to imagine a situation where it was both unreasonable not to complain, and yet reasonable to walk off the job. Often, victims walk off precisely because they were either too afraid to complain, for fear of retaliation or further harassment, or already did complain, to no avail.

Fourth, there is no "floodgates" problem here -- not all harassment will result in strict liability, even if harassment that results in "constructive discharge" does. After all, not all hostile environments are intolerable; and most victims do not quit their jobs no matter how bad the situation is. . . .

After giving equal time to the opposing arguments, Ms. Grossman concludes:

So what should the Court do in this case? It should hold that constructive discharge is -- in this context, as in others -- tantamount to a firing. But it should also reconsider its whole approach to such cases, and put less stress on the idea that a "tangible employment action" must also be an "official act."

Noted feminist scholar Martha Chamallas has proposed that, instead, courts should focus strictly on causation. If the supervisor's harassment caused the plaintiff to resign, then the plaintiff should be able to recover from the employer . . . .

This approach, Chamallas argues, is more realistic about supervisory power, which often comprises both formal and informal aspects. It also would permit courts to take into account how typical victims behave.

Real-life victims simply don't file formal complaints at the drop of a hat. And sometimes, after encountering severe harassment, they simply find it impossible to go to work one day -- and never come back. And that is understandable: Severe harassment can be demeaning, terrorizing, frightening, and traumatic.

The Court should hold that an employer is strictly liable for employing supervisors who treat their subordinates so abominably as to compel their resignation. A drumming out is as bad as -- if not worse than -- a firing. Read more

Read the briefs (scroll down to March 31)

Where to begin?

It is probably worthwhile for the Supreme Court to resolve this issue, simply to remove a basis for legal wrangling and uncertainty in otherwise already contentious and risky harassment cases.

But I have come to the conclusion that it matters little which way it is resolved. It is a fascinating lawyer's argument, but one without much practical significance.

As a defense attorney, if the employee's side wins this case, I will use the same facts regarding the plaintiff's unreasonable failure to make appropriate complaints to rebut her claim of constructive discharge. Constructive discharge is hard to prove. In the Seventh and Eighth Circuits, with which I am most familiar, failure to give the employer a reasonable opportunity to remedy the situation is usually fatal to a constructive discharge claim. I suspect most other circuits are similar.

Ms. Grossman has effectively noted this in her statement "It's hard to imagine a situation where it was both unreasonable not to complain [affirmative defense], and yet reasonable to walk off the job [constructive discharge]." In other words, it is unlikely that an employee vulnerable to the affirmative defense could meet the strict standard for establishing a constructive discharge. Conversely, an employer unable to defend against a claim of constructive discharge will likely also be unable to establish the affirmative defense.

Ms. Grossman's proposed "causation" standard, however, misses the whole point of the affirmative defense -- to encourage both employers and employees to appropriately confront and deal with harassment situations. Ultimately, under the two decisions establishing the affirmative defense, the employer is not liable for supervisory harassment, but for its own action or inaction, either in affirmatively taking tangible employment action or allowing the supervisor to do so, or in failing to respond appropriately to a complaint made by the employee through the appropriate channels. But supervisory conduct may "cause" an employee to resign under circumstances not meeting this standard. Therefore, the "causation" standard is at odds with Supreme Court precedent.

I must strongly take issue with Ms. Grossman's assertion that "there is no 'floodgates' problem." The greater the legal advantage an employee gains by claiming constructive discharge, the more likely the employee is to be advised to quit in order to strengthen their harassment case. Rightly or wrongly, plaintiff's attorneys presently perceive constructive discharge claims as strengthening cases and increasing bargaining power for settlement. More so if it is made clear that success on such a claim wipes out any opportunity for the employer to prevail on the affirmative defense.

Finally, my prediction? The Court will either reject the employee position altogether or adopt a compromise position: that whether constructive discharge defeats the affirmative defense depends upon whether the alleged cause for resignation was simply hostile environment harassment incidents by the supervisor or whether it was more of the "quit-or-be-fired" variety. If it does rule in favor of the employee position, it will note with strong language, either in dictum or in a concurring opinion, that constructive discharge is very difficult to prove and ordinarily will not occur in the absence of a failure of the employer to respond reasonably to reasonable efforts by the employee to have the harassment remedied.

Continued . . .

Informative and practical review of FMLA issues

Jackie Reinberg of AON Workforce Strategies has written a nice brief summary of FMLA (Family & Medical Leave Act) issues from a practical perspective: "Family Medical Leave: Ongoing Challenges for Today's Employers" [.pdf]

Whether you think you know it all about the FMLA or are a beginner, it's worth reading. Proper management of FMLA is of growing importance as there is increasing awareness of this law on the part of both the public and plaintiff's attorneys.

Continued . . .

Age remarks not sufficient evidence of bias

In Rowan v. Lockheed Martin Energy Systems, Inc., (6th Cir. 3/1/04), two laid off Lockheed employees alleged in support of their age discrimination claim that some of their supervisors made statements about the need to lower the average age at the plant in connection with the layoffs, that their immediate supervisor occasionally called them “old farts,” and that two of their superiors commented on a golf course seven years before the layoffs that “the older people should go, bring in some new blood . . . .”

The Sixth Circuit affirmed summary judgment for the employer, finding the alleged comments were not direct evidence of discrimination and while "[t]hey might . . . raise some suspicion as to Lockheed’s motives, and to that extent . . . make out even a prima facie case of discrimination, . . . when understood in context these statements could not lead a reasonable jury to conclude that the numerous legitimate reasons offered by Lockheed were merely a pretext for age-biased discrimination."

The court found "the concern for the average age of the work force in the plant was entirely motivated by . . . findings of [a] commission, which concluded that the nuclear industry was in danger of having a high percentage of its most important, highly skilled workers retire soon. The worry was not that older people were less capable than younger workers. On the contrary, the concern was that most of the workers with critical skills were eligible or nearly eligible for retirement, and that when those people retired the nuclear industry could potentially suffer dearly."

The significance of other alleged comments was minimized because they were by persons not involved in the decisionmaking or too remote in time. As to "old farts," the court cautioned: "using such age-based slurs may well betray a bias that older workers are less valuable or competent. However, such statements will not constitute direct evidence. Since the plaintiffs do not allege that they were made in relation to the decision to discharge the plaintiffs . . . , an inference is required that such a bias may have played a role in the decision to select these plaintiffs. " Here, the statements were not made in connection with the decision, and not by a decisionmaker.

Such remarks, or allegations thereof, are all too common in discrimination cases. Courts can find most of them inconsequential, should they so choose, for reasons such as discussed above. But they can also find them to raise issues of material fact, precluding summary judgment. Perhaps the key consideration is the strength of the employer's legitimate, nondiscriminatory reason(s) for its decision. If the employer's explanation is weak, the alleged remarks can help tip the balance towards going forward to trial. If strong, they can be explained away.

Here, the employer's explanation was strong. A younger employee retained over one plaintiff had longer company service and more time in his position, and had been responsible for more sophisticated work. His "experience and expertise clearly exceeded" the plaintiff's, "and were needed . . . ." The other plaintiff's position was being eliminated, and two employees retained instead of him "consistently received higher performance evaluations . . . while doing more complex work." The court concluded:

The plaintiffs allege that they had other qualifications that Lockheed should have considered. In order to prove discrimination, though, the plaintiffs must directly confront the asserted justification for the discharge. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 148 (2000); Gagne v. Northwestern Nat. Ins. Co., 881 F.2d 309, 314 (6th Cir. 1989). The plaintiffs may not simply substitute their own business judgment for that of the defendant. Rather, to survive a summary judgment motion they must show that a reasonable jury could conclude that the actual reasons offered by the defendant were a mere pretext for unlawful age-discrimination, not that other reasonable decision-makers might have retained the plaintiffs. In this case no reasonable jury could reach that conclusion. Read the whole opinion.

Continued . . .

One more Pledge article really worth reading

In the last post, I covered a number of stories on the Pledge of Allegiance case. Today in Findlaw, law professor Marci Hamilton writes: "The Court Hears Oral Argument in the "Under God" Pledge of Allegiance Case; Why the Court Should Reject This Pledge, and Why the Department of Justice Is Wrong To Support It"

She addresses the legal points well, but is at her best on the practical and political implications (first a few points I quibble with):

They immediately proved his point. As atheist, he is disenfranchised precisely because of his beliefs. He cannot be secure in knowing the school district will not try to inculcate his daughter in the majority religion, he cannot be elected to office, but more importantly, he cannot even argue a case at the Supreme Court--that most hallowed of courtrooms--without being reminded that he is not in the majority. The preference for "under God" cannot be separated from the desire to suppress conflicting beliefs.

Actually, I personally see value in the fact that, as a 5-year old atheist, I was taught that I was in the minority, and I think there's a difference between such a reminder and "suppression" of conflicting beliefs.

It's plain and simple endorsement of a particular religion -- as the Ninth Circuit held -- and the Court will have to tie the Establishment Clause into a pretzel to make it anything else.

Belief in "God" is far from being "a particular religion." It's every religion.

Now a few points I especially like:

Many of the Framers believed in the Christian God, but plenty of the framing generation were nonbelievers, and nonchurchgoers, as well. They founded the United States and its Constitution to create the "freedom of conscience," not some safe haven for only a likeminded hegemonic majority. The latter was precisely what they escaped in Europe. . . .

There has never been a time in United States history when it was more important for the government to maintain scrupulous neutrality with respect to religion. It is abidingly important to show that this country stands for freedom for every faith. . . .Here, every conceivable belief can be accommodated, and the number of denominations, sects, and beliefs that inhabit this country is breathtaking. That is what makes the United States distinctive--better--if you will.

To endorse Christianity [wrong, the Pledge is not just about Christianity, but is a big enough tent for all but atheists, agnostics, and polytheists] is to show ourselves as hypocrites to liberty-- and to provide fresh fodder for critics. Only if the government stays neutral on matters religious, can it persuade the world that this world war is over the right to be free, not a holy war.

The war on terror is only a religious war if President Bush permits himself to characterize us as a people unified by a single religion. [Actually, it is defined as a holy war by the enemy, not us, but the point is we shouldn't play into that characterization] We are not--we are a tolerant people united by a passionate devotion to the Pledge's "liberty for all." Read more

Continued . . .

Off-topic personal view -- on pledging allegiance to "one nation under God"

Oral argument on the pledge of allegiance case (Elk Grove Unified School District v. Newdow, 02-1624) was one of yesterday's top news stories

Let's start with a summary from Yahoo News ( Reuters -- James Vicini): "Atheist in Supreme Court Objects to 'Under God' Phrase"

Atheist Michael Newdow sought to convince [the] U.S. Supreme Court . . . Wednesday that schoolchildren reciting "under God" in the Pledge of Allegiance amounts to a government-imposed religious exercise.

He argued it violates constitutional church-state separation, winning applause in the courtroom at one point, but several skeptical justices said students can be excused from the recitations or can simply not say the "under God" part.

The justices questioned whether Newdow also objected to singing "God Bless America" in classrooms, to the use of "In God We Trust" on U.S. currency and to "God save the United States and this honorable court" as part of its opening invocation.

Newdow, an emergency room doctor from California who has a law degree and is acting as his own attorney, said the pledge in schools was different, almost like a prayer.

Read more


Warren Richey writes about the case for the Christian Science Monitor: "'One nation' - but under what?" He summarizes some of the opposing viewpoints on this seemingly trivial, but highly symbolic case:

When the nation's Founding Fathers declared their independence . . . , they stressed that their actions were authorized by a higher authority . . . . They based this revolutionary credo on their understanding that the fundamental rights of men did not flow from man-made institutions. Rather, those rights flowed from what they saw as deeper truths - "That all men are created equal," and "that they are endowed by their Creator with certain unalienable rights." To those who signed the Declaration of Independence, these "truths" were self-evident.

Now, 228 years later, the US Supreme Court is at the center of a debate - over the Pledge of Allegiance - that suggests such views about the religious underpinnings of American government may no longer be self-evident. Indeed, government attempts to highlight religious concepts may be unconstitutional. . . .

Why would America's Founding Fathers, who wrote so eloquently of their "firm reliance on the protection of divine providence" in the Declaration of Independence, use not a single devotional word or phrase in the Constitution and Bill of Rights?

Instead, the First Amendment forbids any law "respecting an establishment of religion." Courts have interpreted that provision as mandating a "wall" between church and state. But justices, judges, lawyers, scholars, political leaders, and members of the clergy differ over how high or low that wall should be. . . .

"When you make the argument that this [reference to God in the Pledge] is no longer religious but is civil, or political, or patriotic in its orientation, you are trivializing religion. You are trivializing the meaning of God," says Derek Davis, director of the Dawson Institute of Church-State Studies at Baylor University. "One of the reasons for the separation of church and state is it allows religion to operate freely of [government] so it maintains its sacredness." . . . .

Supporters of the Pledge in its current form see no constitutional difficulty in the government acknowledging the role of religion in national life by including the words "under God" in the Pledge.

Those challenging the 1954 insertion of "God" into the Pledge say it amounts to an impermissible government endorsement of religion over nonreligion, and that it forces schoolchildren to embrace a particular religious belief (monotheism) in order to express patriotism. . . .

"When read as a whole, the Pledge is reasonably understood, not as establishing a state religion, but as celebrating and affirming the nation and the historical forces and ideals that formed its unique character," says US Solicitor General Theodore Olson in his brief to the court.

Newdow disagrees. "To single out that one aspect of the nation's origins, and to extol its virtues within the Pledge of Allegiance, is an endorsement contrary to the Establishment Clause's principles," he says in his brief to the court. " 'Under God' in the Pledge is an example of the majority using the machinery of the state to enforce its preferred religious orthodoxy." . . .

Two prior decisions by the high court are likely to play a key role in the resolution of the Pledge case. In 1943, the justices upheld classroom recitation of the Pledge, provided any objecting students were not forced to participate. Although that case was decided before the words "under God" were added to the Pledge, its supporters say the same opt-out principle applies to those who might object to repeating the words "under God."

In the second case, the justices ruled in 1992 that the Constitution forbids a member of the clergy from offering a prayer at a middle school graduation ceremony. The high court reasoned in a 5-to-4 decision that offering such a prayer would force students to participate in a religious exercise at a school-sanctioned event. Pledge challengers say the "under God" component of the Pledge is an even more egregious effort by the government to coerce schoolchildren into participating in a daily religious exercise.

"The Pledge puts schoolchildren who do not embrace monotheism to the Hobson's choice of affirming religious beliefs they do not hold and foregoing participation in a patriotic ritual," says Peter Irons, director of the Earl Warren Bill of Rights Project at the University of California, San Diego, in a friend-of-the-court brief.

"The 1954 law adding 'under God' to the Pledge made affirmation of religious belief an official element of patriotism and religiosity an official element of national identity," adds David Remes in a friend-of-the-court brief on behalf of Americans United for Separation of Church and State. . . .

Not every organization strongly opposed to religious activities in public schools is opposed to the Pledge. In a friend-of-the-court brief, the National Education Association says even with the reference to God, the Pledge is a patriotic observance rather than a religious exercise.

Using the words " 'under God' does not convert the Pledge into a state-sponsored profession of religious belief," writes Robert Chanin in the NEA brief. "Rather, the words are best understood as a reflection of the simple historical fact that the founders believed in a supreme being, and that their belief led them to dedicate the nation to the fundamental secular precept that all men have unalienable rights to liberty and justice," Mr. Chanin says.

Read more


Findlaw (AP-Gina Holland) adds some interesting facts in this story: "Supreme Court to Take Up 'Under God'"

Americans overwhelmingly want the phrase "under God" preserved in the Pledge of Allegiance, a new poll says as the Supreme Court examines whether the classroom salute crosses the division of church and state.

Almost nine in 10 people said the reference to God belongs in the pledge despite constitutional questions about the separation of church and state, according to an Associated Press poll. . . .

God was not part of the original pledge written in 1892. Congress inserted it in 1954, after lobbying by religious leaders during the Cold War. Since then, it has become a familiar part of life for a generation of students. . . .

Justices could dodge the issue altogether. They have been urged to throw out the case, without a ruling on the constitutional issue, because of questions about whether Newdow had custody when he filed the suit and needed the mother's consent.

The girl's mother, Sandra Banning, is a born-again Christian and supporter of the pledge.

Read more

Another angle on this story is that contrary to much advice, the father raising the issue, a doctor with a law degree, chose to argue the case personally to the Supreme Court. It is not unusual for even very experienced lawyers to defer to those with particular Supreme Court experience.

By all accounts, whether he wins or loses will not turn on this decision to go it alone, as he did a very fine job.

See this story: "Novice Lawyer, Atheist Gets Point Across" (Findlaw-AP-Gina Holland)

The California father who put the constitutionality of the Pledge of Allegiance in the national spotlight brought passion and feistiness to the austere Supreme Court.

Michael Newdow, arguing his own case at the high court on Wednesday, made no rookie mistakes. He threaded his arguments with legal and human elements, winning praise all around. . . .

He sparred with several court members, and after 30 minutes seemed to have won their respect. "I think he surprised a lot of people. He was superb," said Kenneth Starr, a veteran Supreme Court lawyer who opposes Newdow's position.

"I'd give him an `A.' He remained undeterred during intense questioning," said Jay Sekulow, chief attorney with the American Center for Law and Justice, which also supports keeping the Pledge of Allegiance as is.

As an atheist, Newdow said, hearing the phrase one nation under God is like "getting slapped in the face.". . .

A graduate of one of the country's top law schools, the University of Michigan, Newdow took part in more than 10 practice courts to prepare.

"He was passionate and eloquent and responsive and thoughtful," said Ayesha Khan, an attorney for Americans United for Separation of Church and State, which supports Newdow. "He was confronting some closed minds. I thought he opened some of them. Whether he convinced them of the opposite position than they came in with, we'll just have to wait and see."

Read more


And finally, "Many kids don't see Pledge as religious," by Daniel B. Wood for the Christian Science Monitor

Grayson Cady is making a beeline for the swings at Houston's Memorial Park. This Monday, as on every other, he recited the Pledge of Allegiance with his third-grade class - and for him, as for many children nationwide, saying "under God" is no big deal. "Everybody says it," he says - then corrects himself. "I guess there's one kid in my class that doesn't say it. But he's kinda weird."

Read more

Now, what do I think (and why am I writing about this)?

This issue hits home for me. You see, when I entered first grade in the early 1960s and began saying the Pledge, I was a died-in-the-wool atheist, having been raised that way by both parents -- not just one like the girl whose Dad just argued this in the Supreme Court. (I'm not an atheist anymore, but that's another story.)

How did it make me feel to hear the words "one nation under God"?

I don't even remember if I said them or was a "conscientious objector." Either way, it made me feel "kinda weird," in the words of the kid quoted above. And it created a strong impression, as this is among the relatively few first-grade memories I have retained.

But I learned a valuable lesson. No, I didn't expressly understand that this was all about the Founding Fathers and their understanding of the source of human rights (in fact, it wasn't, it clearly was a Cold War reaction to Communist atheism). What I learned was that -- however unreasonable and irrational it appeared to me at the age of 5 -- the vast majority of Americans have some belief in God, or at least have no problem with paying lip service to such belief. This was not a bad lesson to learn and I never felt coerced or ridiculed.

Apparently Justice Rehnquist commented that the Pledge sounds nothing like a prayer. I disagree. Now, after being conditioned by many years of church attendance to respond to certain solemn and ritualized cadences with "Amen", I always want to say "Amen" at the end of the Pledge.

So how should the court decide the case? The most judicially conservative part of me votes to pitch the issue based on the lack of standing.

I mean, for crying out loud, this man is using a girl who doesn't even have an issue with the Pledge to further his own agenda. Rather than emphasizing his religious differences with her mother in a national forum, he should be paying serious attention to trying to honestly raise her in a way in which she can come to understand both parents' religious beliefs and their reasons for them, so that as she grows up she can come to her own conclusions on religious issues.

The next most judicially conservative part of me votes to decide the issue in favor of retaining the Pledge as is. I mean, by the time a case on such a serious constitutional issue reaches the Supreme Court, is argued, and nationally publicized, it should be decided on the merits. If not, tomorrow someone who does have standing will file a similar case. But I have a problem with deciding something like this is "unconstitutional" when it has existed unchanged for over 50 years. What happened? Did the Constitution change?

And the 5-year-old in me, who experienced the issue first hand, would honestly be pleased to see the Court decide that it is unconstitutional, removing something that divides rather than unites us and makes some of us feel "weird" and different; even unpatriotic.

Continued . . .

Maybe doctors can do this, but it's risky for employers

Paul Scott writes for Findlaw: "Can Doctors Resort to Self Help to Screen Out the Litigious? Why Websites Offering Exactly This Service Are Entirely Legal"

Recently, a Texas business captured the attention of the national media. The business is Doctorsknow.us -- a web service created by physicians. The site acted as a central repository of medical malpractice plaintiffs and the attorneys and expert witnesses that act on their behalf.

[T]he site was taken down permanently in reaction to the negative press it received. . . .

Here's how such sites would work. First, the company collects, and posts online, a database of public records of litigation. (Later, the company adds additional public records provided by its physician subscriber base.)

Second, the company makes these records easily searchable. As a result, subscribing medical providers can quickly ascertain whether a potential patient has been involved in medical malpractice actions in the past. . . .

The company refers to this . . . as "risk management." . . . Suppose a patient comes into a doctor's office asking for non-emergency services. The office could then use the software to determine if this potential patient is either a very frequent filer of medical malpractice claims (suggesting such claims are probably bogus), or a filer of non-meritorious malpractice claims that judges have dismissed, or that have settled for low amounts.

In such a case, the doctor's office could deny those patients care, as a legitimate form of risk management. Treating these patients means the doctor is more likely to face a baseless suit; after all, the evidence shows they likely filed such suits before, and they may well do so again.

What if, rather than turning away litigious plaintiffs, the office chooses, instead to turn away their lawyers -- or expert witnesses? . . .

The article goes on to argue that such a site would be neither a blacklist prohibited by antitrust law, nor an unlawful denial of medical treatment.

Does this translate into the employment arena? Could such data on applicants for employment who are "frequent filers" be legitimately used as a screening device in the hiring process?

I think not, though it would certainly be tempting. Refusing to hire someone because they filed employment charges or lawsuits against prior employers would likely be found to be unlawful retaliation, prohibited under the employment discrimination laws.

Continued . . .

Less-publicized good jobs news -- planned hiring up

I missed this story initially.

As reported by Leslie Haggin Geary, CNN/Money staff writer on March 17: "Manpower survey finds U.S. companies' hiring plans most bullish in three years."

Strong demand for their products and services is prompting U.S. employers nationwide to say they will soon hire more workers than they have in the past three years.

That's the word from the Employer Outlook Survey by Manpower International, a Milwaukee-based staffing company. The quarterly survey notes that 28 percent of employers expect to hire more workers from April to June.

That's the highest level since the first quarter of 2001 and it's the third consecutive quarter in which U.S. employers have increased hiring.

Interesting, this time-comparison to early '01 is the same as is true of the stats on new unemployment claims [see this post] So again, we see all numbers looking like recovery back to pre-recession levels, except the payroll survey, which the Dems are beating Bush up with every five minutes.

The article also discusses results by type of employment and area of the country. Construction is tops, then durable goods [maybe we haven't lost all manufacturing yet]. South looks best; Northeast worst.

But all sectors and regions are looking up.

Read more

Continued . . .

AFL-CIO challenge to Chinese working conditions: interesting new move on labor globalization

Aaron Bernstein writes for Business Week Online: "Labor's Savvy Charge on China Trade"

As the Presidential campaign centered on jobs and foreign competition heats up, the [the AFL-CIO] fired what could be a potent election-year broadside: It asked the Bush Administration . . . to decide whether worker repression lets China price its exports below their true market value, thus unfairly taking U.S. jobs.

The petition ensures that Bush must choose . . . [whether to] anger China by launching a formal probe -- or alienate factory workers in . . . key battleground states . . . . This could be a tough decision, since the White House is hardly likely to agree to a labor case against China when it and most of Corporate America have argued for years that such issues should be handled by the International Labor Organization, not in trade pacts. . . .

Despite the politics, the AFL-CIO's 100-page brief marks a milestone of sorts in the debate over trade and labor rights. For years, labor and its allies have demanded that labor standards be included in trade pacts. But their complaints often have been dismissed as self-interested protectionism. Now, for the first time, labor's so-called fair traders have articulated a coherent intellectual position that makes a logical link between trade and labor rights.

Even some ardent free traders think the AFL-CIO's petition must be taken seriously. "You can't just dismiss it as protectionist. In a market economy, wages are set by the free interaction between workers and management, which doesn't exist in China," says William A. Reinsch, the President of the National Foreign Trade Council, which represents 300 large U.S. multinationals such as Boeing.

Labor's argument is so elementary that it's astonishing no one has ever spelled it out in such detail before. The brief contends that China's well-documented labor repression allows its factory owners to pay less than they would if the government enforced its own labor laws. These savings in turn lower the price of China's exports to the U.S., giving it an unfair trade advantage -- much as a direct government subsidy to a factory owner would do. . . .

"We're not challenging China's comparative advantage [in cheap labor] but only the added increment of cost advantage it gains by violations of core worker rights," says Mark Barenberg, a Columbia University law professor who drafted the AFL-CIO filing.

His brief even tries to put a dollar value on the labor repression and the price subsidy it entails. Using four methods, it finds that China's failure to pay its own minimum wage or to allow independent unions lowers wages by 47% to 86%. This in turn reduces the price of China's exports by 11% to 44%. . . .

Read more

Other stories:

Reuters: "Labor Group Urges Probe of China Work Conditions"

This move plays into Kerry's hand. He "has promised a 120-day review of existing trade agreements to ensure other countries 'are living up to their labor and environment obligations and that trade agreements are enforceable and are balanced for America's workers.'"

Chinese violations alleged include: prohibiting strikes and forbidding workers from organizing unions outside of the government-controlled All-China Federation of Trade Unions, not enforcing its own laws on minimum wage, overtime and health and safety, and encouraging forced labor by depriving rural migrant workers of fundamental rights when they find temporary jobs in factory towns and cities.

ChannelnewsAsia.com: "Biggest US union demands sanctions against China "

"The US largest trade deficit -- 124 billion dollars -- is with China." Read more

I have come out aginst union -- and other -- protectionism, and in favor of trade, even at the expense of some American jobs, if it improves lives overseas and has some benefits for Americans, such as lower prices.

But I think this is a very good approach to a level playing field and to ensuring that the impact overseas is indeed beneficial in the lives of citizens of developing nations.

Barenberg, quoted above, has a very impressive resume [click "details" link here], having lived in China and written extensively on labor and trade subjects.

Continued . . .

MTV learns about construction unions in "the Real World"

ABC News reports: "Real-World Labor Issues Too Much for MTV"

Real-world labor issues apparently were too much for the producers of a popular MTV reality show.
Bunim/Murray Productions said Tuesday it had given up plans to tape the 15th season of "The Real World" in Philadelphia. Taping had been set to begin in three weeks.

The production company had angered labor unions by hiring a nonunion company to renovate the former Seamen's Church Institute in Old City, where it planned to have seven strangers live together and have their lives videotaped. Members of the building trades unions picketed outside the building.

A Bunim/Murray spokeswoman declined to comment beyond the one-sentence statement issued Tuesday: "After considerable evaluation, we are disappointed to announce that Bunim/Murray productions has decided not to shoot "The Real World' in Philadelphia." . . .

"I've got kids looking at me like I killed Santa Claus," Pat Gillespie, president of the powerful Building Trades Council, said Wednesday. "Look, they come into our town and make a decision to avoid union workers. Whether they were prepared for what would happen, it was a conscious decision that they made."

Sure, and the unions made a conscious decision to make bad publicity for Philadelphia, and to help strengthen the anti-union attitudes of so many in that hip young demographic MTV caters to.

Here's more from another story by Michael Klein for Knight Ridder Newspapers: "MTV show abandons Philadelphia"

The series had sidestepped organized labor in 13 previous cities, including union strongholds New York City, Chicago and Boston, without incident.

"Every other production company comes in, sits down and bargains," said Tony Frasco, vice president of Teamsters Local 107, whose members drive and unload vehicles. "The unions are not out to gouge anybody, but this is a union town."

It's a matter of "preserving the way of life in Philadelphia," said Pat Gillespie, business manager of the Philadelphia Building Trades Council. . . . [If they drive off all the business, how does that preserve their way of life?]

The show has been No. 1 in its time slot for seven consecutive seasons among 12-to-34-year-olds: That's four million viewers. . . .

"The Real World's" departure comes less than a year after the city, state and unions resolved a crippling labor controversy. At the Philadelphia Convention Center, union labor costs and ugly jurisdictional disputes chased away repeat business. New labor rules were negotiated last summer.

Since then, only one major trade show has booked a multi-day stay, the first in five years. The center is still trying to regain business from large professional associations. Many that came to Philadelphia from 1998 through 2000 did not return because of labor costs.

Philadelphia is the last bastion of union construction trades in a region that was a stronghold of union activity until the 1970s. Most construction in the Pennsylvania suburbs is done by nonunion workers.

Informed of Bunim/Murray's pullout, Jeff Zeh, president of the Southeast Pennsylvania chapter of Associated Builders & Contractors Inc., which represents nonunion contractors, said, "What else is new in Philadelphia?

"You saw the list of the cities where they've produced their projects, and Philadelphia is the only one where they had a problem," he said. "It really is a sad commentary."

It is true that there are significant regional variations, including within metropolitan areas (e.g., city vs, 'burbs) in the extent to which construction is unionized. It behooves anyone planning a project on unfamiliar turf to tune in to this issue before getting a rude awakening, as the MTV production company did here. It's too bad they didn't have the balls to just tough it out. Interplay between "real worlders" and picketers might have made for some nice reality TV (though they might have had to bleep some of the language).

Continued . . .

Health insurers' profits rise massively, as employers and consumers get priced out of the market

Interesting, after all the complaining they do about rising costs, the big health insurers appear to be utilizing the situation to jack premiums up higher than necessary, in order to generate massive increases in profits, at least in California.

Kathy Robertson reports for the Sacramento Business Journal: "Area HMO profits up 605 percent from '02; Employer premiums continue to increase"

"Double-digit premium increases continue to pay off for the six HMOs that dominate the Sacramento market -- their combined net profits skyrocketed to more than $2.3 billion last year, up 605 percent from 2002.

"The market is completely oligopolized on both sides -- and it's imposing costs on everyone," said an analyst who knows some of the players and asked not to be identified. "If I hear one more bullshit comment about the aging population and consumers who demand too much, I'm going to go to the bathroom and throw up."

Both HMOs and hospitals counter that premiums will continue to climb because healthcare costs keep going up.

Continued . . .

Employer barely avoids getting stuck with voluntary union recognition

International Union of Operating Engineers, Local 150, AFL-CIO v. NLRB illustrates some of the dangers of dealing with union organizers in any manner other than requiring them to go through the NLRB election process.

In this case, the union claimed that as a result of two meetings with the employer's management, it had been voluntarily recognized, obligating the employer to bargain with it, even though there had not been an election.

Fortunately for the employer, although it foolishly gave the Union some pretty good facts to work with, both the NLRB and the Seventh Circuit held that there had not been voluntary recognition

The Union first asserted the employer implicitly recognized it when a management official reviewed signed union recognition cards and stated "you got them all." Rejecting this contention, the court contrasted cases in which employers not only acknowledged that a majority of employees had signed cards, but also stated they recognized the union and agreed to a date for beginning negotiations. "[T]he NLRB has consistently held that merely reviewing authorization cards does not count as implicit recognition."

OK, but you know what? Just don't do it anyway. Tell them you don't care to see the cards and you insist on your right to a secret ballot election (unless, of course, you really desire to have your employees represented by the Union -- in which case you better look at the cards in order to avoid recognizing a union without majority support, which is usually an unfair labor practice).

The Union also contended the employer implicitly recognized it by engaging in bargaining when it discussed some issues with the union representatives. the court said: "Bargaining with a union is, of course,one of the ways an employer can implicitly recognize a union." The employer squeaked by on this point only because "the NLRB concluded that no bargaining took place in this case because the discussions . . . did not have the give-and-take characteristic of negotiation."

Again, why take the chance? Just don't discuss terms and conditions of employment with union organizers.

This is another case of an employer whose unwise decisions, while not preventing it from ultimately prevailing, forced it to expend (probably substantial) resources litigating all the way to the Court of Appeals over an issue it could have avoided entirely.

Continued . . .

Health care debate continues

Here are a bunch more healthcare benefit links. This issue, which is one of employers' (and unions') biggest headaches these days, is getting some much-needed attention.

USA Today (Julie Appleby) reports: "Health insurance premiums crash down on middle class"

Rising health care costs are increasingly pressuring the middle class, adding a large and politically influential group to the category of those who fear they may soon have to do without.
There's little hope for relief in the short term. Health spending is expected to rise well above inflation for years to come. Employers are increasingly passing on the additional costs to their insured workers, causing some workers to opt out, saying they can't afford it. And, at some workplaces, employers are dropping coverage altogether.

For those who have to buy their own insurance -- or those on the low end of the income scale -- insurance has long been hard to afford.

"What this country is actually doing is gradually pricing the lower third of the wage and income distribution out of health care," says Uwe Reinhardt, a Princeton economist.

The success or failure of efforts to control health care costs in the next decade will determine whether those in higher income brackets are similarly shut out, he says.

Harvard economist David Cutler estimates that if medical costs rise 5% above inflation for each of the next four years, at least 3 million more U.S. residents will be without coverage. . . . Many of those will be workers with good jobs and decent pay. . . .

Today's average premium for a family insurance policy -- $9,086 a year -- already represents 21% of the national median household income of $42,409. . . .

Some analysts say the rising cost of premiums and increasing load of deductibles and other fees will lead more of the currently insured to drop their coverage.

"People will start playing roulette with their health insurance," says Glenn Melnick, professor of health care financing at the University of Southern California. "I can see a middle-class family saying, 'We need to cover Mom and Dad, but we'll let the kids go without and put that money into their college fund.' " . . .

Many employers still pick up a large chunk of health insurance premiums . . . . Even so, last year workers paid an average of $2,412 toward their premiums, an amount equal to 5.6% of the median household income. . . .

Read more


Here's a discussion by Devon M. Herrick, Ph.D., from the National Center for Policy Analysis: "Bush versus Kerry on Health Care"

Biased against Kerry, but has some useful details.

The Bush approach moves away from the bias in favor of large-employer-provided plans, by encouraging individual insurance, health savings accounts, and association health care, all of which are job-portable. This portability is important so labor mobility is not impaired by employees making job choices based on healthcare benefits. Small employers should not be handicapped in competing for good employees by their lack of health care buying power -- or the presence of a few relatively unhealthy employees who jack up the rates.

Kerry's reliance on expanding coverage under government plans doesn't seem to offer anything towards cost control. The large and growing uninsured population is a problem, but not one which can be divorced from runaway costs. To the contrary, many are uninsured because of high costs. Coverage and costs must both be addressed.


A March 17 opinion piece by Holman Jenkins in the Wall Street Journal took a strong stand on Kerry's position, as summarized here: "Sen. Kerry's Health Care Proposal Should End Subsidies to Employers for Providing Health Coverage, Columnist Says"

Kerry should include in his health care proposal a provision that would eliminate the "nutty system" of tax subsidies for employer-sponsored health insurance that fuels "an unnatural urge to channel every ache, pain and prescription through a third-party payment bureaucracy." . . .

As part of a proposal that Kerry announced earlier this year, the federal government would assume 75% of annual health care costs care that exceed $50,000 for individuals with health coverage, provided that health insurers pass the savings to employers and employees . . . . However, according to [the Journal piece], the proposal would only shift health care costs to taxpayers and would not provide an "injection of efficiency" or a "reason to imagine total costs won't continue to grow wildly."

[The piece suggests] . . . Kerry should include in his proposal a provision under which the federal government would end "tax-free treatment of employer-provided health insurance" in exchange for "assuming the catastrophic cases." Such a provision would allow employers to end the "primitive practice of bartering health care for labor" and the "crazy spur to channel every routine medical expenditure through the insurance system." . . .

"Mr. Kerry could be a leader here. Too bad he's a political wuss and a Democrat, two facts that likely rule out any hope of him having a single creative thought on health care -- or any urge beyond simply throwing more taxpayer money at it, which we already get from the GOP."

Many people are suggesting that maybe we need to move away from the idea of full-coverage insurance, and from employer-provided coverage. Unfortunately, the insight in that piece is in danger of being eclipsed by the harsh partisan name-calling ending.


Here's a great little interview with Harvard Business professor Regina Herzlinger, arguing strongly for consumer-driven healthcare -- more dollars spent directly by the consumer, with market forces playing a greater role, not a lesser one (as they would with a more government-driven approach), and touching on other interesting issues: "Herzlinger: From Market-Driven to Consumer-Driven Healthcare," by Richard L. Reece, M.D., for HealthLeaders News, March 15, 2004

Herzlinger: Consumers are very smart, and they will make better decisions than those would act for them. Many of the "top-down" technocrats who run HMOs or government programs do not believe consumers are smart enough and only they, the technocrats, have the wisdom and compassion to run the health system. On the contrary, I would say nobody at the top is smart enough to know everything that goes on at the market level. Nobody is that brilliant.

Reece: What can be done to dampen the current rate of healthcare inflation?

Herzlinger: Consumer-driven health care will ultimately correct healthcare inflation. The reason is quite simple. Consumer driven care will bring about prudent consumer spending and increased productivity. Let me turn your question back to you. Why do you think health care inflation is so high while the rest of the economy has such a low inflation rate? The answer is higher productivity in the non-healthcare sector. We must bring higher productivity to the health care sector, and that will come from the bottom-up, from consumers acting in their own best interest and providers responding.

Reece: How do you do that in medicine? The patient-physician relationship is basically a one-on-one relationship. How do you make that more productive? Won't that lead to depersonalization of the relationship?

Herzlinger: On the contrary, CDHC [consumer directed health care] will personalize, deepen, and enrich the relationship. Focused factories [centers for treating AIDS, diabetes, asthma, and congestive failure and other chronic diseases that consume 80 percent of our health care dollars] will help the relationship too. Teams of physicians and other healthcare professionals focusing on one disease and complications surrounding that disease will enhance quality, value, and productivity. . . .

Reece: The New York Times last month carried on an article on the strange nature of Medicare payments for disease. . . . Medicare payments punished hospitals and physicians who improved quality. In other words, if you improve quality and save hospital days, Medicare frequently pays you less. Is this a problem in your mind?

Herzlinger: It is a huge problem, and the whole Medicare payment system needs to be revamped to reward quality and productivity.

Reece: What about the doctor's role in all of this?

Herzlinger: I love doctors. As a matter of fact, my daughter is a doctor. . . . Doctors will be the sources of virtually all the CDHC productivity gains in response to their patients' needs. Right now, doctors have been seduced by insurance companies. They have become too dependent on them. . . .

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I doubt doctorswould agree about their "seduction," but many surely would like to be free of the insurance companies.

Herzlinger's book, "Consumer-Driven Health Care [link to Amazon description]" will be published in April.


The Galen Institute has this report by Greg Scandlen: "Consumer Choice Matters, #55"He discusses his testimony on "the uninsured" before the Health Subcommittee of the Ways & Means Committee in the House.

Glenn Melnick of the University of Southern California discussed how hospital pricing, especially "the lack of a rational and transparent pricing system for self-pay patients," disadvantages the uninsured and potentially stifles the market for Health Savings Accounts.

I tried to make the case that previous state and federal policies, especially tax policy and ERISA, have distorted the market and made coverage more expensive and less accessible for anyone not in the subsidized systems of Medicare, Medicaid, and employer-sponsored health insurance.

[S]ometimes when a problem seems intractable it is because we are not framing it correctly. We are not asking the right questions. Perhaps there is another way to look at this issue.

Instead of asking why so many people are uninsured, perhaps we should look more closely at who is insured and for what. None of us is insured for everything, nor should we be. Health insurance is only one way to pay for health care services, and often not the best way. . . .

The real question is what is the appropriate role for health insurance versus other forms of financing? There is an entire universe of stuff out there that can be considered "health care." Insurance can never cover it all. We are all "uninsured" for something.

If we start with this reality, the next question is "What is appropriate for an insurance plan to cover? And who decides?" Is it really a good use of the clumsy insurance mechanism to pay for a $60 physician's office visit? Is insurance, with its administrative costs, the best way to pay for Viagra and birth control pills? Aren't these things better paid in cash and save the insurance to prevent . . . bankruptcies?

There is always a concern about low-income people - "How can they be expected to pay cash?" But insurance isn't a particularly good way to subsidize their health care needs, either. First, they or someone else has to pay premiums if insurance is used to pay for their care, and the premiums would be lower if routine expenses were paid directly. The money that would otherwise go into premiums could be made available for them to pay cash. Second, to the extent there is administrative waste involved in passing claims through insurance, it is not a very good use of their scarce resources. Getting more bang-for-the-buck is even more attractive to the low-income than it is for other people. Third, is it really a good thing that even low-income people are required to pay premiums for services like in vitro fertilization or psychiatric social workers? Perhaps they should be allowed to use their limited resources to cover only those services that are high priorities for them. . . . [The reference to psychiatric social workers reflects a common but misguided anti-mental health bias; mental health services can be of the absolute highest proiority for many people, not a luxury, in some cases even a matter of life and death (e.g., severe suicidal depression)]

Hospital pricing is heating up as one of the key issues in the care of "self pay" patients, including both the uninsured and those with HSAs. Perhaps the person who has done the most to bring attention to this issue is K.B. Forbes, one time spokesman for both Steve Forbes and Pat Buchanan during the 2000 presidential primaries. He has organized a group . . .that is focusing on uninsured Hispanics who are often charged three and four times as much as insurance companies for hospital care. He calls it price gouging and has wrested some concessions from the Tenet hospitals in California. Unfortunately, the hospitals tend to give price breaks only to patients they deem needy, not to others who simply prefer to pay in cash.

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Indeed, it is unfortunate that providers won't offer uniform pricing, allowing alternative payment mechanisms to flourish. Of course, this came about not out of a desire to discriminate, but out of the HMO/PPO models, in which insurers' market power was used to hammer on providers' prices.


Finally, from fellow bloggers:

Workers Comp Insider reports on a little-noticed aspect of the problem: "Number of uninsured workers at large employers growing"

And Walking the Line (formerly sonria.org) reports: "Health insurance: why it should not be an employment benefit," excerpting a Reuters article, "Cost of Worker Benefits Weighs on Hiring"

Continued . . .

Firing of woman for sexual harassment of men not race discrimination

You never know what combination of discrimination allegations you'll run across next.

Here, in Wheeler v. Aventis Pharmaceuticals, No. 03-1812 (8th Cir. 3/15/04), there was a peculiar mix of reverse sexual harassment (woman-on-man) and alleged race discrimination. The plaintiff was a black female fired for violation of the company policy against horseplay and sexual harassment, based on evidence of "inappropriately touching male employees' sex organs." She claimed the termination was a pretext for race discrimination, but the Eighth Circuit would have none of that, affirming summary judgment for the employer.

[T]he plaintiff admitted that she and her co-workers engaged in various types of "horseplay," which included discussing each others' sex lives and sex toys . . . ," placing "kick me" signs on co-workers' backs, squirting alcohol or other liquids at each other, and placing rubber snakes or spiders on the assembly line. . . . Apparently, the workers in this department developed a tradition of frequently engaging in puerile and lewd behavior during a certain portion of the work day and coined the curious epithet "dirty hour" to describe the tradition.

The plaintiff acknowledged some touching as alleged, but "contended that the conduct was not unwelcome and should not be classified as anything but 'horseplay' or having been done in jest. She argued that other employees often engaged in such 'horseplay' at work and received little or no resulting discipline."

The employer distinguished her situation as specifically involving violations of the sexual harassment policy, not just non-sexual horseplay. The plaintiff attempted to establish racially disparate treatment with evidence that a white female employee was merely reprimanded, not fired, for a similar incident (exposing her breasts). The court found this employee and the plaintiff:

were not similarly situated because their offenses differed substantially. Although they were both involved in sexual "horseplay," their alleged actions involved differing levels of misconduct towards others. Taking the facts in the light most favorable to [the plaintiff], during their alleged "horseplay" [the other employee] exposed her breasts on request, while [the plaintiff] grabbed male coworkers' private area in a way that according to the men interviewed was offensive. Sexually-offensive conduct that involves physical contact is not the same as offensive comments, gestures, or lewd displays. [The employer] was not obligated to treat the two behaviors as substantially similar because they involved objectively different conduct. . . . The record reflects that the only other employee accused of touching coworkers'
genitalia received the same discipline as [the plaintiff] -- termination.

The court missed a more obvious distinction: that between unwelcome and uninvited sexually-oriented conduct -- the crotch-grabbing, and welcome and invited conduct -- the breast-flashing in response to requests.

Nonetheless, it might have been a wiser course for the employer to fire the breast-flashing employee. That's indicative of a pretty out-of-hand workplace environment, whether welcome or not. It certainly could have been the basis of complaints by employees -- other than the men who requested it -- who found it unwelcome.

Harsher action would have set a better example for the workforce, and taken away this plaintiff's only arguable basis for a claim, probably saving the employer a trip to the EEOC, district court, and then court of appeals -- and untold thousands in attorneys' fees.

Continued . . .

Exhibit A on how the federal bench has its act together

Yesterday I mentioned concerns about growing caseloads in the federal courts not being accompanied by adequate funding and commented on the superiority of federal court compared to "judicial hellhole"state courts.

In Legal Times, Vanessa Blum writes: "Drowning in Paper; With fall trial date set, case involves 30 firms, millions of documents" She profiles a mind-bogglingly (is that a word?) complex tobacco case in federal court and the federal District Court Judge doing a masterful job of keeping it on track.

By any measurement, the Justice Department's suit against the tobacco industry is a mammoth piece of litigation.

With a bench trial scheduled to begin in the case Sept. 13 before Judge Gladys Kessler of the U.S. District Court for the District of Columbia, the challenges posed by the immense size and scope of the case are becoming increasingly evident.

For example, government attorneys recently stated their intention to submit 72,525 evidentiary exhibits totaling more than a million pages.

Tobacco industry lawyers . . . were quick to point out the impact such a massive filing would have on court proceedings. . . .

In a Feb. 26 pleading, the government defended its lengthy list: "The exhibits designated by the United States are a reflection of the magnitude of the Defendants' conduct, the complexity of the case, and the number of contested facts."

On March 8, Kessler ordered the government to come back with a trimmed and prioritized exhibit list by May 1. . . .

According to several lawyers involved in the tobacco litigation, Kessler has taken a hands-on approach to managing the unwieldy case, forcing lawyers to stay on track throughout the lengthy discovery phase.

"The judge got involved early on and entered a number of case management orders that set out a schedule for what was going to happen and in what period of time," says William Ohlemeyer, vice president and associate general counsel of Altria Group Inc., formerly known as Philip Morris Cos. Inc. "This is a case that could have gotten bogged down pretty quickly. Instead, it has proceeded on a very strict schedule that has been designed to make the parties move forward."

At least in my neck of the woods, federal courts are way ahead of state courts in terms of using scheduling orders to keep cases on track.

Recent rulings and a rigorous pretrial calendar suggest Kessler intends to demand the same intense focus during the trial, which may last more than six months.

The first of three scheduled pretrial conferences began this week.

Ditto for pretrial conferences.

Kessler has ordered both sides to file trial outlines and proposed findings of fact before the start of trial and will likely set time limits for each side to present its case in court. She has also provided that witnesses' direct testimony be presented in a written question-and-answer format, rather than live. . . .

The case going to trial -- though vast -- is substantially narrower than the complaint filed by the DOJ team in September 1999. In June 2000, Kessler dismissed two of the government's claims that had sought to recover Medicare and Medicaid costs related to smoking. The government's sole remaining claim alleges that the tobacco industry engaged in an illegal conspiracy to defraud the American public in violation of the Racketeer-Influenced and Corrupt Organizations Act, or RICO, and seeks $289 billion [yep, that's a "B"] in ill-gotten profits.

The docket in the tobacco case, still six months from trial, already contains more than 3,000 filings, including more than 500 court orders from Kessler. Special Master Richard Levie, a retired D.C. Superior Court judge, has issued another 150 reports and recommendations on case management issues and discovery disputes since his appointment in December 2000. Overall, 301 depositions totaling more than 2,000 hours have been taken by both sides. . . . More than 45 expert witnesses are expected to testify at trial, and conservative estimates place the total number of witnesses to be called to testify somewhere above 200.

Kessler seems determined to keep the immense case moving toward trial.

"The public interest demands that cases of such significance not drag on for years and years and that they come to closure in a time-honored fashion: a public trial where the positions of both sides can be tested in the glare of cross-examination and public scrutiny," Kessler wrote in a 2002 scheduling order. "It is essential that our civil justice system demonstrate that it has the capacity to efficiently handle a case of this magnitude by narrowing issues, reining in over-zealous lawyers, and directing counsel to focus their efforts on the central issues of the case rather than peripheral minutiae."

Amen to that. Or, as they say in federal court, "God Bless the United States and this Honorable Court." I'm not sure what I think about the merits of this litigation or the government resources being spent on it, but I sure like what I hear about this judge.

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Continued . . .

Jobless Claims Drop; Wholesale Prices Rise (washingtonpost.com)

Washington Post (AP - Martin Crutsinger) writes: Jobless Claims Drop; Wholesale Prices Rise (washingtonpost.com)

New unemployment benefit claims fell last week for the third consecutive week, hitting the lowest level in over three years.

The numbers: new claims fell by 6,000 to 336,000, and the four-week moving average fell to 344,000 levels last seen in January, 2001.

Trying to be objective: of the three most-publicized employment figures -- unemployment rate, new jobless claims, and payroll employment -- only payroll employment has been disappointing; the other two have showed a very consistent positive trend over the last year or so. We still have a mixed picture, but it would be wrong to ignore the signs of hope.

Continued . . .

Are these two justice system stories in any way related?

Yahoo News (AP - Anne Gearan) reports: "Judges Say Federal Courts Are Swamped"

Federal courts are swamped, partly because of Bush administration get-tough-on-crime policies that lead to more trials, the head of a federal judges' group said Tuesday. Fifth U.S. Circuit Court of Appeals Judge Carolyn Dineen King singled out drug and immigration prosecutions along the U.S.-Mexican border and Attorney General John Ashcroft's order last year that federal prosecutors should seek the severest charges and penalties.

Federal spending has not come close to keeping pace with the increase in caseloads prompted by decisions like those, she said following a meeting of the policy-setting Judicial Conference of the United States that she chairs. "More trials take place because of that, more prosecutions ensue because of their policies," King said. "Our criminal caseload keeps going up, but our resources go down every year." . . .

In the year ending Sept. 30, 2003, the number of cases filed in federal trial courts rose by 5 percent to a record 70,642, and cases filed in federal appeals courts grew by 6 percent to a record 60,847, federal court administrators said Tuesday.

The federal court system needs a yearly budget increase of 6.5 percent merely to keep pace with expenses, because of fixed costs such as rent on courthouses and cost of living raises for employees, King said. But the budget proposed by President Bush (news - web sites) would give the courts only 0.5 percent more next year, she said. . . .

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Meanwhile, Findlaw (Reuters) reports: "Snow Says 'Lawsuit Abuse' Costs Jobs"

U.S. Treasury Secretary John Snow on Tuesday said that runaway lawsuits were costing American jobs and urged an overhaul of rules that permit personal injury lawyers to launch huge legal cases.

"Lawsuit abuse is the ultimate disincentive for hiring new people," Snow said in prepared remarks to a closed session of the American Tort Reform Association. "The cost of doing business is substantially increased by a litigious environment." . . .

He called for Congress to take steps to rein in personal injury lawyers and likened the current situation in which he said lawyers were taking in billions of dollars in profits annually to recent abuses by some corporate leaders. "The lack of personal ethics and responsibility, the excesses of greed, is similar . . . .

He said the Bush administration was urging Congress to pass a class action reform bill to end the "grotesque" practice of personal injury lawyers "shopping" for state jurisdictions that are likely to make large awards. "We're sick and tired of seeing that type of personal injury lawyer bring class-action lawsuits in these judicial hellholes," Snow said. The Class Action Fairness Act [link to article about this Act] before Congress would let defendants move such suits from state to federal courts when a substantial number of plaintiffs were not residents of the state where the suit was filed. . . .

Snow said small businesses were especially hard hit by fear of "frivolous, unnecessary lawsuits" and put a damper on one of the wellsprings of new jobs. . . .

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American Tort Reform Association reports the following list of "judicial hellholes," defined here as "cities, counties, or judicial districts that attract lawsuits from around the nation or the region because they are correctly perceived as very plaintiff-friendly jurisdictions. They are places where the law is not applied evenhandedly to all litigants. In these areas, there is a systematic bias against defendants, particularly those located outside of the state."

Quoting Richard Neely, The Product Liability Mess: How Business Can Be Rescued From the Politics of State Courts (1998) this Association explains the problem:

West Virginia State Supreme Court Justice Richard Neely candidly described one of the reasons behind this phenomenon in his recent book: "As long as I am allowed to redistribute wealth from out-of-state companies to injured in-state plaintiffs, I shall continue to do so. Not only is my sleep enhanced when I give someone's else money away, but so is my job security, because the in-state plaintiffs, their families, and their friends will reelect me....It should be obvious that the instate local plaintiff, his witnesses and his friends, can all vote for the judge, while the out-of-state defendants can't even be relied upon to send a campaign donation."

Here's the Association's list of "hellholes," including my local "favorites," Madison County, Illinois and St. Louis City:

Madison County, Illinois; Jefferson County (Beaumont), Texas; Mississippi's 22nd Judicial Circuit (Copiah, Claiborne and Jefferson Counties); Hidalgo County, Texas; Orleans Parish, Louisiana; Kanawha County, West Virginia; Nueces County, Texas; Los Angeles County, California; Philadelphia Court of Common Pleas, Pennsylvania; Miami-Dade County, Florida; the City of St. Louis, Missouri, and Holmes and Hinds Counties, Mississippi.

So what's the connection between these stories? If federal courts, which are like a bit of heaven on earth compared to the "hellholes," get clogged with criminal cases and suffer from inadequate funding, civil cases in federal court will bear the brunt, with rising backlogs increasingly forcing settlements. This only encourages more questionable litigation (I think "frivolous" is often a bit too strong a term). If instead of making state courts more like federal courts, we "fix" the "hellhole" problem by making removal to federal court easier, this just compounds the federal caseload overload.

Continued . . .

Bracing for more UFCW/grocery chain labor unrest?

Grocery strike coming to D.C area ? Washington Post [reg. req'd] (Michael Barbaro) reports: "Sides Prepare for a Grocery Strike"

The union representing 18,000 local grocery workers in contract talks with Safeway Inc. and Giant Food LLC is laying the groundwork for a possible strike against the chains, union members familiar with the preparations said.

With the local contract set to expire March 27, the United Food and Commercial Workers Local 400 is selecting strike captains, handing out instructions for setting up picket lines, [etc.] . . .

"They are preparing and we are preparing," said Harry Burton, the top negotiator for Giant and Safeway. He said the union's intense preparations are "echoed on the employer side."

Giant and Safeway say they must cut costs in the next contract because of heightened competition from nonunion stores with lower labor costs. Local 400 officials say the supermarkets overstate the competitive threat . . . .

So far, the chains have proposed cuts in pay and vacation for new employees. . . .

Rep. James P. Moran Jr. (D-Va.) last week sent a letter to the chief executives of Safeway and Giant asking them to reconsider a proposal that would, among other things, require new employees to work three years before they earn New Year's Day and Memorial Day off as holidays. "Certainly," he wrote, "you would not tolerate such restrictive personnel policies if your own children were subject to them."

I sure would. You bet. We're a 24-7 society now. Those holidays are big shopping days. If you forget something for your Memorial Day Barbecue (or run out of beer, or whatever), don't you expect the grocery store to be open and fully staffed?

Interesting that there's no mention of dispute over health benefits. Has management decided not to take that monster on, but to seek savings elsewhere, or was this story just incomplete in this respect?

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Meanwhile, in Chicago, the Chicago Tribune (Delroy Alexander) reports: "Grocery store union targets 2 small Chicago-area chains"

Even the friendly neighborhood grocery store can't avoid the burgeoning labor battle launched by Chicago-area supermarket workers determined to maintain health and pension benefits.

Labor unrest previously contained to the major chains, Dominick's and Jewel Foods, spread Monday to two popular, family-owned store operators.

Asking shoppers to boycott stores while workers try to negotiate a new labor deal, the United Food and Commercial Workers union began a flier campaign at six Treasure Island locations and the two Potash Bros. Supermart stores on the North Side of Chicago, where labor contracts ended March 7.

The chains are in separate talks, but their key concerns are similar. At the center of both disputes are attempts by management to force workers to pick up a greater share of fast-rising health insurance costs and welfare benefits, said union leaders. . . .

Workers at Dominick's, which is in the process of closing 12 local stores, have been without a new labor deal since a bitter dispute over similar benefit issues at the end of 2002. Union leaders said they expected to see details of a new deal soon.

Just last week, newly named national union President Joe Hansen said he expected Chicago's talks with Dominick's to be a proving ground of how future labor relations would evolve.

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Meanwhile, in Washington State, there are similar troubles brewing, as reported in the King County Journal by Cydney Gillis: "Labor showdown looms at area grocery chains - Union says it won't give in on health care"

Hands off our health care. That's what union officials are going to tell the area's major grocery chains when contract bargaining starts this month in Western Washington.

The grocers -- Safeway, Albertsons, Fred Meyer, QFC, Top Foods and Haggen -- plan to ask union members to kick in something for their medical insurance, which the workers don't do now.

If a settlement can't be reached by May 2, when contracts expire for five local units of the United Food and Commercial Workers, 15,000 union members could walk off the job from Bellingham to Tacoma. . . .

In California, the grocery workers' union didn't back down on health benefits. But in the three-year contract it accepted, it did agree to create a two-tiered wage scale . . . . The bargaining here will be a rematch on the same issue, with local union officials claiming their members won't accept certain terms of the California settlement.

In the California contract, ``There are two specific things,'' said Mike Hatfield, a union spokesman and president of Local 44 in Bellingham. ``For new hires to wait over a year for medical coverage and to wait 30 months to get family coverage (is) unacceptable.''

Attorney Randy Zeiler, lead negotiator for the grocers, said the union will have to accept some concessions. The current health benefits, Zeiler said, is a 100-percent paid plan that's unheard of today. "It's not a Cadillac. It's more like a Ferrari or a Bentley,'' Zeiler said of the plan. . . .

Zeiler served as lead negotiator for the current three-year contract, which he said the grocers accepted in April 2001, months before the Sept. 11 attacks.

It was a different economy, Zeiler said, in which the retailers agreed to pay the full cost of health and welfare benefits -- currently a contribution of $4.90 per hour -- without any future cap on the amount of the contribution.

Three years later, with insurance costs soaring and non-union competitors expanding in the market, Zeiler said, ``It's safe to assume that reductions in health and welfare will have to be part the settlement.'' . . .

A previous grocery workers strike in 1989 -- four contracts ago -- lasted 81 days in the Seattle area. . . .

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I'd like to hope I'm right in my previously expressed opinion that all parties have learned enough about their respective positions, the cost of health care, and the burdens of striking -- as a result of the strikes this year in St. Louis and elsewhere, as well as the higly publicized one in the LA area -- to be able to find a resolution without striking . . . but in labor relations you never know until that final offer is on the table.

Continued . . .

BusinessWeek Online features slew of stories on jobless recovery, outsourcing, etc.

Business Week Online offers a variety of views on these topics, all accessible from this link

The first piece is by Bruce Nussbaum: "Where Are The Jobs?"

It says "Many blame outsourcing. The truth is a lot more complicated."

The truth is that we are living through a moment of maximum uncertainty. . . . Outsourcing looms large as a potential threat because no one knows how many jobs and which industries are vulnerable. And productivity seems problematic because it's hard to see where the rewards for all the cost-cutting and hard work are going. Meanwhile, the Next Big Thing that is supposed to propel the economy and job growth forward after the Internet boom isn't obvious. . . .

The real culprit in this jobless recovery is productivity, not offshoring. Unlike most previous business cycles, productivity has continued to grow at a fast pace right through the downturn and into recovery. One percentage point of productivity growth can eliminate up to 1.3 million jobs a year. With productivity growing at an annual rate of 3% to 3 1/2% rather than the expected 2% to 2 1/2%, the reason for the jobs shortfall becomes clear: Companies are using information technology to cut costs -- and that means less labor is needed. Of the 2.7 million jobs lost over the past three years, only 300,000 have been from outsourcing . . . . People rightly fear that jobs in high tech and services will disappear just as manufacturing jobs did. Perhaps so. But odds are it will be productivity rather than outsourcing that does them in.

We know also where the benefits of rising productivity are going: higher profits, lower inflation, rising stocks, and, ultimately, loftier prices for houses. In short, productivity is generating wealth, not employment. . . . Corporate profits as a share of national income are at an all-time high. So is net worth for many individuals.

We know, too, that outsourcing isn't altogether a bad thing. In the '90s, high-tech companies farmed out the manufacture of memory chips, computers, and telecom equipment to Asia. This lowered the cost of tech gear, raising demand and spreading the IT revolution. The same will probably happen with software. Outsourcing will cut prices and make the next generation of IT cheaper and more available. This will generate greater productivity and growth. . . .

We know something about the kinds of jobs that could migrate to Asia and those that will stay home. . . . [T]he Internet and cheaper telecom permit routine service work to be done in Bangalore. But specialized jobs that require close contact with clients, plus an understanding of U.S. culture, will likely remain.

America has been at economic inflection points many times in the past. These periods of high job anxiety were eventually followed by years of surging job creation. The faith Americans have in innovation, risk-taking, education, and hard work has been sustained again and again by strong economic performance.

History has shown time and again that jobs follow growth, but not necessarily in a simple, linear fashion. . . . We are now experiencing the maximum pain from the wreckage of outmoded jobs while still awaiting the innovations that will generate the work of the future. While America's faith in its innovation economy has often been tested, it has never been betrayed. Given the chance, the economy will deliver the jobs and prosperity that it has in the past.

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The next Business Week piece is by James C. Cooper and a team of others: "The Price Of Efficiency; Stop blaming outsourcing. The drive for productivity gains is the real culprit behind anemic job growth"

This article makes many of the same points as the previous one, but in even more detail, with more explanation, historical analysis, and statistics. Some additional points:

A broader range of industries, particularly the service industries that account for 80% of the jobs, are benefiting from the productivity increases.

"[T]he demands for profits by a growing investor class have heightened the pressure on corporations to keep costs low."

"The soaring cost of health-care benefits is also making companies more hesitant to add workers."

"Finally, the political and economic shocks of the past three years -- the stock market bust, the terrorist attacks, the corporate scandals, and war in Iraq -- have generated unprecedented uncertainty and caution in the executive suite."

"Retailers from department stores to gas stations to restaurants are now able to move a 35% greater volume of goods and services out the door per worker than they did five years ago . . . . Home Depot . . . has self-checkout counters in almost half of its 1,707 U.S. stores, allowing it to move as many as 1,000 cashiers to the sales floor. The shift helped drive sales per labor hour up 4% last year alone. "

"Another big factor: the explosion in goods moved through e-tail sites, which have done away with salespeople, restockers, cashiers, and other posts required in traditional retailing."

And the only-slightly-optimistic conclusion:

But if outsourcing poses potential challenges over the long haul, in the coming year productivity holds the key to the jobs outlook. The pace of efficiency gains always slows as a recovery picks up steam, but no one is really sure how much. The question is how long companies can meet this big increase in demand without expanding their workforces. "We're getting up close to the point where firms will of necessity have to hire additional people to sustain the growth they see in the demand for their products and services," Treasury Secretary John W. Snow told BusinessWeek. To judge by history, business cannot lean on the workforce so heavily for much longer. The problem, however, is that in this unusual business cycle, history has rarely proved a decent guide.

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Another bad news, good news Business Week piece is by Michael J. Mandel: "Productivity: Who Wins, Who Loses; The U.S. is reaping big -- but uneven -- gains from its highly efficient workforce"

[P]roductivity gains have been carrying jobs away -- but . . . they have also generated real benefits for Americans. By BusinessWeek's calculation, the rapid growth in productivity over the past three years has added an additional $220 billion to the nation's gross domestic product, compared with what GDP would have been if productivity growth had followed the slower pace of the previous business cycle.

High productivity has enabled corporations to boost the bottom line while holding down price increases . . . , while an astonishingly low inflation rate averaging 1.5% a year since 2001 has saved consumers hundreds of billions of dollars.

In addition, the hike in productivity directly and indirectly has driven up asset prices. Rising profits, of course, have pushed the stock market nearly back to levels before the recession, benefiting investors, while low interest rates have sent home prices soaring, to the delight of many homeowners. . . .

What's lacking so far from the productivity boom -- and it's still very early -- are new and innovative industries that create jobs to replace those that are lost. In the second half of the 1990s, productivity growth accelerated as big companies became more efficient and manufacturing jobs were outsourced overseas. But overall employment rose sharply as the technology sector expanded, adding not just engineers and programmers, but also marketers, cable installers, Web site designers, and all sorts of high and low-end jobs.

With info tech employment in a slump, there's no new industry now driving the job market. True, there are plenty of possible candidates for the Next Big Thing: Biotech, telecom, energy, nanotechnology, and even the commercial exploitation of space are all capable, in theory, of making a big difference in the job picture. However, it's not clear which of these, if any, will make the leap into the economic major leagues as autos did in the 1920s, commercial aviation did in the 1950s and 1960s, and info tech did in the 1990s.

For now, the lack of a leading-edge industry means that the benefits of the productivity boom are distributed unevenly. . . .

There are two possible ways that the current productivity boom could play out. In the absence of innovative new industries, the worst fears of pessimists will turn out to be true: Job growth will stay sluggish, demand will eventually sag, and over the course of the next decade, incomes will be driven down under the continued pressure of competition from China, India, and other low-wage countries.

The other, more optimistic alternative is that a new industry arises to take the baton from information technology as the leading sector of the economy. For example, biotech today is in the same situation as info tech was in the 1980s -- a relatively small industry in terms of jobs but with enormous potential. A few blockbuster drugs -- say, a real cure for colon cancer -- could mean a tremendous explosion of jobs in research, sales, and production.

It's important to realize that the new ideas need not be created in the U.S. The World Wide Web was invented in Switzerland, and drug research has been done around the globe for years. Moreover, Europe and Asia have long taken advantage of ideas generated in the U.S., showing that innovations travel easily across national borders.

In that sense, the growth of research and development operations in China and India -- regarded as potential competition by some -- could be good news for the U.S. With more smart minds, tough problems such as cheap solar power could be solved more quickly. What's important is for U.S. companies and workers to be flexible enough, with sufficient access to capital, to quickly take advantage of new technologies and opportunities when they arise.

Still, for all the uncertainty about the future, an economy driven by productivity growth is far superior to the alternative. Even without job growth, Americans are collecting the benefits of higher productivity through rising wealth and lower prices. Consumers are still spending -- and they're still buying homes. And if jobs and wages pick up soon, today's anxiety will feel like a dim memory.

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The special Business Week jobs focus continues with commentary by former Reagan Administration Assistant Treasury SecretaryPaul Craig Roberts: "The Harsh Truth About Outsourcing; It's not a mutually beneficial trade practice -- it's outright labor arbitrage"
Joining Lou Dobbs [see this post] in challenging conventional economic wisdom, he argues that Ricardo's law of comparative advantage no longer obtains:

When Ricardo developed the doctrine of comparative advantage, climate and geography were important variables in the economy. The assumption that factors of production were immobile internationally was realistic. Since there were inherent differences in climate and geography, the assumption that different countries would have different relative costs of producing tradable goods was also realistic.

Today, acquired knowledge is the basis for most tradable goods and services, making the Ricardian assumptions unrealistic. Indeed, it is not clear where there is a basis for comparative advantage when production rests on acquired knowledge. Modern production functions operate the same way regardless of their locations. There is no necessary reason for the relative costs of producing manufactured goods to vary from one country to another. Yet without different internal cost ratios, there is no basis for comparative advantage.

Outsourcing is driven by absolute advantage. Asia has an absolute advantage because of its vast excess supply of skilled and educated labor. With First World capital, technology, and business knowhow, this labor can be just as productive as First World labor, but workers can be hired for much less money. Thus, the capitalist incentive to seek the lowest cost and most profit will seek to substitute cheap labor for expensive labor. India and China are gaining, and the First World is losing.

One factor overlooked is the advantage provided by the American culture and personality.

Indians may work cheaper, but they have been raised in an extremely hierarchical culture, and I have heard first hand reports about low productivity resulting from the constant need to consult with superiors before making the slightest decision.

China is making great strides, but let us not forget that it is still a politically and religiously repressive regime, factors which seriously undermine morale, productivity, and creativity.

Speaking of which, here (finally) is the most optimistic of the Business Week articles: The Future Of Work; Flexible, creative, and good with people? You should do fine in tomorrow's job market (by Peter Coy and a host of others)

This article speaks of the value of skills I believe are less likely to be found in some of these other countries because they are encouraged by the American culture of creativity and freedom.

Changes in the economy in recent years have made some people more valuable and secure than ever, while pushing others -- even those with skills that were recently regarded as highly valuable -- to the margins.

What makes the difference? New research by economists at Massachusetts Institute of Technology and Harvard University concludes that the key factor is whether a job can be "routinized," or broken down into repeatable steps that vary little from day to day. . . . [T]he jobs that will pay well in the future will be ones that are hard to reduce to a recipe. These attractive jobs -- from factory floor management to sales to teaching to the professions -- require flexibility, creativity, and lifelong learning. They generally also require subtle and frequent interactions with other people, often face to face.

The good news is that a substantial majority of the jobs in the U.S. economy are nonroutine. And when you think about it, that has to be the case. In the relentless pursuit of productivity, the U.S. has already demolished millions of routine jobs in manufacturing, clerical work, programming, and other fields. . . .

The surviving secretaries, for example, have moved up from typing and answering phones to planning meetings, keeping books, and other more complex tasks. Bank tellers now spend more time handling special requests, while ATMs have taken over much of the job of taking deposits and dispensing cash. The factory workers most likely to keep their jobs will be those who make themselves experts on a variety of computer-controlled machines, or who excel at quick turnaround of custom orders. Those jobs aren't going away.

As the economy evolves, two kinds of jobs will remain impossible to routinize . . . . One kind involves complex pattern recognition. Such skills as spotting business opportunities or repairing a complicated machine fall into this category. The other relies on complex communication skills, such as those required to manage people, devise advertising campaigns, or sell big-ticket items such as cars. . . .


[S]ome jobs that are highly compensated today could soon be routinized. Powerful computers, advanced software, and speedy communications have vastly increased the vulnerability of routine work. Well-paid legal researchers, tax preparers, and accountants, for example, are seeing their jobs outsourced abroad. The jobs require intelligence and technical knowledge, of course, but because the procedures are highly standardized, they can be done at a distance by well-educated workers willing to do the job for far less. . . .

The people displaced from those jobs are shifting into jobs that can't be so easily standardized. And clearly, the growing importance of nonroutine work increases the value of education. . . .

While the debate over the future of work pervades the whole economy, information technology is where it's most pointed now. That's because the IT sector is being split in two. More routine tech jobs . . . are vulnerable to automation or outsourcing. In contrast, there's still plenty of demand in the U.S. for people who combine technical skills with industry-specific knowledge and people skills. . . .

To be sure, automation and globalization will be tough on those people who prefer comfortable, routine jobs, or who lack the education to tackle challenging new tasks. Some of those people will find work as barbers, truck drivers, hospital orderlies, or waiters. While those jobs will be protected by the fact that they can't be done in a foreign country or by software, wages will be depressed because so many people will be competing for the slots.

Still, there's no reason that automation and globalization have to create an underclass. In time, people displaced from routine jobs can study up for more challenging occupations. . . . [A] century ago, half the U.S. population worked in agriculture, and many people didn't know how to read or write. History has proved that they and their descendants were capable of much more. . . . Those who can [rise above the routine] will find that computers amplify their powers and globalization extends their reach.

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The final Business Week jobs piece gets political. It's a commentary by Mike McNamee(and others): "Stow The Rhetoric; Bush and Kerry need to move past politicking and get real about jobs"

[I]nstead of debating smart policies, both parties are backsliding into hot-button rhetoric. Kerry, a lifelong free-trader, threatens to veer into protectionism and border-closing, rolling back Bill Clinton's historic gains in moving Democrats toward open markets. And Bush has been reduced to singing the praises of a small fiberglass outfit that's set to hire two -- count 'em, two -- new employees, because he has little to offer stymied job seekers besides tax cuts on income that they won't earn.

As the campaign gets into full throat, it's time for both parties to deal with the real issue: How government can best help Americans adjust to a world where productivity grows rapidly, demand for skills changes constantly, and global competition threatens even well-educated service workers? Arming Americans to compete in that world -- without undercutting the flexibility and innovation that makes the U.S. economy so productive -- will demand more careful thought and more sensitive policies than either campaign is serving up. . . .

Neither candidate emphasizes the right policies to help Americans adapt to global job pressure in the long run. And there are ways that Washington can help. Start with the right balance on trade. . . .

The article goes on to offer some concrete policy suggestions.
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Kudos to Business Week. This collection of articles is some of the best stuff I've read on this complex and extremely important subject.

Continued . . .

EEOC releases annual stats

AP reports: "Job-discrimination beefs drop"

The number of job-discrimination complaints filed by workers against private employers edged down last year after hitting a seven-year high in 2002, the government reported.

The [EEOC] said 81,293 complaints were filed . . . in the 12 months that ended last Sept. 30, a 3.7 percent decline from the previous 12 months.

The 84,442 complaints filed in 2002 had represented a 4.5 percent increase from 2001 and put workplace-discrimination complaints at the highest level since 1995.

The EEOC had blamed the poor economy, an aging work force, a more multinational work force and the backlash from the 2001 terrorist attacks for the high level of complaints in 2002.

Even with the overall decline, discrimination complaints remained at the second-highest level of the past eight years. EEOC officials said this was cause for concern.

"Discrimination continues to be a problem in too many of today's workplaces," said EEOC Chairwoman Cari M. Dominquez, who noted that this July will mark the 40th anniversary of the passage of the landmark Civil Rights Act of 1964. . . .

No doubt, there's still plenty of genuine discrimination, but the number of charges filed is far from a direct measure of this.

Ask any experienced HR person or employment lawyer, and you'll hear lots of stories about charges filed without merit just because someone was unhappy with their treatment and happened to fall within a protected category, allowing them to file a charge, unlike the unfortunate WGUFWOD's ("White Guy Under Forty Without Disability"), who cannot use discrimination laws to attempt an end run around the harshness of employment at will (allowing termination for a good reason, bad reason or no reason at all).

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Here's the EEOC press release

Here's a page linking to all the underlying EEOC statistical tables.

Continued . . .

Older employees (retiring Boomers) will be needed in face of upcoming labor (not jobs) shortage, says Harvard Business Review

Harvard Business review has this: It's Time to Retire Retirement [synopsis only; reprint available electronically for $6.00]

Companies have focused so much on downsizing . . . that they've largely neglected a looming threat to their competitiveness: a severe shortage of talented workers. The general population is aging and with it, the labor pool. . . .

During the next 15 years, 80% of the native-born workforce growth in North America--and even more in much of western Europe--is going to be in the over-50 age cohort. When these mature workers begin to retire, there won't be nearly enough young people entering the workforce to compensate. . . . The problem won't just be a lack of bodies. Skills, knowledge, experience, and relationships walk out the door every time somebody retires.

This problem is going to become much more acute in the next decade or so, when baby boomers--more than one-quarter of all Americans . . . start hitting their mid-60s. [T]he authors of this article offer recommendations for gaining the loyalty of older workers and creating a more flexible approach to retirement that allows people to continue contributing well into their 60s and 70s.

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This demographic trend playing out may have all kinds of consequences. Outsourcing and immigration may start looking pretty good. And labor shortages could be inflationary. Flexible working arrangements created for -- and by -- aging Boomers may redound to the benefit of younger employees as well.

Continued . . .

Working the electronic grapevine

As usual, the Christian Science Monitor is on top of another interesting cutting-edge development: virtual social networking. Staff writer Stacy A. Teicher reports: "Working the electronic grapevine"; Networking sites are quickly becoming a mainstream way to find jobs and employees

Networking sites are quickly becoming a mainstream way to find jobs or employees, make deals, and meet mentors. Several million people have raced to link up everyone in their little black books on the Internet. . . .

[O]nline networking has come a long way since SixDegrees.com tried it in the mid-1990s and folded a few years later. Now the Internet is faster and offers more sophisticated functions, and the popularity of other online activities has wrought a massive change in attitudes: Buyers and sellers have been connected through eBay, boyfriends and girlfriends through Friendster, and Deaniacs through assorted blogs.

"We have become convinced as a society, reluctantly ... that if people can build a close enough relationship to propose marriage without having met face to face ... then surely we can build the kind of relationships that allow us to hire someone for a six-figure position," says Scott Allen, coauthor of the forthcoming book "The Virtual Handshake."

The concept raises a classic dilemma: quality versus quantity. "With face-to-face networking, you get much greater depth to your relationships, but it takes so much longer, so your circle cannot be as great," says Steven Rothberg, president of CollegeRecruiter.com in Minneapolis. "My concern is, if each of those hundreds of relationships [created online] aren't meaningful individually, why would any one of [those people] be inclined to stick their neck out to help you?"

Founders and users of the sites say they supplement face-to-face interactions, revealing new layers of connections. Online introductions are typically followed by in-person meetings . . . .

Once people decide they're ready to try online networking, they need to think about which of more than a dozen sites would be a good fit. Some are open to anyone.

On Tribe.net, for example, people join online interest groups and post classified ads within them. In December, the job-search giant Monster.com added a networking component, where members can ask to be connected to others they find through detailed searches. Friendster.com is popular among the under-35 crowd and is known as more of a social and dating network, but job recruiters have their eye on it as a potential resource.

Some sites require that you be invited by other members. Google's multipurpose networking site, Orkut, is so new that many people eager to join are frustrated because they are waiting for someone they know to link them in.

The strictly business sites that work by invitation, such as LinkedIn, appeal to people who would probably be flooded by requests in a more open forum. LinkedIn's members include many venture capitalists, as well as top executives from companies such as Netscape and Sony Worldwide, says spokesman Konstantin Guericke. . . .

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I've joined LinkedIn, but have yet to import my contacts, which as I understand it, is essential to gain the full benefit of networking. All of these sites seem to work on the "friend of a friend of a friend" notion, which of course is quite powerful.

Continued . . .

LLCs boom in Tennessee; what does this portend about the economy and the meaning of employment statistics?

J. Holly Dolloff writes in the Nashville Business Journal: "Boom times ahead? LLC formations soar"

It is likely that this article describes a trend seen in many other states besides Tennessee, and one worth watching. LLCs, or limited liability companies, are a relatively new form of business organization providing the legal protection of a corporation, without some of its cumbersome requirements. It has been frequently used by doctors, lawyers, and other professionals to organize their practices, and now apparently is being used more widely by business startups

The formation of limited liability companies in Tennessee has soared over the past two years, a trend that could mean the region's bleak jobs picture may soon brighten considerably.
The Tennessee Secretary of State Division of Business Services registered . . . 49 percent more than in 2001 [and] more than double the number of 1995, when companies first gained that option from the state. . . .

"The LLC has come into its own," says Leigh Griffith, an attorney at Waller Lansden Dortch & Davis. "It's the entity of choice for closely held companies."

Total for-profit business formation also set a new high . . . up 22 percent from 2001.

Griffith speculates the 2003 boom may have resulted from the downturn that began in 2001. "As the economy gets softer, people get laid off and start their own businesses," he says. . .

Though their greater numbers may often be attributable to past bad news, new LLCs could end up improving the local and state economic picture as they grow into bona fide businesses with multiple employees.

At this point, it is very unlikely that many of the new companies are being counted in the local or state economic statistics that show a stagnant job market despite optimism from both consumers and business owners.

At present, the only workers utilized by such new businesses may be the owners, who will not be reflected as employees in the payroll survey relied on for the disappointing employment statistics, although they may report themselves as employed or self-employed in the household survey which yields the somewhat more encouraging unemployment numbers. See this post -- What's going on with the employment data?

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Continued . . .

FedEx Driver Wins $3.24M in sex discrimination and harassment case

AP (Mark Scolforo) reports; "FedEx Driver Is Awarded $3.24M in Sex Case"

A federal jury in Harrisburg awarded $3.24 million to a former FedEx tractor-trailer driver who claimed she was sexually harassed and had the brakes on her truck sabotaged five separate times in an attempt to intimidate her.

The jury found Federal Express Corp. . . . liable for a hostile work environment and retaliation against Marion Shaub, 47, and determined it had intentionally inflicted severe emotional distress. Shaub was awarded $2.5 million in punitive damages, $391,000 in back pay and $350,000 for pain and suffering.

There must have been a state law claim, as these amounts exceed the top damages cap under Title VII. Indeed, the EEOC press release indicates there was a successful "intentional infliction of emotional distress" claim.

Shaub was the only female tractor-trailer driver at the . . . facility at Harrisburg International Airport . . . from 1997 to 2000. During that period, she was subjected to sexual innuendo and harassment and unfairly given poor assignments, her attorneys said.

The [EEOC] sued the company in February 2002, and Shaub was subsequently allowed to join the suit.

The EEOC complaint said that among the "anti-female remarks" Shaub's male co-workers made to her were that women should be "barefoot and pregnant" and that she "looked like a porn star." One male colleague told Shaub that if she were his daughter, "he would abort her," according to the suit.

Shaub also claimed that her brakes were loosened, the brake lines were cut and the lines were filled with dirt.

This situation of having only one female employee (or very few) in a traditionally male job classification presents a very high risk of sexual harassment or discrimination. Special care should be taken in such situations to communicate anti-harassment policies and to monitor compliance.

It is also noteworthy that most of the conduct was not what is normally thought of as sexual harassment. But it met the definition of sex discrimination in that it clearly targeted the woman because of her gender. This, rather than whether conduct is "sexual," is the key element of a violation.

Continued . . .

Lou Dobbs on outsourcing/offshoring

Accused of fanning the flames of protectionism contrary to our economic interest in free trade, CNN's Lou Dobbs defends himself in:"Exporting America: false choices"

You may have noticed recently that I'm being attacked for my views on the exporting of American jobs and my calls for a balanced U.S. trade policy [citing articles in the Financial Times, the Economist, Wall Street Journal, and Washington Post ]. . . .

I will tell you it does make a fellow think when attacked so energetically and so personally. But in none of the attacks on my position on outsourcing has a single columnist or news organization seen fit to deal with the facts.

Number one: We're not creating jobs in the private sector, and that's never happened before in our history. Our economists and politicians need to be coming up with answers, not dogma.

Number two: We haven't had a trade surplus in this country in more than two decades, and our trade deficit continues to soar.

Number three: We've lost three million jobs in this country over the last three years, and millions more American jobs are at risk of being outsourced to cheap overseas labor markets.

That seems to me, at least, to be more than sufficient evidence for all of us, Republicans and Democrats alike, to question critically the policies of both parties that have led us to this critical juncture in our economy and our history. . . .

Frankly, I would love to be proved wrong in my views, and I would gladly change my position, if only my critics would answer a few questions factually, empirically and straightforwardly.

One: How many more jobs must we lose before they become concerned about our middle class and our strength as a consumer market? Two: When will the U.S. have to quit borrowing foreign capital to buy foreign goods that support European and Asian economies while driving us deeper into debt? Three: What jobs will our currently 15 million unemployed workers fill, where and when? . . .

Our principal trading partners, Canada, China, Japan and the European Union, all typically maintain annual trade surpluses and pursue balanced trade. Why don't my critics call them protectionists? Why not call them economic isolationists?

My critics, and proponents of the status quo, are offering false choices. They say we must decide between protectionism, or economic isolationism as the president said today, and free trade. I'm sure they believe those choices are the only ones available.

But maybe they also fear our policymakers may discover a middle ground for a desperately needed new U.S. trade policy: a balanced trade policy in the national interest.

Continued . . .

Off-topic, but interesting: Atlantic interview with John Kerry biographer

Atlantic Online has this: "The Thoughtful Soldier: Douglas Brinkley, the author of Tour of Duty, on John Kerry's conflicted but heroic service in Vietnam"

Within a five-year period from 1966 to 1971, John Kerry gave a college graduation speech denouncing the Johnson Administration's policies in Vietnam, voluntarily entered the United States Navy, requested duty in Vietnam, won three Purple Hearts and a Silver Star, became the most prominent spokesman for the anti-war group Vietnam Veterans Against the War, and quit the organization because it had became too radical.

Though no one questions Kerry's bravery during the war, he has been criticized for flip-flopping back and forth between positions. That he is capable of such twists and turns concerns some people and, no doubt, delights Karl Rove. But in his new book, Tour of Duty: John Kerry and the Vietnam War, Douglas Brinkley suggests that Kerry's decisions during those years were based on thoughtful principles and are not evidence, as some critics have argued, of a lack of conviction. Brinkley's book, an excerpt of which was The Atlantic's cover story for December, is based on Kerry's diaries and letters, as well as interviews with Kerry and the men who served with him. Brinkley offers a comprehensive picture of Kerry as a young soldier seeking to reconcile his sense of duty to his country with his belief in the importance of speaking out about his convictions. . . .

The portrait of Kerry that emerges in this book is complex and multifaceted. He is not necessarily easy to know, and his actions are not necessarily easy to predict, but in Brinkley's view he is a conscientious and thoughtful man, adept at seeing all sides of an issue and taking decisive action.

I can't fault Bush, Kerry or anyone else for how they handled the issue of service in Vietnam. I was a few years too young for the draft, but surely knew I didn't want to go over there to kill or be killed.

It is noteworthy that what can be criticized as Kerry's flip-flopping may reflect thinking carefully about issues. Few policy issues are black-and-white. To the extent Bush's appearance of strong leadership is reflective of his being someone who sees things as black and white, perhaps it involves oversimplification that will not serve us well in the long run.

I'm still an undecided swing voter, and am interested to learn more about Kerry. This short interview's worth reading (if I had the time, I'd read the book too).

Continued . . .

Various items on organized labor and politics

Chicago Tribune [reg. req’d] (Reuters) reports impact of SoCal grocery strike on stores’ bottom lines: "Labor fight takes toll at Kroger, Albertson's"

Kroger Co. and Albertson's Inc., the nation's two largest grocery store chain owners, said Tuesday that quarterly results were hit hard by labor turmoil in Southern California and forecast a difficult year ahead. . . .

Albertson's estimated that the Southern California labor troubles cut its quarterly profit by about $90 million. Kroger said the dispute, combined with a West Virginia work stoppage, cut its profit by $156.4 million. . . .

Edouard Aubin, an analyst at Deutsche Bank Securities Inc., said the 2004 outlook was disappointing. He said the latest results also highlight the growing influence of stores like Wal-Mart Stores Inc. in the U.S. grocery business. . . .

Albertson's CEO Larry Johnston said on CNBC that grocers had been aggressive in introducing a lower cost structure in Southern California, possibly creating a benchmark for driving down labor costs in the rest of the country over time.

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Agreeing that the SoCal strike outcome may have this longterm result, and viewing that prospect from a pessimistic, prounion perspective, Harold Meyerson writes in the Washington Post: “What Wal-Mart Has Wrought”

Meyerson starts by recalling what he views as “the role that unions played in making Los Angeles the epicenter of America's epochal post-World War II prosperity,” crediting “the greatest new housing boom in world history” on “huge aerospace factories, whose unionized workers could afford to buy new homes.”

Chicken-and-egg question: which came first, prosperous aerospace factories fueled by cold war government spending, and the consequent high demand for labor, pushing up wages and benefits, or union activism? Is it really historically accurate to credit unions with generating middle class prosperity under those circumstances?

Meyerson fast forwards to today:

Since the Cold War's end, the aerospace industry and other unionized manufacturing here have drastically downsized. The service sector waxed as manufacturing waned, but most nonprofessional service-sector jobs are nonunion and low-wage.

The great exception was supermarket work. . . .

And why should this be an exception? Ultimately unions can’t defeat market forces. Labor is worth what it’s worth, and unwarranted exceptions won’t last forever. Indeed . . .

[L]ate last week, the union threw in the towel. The contract that the unhappy but increasingly desperate workers ratified created a lower pay scale for all new hires. It virtually ended the markets' responsibility for new workers' health coverage: Employers agreed to contribute $4.60 hourly for current workers' health plans but just $1.35 hourly for those of future employees. .

You get that one? $1.35 an hour is virtually nothing! Tell that to folks with no employer-provided healthcare whatsoever!

The union's contracts will expire in other parts of the country later this year, but now its strike fund is depleted and the companies can point to the new contract as setting the pattern for the industry. Close to 1 million unionized supermarket jobs may now be downward-bound. And while Americans have focused, understandably, on the ongoing evisceration of manufacturing jobs, the downscaling of service-sector jobs in the age of Wal-Mart poses no less a threat to the existence and idea of a working-class career.

Fortunately, the defeat of the supermarket strikers wasn't the only union news in the past week. Last Thursday two of the nation's most proficient organizing unions . . . announced that they were merging. UNITE, the clothing and textile union, and HERE, the hotel and restaurant union, agreed to join forces in what will be a remarkable organization of largely immigrant workers in routinely low-wage industries.

UNITE and HERE may well be the two most tenacious unions out there. . . . UNITE is situated in an industry that will soon move almost entirely offshore, while HERE, a union in an industry that is anchored in every American city, has more opportunities than it has resources. Their merger creates a powerful force for organizing and upgrading the kind of service-sector jobs that otherwise are being ratcheted downward.

So UNITE, having failed to salvage any textile jobs for its members, is the model service workers should turn to?

Anyone who doubts the ability of these unions to transform dead-end jobs into productive careers should check out the improbable union city of service-sector America: Las Vegas. By organizing almost every Strip hotel, HERE has created an employer-funded training academy where maids and dishwashers can become cooks and servers and wine stewards, and a hotel workforce that makes enough to purchase new homes. The biggest housing boom in the nation today spreads across the Vegas desert and, as in Los Angeles a half-century ago, it is largely the consequence of unionization.

Chicken-and-egg question again: which came first, gambling-and-tourism-driven prosperity or unionization? Were the unions the fertilizer of this growth or the parasites feeding off of it? And since when is Vegas comparable to anywhere else? I mean people basically go there to throw money away. If restaurants and hotels there are pricier due to labor costs, a Vegas trip costs more. So what, that just makes it a better vacation, doesn’t it? I mean if the point is splurging and throwing a lot of money around . . . .

Myerson concludes:

John Kerry walked a supermarket picket line in Santa Monica last week in the waning hours of the strike, pledging to provide the kind of health insurance that the new supermarket workers will sorely need and to change labor law to protect workers' right to organize. The Wal-Mart political action committee, meanwhile, has abruptly become the largest corporate PAC in the nation, funneling 85 percent of its congressional contributions to Republicans. The battle over the Wal-Martization of America has entered the electoral arena -- one more reason why Kerry has a strong hand in November's presidential election.

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Kerry’s hand will be stronger, IMHO, if he shows he’s not just a typical Democratic suckup to organized labor’s political machine. He’s got the substantial hardcore anti-Bush vote no matter what. The true-blue labor Democrats will stick by him even if he shows labor some backbone. But if he wants to get “Reagan Democrats” and right-to-work southerners and midwestern swing voters like me, he’d gain by distancing himself a bit from the AFL-CIO machine. Look what happened to Labor’s buddy Gephardt in Iowa, when Labor pulled out all the stops for him!

And Labor just may be setting the stage for an opportunity for Kerry to tell them where to go (or not):

Boston Globe (Rick Klein) reports: "Union raises stakes for July; Police group eyes convention boycott"

Boston's largest police union is asking Democrats nationwide, including presumptive presidential nominee John F. Kerry, to boycott the Democratic National Convention in July, a dramatic escalation of tactics in the union's quest for a contract.

Yeah, right, so what are they supposed to go, move the convention to another city, or just blow it off altogether?

Police union allies across the country have already begun phoning local delegates and party officials, telling them that entering the FleetCenter will be seen as crossing a picket line if Boston police do not have their contract settled by then. Thousands of police from at least nine states and 18 unions are ready to stand beside Boston officers to show their solidarity.

"There will be an expectation that the line not be crossed," Thomas J. Nee, president of the Boston Police Patrolmen's Association, said at a news conference yesterday at the union's Roxbury headquarters. "I know Democrats do not do that. That's the protocol."

That’s BS, is what that is. Democrats should do like everyone else does: decide whether to cross a picket line based on the merits of the dispute, not some kneejerk “protocol” that a good person never crosses a picket line.

Asking delegates to stay away from the biggest Democratic political event of the year would embarrass hundreds of Democratic elected officials, particularly if officers from their hometowns are on the picket line.

A picket line outside the convention could also embarrass Kerry, who will formally receive his party's nomination at the convention. A public display of disharmony among Democrats, who have traditionally had close ties to organized labor, could send a negative message as the party tries to present a unified front against President Bush. . . .

Don Fowler, a former chairman of the Democratic National Committee, said that local labor disputes are common in the months before a convention, but that they have been smoothed over in time to prevent disruptions. While many delegates would be sympathetic to a picket line, he said, a local dispute is unlikely to keep droves of delegates away.

"Every convention in my memory has had this kind of matter pending prior to the convention," Fowler said.

Hmmm . . .what does that tell us. That the Dems have bad luck and timing picking cities for conventions? Or that Labor sees them as gutless pushovers and always uses conventions for unmitigated and disgusting power plays?

Senator Edward M. Kennedy of Massachusetts, a strong labor ally, declined to comment on how he would handle a picket line at the convention, saying only that he is sure it will never come to that. "I'm confident that both sides will be able to find a satisfactory resolution of the issues," said a prepared statement Kennedy issued.

Sounds just like him. What would happen if someone like TK just said “the union [expletive] well better get it settled because if they don’t I’m crossing their line and will never vote for a labor-sponsored bill again”?

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Meanwhile, at the AFL-CIO convention in Florida: "Labor OKs Funds to Mobilize Against Bush", reports the Miami Herald (AP; Leigh Strope)

Labor leaders voted Wednesday to spend $44 million to mobilize union household voters in November against President Bush, a record sum in an election they say is do-or-die for the labor movement. . . .

"People are fed up with this administration's inability to create good jobs and get our country back on track," AFL-CIO President John Sweeney said. "They are demanding a change and we plan to give it to them."

Union leaders meeting this week at a luxury seaside resort approved a hike in the assessments they pay to the AFL-CIO to help fund the $44 million effort, which does not include money the affiliates will spend individually on their own programs. The 64 unions agreed to pay 48 cents per member.

This is what you get when you work in a union shop (unless you specifically object) – the union spends your money backing political candidates, assuming that you and your union brothers and sisters are going to vote as they tell you.

Labor's strength in the workplace has been plummeting, but union members have remained reliable voters for Democrats. One in four voters in the 2000 election was from a union household. That year, the AFL-CIO spent about $41 million to mobilize its 13 million members and their families.

Think how much job training for unemployed union members that money would have bought.

Previous election efforts focused on registering and turning out new union voters. This time, the AFL-CIO is targeting undecided and swing union household voters.

"Our program is more sophisticated," Sweeney said. "We can more accurately identify the undecided voters among our ranks, and plan to make a special new effort to make sure they get educated about where the candidates stand on issues like overtime, jobs and education."

As if union members can’t educate themselves from more objective sources. Maybe they’re undecided because they think for themselves, and don’t plan on blindly obeying the union bosses.

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Finally, CNN reports on the AFL-CIO meeting: “Labor pains, continued”(by John Mercurio)

[T]he story we're watching most closely today is the awkward reunion of organized labor, which gathers in south Florida to make sense out of a particularly clumsy primary roadshow that left them divided, dispirited and, in some cases, doubting their ability to defeat President Bush.

If one head should roll at the Sheraton Bal Harbour Beach Resort, sources say it could be that of Gerald McEntee, the president of the American Federation of State, County and Municipal Employees, who may face a challenge as chair of the AFL-CIO's political education committee after the way he handled his union's endorsement -- and abandonment -- of Howard Dean.

Criticism of McEntee, who as chairman of the committee controls labor's multimillion-dollar voter-turnout operation, comes strongest from unions that had backed Dick Gephardt. . . .

For the record, an AFSCME spokesman dismissed speculation about McEntee's woes as "idle chatter." He noted that McEntee is scheduled to preside over his committee's meeting tomorrow morning and will hold a news conference in Florida with Sweeney and Gephardt following the meeting. . . .

Now, to John Kerry, who by all accounts is showering his newfound labor friends with constant phone calls and made sure to schedule campaign stops earlier this month (in Atlanta and Oakland) designed to give local unions a national platform. . . .

"We're pretty unified [behind Kerry], which is incredible if you think about how screwed up the primary was," said Mike Mathis, political director of the Teamsters, which backed Gephardt. "Kerry has been really good about touching base with people. He's good at making phone calls, he checks in with a lot of labor people."

But in the end, of course, labor's unity has resulted more from who Kerry's not, than who he is. "He's not Dick Gephardt, sure. But he's also not George W. Bush," one labor wag said.

And ultimately, eight months before Election Day, labor leaders say that's the most important factor.

So what was screwed up about the primary? Big Labor didn’t throw its weight around as a solid bloc, holding off on an endorsement, but what’s wrong with that? Why shouldn’t they just encourage their members to participate in the process, instead of trying to dictate their votes with their “endorsements”? And why should candidates suck up to the unions? Now Democratic candidates know they can win a nomination without a unanimous union endorsement. Maybe the cat’s out of the bag . . . .

Continued . . .

More post-mortem on SoCal grocery strike

James F. Peltz, LA Times Staff Writer reports in the LA Times [free regist. required]:"How the Supermarket Strike Was Settled," an interesting inside look at the negotiations.

While most of California slept, the longest supermarket strike in U.S. history was settled in Steve Stemerman's hotel room.

It was 3 a.m. Feb. 23 when Stemerman, the United Food and Commercial Workers union's lead negotiator, and one of his colleagues huddled at the Hyatt Newporter with representatives of the three national supermarket companies whose insistence on slashing their labor costs had persuaded the union to strike.

The five men had been bargaining in various locales at the Newporter for 13 straight days, on this day alone for more than 13 hours. They were haggard, fed up with room service coffee and casually dressed; any need for ties had long since passed.

Good description of atmosphere, procedure, history of this hard-fought negotiation.

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Next, here's an analysis of the strike and its implications from the TomPaine.com website by Ruth Milkman, who directs the UC Institute for Labor and Employment and is a professor of sociology at UCLA: "Striking Out"

Once upon a time, strikes were a tool used by labor unions . . . . In recent decades, however, with unions on the defensive against increasingly aggressive corporations, strikes have morphed into an employer weapon. The massive four-and-a-half month labor dispute that just ended this week . . . must be understood in this context.

Southern California's supermarkets have been unionized for more than half a century. Until last year, they were a poster child for "high road" management. Labor-management relations were cordial, and the industry had an unbroken record of labor peace going back 25 years. With all the major grocery chains under the same union contract, paying the same wages and benefits, competition was based on service and quality; not on squeezing labor. The happy result was that supermarkets were one of the region's few remaining sources of middle-class jobs with decent wages and benefits for workers without a college degree.

One can describe this situation as "happy"; but one can also observe that perhaps the passivity of the employers all these years lead to an untenable divergence between contract wages and benefits and the labor market. Perhaps finally something had to give.

Last summer, however, . . . the industry's Big Three made a calculated decision to radically restructure their wages and benefits and, in effect, abandoned the high road. They demanded major concessions . . . . As the companies knew perfectly well, no union worthy of the name could have accepted these concessions without a fight . . . .

The employers claimed they needed concessions from the UFCW because of competition from Wal-Mart . . . . But the Wal-Mart argument is less than compelling for the case of Southern California, since Wal-Mart has yet to open a single store selling groceries in this region. At best this was a threat on the distant horizon.

Why, then, did the grocery chains choose southern California as the battleground for their assault on the UFCW's long-established wage and benefits? Perhaps it was simply a matter of timing . . . . Or perhaps it was the fact that the southern California UFCW contracts were the best (from the union's perspective) in the nation, and covering the largest number of workers. If the union could be forced into a strike here, not only would the results set the pattern for the rest of the nation, but the union's treasury might be depleted in the process. . . .

Yet the Big Three didn't hold all the cards. No one anticipated the huge public support the picketers garnered. . . .

When the parties finally reached a settlement last week, the union publicly declared victory. . . . The union pointed to the fact that the settlement succeeded in preserving the established health insurance system for current workers for two more years, which was one of the central issues that led to the strike and lockout. But in every other respect, the employers were the real winners here.

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But according to Findlaw (AP)(Alex Veiga): "Grocery Union Ready for More Disputes"

As Southern California grocery workers return to work after their long strike-lockout, union leaders are already discussing how to tackle negotiations for more than a dozen other contracts expiring over the next several months. . . .

[R]egardless of any mutual understanding that might have developed by the time the 4 1/2-month-long Southern California strike was settled, union officials warn it's not going to make much difference in future negotiations and say they are gearing their members up for other strikes, if needed.

"You cannot say that the settlement in Southern California sets the stage for settlements everywhere. ... What it did do is mobilize our local unions for a potential fight," said Greg Denier, national spokesman for the United Food and Commercial Workers. "

"If the employers continue to pursue an aggressive strategy and present unreasonable demands as they did in Southern California, they're inviting labor disputes across the country." . .

In a message posted on a Web site for San Francisco-area grocery employees, the union advises its members that the Southern California strike was "just the first battle in a much larger war," and that their contract will soon become the next front. . . .

The UFCW will be able to back up threats of a strike in upcoming negotiations by pointing to how it kept Southern California members out of the stores until a compromise was reached. But labor experts say the financial hit absorbed by the workers might make employees elsewhere think twice about supporting a walkout. . . .

The supermarket chains will also have to consider whether they can endure the losses of another large strike. . . .

Union officials won't give specifics, but concede they learned hard lessons during the strike and plan to do some things differently next time, starting with winning the battle for the hearts and mind of the public.

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My prediction: both sides will indeed have learned some lessons and depleted various resources, including public good will. They have also learned what kind of contract provisions to realistically expect. Both sides will be making comparisons to the terms reached in SoCal. Therefore, these upcoming grocery negotiations, while not easy, will be resolved more peacefully.

Continued . . .

More on 360 Degree Feedback

About.com Human resources with Susan M. Heathfield has this: "360 Degree Feedback: The Good, the Bad, and the Ugly Defines and Examines Multirater Feedback"

This article explains what 360 degree feedback is: -- "a method and a tool that provides each employee the opportunity to receive performance feedback from his or her supervisor and four to eight peers, reporting staff members, co-workers and customers" -- and then discusses pros and cons and benefits and pitfalls.

Good HR stuff.

As I believe I've said before, from the lawyer's perspective, such feedback can have the benefit of neutralizing claims that one person or another had a discriminatory attitude. (E.g., if all these people agreed the employee had a lousy attitude, maybe they were right, even if Joe Supervisor was a racist pig)

Continued . . .

Is pressure to finally start hiring building up in the executive suite and among investors?

Business Week online reports: "What Investors Want Now: Jobs"

No doubt about it, investors like to see Corporate America squeezing the most it can out of its employees. As the economy has bounced back, productivity, or output per worker per hour, has continued to expand. Meanwhile, stock prices have risen 50% from their October, 2002, lows as a smaller, more productive workforce seems to have turbocharged corporate profits. While productivity grew 4.2% last year, profits jumped 18.2% -- the biggest increase since 1995. Gains garnered through investments in technology and outsourcing generally result in a stronger bottom line because they keep a lid on staffing costs -- typically a company's single biggest expense.

Investors also like to see a trend that generally lowers productivity growth. And that trend -- hiring -- has been maddeningly elusive in this economic recovery. "Labor is consumers, and you can't get top-line revenue growth if you don't have people spending money," says Sherry Cooper, global economic strategist at BMO Financial Group in Toronto.

A tension exists between job growth and productivity, she points out. As the U.S. economy continues to expand at an anual rate of about 4%, the friction is palpable in executive suites. On one side are the bean-counters, who want to push existing employees to do even more. On the other side are maxed-out managers, who want to add workers to the payroll.

"THE LINCHPIN." With so much productivity growth over the last few years and no job growth, something has to give. And CEOs who want to see stock prices move higher in 2004 probably will start to listen to their stressed workers, say the pros. It will be job growth, not further productivity gains, that most likely boosts share prices for the rest of 2004. . . .

This may be just the time to start adding people, too. Businesses appear to have wrung about as much as they can out of employees. Productivity growth in the fourth quarter of 2003 declined to a 2.7% annual rate from 9.5% -- a 20-year high -- in the previous quarter. This sharp quarter-to-quarter slowdown suggests that companies have hit a wall. "I think we're at the limit of pumping up productivity without hiring new workers," Cooper says. "You are ending up with a lot burned-out people." . . .

Not everyone is convinced that job growth will be key to a continuing recovery. Donald Luskin, chief investment officer at TrendMacrolytics in Menlo Park, Calif., argues that the unemployment rate is a very tame 5.6% by historical standards. "We are in a perfectly fine, better-than-average recovery," he contends, and it won't matter to the stock market what happens with jobs or productivity as long as profits rise. . . .

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Indeed, the unemployment rate used to be the key benchmark. So what's happened? Why aren't we happy it's down to 5.6%?

Jerry Bowyer has an answer -- it's politics (duh!) he writes in National Review Online: In Defense of the Unemployment Rate; The media have switched jobs stats midstream

Since the president's tax cut was fully implemented last May the unemployment rate has dropped rapidly from 6.3 percent to 5.6 percent today. Everyone knows this. It's one of the fastest declines in unemployment in decades. The problem is, this is a presidential-election year. Hence, improving economic statistics will not be accepted by the mainstream media no matter what those statistics say. . . .

Remember how business and financial reporters measured the health of the job market back in the '70s, '80s, and '90s? Right. They used the unemployment rate. . . .

During the deep recession which occurred between 1981 and '82, before the Reagan tax cuts were officially implemented, the Gipper was hammered with "high unemployment" rates. During the recession of '91, Bill Clinton, by way of a willing media, was able to attack George Herbert Walker Bush using unemployment rates that hovered around 7 percent.

The point here is that the nation has historically focused on the unemployment rate when it comes to measuring the health of the jobs market. All of a sudden, however — just when the unemployment statistics have given us an unbroken series of good tidings — we've seen a switch to the importance of the payroll jobs survey as the preferred metric of the labor climate.

Opinionated and right-wing? Perhaps. But certainly interesting.

Continued . . .

Bunch more stuff on outsourcing/offshoring

This is a big topic today. We need to understand what's going on and its ramifications. We don't really even know for sure what's going on with the level of employment and job creation (see this post and sources cited therein). If we wrongly jump to the conclusion that this is still a jobless recovery and then further assume that outsourcing is at fault and is a bad thing, we may make serious policy errors. Here are some of the things I've read recently on this:

"In age of outsourcing, do the old rules apply? Most experts say globalization's benefits outweigh the costs, but some see altered equations," by David R. Francis for The Christian Science Monitor, covers some controversy among economists:

Most economists support freer trade, international investment, and a freer labor market - all enablers of offshore outsourcing. Though it may cause short-term job loss and other disruptions, the long-term effect is to raise living standards, they say.

But a few economists charge that economists' old trade theory no longer applies.

He also talks about dramatic shifts in public opinion, as "America's white-collar work force is experiencing the kind of vulnerability once felt mainly on assembly lines." Opinions clearly depend on "whose ox is being gored": "Only 28 percent of those making more than $100,000 a year support active promotion of free trade, down from 57 percent in 1999."

Francis points out that "the rising debate could have far-reaching policy implications - possibly slowing the trend toward globalization that many credit with raising living standards worldwide in recent years. Now, even if the outsourcing threat is overblown, it could help put the brakes on globalization."

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Another good article in the Monitor, by staff writer Stacy A. Teicher, covers some of the difficulties American companies are discovering as they try sending service and technology work abroad. In "A not so simple path," she writes that although programmers in India work for one-tenth the salary of programmers here, "labor-cost savings aren't the only factor firms need to consider before jumping on the outsourcing bandwagon." Giving a series of specific examples of "stories of outsourcing gone wrong," she says many companies "still wonder if the benefits surpass the risks." The article says: "Studies suggest that more than half of outsourcing contracts haven't delivered their projected cost savings, but once companies refine their strategies, they can expect to save 20 to 40 percent."

The article concludes with an opinion that "we're headed toward more global equality in technology wages, [that] IT professionals have to accept that their trade is becoming more like an average trade," [and] [i]f salaries hadn't gotten so overheated in the 1990s, . . . it wouldn't be worthwhile to outsource."

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The savings figures above indicate much smaller savings than the labor-cost differential alone would suggest. It would not take too many years of wage convergance to neutralize 20%-40% savings. I have read elsewhere that the relevant wages in India have been rising 10% a year.

In a similar vein, CNN/Money reports: "Study notes offshoring downside; As firms move jobs overseas to cut labor costs, they could be incurring new costs, firm says."

Issues discussed include tax consequences, supply chain costs, and the expense of shutting down U.S. facilities.

An interesting point, offered without factual support, is that "[s]tatistically speaking, offshoring has not been a major factor in the U.S. labor market's prolonged slump, the longest since 1939."

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So if that slump is itself overstated (due to difficulties with our statistics), then the overall impact of this phenomenon may be much less significant than the alarmists would have us believe. Knowing the truth is vital to current political debate.

Friday, one of my favorite columnists, Thomas Friedman, wrote this from Bangalore, India: "Turbulent global change, version 3.0"

Friedman says: "having now spent 10 days in Bangalore, India's Silicon Valley, I realize that while I was sleeping, the world entered the third great era of globalization." He concludes:

So now I wonder: When they write the history of the world 20 years from now, and they come to this chapter - Sept. 11, 2001, to March 2004 - what will they say was most important? The attack on the World Trade Center and the Iraq war? Or . . . the convergence of PCs, telecom and work-flow software that allowed India to become part of the global supply chain for services the way China had become for manufacturing - creating an explosion of wealth in the middle classes of the world's two biggest nations and giving both nations a huge new stake in the success of globalization?

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Indeed, IMHO we are acting like piggish spoiled Americans if we are unable to see the silver lining of this cloud. And I'm sure we'll be seen that way around the world as we whine and whine about outsourcing.

China and India are huge nations and nuclear powers, with unbelievably huge populations of unbelievably poor people. India is a democracy which shares with us some remnants of the British colonial experience. Is there not great good in our becoming increasingly tied to these countries economically?

There are those who attribute peace in Europe finally being achieved post WWII to the economic interdependence of the Common Market approach. Do not the rapidly growing economic ties between the US, China, and India have the potential of similarly enhancing world peace and stability?

What about the humanitarian benefit of improved living conditions in these countries?

What about the economic benefits to us of increased consumerism there?

On the last point, there was some very heartening news about how my home state of Missouri is benefiting nicely from trade with China. Eric Heisler wrote in a cover story in the St. Louis Post-Dispatch: "Chinese buy more goods from Missouri"

China imported $260.2 million of Missouri-made goods last year, leapfrogging past Germany, Italy and others as a major market for the state's products. That mark also doubled the value of Missouri goods sold to China in 2002 . . . .

Tapping into a fast-growing economy with 1.3 billion people benefits a diverse list of Missouri companies, from a major chemical maker in St. Louis to a small producer of sewage-treatment components in Columbia [MO] . . . .

"In China, they like American goods and they love American quality," said Randall LaBounty, director of the U.S. Export Assistance Center office in St. Louis. "As the Chinese get more income, they're just going to buy more from around the world, and that includes the United States."
Many of the Missouri products are ones that China largely didn't need before massive economic and social changes began to sweep the nation over the past decade. For instance, as its rural regions develop, China is quickly building sewage treatment plants. That means it needs the type of parts made by Environmental Dynamics Inc. of Columbia, Mo. . . .

"It's just a huge, untapped economy," said James Wareham, vice president of international sales and operations for St. Louis-based Sigma-Aldrich Corp.

Until the past five years, Sigma-Aldrich barely sold its products to China. Now, the nation has become one of the top markets for the company's research chemicals. . . . China moved onto Sigma-Aldrich's radar screen as more U.S. companies moved their research arms there to take advantage of lower-cost labor. That's meant an increase in demand for Sigma-Aldrich's products, many of which are made at its five St. Louis-area plants, Wareham said.

"There's lots of Chinese researchers who were educated abroad and are returning to China for work," he said. "They're familiar with our brand and our quality, so they use our products." . . .

When U.S. companies invest in China, they still tend to buy some U.S.-made supplies, LaBounty said. "That's just how companies work. They like to buy supplies from the sources they're used to." . . . .

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Finally, two pieces about specific white-collar outsourcing, one close to home for me (professionally, not geographically):

"Law firm cuts rates by outsourcing to India"

"Reuters' Offshore "Experiment"; why the news service is hiring reporters in Bangalore to cover U.S. companies"

Continued . . .

Learned professor comments on Supreme Court's general Dynamics age discrimination decision

Michael C. Dorf of the Columbia University School of Law writes this in Findlaw: "The Supreme Court's Recent Ruling that Federal Age Discrimination Law Protects the Old, but not the Young"

Unlike my previous post, Dorf's criticism is not so much the reliance on legislative history as the failure to adequately consider policy, and he likes the dissent's result:

Legal scholars have long noted that in close cases, judges typically consider questions of policy as well as technical legal matters, and properly so. Faced with an ambiguous statutory command, courts appropriately ask what makes sense: what resolution of the ambiguity will best serve justice? . . .

Remarkably, however, neither the majority nor the dissent in General Dynamics engaged in any policy analysis whatsoever. Both were content to puzzle over the meaning of the words of the statute, as though this were a purely lexicographical exercise. . . .

How, then, should the Justices have resolved the textual ambiguity in the ADEA? That is a genuinely hard question, but I would side with the result, if not necessarily all of the reasoning, of the dissent.

In explaining what he thought Congress must have meant in proscribing age discrimination, Justice Souter observed that it is a commonplace that we live in a "youth culture." He's right, of course. Far from respecting the wisdom and experience of age, our society does stereotype the old as unattractive and unproductive.

But to recognize that the old are frequently the victims of discrimination is not to deny that sometimes the young are the victims of stereotypes as well. Even if age discrimination against the young is less common than age discrimination against the old, when the former happens it may still be invidious.

Moreover, in the Court's equal protection jurisprudence, one marker for heightened judicial protection is political power. It is a commonplace that the old have vastly more political power than the young, enabling the old to secure proportionately greater funding for programs that benefit themselves than the young are able to obtain for themselves.

Granted, the young aren't quite what the Court's equal protection cases call a "discrete and insular minority." But neither is it outlandish to think that their lack of political power relative to the old calls for some greater judicial solicitude. . . .

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Indeed, I have always found it quite unreasonable that the ADEA protects only those over 40, as if there could never be unjustified discrimination against the young.

How about the case of a talented young employee who doesn't even look his/her age? Don't employers ever fear putting such a person in charge of supervising much older employees, thinking a man/woman who still looks like a teenager (but in fact is, say, 28) will cause them not to be viewed seriously as an authority figure?

Is this discrimination that ought to be prohibited?

Shouldn't discrimination laws be construed, if at all plausible given their language, as promoting true equality of opportunity -- meaning prohibiting discrimination in either direction? This, of course, is at the heart of debate over affirmative action as well.

Continued . . .

Inappropriate, imature and unprofessional conduct held not sexual harassment

In Henthorn v. Capitol Communications, Inc., No. 03-1018 (8th Cir. 3/5/04), the court held that "repetitive and annoying" requests by a supervisor that the plaintiff go out with him, including late night telephone calls at home, while "inappropriate, immature, and unprofessional," did not rise to the level of sexual harassment. The conduct was not lewd or threatening, there was no touching, and no sexual comments about her in her presence. Although the conduct made her uncomfortable, it did not interfere with her ability to perform her work assignments.

The standard for sexual harassment as applied by the courts, particularly at the federal appellate level, is often more forgiving than is expected by both employees and employers, conditioned since the long-ago days of Anita Hill to view every expression of potential sexual or romantic interest in a coworker as the basis for a lawsuit.

This reality is no reason for employers to slack off in enforcement of harassment policies; but it is reason to take a realistic, measured approach to discipline. An employee such as the supervisor in this case need not necessarily be fired for a first offense. The employer in this case in fact did take appropriate action by investigating, warning him, and removing him from a direct supervisory relationship with the plaintiff.


Read full text of opinion

Continued . . .

What's going on with the employment data?

FindLaw (Reuters) reports the news on employment in the extremely negative manner everyone is hearing it: "U.S. Job Growth Anemic in February"

The U.S. economy added a paltry 21,000 jobs last month, according to a surprisingly weak government report on Friday that turned up the heat on President Bush as he seeks re-election.

The February jobs report from the Labor Department was the latest in a string that have fallen far short of expectations, dashing hopes employment would soon turn decisively higher.

"The job market is stuck in a cycle of inertia," said John Challenger, head of the outplacement firm Challenger, Gray & Christmas. "The fact is, we are going to have to get used to slow job creation in this country."

The details in the report were uniformly bleak. Private-sector employment showed no gains. Government hiring was the only reason the nonfarm payroll count rose. In addition, job creation in December and January was weaker than previously thought, by a combined 23,000 jobs.

While the unemployment rate held steady at 5.6 percent, that was only because many people stopped looking for work. Employment as measured by a survey of households plummeted.

Chris Low, chief economist at FTN Financial, said the report was "unambiguously ugly." Joel Naroff of Naroff Economic Advisors called it "terribly disappointing." . . .

Economists warned consumer spending could falter, once a burst of tax refunds was spent if jobs did not turn up.

Democrats reacted almost as swiftly as the markets, blasting Bush for the 2.2 million jobs lost on his watch.

"At this rate the Bush administration won't create its first job for another 10 years," Democratic presidential candidate John Kerry said in a written statement. . . .

An average of just 42,000 jobs have been created each month in the last three months, down from the 79,000 average of the prior three months. Economists say gains near 150,000 are needed each month just to keep pace with labor force growth. . . .

Economists were hard-pressed to explain why job growth had fallen far short of expectations yet again, although some said poor weather may have played a role. For the most part, however, they cited the ability of businesses to boost output without taking on new workers. . . .

Some economists said the relative dearth of hiring more than 27 months into an economic recovery was unprecedented.

"We are in uncharted territory," said David Rosenberg, chief North American economist at Merrill Lynch.

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At least one source, however, in a fascinating in-depth report, argues that we may be viewing the impact of flaws in the government's statistical tools, combined with changes in how Americans are making a living, with many turning away from conventional wage-based employment.

According to this Heritage Foundation study by Tim Kane, Ph.D. -- Diverging Employment Data: A Critical View of the Payroll Survey -- these factors combine to make the numbers look worse than they are.

This is no mere academic argument, as the political consequences in an election year are obviously huge, as is the danger of self-fulfilling prophecy, as consumer confidence stumbles in the face of relentless reporting of bad news on jobs. This article is really worth reading in full.

Here's its nutshell summary:

This paper takes a critical view of the payroll survey and finds that:

The payroll survey double-counts many workers who change jobs and is now artificially deflated because job turnover is down. Decelerating turnover in 2002-2003 explains up to 1 million jobs artificially "lost" in the payroll survey since 2001.

The BLS household survey indicates record high employment. The disparity of 3 million jobs (in employment growth) between the household and payroll surveys since the recovery began is unprecedented.

The disparity between the two BLS surveys of total employment is cyclical. The disparity widens during recessions and narrows during periods of rapid growth in gross domestic product (GDP). Such variation strongly suggests a statistical bias in one of the surveys.

Payroll survey data are always preliminary. Past revisions have regularly shown the initial estimates to be off by millions of jobs. For example, initial estimates of job losses in 1992 were revised in 1993, 1994, and 1995 and now show net job creation.

The payroll survey does not count the surge in self-employment. The household survey has recorded a surge of 650,000 self-employed workers. This number may be even higher if modern workers in limited liability companies and in consulting positions with traditional firms are not identifying themselves as self-employed.

Read the whole article

Also read his article: The American Workforce: Strong Facts Trump Weak Myths:

The catchphrase “jobless recovery” enjoys permanent status in daily media reports about the economy, despite the fact that an unprecedented number of Americans were employed last quarter, not to mention the low rate of unemployment. Skeptics attribute lower unemployment to growing ranks of “discouraged workers” leaving the labor force, but that scenario doesn’t fit the data. Teenagers account for two-thirds of the decline in the labor participation rate in recent years, and their decision to work less could have an encouraging cause: the increasing market value of a good education.

More Workers Than Ever

The good news is that the number of American workers is at an all time high of 138.5 million – a level never attained in U.S. history. Most measures of the labor market indicate strength across the board. Jobless claims are 10 percent below the average of the last 25 years and still falling. Hiring indices are up, even in manufacturing. Productivity growth is extremely high. And real earnings have risen over the last three years. The most visible indicator of all, the unemployment rate, is coming back to its natural, full-employment rate.

Now skeptics have started to question the integrity of the unemployment rate, which at 5.7 percent just does not fit their gloomy story. Policymakers and the media need to take a closer look at the myopic arguments of the skeptics and recognize the facts of a strong labor force.

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Continued . . .

No protection against retaliatory discharge for malicious bad faith filing of unfounded harassment charge

In Mattson v. Caterpillar, Inc., No. 03-2495 (3/4/04), the Seventh Circuit held that summary judgment was properly granted for the employer on a claim that an employee was terminated in retaliation for filing an EEOC sexual harassment charge based on conduct of a co-worker.

The charge was objectively and subjectively unreasonable; the plaintiff had conceded the alleged touching may have been inadvertent and he did not believe it was based on sexual attraction. Moreover, a witness gave an affidavit that the touching did not occur as claimed and that the employee had a malicious motive for wanting to get the alleged harasser in trouble.

Certainly one lesson is that the retaliation provisions of Title VII do not protect employees who file unreasonable charges in bad faith.

But for most employers trying to deal in a practical manner with discrimination charges, this case is really the exception that proves the rule.

The rule that's more important to bear in mind is that a charge is protected even if it proves unfounded, as long as it is made in good faith with some reasonable belief in its validity. The type of evidence of malice and lack of reasonableness that was present here is highly unusual.

Was this employer better off paying the price of litigating this all the way to the Seventh Circuit and being rid of the employee or would it have been better served just to concentrate on beating the frivolous charge and leaving it at that?

In hindsight, perhaps it was worth it, given the successful outcome. But what about the risk of losing on retaliation, so even though the employer would not be liable for the underlying charge, it would be liable for backpay, compensatory and punitive damages, and attorneys' fees (plus its own fees)?

Continued . . .

Watching what you do and don't say in response to reference checks

A pair of stories, both from the Christian Science Monitor, discuss the hard choices employers face in responding to reference checks on former employees.

Randy Dotinga writes in the Monitor: "Would you hire this man?"

At many American companies, . . . [w]hen someone asks for references on a potential hire, these bosses are supposed to reveal only job titles and dates of employment. Never mind that the employee pilfered office supplies, harassed the receptionist, or threatened co-workers. In the lawsuit-phobic world of corporate America, caution keeps many lips zipped tight, everywhere from the factory floor to the human-resources office.

But a chorus of legal experts and employment consultants is calling for a return to the days when job references flowed more freely and managers didn't need to break rules to criticize - or compliment - an employee. "I do see why employers are very cautious, but the policies put a lot of wackos out there in the workplace because people don't share information," says Peggy Garrity, a Santa Monica, Calif., attorney who represents employees. . . .

Currently stirring the pot is the case of Charles Cullen, a New Jersey nurse who has admitted killing as many as 40 patients with lethal drug injections. During his 16-year career, four hospitals and one nursing home fired him, another hospital suspended him, and another questioned him about a patient's suspicious death. But Mr. Cullen kept getting new nursing jobs until late last year, when Somerset Medical Center in Somerville, N.J., looked into questionable lab results involving patients under his care. Authorities arrested him in December and charged him with murder. . . .

The demise of job references began about two decades ago as companies began to worry about defamation lawsuits if they gave poor references. . . .

While they don't usually resort to humor, many managers and bosses do manage to spread the word about poor employees, policy or no policy, says Lewis Maltby, president of the National Workrights Institute. "Smart HR professionals know how to get around the system," says Mr. Maltby, who opposes the gag-order rules.

Bosses and personnel managers don't even need to say anything negative to get messages across. In telephone conversations, tone of voice can add volumes of meaning to a simple "no comment," as can extended sighs and drawn-out syllables ("Oh yes, Daaaaavid. Wellll....").

Dara Herbst, president of the Missouri-based Certified Reference Checking Co. [link to their book on reference checking], estimates that about 10 percent of the job applicants she investigates have poor work histories. She gets at the truth by using a combination of diplomacy and persistence to encourage managers to break the rules. . . .

Read more

See Walking the Line's comments on this article and my comment appended thereto, and Jottings by an Employer's Lawyer's discussion as well.

I have heard of negligent hiring cases where an employer is held liable for failure to conduct a reasonable background check; but not of a case holding a former employer liable for failure to disclose unfavorable information. But this is not to say no such case exists. In this litigious society, I expect sooner or later there will be such cases, if there haven't been already. Which puts the former employer between a rock and a hard place. As the next Monitor article indicates, there are significant perils to speaking too freely about former employees. . . including that you might even be speaking to a spy, not a real potential employer.

Jennifer LeClaire writes for the Monitor: "If an old boss smears you, hire a detective"

After submitting dozens of resumes to potential employers and getting no response, Paul became suspicious about what his former employer was saying about him. The New Jersey bank manager . . . hired a detective to find out. He soon discovered that the old boss wasn't saying a word.

"I was laid off after a corporate merger, but the bank refused to respond to requests for a reference by potential employers," says Paul, a 25-year industry veteran. "No one in the banking industry would hire me without a reference . . . ."

What Paul experienced was a little-used, yet effective smear tactic, says Michael Rankin, chief service officer for Documented Reference Check Inc. (DRC) of Diamond Bar, Calif., one of the biggest companies in the field. "Devious ex-employers can blow you out of the job market by refusing to respond," he says. "Potential employers can't hire nonverified applicants without risk of leaving themselves wide open for a negligent hiring suit."

OK, so this "expert" calls mere silence a "smear tactic," though it is legally neutral and cannot be the basis for a cause of action (to my knowledge), and is the response of choice of the majority of employers.

Meanwhile, heaping on the legal disinformation, he misleads prospective employers to fear negligent hiring if they hire someone in the face of silence. Again, I've not thoroughly researched it, but I've never heard of a negligent hiring claim being based on hiring in the face of silence (as opposed to hiring without making a reasonable effort to check references, criminal record, etc.)

So this noble employee advocate's advice in effect becomes a self-fulfilling prophecy, turning silence, which should be perfectly acceptable, into a damaging "smear tactic" by stimulating the very effect (nonhiring out of fear of negligent hiring lawsuits) his clients wish to avoid (no, I take that back, rather than working they'd prefer to sue and extort a settlement; it's the American Way).

Paul took his former employer to court, eventually settling for an undisclosed sum. Like Paul, thousands of people are turning to "career detectives" to discover what their ex-bosses are saying - or not saying - about them. And since most states allow people to sue over bad references if they can prove that defamation hindered subsequent employment, reference-checking has become big business.

Read more

Continued . . .

Biting critique of union's handling of socal grocery strike

Michael Hiltzik writes in the LA Times (free registration required): "UFCW Sacrifices Workers While Declaring Victory"

Union officials are insisting that the contract ratified last weekend represents a great victory. UFCW International President Douglas Dority, who hustled himself into retirement Tuesday, issued a statement over the weekend calling the Southern California job action "one of the most successful strikes in history."

Stirring words indeed. But as an accurate description of events, they rank right up there with "Dewey Defeats Truman."

The obvious question to ask in the wake of the strike and lockout that affected 59,000 supermarket employees is whether it was worth the suffering.

After more than four months on the picket lines, the workers ended up with a deal that is certainly inferior to their previous contract, and in some respects inferior to the contract proposal they rejected just before the strike.

Read more

Continued . . .

Encouraging hard numbers from consumer-driven health plans

AISHealth.com reprints this from the Feb. 20, 2004, issue of its newsletter INSIDE CONSUMER-DIRECTED CARE: "Panel Dispels Common Consumer-Driven Health Myths, Touts Early Results"

Contrary to critics who argue that consumer-driven health plans appeal only to the young and healthy, some plans seem to attract older and far sicker consumers, according to an official from Minneapolis-based Definity Health. . . .

"The most important questions faced by legislators interested in [CDH] are medical service utilization and adverse selection," said Sen. Larry Craig (R-Idaho) whose opening comments kicked off the discussion. "Do [CDH plans] attract a balance of sick and healthy and high-risk employees?"

Mike Showalter, Definity's vice president of market solutions, said they do. The company's claims data suggest the CDH model might actually be attractive to less healthy consumers. . . .

Here are a few specific changes among Definity enrollees and plans . . . .

In 2003, Definity members had 44.3 hospital admissions per 1,000 members. The industry benchmark is close to 60 days. Hospital days among Definity members averaged 162.1 days per 1,000 members, while the industry benchmark is just over 200. . . .

The average pharmacy utilization rate in 2003 was 0.69 prescriptions per member per month (PMPM). Although that number is higher than the 0.57 average cited in 2001, traditional health plan averages tend to run higher. . . . For drugs that have a generic equivalent, Definity said it has a 95% generic substitution rate.

There are more Definity numbers and also numbers from Aetna in the story.

Read more

Continued . . .

Good basic piece on RSS and Atom syndication

David Maizenberg writes in FindLaw's Modern Practice:"RSS & Atom: The Rebirth of Web Syndication"

Good basic explanation of value of newsareaders and feeds for those reading blogs and other news sources voraciously.

For your information, you may subscribe to this blawg's feed using the orange "xml" button at left. Let me know if you have any troubles with it.

Continued . . .

More slight improvement in jobless claims

CNN/Money reports: "Jobless claims dip, in line with forecasts"

345,000 new claims, compared with a revised 352,000 prior week.

Four-week moving average down to 352,250 from revised 355,250 prior week.

Continued claims held steady at 3.1 million in week ended Feb. 21, latest data available.

Continued . . .

Illinois Supreme Court narrowly construes state employee personnel code whistleblower retaliation provision as not creating private right of action

In Metzger v. DaRosa (2/20/04), the Illinois Supreme Court held a state employee who claimed she suffered unwarranted discipline because she reported attendance abuses by co-workers could not sue for retaliation under the state employee personnel code, because it does not expressly establish a private right of action, and none can be implied.

Read full opinion

Continued . . .

Health care trio

Workforce Management magazine has this in-depth story by Maryann Hammers on disease management, an exciting trend with an ROI exceeding 4 to 1, according to one study: "More Care, Less Cost; Disease management today encompasses treatment of the whole person, with all the challenges and conditions that might be part of her life.":

Even as medical benefits shrink, disease-management programs are expanding as part of, or in addition to, a traditional health plan. The reason is simple: employers view disease management as an effective way to control soaring costs. "Five years ago only a relatively small percentage of employers were implementing the programs, whereas today most employers view disease management as a competitive issue, if not a necessity," says Robert Stone, executive vice president and cofounder of American Healthways, the nation’s largest disease-management provider. . . .

Study after study shows that a small fraction of patients with major chronic conditions are responsible for the majority of health-care costs. A January 2004 Watson Wyatt report states that "claimants with annual expenses over $500 for therapeutic services who are treated for 11 (mostly) chronic conditions…account for about 44 percent of health plan payments, but [represent] only about 9 percent of claimants." Through early patient identification, education, nursing support and care coordination, disease management reduces the number of inpatient admissions and emergency-room visits, helps avoid or minimize complications and improves the employee-patient’s quality of life. While every disease-management company operates slightly differently, typically a nurse works with the patient to help promote positive lifestyle changes and ensure compliance. The nurse also coordinates with the primary physician and other providers to ensure that established guidelines for specific diseases are being followed.

Read more

Kaisernetwork.org reports: Small Business Groups Disagree on Benefits, Drawbacks of Federal Association Health Plan Legislation

[L]egislation that would allow small businesses to band together across state lines to form association health plans is "causing divisions" among some small business groups. The legislation would exempt AHPs from state regulations and coverage requirements . . . . The National Federation of Independent Business, with 600,000 members, and the National Association for the Self-Employed, with 250,000 members, support the legislation, which is backed by President Bush. However, the National Small Business Association, with 150,000 members, says that the plan would cause higher, not lower, costs for many small firms.

Read more

Benefitnews.com offers this opinion against single-payer socialized medicine: "Are Americans ready for universal health care? (by Richard Quinn)

I am most amazed that proponents of universal coverage see this as a way of actually controlling costs. There is absolutely no way to control the rate of increase in health care costs other than to simply fix a budget each year and let it grow at no more than an agreed upon rate. What happens then?

I want members of Congress to call a press conference and say the following to the American people.

"We have 40 million citizens without health insurance, and while they do get health care, you are paying for it in the form of taxes and cost-shifting. We want those people to have coverage, therefore all of your current health benefits are going away and you will have a uniform set of benefits set by and administered by the federal government.

"Now we also know you are concerned about health care costs, so you will want to know what all this will cost. To be honest, we can't really tell you, but for starters, there will be a new tax of 6% of payroll on employers and 3% on employees. We believe these percentages will increase in the future, but we cannot tell you how much. . . .

"Now, let us explain a bit more about this annual budget thing. In order to make this work, there may be a few changes in your health care coverage and the way you receive it. . . .

Read more

Continued . . .

Other views on offshoring

CNN/Money (Mark Gongloff) reports: "U.S. jobs moving offshore: what can be done"

Discusses a "vigorous national debate about how best to respond."

Here are some of the more common proposals, along with some of the arguments for and against:

Scrap WTO, trade pacts

Some people argue the United States should simply pull out of the World Trade Organization, NAFTA and other world trade pacts, a view proposed by three candidates for president: Rep. Dennis Kucinich, D-Oh., Rev. Al Sharpton and Ralph Nader. . . .

Speaking of not acting unilaterally and not pissing off the rest of the world at America . . . .

Critics say similar protectionist steps have led to slower economic growth and would likely do so again. . . .

Of course, none of the proponents of these measures are likely to become president this year, and such proposals would be unlikely to pass Congress. . . .

Protect government contracts

Especially loathsome to opponents of outsourcing is the idea of federal and state governments sending jobs overseas, right alongside "Benedict Arnold" companies, as Kerry calls them.

In that vein, Congress in January passed a law requiring that government functions shifted to contractors had to go to contractors in the United States. In Indiana and New Jersey this year, two state government contracts to move call-center work offshore were canceled under political pressure. And dozens of anti-outsourcing bills await action in federal and state legislatures.

Critics of the bills say they would save just a handful of jobs and cost millions of dollars to taxpayers, potentially doing more harm than good.

Slow visa entries

Temporary work visas for high-skilled foreign workers also irritate outsourcing opponents. Not only do they take jobs from U.S. workers in the short run, but visa holders sometimes return home and make future offshore outsourcing even easier for U.S. companies. . . .

Supporters say many visa holders end up staying in the United States, helping U.S. companies develop new technologies that create jobs and becoming consumers in the broader domestic economy.

"I find it ironic that some of the same folks against jobs going overseas also don't want people to come here who would be benefiting and creating more jobs in the United States," said the NFAP's [National Foundation for American Policy][Stuart] Anderson.

Caller ID

Sen. Kerry and other outsourcing critics also want to require workers in overseas call centers to reveal their location in service calls.

Not only would such a measure carry on the spirit of the existing requirement to mark foreign-made goods with their country of origin, it might also allow customers to decide whether they want to discuss personal information with a call-center worker in, say, Vietnam, where privacy laws may not be as stringent as they are in the United States. . . .

Helping displaced workers

It's all well and good to discuss the long-term economic benefits of trade, as most economists do. But those arguments ring hollow with the millions of workers who will be unemployed or have lower standards of living while they wait for those benefits to come to fruition. . . .

Some possible solutions include increased unemployment insurance, wage insurance, and a system that would let workers carry health benefits from job to job.

Education . . .

"The capacity of workers, after being displaced, to find a new job that will eventually provide nearly comparable pay most often depends on the general knowledge of the worker and the ability of that individual to learn new skills," Greenspan told Congress last month.

While almost everyone agrees that U.S. grade-school education could be better, some critics doubt education is the only answer to outsourcing, noting many unemployed workers already have advanced degrees.

Read more

Continued . . .

Job cuts drop in February

CNN/Money reports: "Job cut announcements fall in February"

Job cuts planned by big corporations fell 34 percent last month from January but businesses remain cautious about hiring, an outplacement firm reported Tuesday.

U.S. businesses announced 77,250 job cuts in February, down from 117,556 in January, according to Chicago-based Challenger, Gray & Christmas, which keeps track of monthly job-cut announcements.

This was about 44 percent below February 2003.

Continued . . .

Supreme Court pension ruling helps small business owners

InRaymond B. Yates, M.D., P.C. Profit Sharing Plan v. Hendon, No. 02-458 (U.S.S.C March 02, 2004), the Supreme Court held, in the context of a bankruptcy issue, that:

The working owner of a business (here, the sole shareholder and president of a professional corporation) may qualify as a "participant" in a pension plan covered by ERISA. If the plan covers one or more employees other than the business owner and his or her spouse, the working owner may participate on equal terms with other plan participants. Such a working owner, in common with other employees, qualifies for the protections ERISA affords plan participants and is governed by the rights and remedies ERISA specifies. (Quoting unofficial syllabus prepared by Reporter of Decisions, not Court's opinion itself).

Read the full opinion

Good news for small business owners, though not being an ERISA specialist, I'm not sure to what extent this issue was previously in doubt. Now if we could just get decent health insurance . . . .

Continued . . .

Successor corporation liability for employment discrimination

In Brzozowski v. Correctional Physician Services (3rd Cir 2/23/04), the court applied fairly well-established principles to find a corporation which had purchased the assets of an insolvent predecessor corporation liable for employment discrimination under Title VII.

Citing an earlier Third Circuit case, the court applied "three principal factors applicable to successor liability in the employment discrimination field: (1) continuity in operations and workforce of the successor and predecessor employers; (2) notice to the successor-employer of its predecessor's legal obligation; and (3) the ability of the predecessor to provide adequate relief directly."

Legal researchers note: footnote 1 lists similar decisions from the 5th, 7th, 9th, 10th, and 11th Circuits.

Corporate transactional lawyers note: inquiry into existing and probable employment claims is a worthwhile part of "due diligence"; allocation of risk and cost of such claims should probably be addressed in acquisition documentation.

Continued . . .

Solid endorsement of one of my favorite technologies -- voice-recognition (Dragon NaturallySpeaking)

Andrew J. Roman writes in the ABA's Law Practice Today: "Dragon NaturallySpeaking: A Change In Lifestyle"

Dragon NaturallySpeaking is much more than merely software that replaces the keyboard. The impact of using this software in my law practice over the last decade is so profound that it can only be described as a change in lifestyle. Unfortunately, the nature and the extent of this change is not well understood. Not only by lawyers who do not use it, but by many law firm IT departments, and even by the vendors of the software themselves. . . .

As my practice became busier, it necessitated using more support staff time, eventually reaching 1.5 full-time assistants to keep up with the volume of work. I have been practicing for just over 30 years, and am busier than ever. Yet today, using Dragon NaturallySpeaking, I need only 0.5 of a legal assistant in a sharing arrangement. I now produce more work in less time, with a shorter time lag between the work coming to me from a client and the completion of the relevant documents. This is true whether I am in the office, working at home or on a weekend, or traveling with a laptop. That is only a quick overview of the productivity gain achieved through the use of this remarkable tool. . . .

The productivity improvement with Dragon is so remarkable that it can be compared to the difference between walking along the highway and driving along the highway, or between typing every document afresh on a manual typewriter and editing on a computer. The difference is not merely a quantitative difference in speed between manually typing at a certain speed accurately, versus talking much faster, while still being recorded and transcribed accurately. The difference is also qualitative: the human body and the brain work differently when using Dragon.

Sound interesting? Read more. After a detailed discussion of the benefits of this technology, the author debunks a number of myths he feels prevent greater use of this remarkable product.

I've been a faithful and enthusiastic user of Dragon NaturallySpeaking for years. The original content portions of this blawg are generally prepared using it, as is virtually all my billable written work. I agree with everything said in the article. I would be glad to answer questions about it if you e-mail me.

Continued . . .

Big labor promotes questionable "reform" of card-check recognition

Ronald Brownstein of the LA Times reports: "Labor's Push for Reform Finds Solidarity With Kerry, Edwards"

Is the deck stacked against workers who want to organize unions? Leaders of the AFL-CIO have been making that case for years. And now, with little notice, the leading contenders for the Democratic presidential nomination have joined them.

Sens. John F. Kerry and John Edwards have endorsed the most ambitious attempt to strengthen organized labor since a Senate filibuster blocked President Carter's effort to rewrite the labor laws 26 years ago. Each man is touting a fundamental shift in federal labor law that could give unions their last, best chance of reversing the long slide that has reduced their share of the workforce from a high of almost 35% in 1954 to 13% today. . . .

Today, almost all unions are organized in a two-step process. First, labor organizers must convince at least 30% of a firm's workers to sign cards supporting unionization. Then a majority of the firm's workers must vote in an election to join the union.

As Kerry and Edwards noted, employers have stiffened their resistance in those election campaigns, utilizing tactics that unions say intimidate workers — like firing activists or interminably delaying the vote. The result has been that unions lose most representation elections, especially at firms that actively oppose them.

"The way the law gets played out today in union organizing campaigns, it is very, very difficult for unions to win," says Fred Feinstein, the general counsel at the National Labor Relations Board under Clinton..

Actually, NLRB statistics show that unions win roughly half the elections.

Kerry and Edwards would reshape the playing field with a reform known as card-check recognition. That would force employers to recognize a union if a majority of workers simply sign cards or petitions indicating they want to join.

By eliminating the election stage where management exerts its greatest leverage, that approach could greatly increase labor's prospects of adding new members. To underscore the point, Kerry and Edwards would also toughen penalties on companies that use unfair labor practices, and establish time limits, with binding arbitration, for firms to reach an initial contract with a new union. Kerry says he would even give preference in federal contracts to companies that remain neutral in organizing drives.

In endorsing these ideas, Kerry insists his aim isn't to increase the number of workers belonging to unions. "That's not the goal," he said. "The goal is to empower people to do what they want to do; let people have a choice. I'm not going to go out and say you ought to do this or do that. That's not my role."

But while Kerry and Edwards present these changes as a matter of economic fairness, the prospect of more union members offers obvious political benefits to the Democrats [due to organized labor being such a strong Democratic constituency].

The argument against card-check recognition is compellingly presented by the National Institute for Labor Relations Research in "Big Labor's Cockamamie Campaign Against Secret-Ballot Elections For Workers"

From my perspective, there are several reasons why reliance on cards signed by workers as a means of "empower[ing] people to do what they want to do," as Kerry says, is an unreliable indicator of true employee sentiment.

First, it is not unheard of, perhaps it is even common, for union supporters to obtain signatures by telling employees that the purpose of the cards is merely to obtain an election.

Second, employers do not have a monopoly on coercion and intimidation of employees. Even moderate peer pressure may cause employees to sign cards even if they are not personally in favor of the union. In contrast, a secret ballot election conducted by the NLRB allows employees to truly state their preference, without fear of anyone knowing how they voted.

A much better "reform," if one is truly needed, which I doubt, would be a reduction in the percentage support required for an election to be held. I believe this would not require legislation, as the percentage has been administratively set by the NLRB and is not statutory.

Continued . . .

Dick Clark accused of age discrimination against long-time colleague; smoking gun letter?

Yahoo Finance reports: "Dick Clark Accused of Age Discrimination by Ralph Andrews; Lawsuit Alleges 'America's Oldest Teenager' Denied Long-Time Colleague and Successful Television Show Creator Ralph Andrews a Job Due to His Age"

The lawsuit claims that one day, Andrews was told there were no positions available at Dick Clark Productions. Shortly thereafter, however, a director of development position was vacant and subsequently filled. Andrews wrote a note to Clark telling him he would consider accepting any position. In a letter, Clark responded that he had no positions for Andrews simply because of his age. Clark's letter states:

"It was good to hear from you, Ralph. This is a tough letter to write, I have great respect and admiration for your accomplishments ... The last development guy we hired was 27 years old. Another person who is joining our staff next week is 30. People our age are considered dinosaurs. The business is being run by "the next generation."

This does not appear to be an admission of age-discriminatory motive by Clark, who is 74, against Andrews, who is 76. Sounds like he's saying matters are out of his hands and he suspects such motives on the part of the younger folks calling the shots. If he didn't make the decision, this letter is out of there, and the case ain't near as bad as it sounds.

Continued . . .

Grocery contract ratified; various articles touch on details, perspectives of parties

The Socal grocery strike's settled, at long last.

Here's a Kaiser Network piece summarizing some of the disputed health care terms. "California Grocery Store Workers Vote To Approve Contract, Ending Strike Over Changes To Health Benefits"

Looks like the workers still have an incredible health care bargain, though they gave up all permanent wage increases in exchange. Perhaps not an unwise tradeoff for them, if healthcare costs continue to escalate as they have in recent years. Hopefully they now realize what a great health package they have.

More stories:

NY Times (Reuters): "Longest U.S. Grocery Strike Ends with Deal" (noting "Grocery workers appeared to be disappointed with the terms of the contract but most seemed resigned to returning to work after the crippling strike.")

Findlaw (AP): "Calif. Grocery Workers OK New Contract" (noting 86 percent ratification vote and comments by some strikers that "the contract was not much different from one they received from their employers in October - one that was rejected at the time by the union")

Miami Herald (Orange County Register, Calif. Knight Ridder/Tribune Business News): "California Grocery Strike's Settlement Is Setback for Unions, Experts Say"

[E]xperts say the settlement is a setback for the labor movement.

The full effect of the 20-week strike and lockout likely will be felt sometime in the future as it changes the nature of supermarket work and continues a trend toward employees paying a greater share of health costs. . . .

Most immediately, the ramifications will be felt by grocery workers in other regions, including Northern California, where union locals are due to renegotiate their contracts with employers later this year.

The inclusion in the contract of a two-tier compensation scale, in which new hires top out at a lower level of wages and benefits than current employees in the same jobs, hurts the United Food and Commercial Workers union, experts said.

"Over time, more of the work force will be shifted from the higher-wage, higher-benefit jobs to lower-wage, lower-benefit jobs," said Kent Wong, director of the UCLA Center for Labor Research and Education. . . .

Greg Conger, president of UFCW Local 324 in Buena Park, disagreed that the two-tier system will weaken the union. "It'll make it more militant," because the lower- paid new members "will have reason to fight," he said. . . .

The three chains went to the mat over cost cuts because they were haunted by the specter of Wal-Mart, the low-cost, nonunion retailer that plans to open more than three dozen supermarkets in California over the next few years. They insisted that they needed to rein in labor costs to protect market share.

The irony is that the long dispute may have hurt them on two fronts. First, it cost the chains market share in the near term because some of the consumers who switched to Stater Bros. or Gelson's or Whole Foods or Trader Joe's -- no one knows for sure how many -- are never coming back.

As a result, Kyser said, he expects the three chains to start closing poor-performing locations later this year, laying off hundreds and perhaps thousands of workers.

Second, by altering people's shopping routines, the dispute may turn out of to be a godsend for Wal-Mart. After all, the buying habits of millions of consumers are now a lot less "sticky," making the newcomer's job of luring shoppers that much easier.

"People experimented and learned there were alternatives that worked well for them," Kyser said.

The other potential legacy of the dispute is more controversial.

Because the union got less than it wanted, some analysts say the settlement represents a setback for other low-wage workers in the state. But Christopher Thornberg, senior economist at the UCLA Anderson Forecast, disagrees.

He says Californians have long paid a premium for groceries because of relatively high union wages and benefits. If those come down, the chains will be able to fall into line with whatever Wal-Mart charges -- without necessarily hurting profits.

"People go on and on about how terrible Wal-Mart's going to be. But Wal-Mart will make an enormous difference to those people who are going to see the cost of the goods they need to buy to survive go down," Thornberg said. "They're going to be better off."

Continued . . .

Photojournalist documents hazardous work in America

Thanks to my friends at Workers Comp Insider blog for turning me on to this photographer's site: Earl Dotter, Photojournalist

As described in their blog post, Mr. Dotter chronicles workers performing their jobs in many industries where many hazards are confronted.

I have long been a fan and amateur practitioner of photography, and especially enjoy black and white photojournalism. Mr. Dotter has very sobering subject matter, but his photos nonetheless have a beauty of composition that make them a visual treat to those of us who love the medium.

Continued . . .

Jobs, policy and politics

Business Week Online has this: "Jobs: Desperately Seeking Answers," subtitled "Employment and the economy are both parties' issues -- and both parties are pushing plans that are flawed"

Good summary of Bush and Kerry proposals and political urgency of the jobs issue under present circumstances.

Presidential candidates have their ears to the ground, and what they hear is a rumble of fear about the slow recovery in employment. A Feb. 9-12 Gallup Poll found that 41% of Americans view jobs or the sluggish economy as their top concerns -- three times the number for either the war in Iraq, terrorism, or the spiraling cost of health care. . . .

Economists of all stripes agree that neither Bush's let-'em-eat-tax-cuts stimulus plans nor the Democrats' proposals -- built around targeted tax breaks and a crackdown on trade -- are likely to lift the trend line for employment much anytime soon. Even in the long term, the parties' differing approaches are more likely to affect the mix of jobs more than the number. . . .

Faced with Bush's policies and the Democratic Rx, voters have "a choice between atrocious fiscal policy paired with pretty bad trade policy, vs. pretty bad fiscal policy and atrocious trade policy," says Everett M. Ehrlich, director of research for the business-backed Committee for Economic Development. So the agenda of both parties could crimp growth. . . .

Bush's proposal to lock in lower tax rates threatens to balloon the deficit -- already expected to hit $521 billion this year -- even further. That would hasten the day when bond-market investors demand higher interest rates, thus slowing the economy. And Democrats' trade restrictions, if carried out, could curb imports and raise prices for U.S. consumers -- an economic effect that would quickly outweigh any benefit from added wages earned by workers in protected jobs.

In short, the impact of the two parties' policies is unlikely to be much different -- or address workers' anxiety. "We ought to be paying more attention to the costs that are being imposed on individual workers," argues Peter R. Orszag, an economist at Washington's Brookings Institution who has advised Democratic candidates. For example, neither party has endorsed such ideas as wage insurance -- extra pay from unemployment-insurance funds to soften the blow of accepting a lower-salaried job.

Much more, especially details on Democratic proposals, in full article here.

Continued . . .