Thursday, October 20, 2016


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Air France has had quite the shake up during a corporate meeting Monday morning. It would seem that employees are none too pleased with recent developments. An angry mob of hundreds of employees swarmed those in attendance at a meeting about massive job cuts. Perhaps as poetic justice for planning to take their shirts, the employees struck back and ripped shirts from two of the managers fleeing the office. In order to actually get away one executive had to scale a fence and leave under police protection.

The group was prepared. They waved banners and flags as they stormed the meeting. Given historical evidence, those inside at the time should count their stars that the protesters left their guillotines at home.

Unions had called for a strike at the launch of the meeting, but things dissolved into chaos quite quickly. What was it that had the workers so riled up?

Well, at the meeting a plan was to be announced to the central committee for Air France that 2,900 jobs would be cut from the roster and 14 airplanes would be grounded in a radical effort to restructure and cut costs.

The cuts would layoff 1,700 ground staff, 900 cabin crew members, and 300 pilots.

The French Prime Minister, Manuel Valls, said that not only did he support the board, but that he was “scandalised” by the aggression on behalf of the workers. Yet, that may not be the tone of a man sympathetic to some executives getting roughed up, but one who know that the French government owns a 17.6% stake in the company and could see huge losses if the airline’s cost-cutting measures don’t pan out.

The airline is planning to file a legal complaint against those in attendance at the riot.

No one seems to have clean hands in this debacle, considering that just last year Air France saw the longest strike in its history when pilots refused to compromise on a salary agreement. They were in arms because the airline was asking them to spend more time in the air without an increase in pay. The recent unveiling of job cuts was due in part to the hard line the pilots took during negotiations.

The company has been floundering in the face of new, more competitive, airlines emerging and is desperate to rebrand and restructure to make up for its recent losses which total in the billions.

It seems that the unions are asking for something that the Air France can’t give– money.

The strikes and failed negotiations with the unions may plunge Air France irrecoverably into the red. Then everyone would be without a shirt, won’t they?

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Rank and file labor union members fighting for progress on issues like $15 per hour “living wage”, protection against layoffs and the reduction of hours for some members to 30 or less so businesses can avoid paying ObamaCare taxes might be surprised to learn this interesting fact.

A labor watchdog group Center for Union Facts (CUF) released a research report this past week that identified 162 union presidents who receive compensation packages in excess of the $180,700 a year.

The top 10 union presidents – which all refused to comment on the report – earn more than double that figure or $361,400 a year – more than the average Chief Executive Officer in corporate America is paid each year.

The winner in the gold plated “Union Boss Compensation Contest” is United Food and Commercial Workers Local 464 President John T. Niccollai who “earned” $575,000 in 2014 according to federal labor filings.

Niccollai represents 16,000 grocery store workers in New Jersey who pay the union nearly $500 in dues each year in addition to $50 to $150 in initiation fees when they first join.

Niccollai has raised dues by about 6 percent since 2013 and spent more than 7 percent of all dues and fees collected from union members on his own salary. If you add in the compensation packages paid to Niccollai’s top two deputies and the total rises to $1.3 million combined.

Nepotism plays a role as well. Niccollia’s son, John Niccollai III, was paid a $245,000 salary as the union’s highest paid staffer.

At the same time Niccollai II spent $3.4 million on union salaries, the union spent slightly more – $3.9 million – on representation activities in 2014.

Nine other union presidents received pay packages in excess of $370,000 including American Federation of Teachers (ATF) President Randi Weingarten who completed the top-10 list with a salary of $375,174, according to that union’s most recent report.

According to Rick Berman, executive director of the Center for Union Facts, huge salaries highlight the hypocrisy of union leaders who make more than the business owners they condemn.

“If Big Labor is interested in turning a skeptical eye on executive pay, it should start with the one-percenters in its own ranks. Dues payments from middle-class employees are funding six-figure pay packages for hundreds of union presidents,” Berman said.

The compensation bandwagon doesn’t end there.

If you take perks into account, Weingarten becomes the fifth-highest compensated union executive – perks that included $120,000 spent on limousine services by the AFT last year.

National Right to Work Committee spokesman Patrick Semmens points out a key difference between CEOs and union officers when it comes to compensation. Corporate executives are paid from business income while union leaders receive their plush pay packages from forced union dues.

“The real scandal here is that union bosses fund their often lavish salaries with dues and fees taken from workers who would be fired for refusing to pay,” Semmens said.

“Union officials should work for the rank-and-file workers, but with forced union dues employees instead end up working for the benefit of union officials.”

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Unions Longshoremen

The Pacific Maritime Association (PMA) said that it may need to suspend loading and unloading operations in response to persistent work slowdowns by the International Longshore and Warehouse Union.

In the midst of contract negotiations, the slowdowns have cut freight movement by as much as 50% at some of the 29 West Coast ports covered by union contracts – ports that handle up to 40% of import/export businesses in the United States.

The “work slowdown” is a common tactic used by unions to increase pressure on employers in the lead up to or during contract negotiations. PMA member companies said that a productivity cut of 50% would not support the average wage of $1,200 per day cost to pay International Longshore and Warehouse Union (ILWU) members.

In a statement released on February 5, ILWU International President Robert McEllrath condemned “the Pacific Maritime Association for threatening to shut down West Coast ports, bargaining in the media, and distorting the facts”… and that “intensifying the rhetoric at this stage of bargaining, when we are just a few issues from reaching an agreement, is totally unnecessary and counterproductive.”

The PMA employer group said that they could no longer continue to pay workers the premium pay for lackluster productivity. Predictably, the ILWU said a lack of work accounted for loss of productivity saying shippers were leaving cargo at sea offering undated pictures of empty docks as evidence.

The PMA countered with an observation that the ILWU was withholding needed crane operators and engaging in slow crane movements that PMA member companies and customers said were costing them an estimated $1 billion a day. A complete shut-down would raise the impact on the U.S. economy $2 billion a day.

PMA CEO James McKenna said the “union’s strategy is jeopardizing American jobs and threatening the long-term viability of businesses large and small. It’s like “they’re getting paid to grind us into the ground.” McKenna added that the PMA has been dealing with work slowdowns at West Coast ports since contract negotiations began nine months ago.

Jonathan Gold, speaking for the National Retail Federation (NRF) said “our message to the ILWU and PMA: Stop holding the supply chain community hostage.” The NRF represents more than 1.6 million U.S. retail businesses employing in excess of 24 million Americans and total sales of $6.4 trillion last year.

In short, a work stoppage of any length would jeopardize retail sales, jobs and the struggling economy nationwide.

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Government Worker

The Bureau of Labor Statistics on Friday released its report on the state of organized labor in America and the news is not good as the steady slide in union membership continues from a high of 20.1 percent in 1983 – the first year the Department of Labor began compiling data on the union membership rate.

In 2014, the percent of wage and salary workers who were members of unions was 11.1 percent, down 0.2 percentage point from 2013. The number of American belonging to unions was 14.6 million – about the same as 2013.

Quoting the report:

“The data on union membership are collected as part of the Current Population Survey (CPS), a monthly sample survey of about 60,000 households that obtains information on employment and unemployment among the nation’s civilian non-institutional population age 16 and over.”

Highlights from the 2014 report:

  • Public-sector workers had a union membership rate (35.7 percent), more than five times higher than that of private-sector workers (6.6 percent).
  • Workers in education, training, and library occupations and in protective service occupations had the highest unionization rate at 35.3 percent.
  • Men had a higher union membership rate (11.7 percent) than women (10.5 percent) in 2014.
  • Black workers were more likely to be union members than were white, Asian, or Hispanic workers.
  • Among the states, New York continued to have the highest union membership rate (24.6 percent), and North Carolina again had the lowest rate (1.9 percent).

Industry and Occupation of Union Members

In 2014, 7.2 million employees in the public sector belonged to a union, compared with 7.4 million workers in the private sector.

Within the public sector, the union membership rate was highest for local government (41.9 percent), which includes employees in heavily unionized occupations, such as teachers, police officers, and firefighters.

In the private sector, industries with high unionization rates included utilities (22.3 percent), transportation and warehousing (19.6 percent), telecommunications (14.8 percent), and construction (13.9 percent).

Selected Characteristics of Union Members

The union membership rate was higher for men (11.7 percent) than for women (10.5 percent) in 2014. The gap between their rates has narrowed considerably since 1983, when rates for men and women were 24.7 percent and 14.6 percent, respectively.

Among major race and ethnicity groups, black workers had a higher union membership rate in 2014 of (13.2 percent) than workers who were white (10.8 percent), Asian (10.4 percent), or Hispanic (9.2 percent).

By age, the union membership rate was highest among workers ages 45 to 64 – 13.8 percent for those ages 45 to 54 and 14.1 percent for those ages 55 to 64.

The union membership rate was 12.3 percent for full-time workers, more than twice the rate for part-time workers, 5.8 percent.

Union Representation

In 2014, 16.2 million wage and salary workers were represented by a union. This group includes both union members (14.6 million) and workers who report no union affiliation but whose jobs are covered by a union contract (1.6 million).

Union Membership by State

In 2014, 30 states and the District of Columbia had union membership rates below that of the U.S. average, 11.1 percent, 19 states had rates above it, and 1 state had a rate equal to that of the nation.

All states in the East South Central and West South Central divisions had union membership rates below the national average, and all states in the Middle Atlantic and Pacific divisions had rates above it.

Union membership rates declined over the year in 27 states and the District of Columbia, rose in 18 states, and were unchanged in 5 states.

Nine states had union membership rates below 5.0 percent in 2014, with North Carolina having the lowest rate at 1.9 percent. The next lowest rates were in South Carolina at 2.2 percent and Mississippi and Utah at 3.7 percent each. Three states had union membership rates over 20.0 percent in 2014: New York at 24.6 percent, Alaska at 22.8 percent and Hawaii at 21.8 percent.

The largest numbers of union members lived in California, 2.5 million and New York, 2.0 million. Over half of the 14.6 million union members in the U.S. lived in just seven states – California, 2.5 million, New York, 2.0 million, Illinois, 0.8 million, Pennsylvania, 0.7 million, and Michigan, New Jersey, and Ohio at about 0.6 million each.

States with the highest rates of public union membership also carried the most debt including California ($778 billion), Illinois ($321 billion), Ohio ($321 billion) and New York at ($387 billion) according to State Budget Solutions – a non-partisan, non-profit, national public policy organization with the mission to change the way state and local governments do business.

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Hoffa Corruption

Today, the International Brotherhood of Teamsters announced the end of settlement terms with the U.S. Government.

In 1989, the Teamsters agreed to government oversight to remove corruption within their organization and their elections.

The 25 years of oversight stemmed from a RICO (Rackateer Influence and Corrupt Organization) Act lawsuit brought by the government against the Teamsters.

The current Teamsters president, Jim Hoffa, lauded the announcement saying, “When I took office in 1999, I pledged that we would run a clean union, that organized crime would never have a place in the Teamsters Union. I also promised that we would ensure that every rank-and-file Teamster have a direct voice in electing the Union’s International officers. After 15 years, we have accomplished these goals.”

Jim Hoffa is the only son of missing union boss, Jimmy Hoffa. Hoffa vanished in 1975 and is believed to have been murdered.

Jimmy Hoffa had been relentlessly pursued by Robert Kennedy in his quest to root out organized crime. Hoffa was convicted as a result of Kennedy’s tenacity and served time for bribing a juror and setting up illegal pension funds for mafia bosses.

Hoffa Jr., an attorney, has kept his nose clean but appears to have traded corruption for hard-handed political processes to keep any opposition in check.

Hoffa Jr. and his “old guard” bosses have been accused of extravagant expenses along with using political donations to lock in support members of Congress.

The accusations hold true when looking at the numbers.

Jim Hoffa receives a salary and benefits of $381,403 per year. 181 other Teamster bosses receive salaries of over $100,000. Thirteen others receive over $200,000 a year.

They average salary for a union worker is $48,776. Union dues are 2.5 times the member’s hourly rate, per month. For a member making $12 an hour, dues would be $360 per year.

The Teamsters represents 1.2 million members.

While unions should enjoy the right to operate without government intervention, only 25 states are “right to work” meaning that workers have the right to choose whether they want to participate in a union.

With laws protecting unions in half of the other states, unlike the Teamsters and their new freedom, workers in those states are not free to work without government collusion that forces union participation and payments.

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Jim Hoffa Teamsters

In a sharply worded letter to congressional leaders, Teamsters General President Jim Hoffa complained bitterly this past Tuesday about a “last minute deal to give United Parcel Service (UPS) a $2 billion bailout to relieve the company of negotiated pension obligations” under a pension reform plan working its way through Congress.

Saying such funds would offset Big Brown’s pension payments, Hoffa seemed to express anger that a deal would lessen the pain UPS management and shareholders would feel funding its pension obligations on their own.

When asked about the “bailout” language contained in Hoffa’s letter, UPS Spokeswoman Kara Gerhardt Ross denied that any “bailout” was in the works and that the multi-employer pension reform under consideration by Congress will not change UPS’s “contractual obligation and no policy will change our commitment to our people.”

Ross added that in 2007 “UPS paid $6.1 billion in a cash lump payment to the Central States Pension Trust in order to cover our commitment to protect our 45,000 employees under the plan and their pensions”…“started a new Teamster-UPS Jointly Trusteed Single Employer Plan that is completely funded by UPS today”…and that “UPS took an additional $1.7 billion in Central States’ liability (former UPS pension plan) to support the plan and more importantly our people under it.”

UPS expressed surprise that the Teamsters were calling these contributions bailouts or a special interest earmarks affirming instead that “UPS is standing by its contractual commitment to our union employees under the collective bargaining agreement and has advocated to protect our employees’ benefits during this process.”

So why is Hoffa so upset?

Perhaps it has something to do with the thinly veiled class warfare rhetoric that keeps Big Unions – and Big Union Bosses – in power.

In his closing salvo against UPS in his letter to Congress, Hoffa thought it important to point out that UPS is a Fortune 50 company with sales in excess of $100 billion a year – and that pension reform would somehow lessen the impact that union demands would have on Big Brown’s bottom line.



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