Yesterday's New York Times had two interesting articles on unions and labor. One was Kurtis Lee's "55 Years Ago, Tragedy in Memphis Transformed Labor Movement" and the other was Martha C. White's "Renewed Interest in a Rare Employee Benefit." I'm going to take some numbers and concepts from those articles that I think give a good picture of what's going on in our labor movement and the world of work.
* Black workers now have the highest union membership rate of any racial or ethnic group.
* Black union workers make less than their white counterparts---$1022 a week on average compared with $1246 for white workers.
* The union membership rate of U.S. workers was 10.1 percent in 2022, down from 20.1 percent in 1983.
* Through the first 10 months of this year 492,300 workers went on strike---more than three times as many workers in the same period last year.
The Times highlighted these steps forward: strikes won a large pay increase and a $25 hour minimum wage at Kaiser Permanente in California, the Writers Guild of America won a 12.5 percent increase, the actors' union SAG-AFTRA won a 7 percent increase in the first year of their contract, and the Auto Workers won a 25 percent increase over the next four and half years.
The Times did not mention the details of the Teamsters victory at UPS. This included
* Historic wage increases. Existing full- and part-time UPS Teamsters will get $2.75 more per hour in 2023. Over the length of the contract, wage increases will total $7.50 per hour.
*.Existing part-timers will be raised to no less than $21 per hour immediately, and part-time seniority workers earning more under a market rate adjustment will still receive all new general wage increases.
* General wage increases for part-time workers will be double the amount obtained in the previous UPS Teamsters contract — and existing part-time workers will receive a 48 percent average total wage increase over the next five years.
* Wage increases for full-timers will keep UPS Teamsters the highest paid delivery drivers in the nation, improving their average top rate to $49 per hour.
* Current UPS Teamsters working part-time will receive longevity wage increases of up to $1.50 per hour on top of new hourly raises, compounding their earnings.
* New part-time hires at UPS will start at $21 per hour and advance to $23 per hour.
* All UPS Teamster drivers classified as 22.4s will be reclassified immediately to Regular Package Car Drivers and placed into seniority, ending the unfair two-tier wage system at UPS.
* Safety and health protections, including vehicle air conditioning and cargo ventilation. UPS will equip in-cab A/C in all larger delivery vehicles, sprinter vans, and package cars purchased after Jan. 1, 2024. Two fans, heat exhaust shields, and air induction vents in the cargo compartments will be retrofitted into all cars.
* All UPS Teamsters will receive Martin Luther King Day as a full holiday for the first time.
* No more forced overtime on Teamster drivers’ days off. Drivers will keep one of two workweek schedules and cannot be forced into overtime on scheduled off-days.
* UPS Teamster part-timers will have priority to perform all seasonal support work using their own vehicles with a locked-in eight-hour guarantee. For the first time, seasonal work will be contained to five weeks only from November-December.
* The creation of 7,500 new full-time Teamster jobs at UPS and the fulfillment of 22,500 open positions, establishing more opportunities through the life of the agreement for part-timers to transition to full-time work.
The facts cited above are taken from an August press release issued by the Teamsters. Getting back to the articles in The Times, an article on pensions noted that the Auto Workers could not force the auto makers to reopen defined-benefit pension plans for workers hired after late 2007 and went on to say that "Only about one in 10 Americans working in the private sector today participates in a defined-benefit plan, while roughly half contribute to 401(k)-type, defined-contribution plans, which are funded with their pretax dollars and, in many cases, employer contributions."
The White article also stated the following:
* The number of job seekers looking for employment with pensions has increased greatly over the past three years, and the numbers of employers offering some kind of pension or 401(k) plan is increasing as well. That said, unions are having difficult time organizing in the service sector, among logistics workers, and where workers are regarded as freelancers or as self-employed and where benefits, including any kind of retirement security benefits, are rare unless a union is present.
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* More than four out five millennials working in the public sector in 2020 cited pensions as the key reason for keeping their jobs.
The article on pensions also sounded a warning. IBM is regarded as "a benefits bellwether in corporate America," the article said. The company was among the first to offer a 401(k) in 1983, and from that point 401(k) plans began to displace defined benefit plans even where unions represented workers. A 1971 court ruling held that employers no longer had to bargain with unions over retiree benefits if a union raised the issue during contract negotiations and unions could no longer strike if employers refused to bargain over union demands presented on behalf of retired workers. Millions of private sector workers held on to their union-negotiated defined benefit pension plans after the 1971 ruling, but after IBM and a few other large employers went to 401(k) plans in the early 1980s all defined benefit plans were at risk.
Now IBM is creating a "retirement benefit account" system. The company will "eliminate matching contributions. Instead, it will contribute 5 percent of each worker's pay into a defined-benefit instrument...This retirement benefit account...differs from traditional defined-benefit pensions in that its structure is that of a cash-balance account." The company will allow workers to earn credit each year that will "typically (be) a percentage of their salary plus an interest rate pegged to a benchmark like a particular Treasury yield."
Union members will object that this is unfair. The IBM workers are not unionized and the company is not negotiating this change in benefits. IBM's power in the marketplace means that this retirement benefit account system will likely spread and replace 401(k) plans in non-union workplaces and put pressure on union-negotiated plans to change. A non-union corporation effectively has a vote on my retirement security. I see additional problem here because workers covered by this new plan now have an immediate self-interest in higher interest rates whether that is good policy in the long run or not and because these plans may undermine the wage increases that we are able to negotiate and will make organizing in the service sector and among freelancers more difficult. It seems that it gives encouragement to employers to grant wage increase but cut back or remove benefits.
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