Wages
Labor Department – The National Labor Relations Board voluntarily dismissed its appeal of a Texas federal judge’s decision enjoining its joint employer final rule. In a July 19 court filing for the case, NLRB v. Chamber of Commerce, the Board said that it would “like the opportunity to further consider the issues identified in the district court’s opinion” and that dismissal would “allow it to consider options for addressing the outstanding joint employer matters before it.” The NLRB appealed the judge’s injunction in May. The Board said that it “remains of the opinion” that the joint employer rule is lawful. It noted that a separate lawsuit that targets its rule has been placed in abeyance by the U.S. Circuit Court of Appeals for the District of Columbia. This is a major victory for business groups over the NLRB, which under its current Democratic leadership has moved to shift the balance of power in favor of workers and labor unions over employers in labor disputes across a number of fronts. However, dropping the case is unlikely to be the final word on the matter. The NLRB noted that it has received several petitions for further rulemaking asking it to revisit the joint employer standard and that dismissing the appeal would “allow it to consider options for addressing the outstanding joint employer matters before it.” More details.
Massachusetts – The Massachusetts Restaurant Association has suspended their efforts to block the minimum wage ballot initiative that would also eliminate the tip credit from appearing on the 2024 ballot. Last week, the state association filed an objection with the secretary of state’s office challenging a number of signatures submitted by One Fair Wage. The secretary of state certified a total of 12,565 signatures for the campaign ahead of the deadline, only 136 more than the 12,429 minimum due last week. If at least 137 signatures were successfully disqualified, the question would have been blocked from the ballot. After significant effort, it was determined that the association would fall short in their efforts to disqualify enough signatures. As such, the measure will appear on the ballot in Nov. More details.
Oklahoma – Supporters of an effort to hike the minimum wage turned in nearly double the required number of signatures to get the issue on the ballot. Supporters needed 92,263 signatures and turned in just shy of 180,000 to the secretary of state’s office. Proposed State Question 832, if approved by voters, would increase the minimum wage to $9/hr in 2025 from the current $7.25hr (the same as the federal minimum wage) and mandate annual increases until it reaches $15/hr in 2029. After that, the wage would be tied to the Consumer Price Index. The proposal withstood a legal challenge from the Oklahoma Chamber and Oklahoma Farm Bureau Legal Foundation. The state supreme court ruled in March the petition was constitutional and declined an additional request to revisit the issue in April. The signatures will now need to be verified. More details.
Everett, WA – Two competing minimum wage measures may be heading to the ballot. The industry-supported Raise the Wage Responsibly signatures to have their initiative considered for the Nov. ballot, one week after labor-supported Everett Deserves a Raise submitted signatures for its own ballot measure. Each proposal would raise the minimum wage at large businesses from $16.28/hr to $20.24/hr in Everett, further adjust wages based on inflation, and require that businesses offer additional hours to current employees before hiring new employees. Under each proposal, employers with fewer than 15 employees or those that make $2 million or less in annual gross revenue would be exempt. Where Raise the Wage Responsibly differs are provisions it says are designed to protect small businesses with more than 15 employees – primarily by factoring “additional compensation,” such as tips, insurance, and other benefits, into wages. The Washington Hospitality Association, a trade group representing more than 6,000 members of the restaurant and hotel industry, contributed over $38,000 to Raise the Wage Responsibly. More details.
Portland, ME – The city council heard two wage proposals that potentially could appear on the Nov. ballot. One would raise the minimum wage to $20/hr by 2028 and the other would eliminate the tip credit incrementally over ten years. Proponents ran a similar measure in 2022 with both questions joined together as one ballot question but it garnered only 39 percent of the vote. Proponents felt that was a mistake and this time around are proposing two separate ballot questions. Another hearing is scheduled for Aug. 19 and it is possible the measures could be approved for the ballot at that meeting. More details.
Labor Policy
EEOC – Equal Employment Opportunity Commission (EEOC) member Keith Sonderling will depart the agency in Aug. at the end of his term. His departure will leave a Republican vacancy on the five-member panel charged with enforcing workplace civil rights laws. Sonderling’s term expired July 1 but Title VII of the 1964 Civil Rights Act provides that EEOC commissioners can stay in their posts another 60 days. They may remain beyond that, if the president nominates a replacement during the holdover period. Sonderling was originally nominated to the EEOC by former President Donald Trump and joined in 2020. He served as vice chair until 2021. Republicans became a minority on the commission in Aug. 2023, when Democrat Kalpana Kotagal joined, creating a 3-2 split that ended a long period of partisan gridlock that kept the commission from taking a more active approach to policy and enforcement. More details.
NLRB – The National Labor Relations Board (NLRB) has received more than 2,600 petitions since the beginning of FY24, already exceeding the 2,594 over the preceding 12 months. Petitions are up more than 30 percent compared to the same point in 2023, according to the agency. The increases largely were driven by a 2,000 percent surge in the number of employer-filed petitions after the board’s decision in Cemex Construction Materials Pacific, LLC altered its framework for policing alleged legal violations before an election. Cemex requires that employers either voluntarily recognize a union or file RM election petitions with the NLRB when unions come to them with proof of majority employee support. Yet the number of worker-filed election petitions also went up by 13 percent from last fiscal year, the agency said. At the same time, decertification petitions to oust existing unions increased by 12 percent. The agency’s regional offices additionally have conducted more elections this fiscal year than in all of fiscal year 2023. According to the statement, unions have won 79 percent of elections from union-filed petitions and 70 percent of the elections from employer-filed petitions. More details.
Labor Activism
Compass Coffee – Workers from seven units voted this week on whether to unionize; however, after all the ballots were cast, nothing was resolved because over 100 ballots were contested either by the union or company management. Only 22 ballots were uncontested and all of them voted yes on unionization. The ballots are being challenged after the company went on a hiring spree in the weeks after workers announced plans to unionize on May 31. The move drew criticism from organizers and labor experts who say Compass employed a traditional union-busting tactic to try to dilute pro-union votes. Now an NLRB regional director will decide whether to count or open the challenged ballots. The director could also order a hearing to adjudicate the matter, potentially deciding which of the challenged ballots were from employees qualified to weigh in on the union vote. Both sides have five days after the election to file objections. More details.
Key Takeaways
- Reporting this week on the boom in labor organizing activity (a 30 percent increase) following the Cemex decision confirms what we already knew: Unions believe that the decision fundamentally shifts labor organizing rules in their favor and will press their advantage. Unions won over 70 percent of those elections. Companies need to ensure that all silos of the company understand the new environment in which they operate.
- The tone of the RNC Convention this week was much more critical of corporate interests generally, casting multinational companies as part of the “ruling class,” compared to past RNC conventions. This follows a years-long trend of leading Republican figures attacking corporate America. DEI, ESG, and other hot button issues were touched upon by many speakers. Vice Presidential nominee J.D. Vance, in many ways the new standard bearer for the party, also articulated a populist economic agenda that is intended to resonate with Rust Belt union members. This vision, and realignment of the Republican party, has and will continue to present challenges for the business community. Former President Trump’s economic populism is now firmly embedded within the Republican Party.
Podcast
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