Rants &amp; Raves for the Week of May 30th

Rants and Raves for the Week of May 30th, 2011

As pay skyrockets for corporate CEOs, workers see their pay stagnate as prices rise for basic necessities. Persistently high unemployment has put downward pressure on wages, and private sector workers have seen their pay decline as much as 9 percent in some areas of the state. If employers are hiring at all, more and more are paying minimum wage, barely allowing workers to eke out a living, let alone support a family. Yet at the same time, CEOs are raking in the big bucks. A recent report shows that executive pay was up 23 percent over last year at the top 100 California companies, which is consistent with national trends. While public sector workers have to fight to hold onto their $3000 a month pensions, the CEO of McKesson Corp pharmaceutical company received a $21 million supplemental retirement contribution, along with his multi-million compensation package. The same companies that pay lavish salaries and perks to executives are paying poverty wages to their workers, taking advantage of the recession as an excuse. There’s no excuse for corporate greed, and more needs to be done to reign in CEO compensation.


Speaking of salaries, one of the top executive earners in the insurance industry is Bruce Bodaken of the non-profit giant Blue Shield. Bodaken earned a stunning $4.6 million last year, at the same time that Blue Shield came under fire for attempting to raise policyholder premiums three times in a row. The non-profit’s executive salaries are news this year because they were previously not released to the public. Under a new state law, health insurers have to publicly release information to the state regulators when they file for rate increases. The information is designed to help regulators, and consumers, identify where health insurers are spending their money and whether skyrocketing CEO salaries have anything to do with skyrocketing premiums.


Wisconsin-style attacks could never happen in the San Francisco Bay Area, right? Wrong. The mayor and City Council of San Jose, the largest city in the Bay Area, have launched an all-out assault on city workers. But unlike Wisconsin, these attacks aren’t coming from extreme right-wing Republicans – they’re coming from Democrats. This week, the City Council took their assault one step further forcing contract terms on four city unions without their consent. Maybe the San Jose City Council has been living under a rock, because we’ve all seen over the last few months that attacking collective bargaining rights isn’t going to win them any brownie points, and it’s not going to win them any elections either. Our message to Mayor Reed and the City Council – when workers’ rights are under attack, what do we do? Stand up, fight back!


Child labor laws ensure that working teens have enough time to go to school, study and sleep in addition to any hours that they work. The idea is that society benefits from educating our children and we should make sure they’re not working their fingers to the bone for minimum wage instead of going to class. The Governor of Maine seems to think that kids do not need time to go to school but instead should spend their school nights working the fry machine, sweeping floors and cleaning toilets. Governor Le Page, a Republican, signed into a law a bill that significantly weakens Maine’s child labor laws and allows kids to work longer and later on school nights—for a possible total of 50 hours a week. While the Maine Restaurant and Innkeepers association supported the bill, a Democratic Rep. Timothy Driscoll dubbed the bill “an act to exploit our children for the financial benefit of the restaurant and the hospitality industry.”


It’s been a big week for Labor-backed legislation in Sacramento. Despite fierce opposition from insurance industry giants and Republicans, a bill to regulate health insurance rates got off the Assembly floor this week. AB 52 (Feuer) would give California regulators the ability to approve, modify or disallow health insurers from raising their rates. Right now, all regulators can do is tell the public when a rate is unreasonable or excessive, but they can’t do anything to stop the insurer from increasing premiums. The case for rate regulation has grown over the past year as the big insurers have filed for rate increases ranging from 39 to 85 percent—outraging the public and terrifying policyholders. Since the recession began in 2007, the ranks of the uninsured in California has swelled to close to 8 million people – meanwhile, insurers have enjoyed outrageous profits. Before the Assembly vote on AB 52, Republicans walked off the floor in protest after they were denied a caucus designed to kill the bill through stall tactics. But insurers and doctors couldn’t beat back consumers, unions and health care groups that also fought tooth and nail for more protections from premium increases for their members.

With each new dismal set of unemployment figures released, one unique aspect of this recession grows increasingly clear: relentless and widespread unemployment will not be addressed broader economic recovery alone. Meanwhile, employers in key growth sectors clamor for more of the skilled workers necessary to make that broader economic recovery happen. That’s why California State Senators overwhelmingly passed—with only three no votes—SB 776 (DeSaulnier), critical legislation to require that 50% of California’s federal Workforce Investment Act adult and dislocated worker funds go directly to job training programs. This proposed standard, sponsored the California Labor Federation, the California State Building & Construction Trades Council and the California Manufacturers Association, reflects undeniable evidence that job training is the best and most effective way to invest these scarce dollars and connect the unemployed with stable, living wage careers. SB 776 now goes to the Assembly, where we’re confident lawmakers will see the wisdom in a strong focus on training tomorrow’s workforce.

Those aren’t the only Labor Federation’s sponsored bills that passed off the Assembly and Senate floors this week right before the deadline. We advanced two bills to rebuild California’s manufacturing base. We beat back industry opposition to bills to crack down on wage theft and independent contractor misclassification and for worker retention in garbage contracts. A bill requiring mediation before cities file bankruptcy and do away with collective bargaining agreements flew off the Assembly floor. Our corporate tax accountability bill, which faced fierce industry opposition last year, made it off the Senate floor. Next week, policy committee hearings start again and members will need reminders of the legislative priorities of working people. You can view Labor’s Legislative agenda here.


If the idea of a labor advocate, a government representative and a corporate CEO sitting down and hashing out ways they can work together towards a common goal of renewing our workforce and reviving our economy seems far-fetched to you, you’ve obviously missed last week’s “Building Workforce Partnerships” conference in San Jose, sponsored our Workforce & Economic Development program. The unique and groundbreaking conference has exploded in popularity, and this year’s three-day event drew the best and brightest economists, labor activists, environmentalists, workforce experts, business leaders, government representatives and others from all across the state and country. Even though the participants came from a wide variety of backgrounds, they all share a common goal – to build a new, sustainable economy fueled advanced manufacturing and renewable energy jobs. If there’s one thing we call all agree on, it’s the fact that everyone – business, labor and government – must work together if we want to build a new, sustainable economy that works for all of us.