Wage Standards and Workplace Freedom

On March 1st, a new law in New York goes into effect, strengthening the freedom of employees to form labor unions at hotels or convention centers run or funded by state authorities, a dramatic victory for hotel workers in the state.  The law has specific language requiring that hotels or convention centers where state public authorities have a substantial proprietary interest include a "labor peace agreement" with hotel unions in the state in exchange for the unions agreeing not to strike for five years.  The law follows a similar executive order by the Governor approved last year.

Progressive States Network will be working with state leaders around the country to promote policies to improve enforcement of minimum wage, overtime and related wage laws in the states.  This Dispatch will highlight the chronic wage violations in the workplace, model wage law enforcement language for states to promote, messaging to support those campaigns, and specific ways such an approach has the added benefit of undercutting anti-immigrant attacks in the states.

As part of the Progressive States Network’s 2010 Shared Multi-State Agenda, we are advancing a corporate transparency initiative in coordination with key allies and experts.  Demand for transparency in government is rising, but most states still do not collect even the most basic, critical data from recipients of state grants, state contracts or tax breaks.  In this Dispatch, we will examine the need for corporate transparency, recent cases relating to the subject, and how the policy will benefit states dealing with massive deficits.

Delaware’s legislature passed the Workplace Fraud Act (HB 230), an employee misclassification bill that increases penalties for construction employers who knowingly misclassify employees as contractors in order to evade state and federal taxes and wage and hour laws, saving as much as 30% on the margins.

Too often workers are forced by employers to listen to religious, political, or anti-union propaganda that has nothing to do with their work responsibilities-- yet they are threatened with being fired if they don't attend such employer-mandated meetings.  The Oregon legislature this past week joined New Jersey in giving employees the right to skip such employer propaganda meetings without fearing reprisals.

In this Dispatch, we emphasize that any stimulus spending has to be tied to increased accountability and transparency in spending decisions, especially by government contractors who often operate like a shadow government with little oversight.  One key reality is that those most in need often don't receive help from government spending without transparency and accountability measures built into the rules.  While the recent federal recovery plan made real strides in expanding such accountability, additional measures are still needed if the recovery plan is going to deliver real equity in our economic recovery.

It seems relatively simple.  The proposed federal Employee Free Choice Act would give employees the freedom to form a union when a majority of workers sign cards saying that they want one, avoiding the often months of employer harassment that have inevitably accompanied traditional National Labor Relations Board (NLRB) election processes.

Earlier this month, the Maryland legislature joined a number of states in cracking down on worker misclassification by enacting the Maryland Workplace Fraud Act (S 909 / H 819 ) which has the support of Gov. O'Malley who is expected to sign the bill shortly.  The main focus of the bill was stopping the misclassification of workers as "independent contractors" used by employers to deny them a minimum wage, overtime and key workplace benefits.

New Mexico Governor Bill Richardson recently signed a wage enforcement bill (H 489) to allow underpaid workers to collect their back wages plus twice that amount in damages. The bill was backed by community groups and labor unions as well as the New Mexico Department of Workforce Solutions.  New Mexico now becomes the eighth state that allows workers to collect treble damages against employers violating the minimum wage – a key deterrent to employers to ensure compliance with the minimum wage. 

Given the central role of private contractors in delivering public services, this Dispatch continues our series of Privatization Updates (see November's edition). Today we focus on current privatization debates in the education, prison and mental health sectors -- and what states are doing to increase accountability for contractors.