Giving thanks: A luxury that Wal-Mart workers can’t afford 3

A Wal-Mart food drive... for Wal-Mart workers!

 

By Ramit Mizrahi and Sharon Vinick

This photo has been making the rounds on the internet, sparking both criticism and ridicule. It shows bins at a Canton, Ohio Wal-Mart put out by management with a sign asking: “Please donate food items here so Associates in need can enjoy Thanksgiving Dinner.” The photo went viral for a simple reason: it captures perfectly the fact that Wal-Mart associates earn so little that many will struggle to put dinner on their table this Thanksgiving — and management knows it!

Most of Wal-Mart’s hourly employees make less than $25,000 per year. This statistic makes sense since Wal-Mart typically pays entry level employees $8.00 per hour, which is just above minimum wage. Even after six years, an individual employed by Wal-Mart can only expect to be paid $10.60 per hour.

Given the low wages paid by Wal-Mart, it is not too surprising that many of its employees have to turn to state and federal aid programs in order to make ends meet. According to a report by Congressional Democrats released in June 2013 (discussed in this Mother Jones article), many Wal-Mart employees receive government aid, which costs taxpayers between $900,000 and $1.75 million per store, per year. Taxpayers in California, alone, are spending $86 million each year to provide healthcare and other public assistance to the state’s 44,000 Wal-Mart employees, at a cost of about $2,000 per worker.

Even Wal-Mart seems to recognize that its employees can’t live on the wages that the company pays and must rely on public assistance (and charity). Back in 2005, the New York Times reported that Wal-Mart’s executive vice president for benefits sent the board of directors an internal memo stating that “Wal-Mart has a significant percentage of associates and their children on public assistance.” But Wal-Mart has taken an unapologetic stance. With respect to the food drive pictured above, Wal-Mart representatives have said that it is proof of its efforts to take care of its employees!

For many years, Wal-Mart’s treatment of its employees has been the focus of activism, employee action, and litigation. This year, protests will be held on Black Friday at over 1,500 Wal-Mart stores.

Why has so much attention been focused on a single corporation? Perhaps it is because Wal-Mart is larger than Home Deport, Kroger, Target, Sears, Costco and K-Mart, combined? Perhaps it is because of the low-wages that workers earn while Wal-Mart’s CEO makes more in an hour than a full-time worker makes in an entire year? Whatever the reasons, Wal-Mart, as the nation’s largest employer, has become a symbol of the problems plaguing workers who work full time, yet don’t make enough money to make ends meet.

In the coming days, as Americans prepare for — and recover from — their Thanksgiving feasts, we should not only give thanks for what our families have, but make a commitment to helping other families who have far less. Real help requires more than just a few spare canned goods thrown into a bin. It requires that we address the reasons that our nation’s workers are in need. We should applaud Governor Jerry Brown for signing into law AB 10, a bill that will increase the minimum wage in California to increase the minimum wage to $10 per hour in 2016. And, we should lobby Congress to pass the Fair Minimum Wage Act of 2013, which would increase the federal minimum wage for all workers, including those at Wal-Mart, to $10.10 by 2015. Such legislation could help in ensuring that all workers can afford a Thanksgiving feast, without relying upon the kindness of their co-workers.

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Disclosure: Co-author and attorney Ramit Mizrahi worked on the Dukes v. Wal-Mart Stores, Inc. case from late 2004 to early 2006.

Ramit Mizrahi

About Ramit Mizrahi

Ramit Mizrahi, the founder of Mizrahi Law, APC, practices in the area of employment law, representing employees exclusively. Her work focuses on cases involving discrimination, harassment, retaliation, leave law issues, and wrongful termination. She is a graduate of Yale Law School, The London School of Economics, and UC-Berkeley.

Finally, overtime coverage for all domestic workers in California!

Finally, overtime coverage for all domestic workers in California!

BVHRFetCIAA_z1k.jpg-largeBy Hina Shah

After nearly 75 years of exclusion from federal and state labor protections, domestic workers have finally scored two important victories in their fight for equal treatment.  Late last week, Governor Brown signed AB 241, extending California overtime protections to domestic workers who spend a significant amount of time caring for children, elderly and people with disabilities.  One week earlier the federal Department of Labor finalized new rules that significantly extend federal minimum wage and overtime protections to domestic workers who care for the elderly and people with disabilities.  Together, these actions extend overtime coverage to all domestic workers in California.

These historic changes are a direct result of domestic workers organizing on the local, state, and national level.  Over the past eight years, the California Domestic Workers Coalition has built a grassroots, worker-led, statewide movement in California that includes allies from labor, faith groups and employers.  Similar efforts by domestic workers in New York and Hawaii have also resulted in legislative victories.

The struggle for equal treatment of domestic workers dates back to the beginning of the regulated workplace.  Domestic workers organized a massive letter writing campaign in the 1920s and 1930s. Highlighting slave-like working conditions, they petitioned President Franklin and Mrs. Eleanor Roosevelt, as well as Secretary of Labor Frances Perkins, to cover them under the Fair Labor Standards Act, to no avail.  Thirty-six years later, when Congress amended the FLSA to include most domestic workers in minimum wage protections and overtime pay, it exempted live-in domestic workers from overtime and excluded casual babysitters and companions for the elderly or people with disabilities entirely.

In California, a similar letter writing campaign was instituted to get the Wage Board to regulate employment in the home as early as the 1940s.  However, when California finally adopted a Wage Order for Household Occupations in 1976, it exempted domestic workers (called “personal attendants”) who spent a significant amount of time caring for children, elderly and people with disabilities.    Personal attendants finally gained minimum wage protection in 2001 and have only now gained the right to overtime.

These gains, while significant, are not secure.  Because the federal regulations do not take effect until 2015, there is fear that they may be reversed with a change in administration.  The California statute is set to expire in 2016, unless the legislature acts to extend it.

One reason for these time limitations is the fear that home care will become unaffordable for many modest to low-income recipients.  Available evidence is to the contrary.

Currently, fifteen states provide minimum wage and overtime protection to home care workers and twenty-one states provide minimum wage. According to the Paraprofessional Healthcare Institute, institutionalization rates are not higher in states that provide home care workers with minimum wage and overtime.  Furthermore, there is significant cost to high turnover rates (estimated at between 44 and 65%) that is a direct result of low wages and poor working conditions.

While neither AB 241 nor the federal rules are a panacea, domestic workers in California have much to celebrate this month. Today’s home-care industry is staffed by trained professionals. These workers are their families’ breadwinners.  The removal of these historical exemptions at both the federal and state level is an important first step in valuing their labor as real work, and recognizing the dignity of those who care for our loved ones.

Hina Shah

About Hina Shah

Hina B. Shah is an Associate Professor of Law and Co-Director at the Women’s Employment Rights Clinic (WERC) of Golden Gate University School of Law, addressing employment and labor issues faced by low wage and immigrant workers.

Raising the minimum wage 1

Raising the minimum wage

By Elizabeth Kristen

Last night the California legislature approved Assembly Bill 10 (Luis Alejo (D-Salinas)) to raise the California minimum wage to $10 by 2016,  with Governor Brown indicating he will sign the bill.

When enacted, AB 10 will raise current California minimum wage from $8 to $9 on July 1, 2014 and then to $10 on January 1, 2016.

While California’s minimum wage at $8 per hour has been significantly higher than the federal rate of $7.25, the legislature had not increased California minimum wage since 2008.  To counter the effects of a stagnant state minimum wage, some cities like San Francisco and San Jose have passed on their own higher minimum wages (at $10.55 and $10), respectively.

This summer has seen significant activism to raise the minimum wage.  July 24th was the National Day of Action to Raise the Minimum Wage, marking the four-year anniversary since the federal minimum wage was raised to $7.25 per hour.  In the last 30 years, Congress has voted to raise the minimum wage just three times. The current value of minimum wage today is nearly a third lower than it was in 1968.  Meanwhile, chief executives at the nation’s top corporations have seen a median wage increase of 16 percent in the last year alone.

It is no surprise that income inequality has risen nationally, but few realize that California ranks third worst in the country when it comes to the income gap between rich and poor.

AB 10’s minimum wage increases would go a long way toward closing this gap.

Raising the minimum wage will benefit working families.  According to the Economic Policy Institute, women constitute 55% of the workers who benefit from raising the federal minimum wage.  In the restaurant industry, women make up 66% of the workers paid the federal sub-minimum wage.  More than 25% of those who would benefit are parents.  The burden of low wages also falls disproportionately on people of color who are 42% of minimum wage earners despite being only 32% of the total workforce.

In addition to improving the lives of workers, increased wages will increase consumer spending, benefitting the economy overall.

At the national level, pending legislation would raise the minimum wage to $9.80 in three phases and then index it to inflation.  The federal legislation would also raise the sub-minimum wage paid for tipped workers (which has not been raised since 1991) from $2.13 in 85 cent increments until it reaches 70% of the minimum wage.

Recent community actions have drawn greater attention to this issue of low wages. For example, workers at places such as McDonalds and Taco Bell have been staging one-day walkouts to protest their low wages.  The New York Times described a worker, Ana Salvador, whose job is at a fast food restaurant inside the Smithsonian Institution’s Air & Space Museum, did not pay enough to support her four children.  She had to rely on food stamps and Medicaid to help her family.

While AB 10 is great progress for California, federal lawmakers need to raise the minimum wage and at all levels policy makers must institute meaningful change to wage policies to ensure workers nationwide can support themselves, their families and the economy.

Elizabeth Kristen

About Elizabeth Kristen

Elizabeth Kristen is the Director of the Gender Equity & LGBT Rights Program and a senior staff attorney at Legal Aid at Work.  Ms. Kristen began her public interest career as a Skadden Fellow at Legal Aid.  Ms. Kristen graduated from University of California at Berkeley School of Law in 2001 and served as a law clerk to the Honorable James R. Browning on the Ninth Circuit Court of Appeals in San Francisco.  In 2012-13, she served as a Harvard law School Wasserstein Public Interest Fellow.  She has been a lecturer at Berkeley Law School since 2008. Legal Aid at Work together with the California Women’s Law Center and Equal Rights Advocates make up the California Fair Pay Collaborative dedicated to engaging and informing Californians about fair pay issues.

Celebrating Labor Day 3

Celebrating Labor Day

By Joan Herrington

What does Labor Day mean to you?  A day to sleep in, to fire up the BBQ, to organize school supplies, or to hit the sales?  How about a day to remember the Pullman strike?  The what? Why?

Labor Day was established in 1894 after federal troops killed workers during the Pullman strike.

Pullman railroad workers lived in company towns, rented company houses, and bought their goods in company stores…all at company-set prices.  They were fired if they tried to unionize.  When George Pullman slashed his railroad workers’ pay by 25%, they could no longer afford to live in Pullman Town.  To protest their non-living wage, Pullman employees went on a “wildcat” strike.  Over the next six days, to show solidarity for Pullman workers, over 100,000 railroad union members cross-country refused to service trains with Pullman cars.  At George Pullman’s request, United States Attorney General Richard Olney obtained a federal court injunction against the strikers, and federal troops were sent in to enforce it.

After federal troops killed some of the workers on strike, the trains started running again.  But scandal erupted when the public learned Olney was also a director of Pullman’s railroad.  In other words, Olney, the head of a taxpayer-funded federal agency obtained a federal court order and used federal troops to protect his own and corporate interests against striking workers.  Outraged at this abuse of power, rioters spread from city to city, causing 30 deaths and millions of dollars in damage.  To restore calm, within the next week, a bill establishing Labor Day as a national holiday honoring “the strength and spirit de corps of the trade and labor organizations” was rushed through Congress and signed by President Grover Cleveland.

The battle for a living wage continues to this day.

This Labor Day, some 15 million American workers struggle to live on minimum wage earnings. Just last week, fast food workers went out on strike for a living wage. 

Earlier this year, Acting Secretary of the United States Department of Labor Seth Harris travelled around the country to hear testimony in support of the proposed Fair Minimum Wage Act of 2013 to raise the federal minimum wage from $7.25 to $10.10 per hour by 2015.  He listened to: a store clerk who doesn’t know how she will support herself and her five-year-old son since her employer cut her hours of work; a homeless shelter worker who often lives without power because she can’t afford to pay her bill; a solo father who sells his own blood so his two children won’t go to bed hungry.

Reflecting on the people he met, Harris stated:

I’ve met workers of every age, race, ethnicity and background. In superficial ways, they could have not been more different. But what unites all of them is this: the desire to work hard and the opportunity to make life better for themselves and their families. Too many of them are stuck at a wage that forces them to depend on the generosity of community organizations, family, friends or government just to stay above water. I haven’t met anyone who is looking for a handout. To the contrary, they just want a fair wage so they don’t have to rely on others.

The bill to raise the minimum wage is still stuck in Congress.  Why not honor this Labor Day by contacting your Congressional representative and ask him or her to support The Fair Wage Act of 2013?

Click here to find contact information for your Congressional representative or here for more information on The Fair Wage Act of 2013.

Joan Herrington

About Joan Herrington

As a former Administrative Law Judge with the California Fair Employment and Housing Commission, Joan focuses on protecting employment rights. Joan helps the Department of Fair Employment and Housing enforce the Fair Employment and Housing Act by representing employees in lawsuits, such as discrimination and harassment based on race, national origin, color, pregnancy, sex, sexual orientation, disability, medical condition, age, and religion. Joan also focuses on protecting employees and whistleblowers from unlawful retaliation. As a qualified and experienced mediator, Joan also helps resolve employment disputes.

Subsidizing our food supply on the backs of the working class

By Afshin Mozaffari

The fast-food workers’ protests for higher wages last month triggered a national debate about workers’ compensation, price of food, and the role of the statutory minimum wage.  Thousands of fast-food workers have been holding one-day strikes from New York to several Midwestern cities, demanding $15 an hour – more than twice the federal minimum wage.

The federal minimum wage rate has been in effect since 1938 and is part of the Fair Labor Standard Act (“FLSA”), which, among other things, also set the 40-hour workweek and overtime pay.  Beginning at a rate of $0.25 in 1938, the minimum wage standard has been raised more than 20 times  to reflect cost of living increases.  The last time Congress visited this issue was as part of the Fair Minimum Wage Act of 2007, which amended FLSA to gradually raise the minimum wage from $5.15 per hour to its current rate of $7.25.  Prior to that, the minimum wage rate had not been adjusted since 1997.

These numbers do not reflect the full story. Those making minimum wage have less buying power than their peers did in the mid-1950s.  Although the federal minimum wage generally kept pace with increases in the cost of living, it began to fall behind during the 1980s. In fact, according to a recent report, the “effective minimum wage,” which is the local minimum wage rate adjusted for the cost of living, is actually $6.07 in Los Angeles and $6.27 in San Francisco. Based on the Department of Housing and Urban Development estimates of fair market rents for housing, even ignoring taxes, a minimum wage worker in Los Angeles must work 34.5 hours per week just to pay rent.  Minimum wage workers in San Francisco need to work 33.75 hours to pay rent.

Based on the federal minimum wage standards, a full time worker earns approximately $13,920 per year.  The poverty income threshold in the United States is just over $23,000 for a family of four.  In other words, a minimum wage worker holding a full time job is guaranteed to live well below the poverty line, which itself has been kept artificially low.

Some argue that minimum wage positions are filled with teenagers, who need not concern themselves with such “real life” affairs as paying rent or providing for children.  However, this position simply ignores the reality of minimum wage worker demographics today.  The median age of fast-food workers is over 28, with many trying to support their families.

Many, if not most, minimum wage workers are compelled to work multiple jobs to make ends meet.  Indeed, McDonald’s financial planning guidelines for its low-pay workforce anticipates a second, nearly full-time job as part of its “sample monthly budget” for its low wage employees.  Meanwhile, the food prices, especially in the fast-food industry, remain fairly low and fast-food companies continue to post healthy profits.  The McDonald’s Corporation, for instance, reported approximately $5.5 billion in profits in 2012. It paid its CEO $27.7 million in compensation during the same year.  With the public benefiting from a relatively cheap food supply and the corporations enjoying profits equal to small countries’ gross domestic product, it is time to ask ourselves how long are we willing to allow minimum wage workers to subsidize our food supply by working more than 70 hours per week while struggling with poverty so that our food prices remain where they are and corporate profits continue to rise.

For more information on joining the fight to help raise the minimum wage, click here.

 

Is your favorite restaurant a sweatshop?

By Kevin Kish

Last week, thousands of workers at fast-food restaurants across the U.S. walked out of work to protest low pay.  Their actions brought rare media attention to the millions of people in this country who work full-time shifts – or more – without making enough money to meet basic life needs.

But paying more at a restaurant than you would for a fast-food meal is no guarantee that workers are earning enough to live on, or even that they are earning the legal minimum wage.  The New York Times recently reported about one of my clients who was never paid overtime wages for 60-hour workweeks despite working at a Beverly Hills restaurant where a meal can cost more than $500.  For one person.

In fact, in my experience representing hundreds of restaurant workers in claims for unpaid wages in Los Angeles, there is generally no relationship between the price of a restaurant and the way the workers there are treated, including whether they are paid all of the wages they earn.  At fancy date-night spots and at neighborhood lunch counters alike, workers get paid the minimum, or not, depending on whether the owner cares about following the law.  Many don’t.  A nation-wide study from 2009 found that more than 23% of cooks, dishwashers, and food preparers were not paid minimum wage, and a whopping 70% of restaurant workers experienced overtime violations.

One reason for this is that employees often fear speaking out about unfair or illegal treatment, for good reason.  In the Beverly Hills case, my client was fired on the spot when he asked to go home after working for 9 hours with a fever, and after more than five years of service at the restaurant.

Most people care about whether other people are treated fairly in the workplace.  But in a global economy, where your shirt is made in Bangladesh and your phone is made in China, it can be difficult to feel you can make a difference.

Restaurants are a good place to start.  75% of Americans eat out at least once a week, and when we walk into a restaurant to eat, we also walk into a workplace where we can make a difference directly.  A national restaurant-worker organization, Restaurant Opportunities Centers United, has published its second-annual Diner’s Guide to Ethical Eating (also available as a free mobile app) with information about labor practices at restaurants around the country.

You can find out, for example, whether your favorite spot offers employees paid sick days, so you know your meal wasn’t prepared by someone with a fever. If it doesn’t, ask the manager or owner about it.  As consumers, we have insisted on healthier choices in restaurants, on calorie-counts and on fresh ingredients free of pesticides.  More than 10 million Americans work in restaurants.  We can also insist they get a fair shake.

Kevin Kish

About Kevin Kish

Kevin Kish is the Director of the Employment Rights Project at Bet Tzedek Legal Services in Los Angeles. He leads Bet Tzedek’s employment litigation, policy and outreach initiatives, focusing on combating illegal retaliation against low-wage workers and litigating cases involving human trafficking for forced labor.

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