The U.S. Supreme Court’s recent 5-4 ruling (Janus v. AFSCME) struck a blow to labor unions’ ability to collect membership dues and made international headlines. But in a quieter fashion the Trump administration already had been slowly dismantling protections for workers, especially those enacted under the Obama administration.
During his presidential run, Donald Trump repeatedly proclaimed that he would help workers. He even boasted, “I have great relationships with unions.” But actions taken by the Trump administration have directly targeted workers and unions.
The anti-labor attack gained momentum in the last weeks of 2017. Trump had to wait until his two nominees to the five-member National Labor Relations Board were confirmed. Those new members flipped the board’s majority from Democrat to Republican. And then the NLRB, which oversees collective bargaining law and enforcement of US labor laws and standards, quickly issued a slew of key decisions that rolled back a number of worker- and union-related reforms.
In one of the most important changes, the NLRB reversed a 2011 ruling that helped workers form smaller unions within a single larger workplace. The precedent set during the Obama years allowed the holding of a union election without including all the different types of jobs and occupations within that business who don’t share similar job duties, wages and working conditions. Employers complained that it led to “micro unions.” In this specific case, after 100 welders unionized at a large manufacturing plant, the NLRB ruled that the smaller organizing unit was illegitimate since any union election would have to include all 2,500 workers at the company, spanning 120 job classifications. The board ruled 3-2 along partisan lines.
Another consequential case was decided in a way that will hurt low-income fast food workers. The Trump board overturned a major 2015 decision that had ruled employers are responsible for bargaining with workers, even if they have only indirect control over those workers’ employment. Fast-food companies like McDonald’s license smaller franchise businesses to run most of their restaurants. McDonald’s instructs these franchises on how to operate but leaves them to control many aspects of their day-to-day business. For decades, franchise employees who wished to bargain collectively were caught in vicious trap. Their boss, the franchise operator, could insist that McDonald’s controlled the terms of their employment. But if they tried to bargain with McDonald’s, the company would insist that the franchise operator was their true employer. Catch 22.
Obama’s NLRB solved this problem by clarifying that companies like McDonald’s are, jointly with franchise operators, employers of these workers and can be forced to the bargaining table. This new standard permitted much more meaningful collective bargaining among millions of low-wage workers. Longer term, that ruling on joint employers would have improved dramatically the collective bargaining rights in the fast-food industry. But the GOP majority on the NLRB scrapped this standard, returning to an old, stringent policy that requires employers to exercise “immediate and direct” control in order to be liable under labor law.
Other damaging decisions by Trump’s NLRB include:
- Reversing a 2004 decision bolstering workers’ rights to organize free from employer interference;
- Reversing a 2016 decision safeguarding unionized workers’ rights to bargain over changes in employment terms;
- Overturning a 2016 decision that required settlements between employers and employees to provide a “full remedy” to aggrieved workers, instead of partial settlements.
All of these were 3–2 decisions, with Republicans in the majority and Democrats dissenting.
But the NLRB is only one federal agency. Trump’s Labor Department also has rolled back several rules and executive orders that the Obama administration issued to protect workers. Those include the Fair Pay and Safe Workplaces rule, which required companies bidding for large federal contracts to disclose and correct past labor and safety violations. Another rescinded rule established guidelines for when states can drug-test applicants for unemployment insurance benefits. Also rescinded was the “persuader rule,” which required law firms to publicly disclose any work they do for employers trying to fight against union organization efforts.
Meantime, the federal agency Occupational Safety and Health Administration has delayed three workplace safety rules issued during the last year of Obama’s presidency. Those required certain employers to submit injury and illness data electronically to OSHA for publication on the agency’s website; tightened exposure standards for silica, which is often breathed in by certain construction workers and linked to lung disease; and weakened workplace exposure limits for beryllium, an industrial mineral linked to lung cancer.
Another significant workplace issue, which is pending before the US Supreme Court, is whether employers may require workers to sign arbitration agreements that waive their rights to file class or collective action lawsuits. Last June, Trump’s acting solicitor general filed a brief with the court that took the opposite stance from the Obama administration, asserting that mandatory arbitration agreements do not violate the National Labor Relations Act and are enforceable under the Federal Arbitration Act.
One important ruling from the Obama administration had to do with which workers were eligible to receive overtime pay. The Obama rules required nearly everyone paid less than $47,476 a year to be eligible for time-and-a-half over time pay when they worked more than 40 hours a week. That was a big jump from the $23,660 threshold in place since 2004, and a cornerstone of the Obama administration’s efforts to lift wages. But a federal judge in Texas blocked that rule a week before it was scheduled to take effect, and Obama’s Labor Department appealed. However, Trump’s Labor Department filed a brief in federal appellate court indicating it will not advocate for these overtime changes.
In addition to all that, the Trump administration has proposed $2.6 billion in budget cuts – an enormous 21 percent — to the Department of Labor. Those cuts include the proposed elimination of four department programs and their services, such as training for worker safety and for migrant farmworkers. The budget also seeks to significantly slash funding for Job Corps, a program that provides job training to disadvantaged youth, by $407 million, or 24 percent. Dimitri Iglitzin, a labor attorney in Seattle, says: “Of all of the ways that the Trump administration has been crushing labor, the most important has been the neutering of the Department of Labor. On a day-to-day basis, the agency that should be fighting for working people is doing so no longer.”
Typically, when the US government shifts from a Democratic presidential administration to a Republican one, such as from Obama to Trump, a certain amount of pro-business policies and erosion of labor rights is expected. However, many labor experts say that the Trump presidency has led to a repeal of Obama administration regulations that is unprecedented, and is proceeding faster than is typical under a new GOP administration. Celine McNicholas, labor counsel at the Economic Policy Institute in Washington DC, says the Trump rollbacks of various pro-labor rules and regulations, in addition to deep cuts to the Labor Department’s budget, have been devastating to US workers and “are not business as usual.”
In just over a year and a half as president, Trump has wiped away a number of the modest policy gains that organized labor made during the Obama years. The nominees he chose to fill crucial regulatory roles already are making it more difficult for workers. Taken together, this blizzard of decisions will hurt millions of workers and weaken their abilities to unionize and bargain collectively.
These actions mostly have occurred under the radar. But another headline-grabbing action, which happened early in Trump’s term, was when he withdrew from the 12-nation Trans-Pacific Partnership trade pact that he said would hurt American factory workers. Invoking a similar rationale, Trump has also cracked down on imported steel and aluminum and has made reviving the coal industry a crusade. He also keeps threatening to tear up the North American Free Trade Agreement and return factory jobs from Mexico and Canada to the US.
But these initiatives come with serious downsides. His announcement of tariffs on steel and aluminium imports has spurred Chinese retaliation against other American industries, which will surely cost jobs. Tariffs on imported steel and aluminium will drive up the domestic costs for those two metals, harming industries like automobiles and appliances that use these inputs, reducing employment there as well. Many more communities depend on industries that use steel or aluminium than on industries that make it. When President George W. Bush imposed emergency tariffs on imported steel in 2002, prices of steel shot up and industries that use steel lost 200,000 jobs. That was more than all the jobs in the steel-making industry itself.
All of this amounts to an ongoing tragedy, because it does not have to be like this. Germany and Sweden show another path that is better for workers and that creates a stronger relationship between businesses, employees, and trade unions.
Germany has stronger labor laws than in the US, and consequently more influential trade unions. In addition, the German economy benefits from works councils and worker-elected boards of directors for the biggest of businesses (> 500 employees), including Fortune 500 companies, which together create a “culture of consultation” and a degree of economic democracy. US labor attorney Thomas Geoghegan from Chicago has proposed that US states should try out codetermination. He says states should offer tax breaks to companies that allow rank-and-file employees to elect a third to a half of its corporate board of directors. Doing so, says Geoghegan, would allow U.S. companies to test drive an alternative model to the current dysfunctional stockholder model.
Three US Senators (Democrats Tammy Baldwin, Elizabeth Warren and Brian Schatz) have introduced legislationthat, if passed, would require that US companies allow workers to elect one-third of their corporate board. The bill is not expected to pass easily, and while the AFL-CIO has endorsed this legislation, historically US trade unions and labor advocates have not taken up this cause. One nationally known yet uninformed labor leader even told me that co-determination “just leads to company unions.” Yet labor leaders don’t seem to have any other proposals that might stop the hemorrhaging of union members to fewer than 7 percent in the private sector and 11 percent overall.
Certainly, such progressive proposals are going nowhere at the federal level under the Trump administration. So, the landscape for political change has shifted to certain states and to cities where Democrats and progressives are more dominant. Still, even when Democrats have been in control, whether at the federal level under President Obama or in heavily Democratic states like California, Maryland and Massachusetts, there has been little appetite to push the boundaries of ways to support labor unions or progressive labor reform.
Which is surprising, since the unionization rate in the US already has fallen to less than 7 percent of all workers. And future prospects don’t look too bright. In an age when many more workers are becoming freelancers and contractors who supposedly are the “CEOs of their own business” (whether driving for Uber, or being a hotelier for Airbnb, or a freelancer for Upwork and dozens of other online platform companies), the fate of labor unions hasn’t been this threatened in nearly a hundred years. Trump is just the latest nail in a slowly closing coffin that has been in process for a couple of decades. It’s time for US labor unions to try new tactics.