Monday :: Sep 6, 2004

Yassah, Massa

by pessimist

Future News Service
September 5, 2004

Workers adapt to new overtime rules this Labor Day

Future News Service
September 3, 2005

President Bush announces repeal of National Labor Relations Act, Says unions 'unnecessary interference with business management'

Future News Service
September 1, 2006

His Highness, King George, decrees the Fair Labor Standards Act null and void. Employers to decide if any pay is due.

Future News Service
September 7, 2007

Emperor George I declares Corporation Day (the former Labor Day) - workers to donate entire week of labor in gratitude for employment.

Far fetched? Sure - but by how much?

Continental Airlines to cut 425 jobs

Continental to skip 2004 pension funding

Delta pilots say concession demands too great

All over the nation - wage and benefit concessions

There's more.

Retirement an unlikely luxury?

For working folks, Labor Day is a day off. For retirees, it's just another day. And someday soon? Will all of today's current workers be able to become retirees?

Think about it.

Think Caterpillar. It's September. The supplemental medical insurance fund is gone. There is no agreement about medical benefits. "When we chose to retire, we did so believing we had a handle on our bills and would get by," says David Grochowsky, a millwright at Caterpillar for 35 years. He predicts he can't get by on the "last, best" offer. "It is bad enough with rising property taxes, food costs, utilities and gasoline. ... My costs then would be around 50 percent with deductibles ... and that's not even counting the 80/20 co-pay."

Another retiree sent a copy of one Caterpillar letter on benefits and cites friends whose retirement plans have abruptly changed. One will give up winters in a mobile home in Texas. Others will sell their out-of-state home. "They will have to move back here and hope they can find jobs to work at until they die," he says. "All because they can't stand the thought of living in the same poverty they started out in before Caterpillar."

"While it will be difficult on every UAW family, it does not stop there," points out Julie Stevens, who is married to a current United Auto Workers member. "As an example, I pay $60 to have my hair cut and colored every four weeks. Is this a luxury I can live without? Absolutely! What about my hairdresser? If she has five clients like me, that means she and her two little girls will have $300 less a month in their budget. Every single retailer, restaurateur and movie theater in the community stands to suffer lost revenue. How many will close?"

Think AmerenCILCO, where electrical workers also have no contract and are about to vote on health-care takeaways. Think Mitsubishi, now dickering on layoffs and severance pay. Or Keystone, where unions have made a series of concessions to help bail out the company. Or Maytag, which bade the big adios to Galesburg.

Then think about United Airlines, which is billions of dollars short on contributions to its pension plans and hopes to terminate them. According to an article in the Sept. 6 BusinessWeek, the quasi-governmental Pension Benefit Guaranty Corp. already was $10 billion short of the funds it needs to underwrite failed pension plans. If other ailing companies follow UAL, "some experts fear the situation eventually may require a multibillion-dollar taxpayer bailout."

Then think about the Yoda of finance, Federal Reserve Chairman Alan Greenspan. Just 10 days ago he urged policy makers to "recalibrate" retiree benefits because Social Security and Medicare have promised more than they can deliver. Among other things, he suggested later retirement ages - advice he apparently takes to heart, since his current term won't be over until he's almost 80.

"My father passed on in 1988 after a long illness," Grochowsky says. "A couple of years before, while watching the news one night, he told me, 'You know, I think they are slowly trying to do away with the middle class.' I thought how ridiculous is that, and told him so. After all, who was going to buy the cars, homes and other material things. ... I never did ask him how he came to his conclusions. I wish that I had."

Time to think about that, too.

Think about these interesting facts while you're at it:


In celebration of the working person's holiday, Secretary of Labor Elaine Chao has announced the Bush Administration's plan to end the 60-year-old law which requires employers to pay time-and-a-half for overtime.

I'm sure you already knew that -- if you happened to have run across page 15,576 of last year's Federal Register.

According to the Register, where the Bush Administration likes to place its little gifts to major campaign donors, 2.7 million workers will lose their overtime pay for a "benefit" of $1.53 billion. I put "benefit" in quotes because, in the official cost-benefit analysis issued by Bush's Labor Department, the amount employers will now be able to slice out of workers' pockets is tallied on the plus side of the rules change.

President Bush announced in his convention acceptance speech this week that he was changing overtime rules to give workers "comp time" off instead of pay. He forgot to mention that a couple of days before, on August 23, his Labor Department had already put in half the plan -- eliminating overtime pay for millions -- while failing to put into the regs one word about comp time.

In the pre-September 11 days, we used to call that, "lying."

Nevertheless, workers getting their pay snipped shouldn't complain, because they will all be receiving promotions. These employees will be re-classified as managers exempt from the law. The change is promoted by the National Council of Chain Restaurants. You've met these 'managers' - they're the ones in the beanies and aprons whose management decisions are, "Hold the lettuce on that."


My favorite of Chao's little amendments would re-classify as "exempt professionals" anyone who learned their skill in the military. In other words, thousands of veterans will now lose overtime pay.

I just can't understand why Bush didn't announce that one when he landed on the aircraft carrier.

Now I should say, according to Chao's press office, the changes will actually extend overtime benefits to 1.3 million burger flippin' managers. How does that square with the billion dollar "benefit" to business owners? Simple: The Chao hounds at the Labor Department suggest that employers CUT WAGES so that, added to the new "overtime" pay, the employees won't actually take home a dime more.

I can hear the moaners and bleeding hearts saying this sounds like the Labor Department is telling Big Business how to evade the law. Yep, that's what the Department is doing. Right there on page 15,576 of the Federal Register it says,

"Affected employers would have four choices concerning potential payroll costs: - (4) converting salaried employees' basis of pay to an hourly rate that result in virtually no changes to the total compensation paid those workers."

And in case some employer is as dense as a president and doesn't get the hint, Comrade Chao repeats, "The fourth choice above results in virtually no (or only a minimal) increase in labor costs."

For decades the courts have thrown the book at cheapskate bosses who chisel workers out of legal overtime by cutting base pay this way, but now they'll have a new defense: Bush made me do it. But then, there likely will not be any cases against employers anyway since Chao herself is supposedly the labor cop whose job it is to stop paycheck theft.

She's well qualified for that job. Her resume reads, "Married to Republican Senator Mitch McConnell of Kentucky." I called her press office to ask if she qualifies for overtime, but they'd left the office early.

And there is good news for our sporting President. Word from the White House is he'll be golfing on the Labor Day weekend. Under Chao's rules he need not worry if he wants to replay that hole. "Exempt professionals" who cannot earn overtime - once defined as doctors, lawyers and those with specialized college degrees - will now include anyone who provides skilled advice - like caddies ("You might try the other end of the club, Mr. President").

Now add this into the mix.

Job Market Spotty This Labor Day

A spotty job market and stagnant paychecks cloud this Labor Day holiday for many workers, highlighting the importance of pocketbook issues in the presidential election. "Working harder and enjoying it less," said economist Ken Mayland, president of ClearView Economics, summing up the state of working America. Voters say jobs and the economy are among their top concerns in an election year marked by a struggling labor market seemingly unable to gain footing.

In August, 8 million people were unemployed, with an average duration of 19 weeks without work, compared with 18.6 weeks in July. The unemployment rate, however, fell to 5.4 percent.

An economy in transition may help to explain the bumpy job market. Technology and global competition are siphoning many U.S. jobs. Skyrocketing costs for health care, pensions and other benefits also are curtailing hiring. "If a company experiences an increase in demand that cannot be met with the current work force, it may find alternatives to hiring full-time employees, such as outsourcing overseas or contracting with a temporary help agency," said John Challenger, chief executive of Challenger, Gray and Christmas, a job placement and research firm.

The number of payroll jobs has grown by 1.7 million in the past 12 months. But the economy still has lost 913,000 positions since Bush took office in January 2001. The recovery is the weakest on record for job creation, bolstering Democrat John Kerry's argument that workers are struggling even more financially.

People are working longer hours. As a result, productivity is more efficient, limiting the need for more employees. Nearly two-thirds of 1,050 full-time workers in a Labor Day survey by Harris Interactive and Kronos Inc. said they have increased job responsibilities in the past six months. One-third said they were working longer hours and 62 percent claimed they had not received a pay raise.

"Wages will continue to only grow modestly, more workers will be compelled to accept positions without health benefits, and benefits packages, generally, will continue to deteriorate," said Peter Morici, an economist and professor of international business at the University of Maryland. That could pose problems for Bush in some of his campaign's must-win states that were hit hard with job losses, including Ohio, Michigan, Missouri, Pennsylvania and Oregon.

Voters "will draw their conclusion about the overall strength of the economy based almost exclusively on whether they and/or their neighbors find jobs," Challenger said.

And just to show that this problem isn't just an American issue, check this out - it CAN happen here:

Alitalia seeks job cut support

Alitalia meets unions today to reveal the number of job cuts it wants in a restructuring to avert collapse. Approval of the plan is crucial to the company's survival as it would allow Alitalia to access a 400m [pound sterling] (270m) loan approved by the Italian government and the European Union. Without the loan, Alitalia says it has enough liquidity to pay salaries only until the end of this month. The plan is expected to include cutting a third of 22,000 jobs, but Alitalia has not confirmed the figure.

And muckdoggie will soon come along and tell us that the sky is purple and the sun rises and sets in Texas.

Happy Labor Day

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