Worker Rights

Thinking About A Third Category Of Work In The Trump Years

Our guest author today is Benjamin Sachs, the Kestnbaum Professor of Labor and Industry at Harvard Law School. This post, originally published at OnLabor, is part of a series of posts by speakers at our 2016 conference, "The Challenge of Precarious Labor," videos of which can be found here.

During the last few years of the Obama Presidency, we saw a productive debate over the question of whether changes in the organization of work called for a new legal categorization of workers. In particular, the question was whether we need a third category, intermediate between “employee” and “independent contractor,” to capture the kinds of work arrangements typified by gig economy firms like Uber. Seth Harris and Alan Krueger, in a leading example, called for the creation of a legal category they named “independent worker,” which would grant some – but not all – protections of employment law to workers engaged in these types of work relationships.

There were several primary points of contention in the debate. One was whether such a third category actually was necessary, or whether the existing categories of employee and independent contractor were flexible and capacious enough to capture the new work relationships. Harris and Krueger took one position on this question, I took another.

A second question was whether a third category would result in ‘leveling up’ or ‘leveling down.’ One hypothesis was that if we created a new category – independent worker or something similar – workers previously classified as independent contractors would be shifted up (as it were) into the new category and thus granted expanded protections relative to what they enjoyed as contractors. The other hypothesis, the more pessimistic one, was that workers previously classified as employees would be shifted down into the new category and thus offered fewer protections relative to what they enjoyed as employees.

Build A Precariat Strategy

Our guest author today is Guy Standing, a professorial research associate at the School of Oriental and African Studies, University of London, and co-founder of BIEN, the Basic Income Earth Network. This post is part of a series of posts by speakers at our 2016 conference, "The Challenge of Precarious Labor," videos of which can be found here.

All forward marches towards more freedom and equality are led by and for the emerging mass class, not by and for yesterday’s. Today, the political left in America and Europe is in disarray because they have not taken heed of that historical lesson. Trump is one nightmarish outcome of that failure.

Today’s mass class is the precariat, not the old industrial proletariat. It is scarcely news to say we are in the eye of the storm of the Global Transformation, the painful construction of a global market system. The crisis, analogous to the crisis moment of the Great Transformation that preceded it, is epitomised by the aggressive populism of Trump, playing on the fears, deprivations and insecurities that had been allowed to grow in the preceding three decades.

But the left needs to step back from entering the vortex of the storm Trump is generating, to reflect on a strategic response, to build a new vision of a Good Society that responds to the insecurities and aspirations of the precariat.

The Future Of Worker Voice And Power

Our guest author today is David Madland, Senior Fellow and the Senior Adviser to the American Worker Project at the Center for American Progress. This post is part of a series of posts by speakers at our 2016 conference, "The Challenge of Precarious Labor," videos of which can be found here.

My goal is to provide a long-term vision of how we can address the fundamental economic and democratic challenges faced by our country, as well as to discuss some realistic steps for state and local governments to take to move us toward this vision.

Today’s economy does not work very well for most people. Wages have been stagnant for decades and inequality is near record highs. Many voters blame politicians for these problems – for doing the bidding of CEOs while leaving workers with too little power to get their fair share.  Voter anger and the politicians fortified by it have put our democracy in real trouble.

There are of numerous reforms necessary to ensure that workers have sufficient power to raise wages, reduce inequality, and make democracy work for all Americans – including those that reduce the influence of money in politics and that promote full employment.  But among the most important reforms are those that give workers a way to band together and have a strong collective voice.  Collective voice enables workers to negotiate with CEOs on a relatively even footing and to hold politicians accountable.  When workers have a strong collective voice, not only can they increase their own wages, but also improve labor standards across the economy and provide a key counterbalance to wealthy special interests, making politicians more responsive to the concerns of ordinary Americans. 

But we need new and better ways for workers to achieve that strong collective voice.  Fewer than 7 percent of workers in the private sector are members of a union – meaning that 93 percent are left out of the current system.

Contingent Faculty At U.S. Colleges And Universities

In a previous post, we discussed the prevalence of and trends in alternative employment arrangements, sometimes called “contingent work,” in the U.S. labor market. Contingent work is jobs with employment arrangements other than the “traditional” full-time model, including workers with temporary contracts, independent contractors, day laborers, and part-time employees.

Depending on how one defines this group of workers, who are a diverse group but tend to enjoy less job stability and lower compensation, they comprise anywhere between 10 and 40 percent of the U.S. workforce, and this share increased moderately between 2000 and 2010. Of course, how many contingents there are, and how this has changed over time, varies quite drastically by industry, as well as by occupation. For example, in 1990, around 28 percent of staffing services employees (sometimes called “temps”) worked in blue collar positions, while 42 percent had office jobs. By 2009, these proportions had reversed, with 41 percent of temps in blue collar jobs and 23 percent doing office work. This is a pretty striking change.

Another industry/occupation in which there has been significant short term change in the contingent work share is among faculty and instructors in higher education institutions.

Economic Shocks And Attitudes Toward Redistribution

In the wake of the financial crisis that began in 2007, as well as the subsequent recession, there has been a great deal of attention paid to income inequality. Specifically, there was a pervasive argument among many Americans that the discrepancies in income between the top and bottom are too large, and that the fruits of economic growth are predominantly going to the highest earners (the so-called “one percent”).

Among those who believe that income inequality is too high, the solutions might include policies such as more progressive taxation, stronger regulation, and more generous policies to help lower income families. That is, they might generally support some increased role for government in addressing this issue. Insofar as individuals’ attitudes tend to respond to changes in their own circumstances (e.g., Owens and Pedulla 2013), as well as to overall economic conditions, one would possibly expect an increase in support for government efforts to reduce inequality during and after the financial crisis.

We might take a look at this proposition using a General Social Survey (GSS) question asking respondents to characterize their support (on a scale of 1-7) for the statement that the government should reduce income differences between the rich and poor. The graph below presents the average value of this scale between 1986 and 2014. Note that higher values in the graph represent greater support for government action.

Perceived Job Security Among Full Time U.S. Workers

In a previous post, we discussed some recent data on contingent work or alternative employment relationships – those that are different from standard full time jobs, including temporary help, day labor, independent contracting, and part time jobs. The prevalence of and trends in contingent work vary widely depending on which types of arrangements one includes in the definition, but most of them are characterized by less security (and inferior wages and benefits) relative to “traditional” full time employment.

The rise of contingent work is often presented as a sign of deteriorating conditions for workers (see the post mentioned above for more discussion of this claim). Needless to say, however, unemployment insecurity characterizes many jobs with "traditional" arrangements -- sometimes called precarious work -- which of course implies that contingent work is an incomplete conceptualization of the lack of stability that is its core feature.

One interesting way to examine job security is in terms of workers’ views of their own employment situations. In other words, how many workers perceive their jobs as insecure, and how has this changed over time? Perceived job security not only serves as a highly incomplete and imperfect indicator of “real” job security, but it also affects several meaningful non-employment outcomes related to well being, including health (e.g., Burgard et al. 2009). We might take a very quick look at perceived job security using data from the General Social Survey (GSS) between 1977 and 2014.

Basic Facts About Who Pays State And Local Taxes

Taxes, particularly income taxes, are among the most divisive and controversial issues in any nation, and this makes perfect sense – people care about how much they pay and how it is spent. Yet most of the constant, heated debate about taxation focuses almost entirely on federal taxes, with state and local taxes receiving far less attention.

Periodically, the Institute on Taxation and Economic Policy (ITEP) releases an important and interesting analysis of who pays state and local taxes – that is, the tax burdens among households with different incomes. The latest version of this report was published last year. The findings are worth knowing for anyone interested in public sector services, including education.

ITEP reports that state and local taxes overall are highly regressive, which means that poorer households pay a larger share of their income in state and local taxes than do higher income households. This finding is summarized in the figure below, which is taken directly from the report (note that these are national averages, and that the breakdown varies by state).

Contingent Work In The U.S. Labor Market

For the past 20 or so years, it is fairly common to hear that the U.S. workforce is an increasingly precarious workforce – that is, made up of jobs with non-standard employment arrangements, such as temp jobs, on call work, and independent contracting.

Because these types of employment arrangements, often called “contingent work,” tend to offer less stability, lower wages, and less opportunities for advancement, compared with “standard” full-time jobs, the growth of the contingent workforce is often portrayed as a cause and/or signal of the erosion of workers’ rights and the decline of the middle class in the U.S. Others see it differently, however, and argue that contingent work offers the flexibility desired by employers and employees alike, and that flexible jobs allow faster and more efficient “matching” of workers with positions, thus boosting productivity. This debate, of course, centers largely around empirical questions, and the body of research on contingent work has been building for a few decades now (see Kalleberg 2000; Connelly and Gallagher 2004). Yet not all labor force surveys are designed to capture the full set of nuances of workers’ employment arrangements. Starting in the mid 1990s, the Bureau of Labor Statistics (BLS) had the good sense to collect data on this topic, in the form of the Contingent Worker Supplement (CWS) to the Current Population Survey (CPS). The CWS was administered five times between 1995 and 2005, and provided valuable data on these “nonstandard” employment relations.

The CWS, however, has not been conducted since 2005, substantially decreasing the high quality information available on contingent work at a particularly important time, given that the Great Recession began shortly thereafter. The U.S. Government Accountability Office (GAO) made a laudable attempt to fill this hole with an April 2015 report, which uses several data sources to provide an important snapshot on the prevalence of and trends in contingent work in the U.S. (the data go up to 2010). There are a few key takeaways from this report, some of which are long established.

The Civic Power Of Unions And The Anti-Union Political Agenda

This is the second of two posts on the political dimensions of the Friedrichs case. The first post can be read here.

Before Justice Scalia’s sudden death, it appeared that, through the Friedrichs case, the Supreme Court’s conservative majority would succeed in imposing “right to work” status on public sector working people across the nation. As discussed in a previous post, there were signs that this conservative bloc was looking to deliver its decision in time to sideline the four largest public employee unions – the American Federation of State, County and Municipal Employees (AFSCME), the American Federation of Teachers (AFT), the National Education Association (NEA) and the Service Employees International Union (SEIU) – from the 2016 elections. Not coincidentally, these are also the unions that have the strongest political operations in the American labor. If Scalia had not died and these intentions were realized, what would have been the impact on the 2016 election and beyond?

To grasp the full impact of a negative Friedrichs decision, had the conservative justices been successful in their plans, it is necessary to gauge the effect that public employee unions have on the political activism of their members. Ironically, insight into this question can be gleaned from an essay that exhibits a critical attitude toward public sector unions and collective bargaining, Patrick Flavin’s and Michael Hartney’s “When Government Subsidizes Its Own: Collective Bargaining Laws as Agents of Political Mobilization.”1 (Hereafter, F&H.) While not without analytical flaws, a number of which will be discussed below, F&H contributes to the literature with a new way of measuring the effect of teacher unions on teacher political activism and engagement, above and beyond voting. (Teachers have always voted at consistently high rates, with over 90 percent turnout in presidential elections and over 80 percent in mid-term elections.) Consequently, F&H places in relief the union contribution to member political activism that was targeted by the SCOTUS conservatives.

The Political Calculus Behind Friedrichs v. California Teachers Association

When the Supreme Court of the United States (SCOTUS) delivered its March 29 ruling in Friedrichs v. California Teachers Association, the announcement of a 4 to 4 deadlock was something of an anticlimax.  Ever since the sudden February 12 death of conservative Justice Antonin Scalia, SCOTUS watchers had anticipated just such an impasse. Based on Scalia’s questions when the case was argued before the Court a month before his passing, the late justice appeared to be the fifth vote for a decision that would have overturned 40 years of precedent – in effect, imposing “right to work” status on all those working in the public sector and eviscerating their unions. Without this vote, the four remaining conservative justices failed to constitute a majority.

In the days following this decision, observers across the political spectrum described the judicial deadlock in Friedrichs as a victory for public sector workers and their unions (at least for the moment). A more definitive resolution of the issue awaits Senate confirmation of Scalia’s successor, whether President Obama’s pick, Judge Merrick Garland, or someone yet to be named by the next president.

But, so far, what has been missing from most media commentaries is a recognition of the immediate political import of the Court’s impasse, and most especially, its impact on the 2016 election campaign. To understand the full political dimensions of Friedrichs – how the Court’s conservative majority seem to have been prepared to use the case to sway the election – a brief review of the case is necessary.