Washington Watch
May 2009
- Employee Free Choice Act Update
- National Commission on State Workers’ Compensation Laws
- Bill Proposes Higher Vehicle Weight Limits on Interstate Highways
- Unemployment Reaches 8.9 Percent, But Pace Eases
- Bright Spot in Downturn; New Hiring Is Robust
- Economic Rebound Predicted in Second Quarter for China
- U.S. Shifts Target to Employers of Illegal Workers
- EPA Nominee Says Small Emitters May Be Exposed Under New Rules
- Experts Says GM Bankruptcy Is “All But Inevitable”
Employee Free Choice Act Update
Senator Arlen Specter’s recent announcement regarding his change in political affiliation is not expected to impact his position on the Employee Free Choice Act (EFCA) in its current form, which he noted in his official release.
While Senator Specter has made his position on the EFCA clear, there are a number of reports that the Senator is actively seeking to develop an alternative to the EFCA with labor groups and key Congressional leaders. Details on the “compromise” proposal are not yet available but will likely include quick snap elections and increased access for union organizers. The proposal to impose “quick snap elections” would require union representation elections to be held within just a few days (potentially 10-14) after the required amount of union authorization cards are submitted. Union access provisions would give non-employee, professional union organizers the right to enter a workplace during work hours to solicit support during a union organizing campaign.
Last week, Vice President Joe Biden indicated that the Administration would continue to support the EFCA as a way to ‘reform’ our labor law system. Quoted as saying, "We're supportive of it, and we will continue to support it," Vice President Biden further claimed he expects Senator Specter to have ‘an open mind’ on voting for a bill related to the EFCA, if a compromise emerges.
Despite speculation that labor leaders may seek to hold
off on their effort to pass EFCA until the next Congress, labor officials
have made it clear that they intend push the measure in the current Congress.
The State Chamber/AIA will continue to oppose the EFCA and will accept no
compromise that eliminates the secret ballot, imposes mandatory binding
arbitration or jeopardizes the prosperity of
We encourage all State Chamber/AIA members to remain involved and help us to defeat EFCA. If you have not already done so, please contact Senator Lincoln today to say thank you for publically stating her opposition to EFCA. Also, contact Senator Pryor and your district representative.
Instructions and tips for letter writing are available online at www.yoursecretballot.com. For additional information or to become part of the Coalition against EFCA, contact Coalition Coordinator Natalie Smith at (501) 975-8344 or e-mail her at info@yoursecretballot.com.
National Commission on State Workers’ Compensation Laws
The State Chamber/AIA is opposed to H.R. 635, the “National Commission on State Workers’ Compensation Laws Act of 2009.” The legislation would establish a national commission to study and evaluate the adequacy of state workers’ compensation laws and report back to Congress its findings and recommendations.
Workers’
Compensation affects every business in
Specifically, the State Chamber/AIA opposes H.R. 635 based on the following:
- The imposition of federal oversight and development of federal mandates is inconsistent with the state workers’ compensation system. The purpose of the national commission established by H.R. 635 is to develop recommendations that will dramatically impact state workers’ compensation laws, as well as the employer-funded state workers’ compensation systems. States’ workers’ compensation systems have continued to improve for decades based on the unique economies, business environments and traditions of each state. The state-based system provides the ability to experiment creatively and borrow from experiences in other states without the burden of a rigid, nationwide, one-size-fits-all federal program that is slow to change and administratively cumbersome. The design of a state workers’ compensation system, its administration, legal precedents, funding and fiscal accountability is intricately linked to each state’s economy. The imposition of federal requirements on the state-based system would create unnecessary imbalances and unintended consequences for a system that has been operating effectively for decades.
- States have effectively modernized their systems. Based on improved research, states have employed a myriad of innovative tools, including cooperative labor-management committees leading to reduced litigation, as well as best practices such as utilization review, the adoption of evidenced-based medicine, improved access to high-quality medical treatment, strengthened employee return-to-work efforts, more effectively compensated injured workers, streamlined claims adjudication, and enhanced efforts to detect and prosecute fraud. The state workers' compensation system is fundamentally sound and a valued institution in our industrial economy.
- There is no need for a new national study. Each state reviews its own workers’ compensation laws and the application of the laws, to continuously improve the state’s system. The efficiency and effectiveness of individual systems are examined by state legislatures each year through legislative or regulatory proposals. There is already an abundance of state specific data and studies of state workers’ compensation laws providing ample information on the issues identified by H.R. 635. The research capacity of states and private research organizations has grown dramatically over the last 30 years to respond to an array of proposed programmatic and system modifications made at the state level.
- The cost of the study commission and staff is unnecessary. During a time of strained federal and state budgets and the need to concentrate efforts on economic recovery and the retention and creation of millions of new jobs, Congress should focus on growing the economy and its workforce rather than funding a solution in search of a problem.
The State Chamber/AIA has
contacted the members of
Bill Proposes Higher Vehicle Weight Limits on Interstate Highways
H.R. 1799, the Safe and Efficient Transportation Act of 2009, was introduced in Congress by U.S. Reps. Michael Michaud (D-Maine) and Jean Schmidt (R-Ohio) earlier this year. The bill would authorize states to allow the operation of trucks on the interstate highway system with a gross weight of 97,000 pounds. Current law limits the weight of 5-axle trucks traveling on the interstate system to 80,000 pounds. The legislation would require trucks operating above 80,000 pounds to add a sixth axle to compensate for the extra weight. The extra axle adds two more brakes, preventing an increase in stopping distances, and reduces the pounds per tire avoiding additional pavement damage. Most interstate highway bridges are capable of handling the additional weight of these vehicles. However some bridges, particularly those off of the interstate system will have to be strengthened or replaced on an accelerated cycle in order to accommodate the heavier vehicles. Vehicles authorized to operate under this legislation will be required to pay an additional user fee, which will be dedicated to bridge investments in those states that authorize their use. There are no mandates in the bill and the highways on which these vehicles will operate will be chosen by the states that choose to authorize their use.
Opponents of H.R. 1799 cite safety concerns, damage to the nation’s infrastructure and the harm to the environment at an expedited rate as reasons to oppose the measure. But coalitions comprised of industry, shipping and agricultural interests that have formed to support passage of higher vehicle weight limits say just the opposite would be true. < American Trucking Association’s President and CEO Bill Graves said that "the use of more efficient trucks, such as those allowed under the bill, will significantly reduce the trucking industry's carbon output." According to an ATA press release, “a recent study by the American Transportation Research Institute found that the 97,000-pound truck is 17 percent more fuel-efficient on a ton-mile basis than a truck with a gross weight of 80,000 pounds. This means 17 percent less carbon output and similar reductions in other pollutants.”
The Coalition for Transportation Productivity
provides these statistics: “In 2001, the
The bill requires states to report safety and infrastructure cost impacts to the U.S. Secretary of Transportation, who is authorized to discontinue operations in a state if safety problems are detected.
Unemployment Reaches 8.9 Percent, But Pace Eases
Dave Huether, chief economist with the National Association of Manufacturers, reported in The Monday Economic Report that conditions are getting better as the economy moves through the second quarter of the year. Of the eight major economic reports that came out last week, six improved and only two were negative. With respect to the two negative indicators (the April reports on employment and the Institute for Supply Management’s non-manufacturing business survey), the downturns were more modest than in prior months.
Evidence is mounting that the worst of the economic crisis may be over. Consumers are no longer retrenching, businesses have begun to clear out excess inventories and the banking system seems to be on the mend. While the recession will continue into the second quarter, the pace of the decline will likely start to moderate from the 6 percent plus declines experienced over the prior two quarters.
The major indicator that came out last week was the employment report, which showed that payroll employment declined by 539,000 in April. While this was the sixteenth consecutive monthly decline, the loss was the smallest since last October and 24 percent below the average decline during the first three months of the year.
Among the sectors of the economy that contributed to the slight improvement in payroll losses were construction and manufacturing, which shed 48,000 fewer jobs in April than in March. Meanwhile, private service employment declined by 341,000 in April, which was 34,000 fewer than the prior month. While one month does not make a trend, the more moderate decline in employment last month, along with other positive indicators, does bolster the case that economic conditions are starting to improve.
Bright Spot in Downturn: New Hiring Is Robust
Everyone knows the grim news — unemployment in the
But not everyone knows the brighter side to the equation: deep in the maw of the deepest recession since the Great Depression, millions are still being hired.
So, while 4.8 million workers were laid off or chose to leave their jobs in February, employers across the country hired 4.3 million workers that month, according to the Bureau of Labor Statistics.
“The best thing you can say about these numbers is it
speaks to the dynamism of the
In February — before the economy started to show the first faint signs of a possible recovery — there were three million job openings nationwide. And despite large new job losses likely to be announced, there are still millions of job openings.
Who is hiring? Hospitals, colleges, discount stores, restaurants
and municipal public works departments. I.B.M. is hiring more than 700 people for its new technical services center in
Zachary Schaefer has hired 72 people since February for the Culver’s hamburger and frozen custard restaurant that he and several partners just opened in Surprise, Ariz.
“The amount of applicants who are qualified is definitely up,” he said. “Whereas before we were counting on a lot of high school applicants, now there are a lot more middle-age people applying.”
Eddie Hamm, a former construction worker, was unemployed for five months when he drove by the site where the Culver’s was under construction. Mr. Hamm, 29, applied for a job there, and now he’s a “fry guy.”
“I’m just happy I got hired — I didn’t want to stay home, not doing anything,” he said, hardly complaining that he is earning half the $15 an hour he made in construction. “I don’t look at it like I’m making $7.50. I look at it — I’m having a job in a down time, and it’s a job where I can move up.”
Economists and job counselors advise the unemployed that there are definitely jobs to be had, even if there aren’t nearly enough to go around. With 13.2 million people out of work, there are 4 1/3 unemployed Americans for every job opening. “You’re facing more competition for every job you apply for, but the reality is there is a lot of hiring going on,” said Andrew M. Sum, director of the Center for Labor Market Studies at Northeastern University. “You’re never going to find anything unless you apply.”
Even industries that have taken a beating are doing plenty of hiring. According to the Bureau of Labor Statistics, construction companies hired 366,000 workers in February, and manufacturers hired 249,000. Retailers hired 536,000 workers in February, but that was down 25 percent from the previous February.
Some job openings are to replace retirees, some to replace employees who left for other jobs, but many openings result from expansion. Companies that are still growing are blessed with talented applicants.
“It’s easier to hire in a recession — we have
about five applications for every position,” said Howard Glickberg, principal owner of Fairway Market, the
well-known grocery company based in
Fairway just hired 350 people for its month-old store in
“What you have to be afraid of is hiring someone who can’t find something better at the time, and when they find something better they leave you,” Mr. Glickberg said. “I want to hire someone who will make a career of it.”
The nation’s largest private-sector employer, Wal-Mart Stores, is also hiring aplenty. Wal-Mart, with 1.4 million workers nationwide, hires several hundred thousand workers each year because of employee turnover, and expects to increase its domestic work force by nearly 50,000 this year, thanks to plans to open 150 new stores.
Shawnalyn Conner is running a hiring center for a Wal-Mart store that
will open on June 17 in
“The biggest comment that we get from people is that
they’re looking for a company that’s growing, and Wal-Mart offers
that,” said Ms. Conner, who, as the top manager of the new store, has
hired 77 people so far. Gisel Ruiz, senior vice
president for the people division of
The health care industry has held its own in hiring. The University of Miami medical school, which runs three hospitals, has 250 openings and is hiring about 35 people a month, compared with 100 a month in good times. Cleveland Clinic has 500 job openings, compared with 2,000 during better times.
“We have a hiring freeze on, but even when there’s a hiring freeze, we need to maintain our head count,” said Joe Patrnchak , Cleveland Clinic’s chief human resources officer. “We have 40,000 people, and you’re going to have some openings.”
He is encountering an unusual snag in hiring people. “A challenge we have now is people from other areas are having problems selling their homes,” Mr. Patrnchak said. “People aren’t quite as mobile nowadays.”
The
The recession has encouraged people to cling to their jobs. Just 1.5 percent of workers voluntarily quit their jobs in February, the lowest level since the Bureau of Labor Statistics began collecting those numbers eight years ago.
Like many educational institutions, Washington
University in
Economic
Rebound Predicted in Second Quarter for
China
The AP reported,
"Robust investment backed by stimulus spending will likely help China's
economy to expand 7 percent in the second quarter, showing the economy may be
rebounding from the financial crisis," the State Information Center, a
government-affiliated think tank suggested [on May 4th].
"That would be an improvement from the 6.1 percent growth it notched the
first quarter, its slowest rate in at least a decade." Meanwhile,
according to the report, "investment in fixed assets such as factories
and construction is forecast to rise 27.6 percent in the second quarter from
a year earlier." Those projections, noted the AP, "and other recent
numbers suggest that a 4 trillion yuan ($586
billion) government spending package aimed at catalyzing investment and
spending is beginning to take hold. A business group says
U.S.
Shifts Target to
Employers of Illegal Workers
The Chicago Tribune on May 1 reported, "In a major departure from the Bush administration, the Department of Homeland Security on Thursday issued new work site enforcement guidelines that shift the focus to employers rather than illegal workers and could be a harbinger of more immigration reforms." Homeland Security officials said the "goal was to reduce unfair competition and stem the flow of illegal crossers by targeting the magnet: jobs." During the Bush administration, work site raids "led to the arrest and deportation of thousands of illegal workers but few criminal prosecutions of their bosses. In 2008, only 135 of more than 6,000 work site arrests were of employers." The new guidelines, which "stress that illegal workers will still face arrest, have received mixed responses from groups on both sides of the debate." Immigrant rights groups "welcomed a new focus on abusive employers but said the government should go after the employers for violating labor and immigration laws."
EPA Nominee Says Small Emitters May Be Exposed Under New Rules
The Wall Street Journal reported
last week, "New federal greenhouse gas emission regulation could expose
a raft of smaller emitters to litigation," according to Regina McCarthy,
nominated to be EPA's Director of Air and Radiation. The potential for
smaller emitters "to be regulated under the Clean Air Act is one reason
why business groups warn that EPA regulation of greenhouse gases could create
a cascade of legal and regulatory challenges across a much broader array of
sectors." McCarthy told lawmakers "that even while the government
has flexibility in setting the threshold of emitting facilities to be
regulated, she acknowledges the risk of lawsuits to challenge those levels
for smaller emitters." EPA Administrator Lisa Jackson earlier this year
dismissed "concerns raised by groups such as the Chamber and the
Experts Say GM Bankruptcy Is "All But Inevitable"
The AP reported, "For General Motors Corp., the task at hand is so difficult that experts say a Chapter 11 bankruptcy filing is all but inevitable." In order "to remake itself outside of court, GM must persuade bondholders to swap $27 billion in debt for 10 percent of its risky stock." Additionally, "the automaker must work out deals with its union, announce factory closures, cut or sell brands and force hundreds of dealers out of business -- all in three weeks." Even though "company executives said last week they would still prefer to restructure out of court, experts say all GM is doing now is lining up majorities of stakeholders to make its court-supervised reorganization move more quickly."
The Wall Street Journal reported, "General Motors Corp. has hired an executive-search firm to help find replacements for at least half of its 12 directors, reflecting the Obama administration's increasing influence over the auto maker." Sources say that "interim GM Chairman Kent Kresa has hired New York-based Spencer Stuart to help him in a bid to line up new directors to join the board as early as this summer." Since "the government could own a controlling stake in the new GM, or in the non-bankrupt company if it avoids a Chapter 11 filing, it is expected to name a small portion of the directors in addition to Mr. Kresa's picks to represent the Treasury Department." Sources also say that "the United Auto Workers union, which has been offered 39 percent of GM in exchange for health-care concessions, will likely get to pick at least one board member in the future."
Furthermore, AFP reported, "General Motors is sparring with its main union over plans to
shut U.S. plants and outsource production to Mexico and Asia as bankruptcy
looms over the troubled automaker," according to union sources.
"UAW legislative director Alan Reuther wrote in a letter to Congress
that "the UAW strongly objects to GM's restructuring plan because it
essentially means that GM will be shifting more of its manufacturing
footprint from the
