December 24, 2005
Public's Perception of Public Unions
PUBLIC EMPLOYEE UNIONS....This single paragraph from the New York Times does a pretty good job of encapsulating the mixed feeling a lot of people probably have about public employee unions:
To control soaring pensions costs, the [Metropolitan Transportation Authority] at first demanded raising the retirement age for future employees to 62. Workers can now retire at age 55, after 25 years on the job, and receive pensions equal to half their earnings. They average $55,000 a year, including overtime.
An average salary of $55,000 a year? That's fine. Sure, it's pretty good money, but my guess is that most people are OK with it anyway.
But retiring at age 55, with 25 years on the job, at half salary? I support unions and I support the notion that Americans work too much, but even so that strikes me as indefensible. After all, most people have working lives of 40-50 years, and it's hard to imagine that they have a lot of sympathy for a deal like that. I have to confess that I don't.
I don't really have any bigger point to make here. I just thought I'd toss this out for comments.
And like Kevin, I also like to throw out these observations for further comment.
NYC Transit Strike and the State of Public Pensions in the United States
Interesting article in the New York Times this morning about the large financial issues facing governmental pension plans and that the recent NYC Transit strike might just be the first of many such labor battles over the financing of public pension plans. As just one example of the size of the problem: "New York City's annual pension outlays are expected to jump to nearly $5 billion in 2008, more than double the level in 2004."
As some of you might remember, one of the main sticking points between the MTA and TWU in NYC continues to be over pension issues. The MTA wants its employees to contribute 6% of their pay to their pensions, while the union wishes only to have employees contribute 2% of their pay. (BTW, thanks to Red Harvest for the pointer that under the New York Taylor Law pension plans are not deemed a legal subject of bargaining and thus, the MTA should not have been able to declare impasse based on disagreements over pension issues).
In any event, according to the Times article:
Many officials and fiscal experts assert that across the nation government pension plans face a shortfall of hundreds of billions of dollars. From New Jersey to California, government officials say that attempts - either through contract fights, legislation or public referendums - to limit the amount of money that states and cities contribute to pensions are inevitable and overdue. Labor unions, for their part, say that the worries are overblown.
Although many of you are familiar with ERISA and private pension plans (including such notorious stories as that of the pensioners for United Airlines), government pension plans are specifically exempted from regulation by ERISA and are regulated by state laws and regulations.
Nationwide, 90 percent of public-sector workers have traditional benefit plans - known as defined-benefit plans because retirees receive a defined amount each month- while just 20 percent of private-sector workers do. In 1960, 40 percent of private-sector workers were in traditional pension plans. One reason for the disparity: 36.4 percent of government employees belong to unions while just 7.9 percent of private-sector workers do.
So, as approximately 15% of our nation's workforce is employed in the public sector and most have some form of pension, this issue is become an increasingly important national topic and I hope to follow developments in this area on the blog in the year to come.
December 23, 2005
Senate Votes to Extend Mental Health Parity Law for One Year
The Senate on Thursday by voice vote passed a bill (HR 4579) that would extend for one year a mental health parity law under which health insurers cannot place caps on annual or lifetime mental health benefits unless they place similar caps on medical and surgical benefits, CQ Today reports. The legislation, sponsored by House Education and the Workforce Committee Chair John Boehner (R-Ohio) would extend a 1996 law (PL 104-204) scheduled to expire on Dec. 31. The House passed a similar bill on Dec. 17 (Schuler, CQ Today, 12/22).
Microsoft does not Heart Google
Yahoo! news is reporting the settlement of a contentious non-compete dispute between Google and Microsoft over a key former Microsoft (current Google) employee:
Lee had worked at Microsoft since 2000 and helped develop its MSN Internet search technology, including desktop search software rivaling Google's. He left in July to lead Google's expansion into China after Google offered him a $10 million compensation package.
Microsoft sued Lee and Google in a Washington state court, contending that Lee's job at Google would violate terms of the noncompete agreement that prohibits him from doing similar work for a rival for one year. Microsoft also accused Lee of using insider information to get his job at Google, based in Mountain View, Calif.
Google responded with its own lawsuit against Microsoft in U.S. District Court in San Jose, Calif.
Because of the settlement's confidential terms, it's unclear what tasks Lee can perform until his noncompete agreement runs out.
A Washington state judge ruled in September that Lee could not work on products, services or projects he worked on at Microsoft, including computer search technology, pending the trial. But the judge said Lee could recruit and staff a Google center in China.
The case has shed light on bitterness between software titan Microsoft and search engine king Google, two high-tech powerhouses who seem increasingly to be edging into one another's turf.
Here's the whole story.
Now That's One Expensive Lunch Tab
Under California wage and hour laws, workers must be given a 30-minute lunch break for every six hours they work.
Although the law has been on the books in California since 2001, Wal-Mart did not give the mandated meal breaks. As a result, the retailer has been hit with a $172 million dollar jury verdict ($115 in punitive damages) for violating the law with regard to about 200,000 of its workers.
Wal-Mart's response? They plan to appeal.
Update on Wal-Mart's response to verdict here.
December 22, 2005
Race and the NYC Transit Strike
One of the less covered stories during these last few tumultuous days of the NYC Transit strike is the role played by race in the controversy between TWU Local 100 and the MTA.
According to a New York Times article today, there has been some overt and subtle instances where race has come to the fore between the largely non-white union (70% of the union is comprised of blacks, Latinos, or Asian-Americans), and the mostly white officials of the MTA and state government. As examples, the Times points to a particularly disgusting example in which "the union - representing workers who are largely minority - shut down a Web log where the public could comment on the strike after it became so clogged with messages comparing the workers to monkeys and calling them 'you people.'"
On the more subtle side, union members took offense when Mayor Bloomberg said on Tuesday that union leaders had "thuggishly turned their backs on New York City," saying that, "[t]he word thug is usually attributed to people of color whenever something negative takes place," and was "unnecessarily hostile."
In sum, the Times comments that, "But for all the accusations and counter-accusations, clues of a simmering racial tension have hovered over the contract negotiations between the union and the transit authority all along."
I would be interested hearing readers' comments on what role they believe race has played in the dynamics of this labor struggle. Different situation if the mostly white police officers and firefighters had engaged in the same conduct or would any union engaging in a highly unpopular strike be subject to the same harsh recriminations we have seen with this strike?
Hat Tip: Ronald Turner
NYC Transit Strike Over, Nothing Gained But Docked Pay and Fines for Union
As most of you have probably heard by now, Local 100 of the TWU has called off the NYC Transit strike against the MTA, with subway and bus service due to resume this (Thursday) evening after almost three full days of striking. The AP story can be read here.
The timing of the end of the strike coincided with union officials being about to be haled into court to answer to criminal contempt charges, which could have seen some of them spending their holidays in prison.
As it turns out, the strike scorecard looks something like this: the local union was fined one million dollars a day for engaging in the illegal strike (so 3 million dollars in fine for the union), individual strikers will be docked two days pay for each day they engaged in the strike (meaning they will be docked six days of pay and no amnesty would be granted insisted Gov. Pataki), and probably hundreds of millions dollars of lost revenue to businesses and the city itself as a result of the lack of public transportation services in the city during the holiday season.
And what has the union gained from this strike? At this point, nothing. Although the union continues to seek to keep members pension contributions to 2% of their pay rather than the 6% the city wants, nothing has been agreed upon and the MTA has conceded nothing. The union seems to have made no headway on either wage concessions or health care issues.
My guess is that the impact of this strike on the union movement might be felt for years to come, especially with the general public who, by and large, were unsympathetic to the unions tactics which were in clear violation of New York labor relations law and caused much hardship for many in the city.
Reverse Race Discrimination Jury Award and "Crackers"
The Philadelphia Inquirer is reporting that four white men have won a 3 million dollar jury employment discrimination verdict against the Philadelphia School District for reverse race discrimination.
But that is not the interesting part of the story. According to the Inquirer, the African-American lawyer for the school district allegedly referred to a number of the members of the all-white jury as "crackers," not an endearing term at all, while riding with them in the courthouse elevator.
The story goes on to report that, "[w]ithin 30 minutes, U.S. District Judge Harvey Bartle 3d brought [the school district lawyer] and five of the seven jurors in the case back into his courtroom. [The school district lawyer] promptly apologized."
"What I did and said was inappropriate," [he] said, according to a transcript. "I should not have disrespected you, and I do apologize."
Hat tip: Malcolm Heinicke
PBGC, EBRI Dispute Extent of Pension Plan Exodus
PLANSPONSOR.com reports on two conflicting reports on the extent to which employers are freezing their pension plans.
On the one hand, the PBGC maintains from an examination of Form 5500 annual
9.4% of pension plans were frozen as of 2003. The press release goes on to report that, "only 2.5% of pension plan participants were affected, however, because most frozen plans were small. "While anecdotal evidence suggests that the number of frozen pension plans has
increased since 2003, reports of a mass exodus from the defined benefit
pension system appear to be overstated," said PBGC Executive Director
On the other hand, EBRI claims that PBGC numbers are old and that, "the 2003 Form 5500 data is the most recent available, but misses recent activity by plan sponsors and probably undercounts a significant increase in pension freezes or terminations." EBRI also contends that, "the PBGC report misses much of what has been happening among defined benefit plans because the Form 5500 only asks about total plan freezes (ending accruals for all current participants and closing the plan to new hires), not those closing the plan to new hires and giving them a different plan," EBRI president Dallas Salisbury said in a news release.
EEOC Can Seek Damages for Former Sidley Austin Partners
U.S. District Judge James B. Zagel has denied a request of Sidley Austin Brown & Wood that the EEOC be barred from obtaining monetary relief in the agency's class age discrimination lawsuit for attorneys expelled from the firm partnership. The ruling came in response to a Sidley motion asking the Court to reconsider and reverse its June 9, 2005, ruling denying the firm's motion for summary judgement and holding that the EEOC could obtain monetary relief for "partners" expelled on account of their age or forced to retire.
In holding that the EEOC may obtain monetary relief in the case as well as injunctions, Judge Zagel ruled that the U.S. Supreme Court's 2002 landmark decision in EEOC v. Waffle House, Inc. (534 U.S. 279) was controlling, writing: "Waffle House makes clear that EEOC's ability to seek monetary relief on behalf of individuals is derived from its own statutory rights to advance the public's interest and is unrelated to any individual's right."
The EEOC lawsuit is a class age discrimination case brought, first, with respect to 31 former
Sidley & Austin partners who were involuntarily downgraded and expelled from the partnership in
October 1999 on account of their age; and, second, with respect to other partners who were
involuntarily retired from Sidley & Austin since 1978 on account of their age pursuant to a mandatory
Judge Zagel also ruled that he would certify his decision for appeal to the U.S. Court of Appeals for the Seventh Circuit if Sidley wished to pursue an appeal.
December 21, 2005
Kotkin on Invisible Discrimination
Minna J. Kotkin, Invisible Settlements, Invisible Discrimination, 84 N.C. L. Rev. (forthcoming 2006).
From the abstract:
Invisibility defeats the intent of the discrimination statutes, skews empirical studies of discrimination litigation, which inform the public debate about the prevalence of bias, and hampers lawyers' ability to counsel and negotiate on behalf of discrimination claimants. The roots of invisibility can be traced to an increasingly privatized model of statutory enforcement, which ignores the deterrence function of public resolutions.
Increased transparency could be achieved by any of the following means. First, the EEOC, which requires a public record of settlements in litigation that it brings, could follow the lead of the United States Department of Labor, which by regulation insists on agency or judicial approval of settlements under the worker protection statutes that it administers. Second, the civil rights bar could take a stand against secrecy, as the personal injury bar has done, and gain agreement from clients in advance to reject settlements that require confidentiality. Finally, at the very least, the courts could require submission of the specific terms of stipulated dismissals, without party identification, so that aggregate data about the nature and extent of settlements in civil rights litigation could be publicly available.
You can download the article here.
New York Sun Interview on NYC Transit Strike
Update from Drudge: Strike Settlement may be in the works.
Had an interview with a reporter from the New York Sun today concerning the on-going NYC transit strike. The reporter, Jacob Gershman, had some real interesting queries and I thought, since I did not have most of the answers he was looking for, whether some of you might want to comment or have some thoughts on some of these questions.
There were three questions:
1. Can businesses affected adversely by the transit strike bring a class action lawsuit against the union for engaging in an illegal strike?
I could not think of any such instances, but, of course, most of my background is in the private sector. I guess an action could be brought under something like intentional interference with prospective business advantage, but I really could not say for sure.
2. Could TWU Local 100 be sued under RICO or similar state law for its conduct and could its leaders be jailed if convicted. (This one I had no idea about since I know little to nothing about RICO).
3. Could the New York State Attorney General, Eliott Spitzer, bring criminal charges against the union and its leaders for engaging in an illegal strike under the Taylor Law or under some other criminal law? (Indeed, Spitzer's opponents have criticized Spitzer for not taking more aggressive action against the TWU).
My understanding is that criminal sanctions are available under the Taylor Law, but to this point the New York state judge has decided not to use them, and is instead using the one million dollar a day fine. Maybe some version of progressive discipline?
Looking forward to hearing thoughts on these questions, if for no other reason than my own edification.
Strike Continues with Fines for Union and Maybe Jail for Union Leaders?
More from Suitably Flip today on the NYC Transit Strike. Things are starting to get ugly for the city, the union, and New Yorkers:
TWU Local 100 chief Roger Toussaint remains out of jail.
The TWU is being fined $1 million per day for carrying out their illegal strike.
Public Employment Relations Board representative Richard Currieri held initial mediation between the MTA and the TWU.
Tuesday morning wind chill (at 8:30): 24 degrees (15 with wind chill).
The Wall Street Journal ponders just how many hundreds of millions of dollars per day this strike will cost.
Lawyers are back in front of Brooklyn State Supreme Court Judge Theodore Jones today, where additional fines for union leaders and a second striking organization (the Amalgamated Transit Union) may be handed down.
December 20, 2005
Contempt Proceeding Brought Against NYC Transit Strikers
Suitably Flip is reporting that the Metropolitan Transit Authority (MTA) is in the process of bringing a criminal contempt proceeding against Local 100 of the Transport Workers Union (TWU). The MTA will seek to have a New York State judge find the Local union in contempt of the preliminary injunction entered against the Union striking under the state Taylor Law from last week.
Flip has this update:
A few details are emerging now about the mid-day criminal contempt hearing ... currently being held by Brooklyn State Supreme Court Judge Theodore Jones. The TWU's Local 100's parent union, the Transport Workers Union of America, explicitly does not support the strike and maintains that negotiations were still progressing when the TWU chief Toussaint walked out and called for the strike.
[Judge] Jones has rejected the local TWU's attempts to delay the hearing and to secure a jury trial. The union is also now reportedly claiming that the MTA provoked the strike. Governor Pataki has advised, "All I can say is go back to work, come back to the table."
My take? In a former life, I used to practice public labor relations law, but in Pennsylvania and New Jersey. So I do not know that much about the New York law, but as my friend and colleague Marty Malin (Chicago-Kent) pointed out in this previous post, the Taylor Law in New York is particularly harsh on public unions that go on illegal strikes. At this point, Local 100 better have a good strike fund in place not only for its workers, but also for the likely fines and penalties about to come their way.
Louis J. Virelli III, Don't Ask, Don't Tell, Don't Work: The Discriminatory Effect of Veterans' Preferences on Homosexuals, 38 John Marshall L. Rev. 1083 (2005).
Debra L. Greenberger, Note, Toward Increased Notice of FMLA and ADA Protections, 80 NYU L. Rev. 1797 (2005).
Jamie Lund, Comment, ERISA Enforcement of the HIPAA Privacy Rules, 72 U. Chicago L. Rev. 1413 (2005).
Jason E. Pirruccello, Note, Contingent Worker Protection from Client Company Discrimination: Statutory Coverage, Gaps, and the Role of the Common Law, 84 Tex. L. Rev. 191 (2005).
Claire Tuck, Note, Policy Formulation at the NLRB: A Viable Alternative to Notice and Comment Rulemaking, 27 Cardozo L. Rev. 1117 (2005).
Indianapolis Becomes Latest City to Ban Sexual Orientation Discrimination
Indianapolis, Indiana became the latest city in the United States to ban discrimination on the basis of sexual orientation and gender identity. The ban not only applies to employment, but also to housing, public accommodations, and other areas.
The city council vote was 15-14.
It was rejected in April (story) on an 18 - 11 vote after the conservative group Advance America launched an e-mail campaign encouraging its members to write the 29 council members.
Hat Tip: 365Gay.com.
Full Strike on NYC Transit
From CNN.com a few hours ago:
Under threat of legal action, more than 30,000 New York City transit workers went on strike early Tuesday, shutting down the nation's largest public transportation system just days ahead of Christmas.
"Transit workers are tired of being underappreciated and disrespected," said TWU President Roger Toussaint. "The Local 100 executive board has voted overwhelmingly to extend strike action to all MTA properties immediately."
According to Ainsley Stewart, a Transit Workers Union vice president, the walkout was called after the executive board for the TWU rejected an offer made late Monday by the Metropolitan Transportation Authority. The vote was 28 to 10 with five abstentions, Stewart said.
This strike includes 33,000 workers and could affect upwards of 7 million subway and bus riders in New York City. Clearly one of the largest strikes in recent memory, and because of the public labor law implications, it is anyone's guess how this one plays itself out.
Whole story here.
Consumer-Driven Health Plans Becoming Even More Popular
From Deloitte Tax this morning:
Consumer-Driven Health Plans Becoming Mainstream, Deloitte Survey Finds.
Deloitte’s first Consumer-Driven Health Care Survey, conducted in 2003, found only 19 percent of employers offered a consumer-driven health plan or expected to offer such a plan to employees within the next two years. Today, more than twice as many employers (43 percent) respond affirmatively to the same question, according to the just-released 2005 version of the Survey.
Hat Tip: Debra A. Davis
December 19, 2005
Ft. Lauderdale Aggressively Recruiting Gay Police Officers
"The [Ft. Lauderdale] police department has begun an aggressive
advertising campaign in the state's LGBT press hoping to find recruits for the
force. It will also have a booth at Pridefest, Fort Lauderdale's gay pride
What gives? Well, for one thing, Police Detective Brice Brittenum, one of the few openly gay officers on the force, was recently appointed the liaison to the LGBT community. Detective Britenum told the Sun-Sentinel newspaper, "I think that [having more gay officers] would be great for the department and the community.''
He went on to say, "We hope to send a positive message to the community that we're not going to turn our backs on any group,'' adding that there is also a liaison on staff to the Haitian community.
DOL Seminars & Workshops
The Department of Labor has announced the following seminars and conferences:
- Voluntary Fiduciary Correction Program Seminar. The New York Regional Office of the DOL's Employee Benefits Security Administration (EBSA) is holding a free seminar offering comprehensive information and one-on-one help on how to use the Voluntary Fiduciary Correction Program to self-correct violations of ERISA. 1/13, New York, NY.
- HIPAA and Other Health Benefits Laws: Compliance Assistance Seminar. The Dallas Regional Office of EBSA is cosponsoring a free seminar with the Louisiana Department of Insurance to provide practical information, helpful tips and clarification regarding Louisiana and federal health benefits laws. 1/24 Baton Rouge, LA.
- COBRA Compliance Workshops. The Seattle District Office of the Department's EBSA is holding two free workshops discussing the final COBRA notice and disclosures regulations and common COBRA mistakes. 1/24 & 2/14, Seattle, WA.