How to Help Working People

From The New York Times:

by The Editorial Board

The fate of the Obama-era labor reforms is in the hands of President-elect Donald Trump. What he decides to do will affect the pay and working conditions of tens of millions of people, making those decisions far more consequential — practically and politically — than striking a deal to keep 800 factory jobs in Indiana. If Mr. Trump chooses to meet the needs of the people who elected him, he will retain the reforms.

A defining issue emerged shortly after the election when a federal judge in Texas blocked the Obama administration’s new overtime-pay rules from taking effect as planned on Dec. 1. The ruling denied extra pay for extra work to as many as 12.5 million salaried workers — those earning between $455 and $913 a week — including 7.3 million who live in the 30 states that went for Mr. Trump. If Mr. Trump defends the new rules through the appeals process, he will be sticking up for those people. If he doesn’t, he’ll be supporting the agenda of establishment Republicans and their corporate allies.

Mr. Trump won, in part, by appealing to people who feel left behind economically. Trade pacts that have failed to protect jobs are one reason for their discontent, as Mr. Trump has noted. Stagnating wage growth is another. For the past 35 years — as the minimum wage, overtime pay, unions and other labor protections have eroded — worker pay has barely budged, while income at the top has soared. The overtime rules are the farthest reaching of the Obama-era reforms that seek to redress that imbalance, but there are others that also will need Mr. Trump’s support to survive.

THE GOVERNMENT AS MODEL EMPLOYER Mr. Obama has issued executive orders to raise pay and improve conditions at companies that do business with the government. The orders, which require contractors to pay employees at least $10.10 an hour, provide paid sick days and report wage-and-safety violations to procurement officials, have value beyond helping federal contract employees. They also set an example for the entire private sector to follow.

As president, Mr. Trump will be free to ditch these executive orders. As a private employer, his own approach to low-paid labor indicates that model-employer orders would be the first to go. But in his new job, Mr. Trump will be the nation’s chief executive. Does he want to be known for lowering basic standards?

GUIDELINES FOR THE GIG ECONOMY The Labor Department has issued clear, common-sense guidelines for employers on how to follow the law when classifying workers as either employees or independent contractors. The guidelines are needed. There is ample evidence that employers routinely misclassify employees as independent to sidestep employee-related costs, including overtime pay and business taxes that finance unemployment benefits. The guidelines apply to all industries but are especially relevant to companies like Uber whose business models rely on independent contractors. Guidelines, however, do not have the force of law or regulation — and thus can be withdrawn by the Trump administration. That would be a step backward.

THE FUTURE OF UNIONS Mr. Trump’s nominees for secretary of labor, the National Labor Relations Board and the Supreme Court will greatly affect union organizing. The N.L.R.B. is in the midst of cases that could require more employers to engage in collective bargaining. The Supreme Court is all but certain to hear a new case on the long-established right of unions to collect dues or fees. Mr. Trump’s choice of a decidedly anti-union nominee for education secretary, Betsy DeVos, who has long tried to weaken the power of teachers’ unions, is not a good omen for those other selections. Nor is his selection for transportation secretary, Elaine Chao, who was an anti-union labor secretary under President George W. Bush. An administration hostile to unionism does not bode well for wage growth and would invite greater income inequality. Research shows that declining union membership worsens inequality by depressing worker pay; from 1973 to 2007, as the share of the work force in a union fell sharply, inequality in hourly wages increased by over 40 percent.

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