Week Ending May 20, 2016
New Overtime Rule Will Give 4.2 Million Workers a Raise
On Wednesday, the Obama administration released its final rule extending overtime protections to an additional 4.2 million working Americans. The rule, which is set to go into effect December 1, more than doubles the existing overtime salary threshold from $23,660 to $47,476. This means that salaried employees who earn less than $47,476 will be legally entitled to receive overtime pay if they work more than 40 hours in a week. And, the salary threshold will be adjusted every three years to prevent it from becoming outdated and leaving workers behind.
The overtime rule represents one of the most sweeping steps taken by the Administration to address income inequality in an economy that is out of balance and favors the wealthy. “The administration’s overtime rule will help to reverse this imbalance by helping to ensure that working people get paid for the work they already do,” said AFSCME President Lee Saunders in a statement released just after the rule was announced. Expanding the reach of overtime protections, President Saunders said, “will not only help to restore the 40-hour work week, but also improve incomes and grow the middle class.” The administration reports that the rule is expected to put $12 billion more dollars in the pockets of hardworking people over the next 10 years.
Immediately after the Department of Labor released its final overtime rule, congressional Republicans announced preparations to block it from taking effect. AFSCME will vigorously oppose any attempts to overturn this economic boost for working families.
House Committee Approves Harmful Bill to Weaken Child Nutrition Programs
The House Education and Workforce Committee approved by voice vote the so-called “Improving Child Nutrition and Education Act of 2016” (H.R. 5003). Despite its name, the bill would roll back years of progress to improve child nutrition.
The bill would weaken the Community Eligibility Provision (CEP) which eliminates individual eligibility requirements by increasing the eligibility threshold for participation from 40% to 60%, of all students. The bill also ends CEP for approximately 7,000 high-poverty schools currently participating and eliminates the option for an additional 11,000 eligible schools that serve mostly poor students. The bill also significantly increases school meal application verification requirements which will result in eligible students losing access to free or reduced-price meals. The bill weakens nutrition standards that have made students healthier. Further, the bill includes a proposal to block grant child nutrition programs in some states.
The bill also fails to provide additional resources for the Child and Adult Care Food Program (CACFP), which funds meals for young children in child care and Head Start. Rep. Suzanne Bonamici (D-OR) attempted to add reimbursement to child care providers for an additional meal or snack. All Democrats and Reps. Elise Stefanik (R-NY) and Carlos Curbelo (R-FL), supported the amendment, but it still failed. AFSCME strongly opposes H.R. 5003, which has not yet been scheduled for a vote by the full House of Representatives. The Senate is expected to bring a bipartisan version of child nutrition reauthorization to the floor for a vote, possibly before Congress recesses in July.
House Panel Votes to Overturn Transparency Rule in Union Elections
On Wednesday, in a party line vote of 21-10, the House Education and Workforce Committee passed a Congressional Review Act resolution (H.J. Res 87) to block the U.S. Department of Labor’s (DOL) “persuader” final rule. This rule is an overdue leveling of the playing field for required federal reporting by unions and employers. Specifically, it closes a loophole where employers hire consultants to create anti-union materials, strategies and policies, and script managers’ communications with employees, without disclosing anything to the DOL. With the new rule, employers must report not only their direct persuader activities with employees but also their consultants’ behind-the-scenes, or indirect, persuader activities. Unions have long-been required to report all of our expenditures, including spending on union organizing campaigns.
The persuader rule means that workers will know who is saying what during organizing campaigns, and at what cost. Committee Ranking Member Bobby Scott (D-VA) explained that the rule “pulls back the curtain” on companies that are trying to block union organizing so that employees “know whether or not what they are hearing is a product of certain well-known consultants hired to influence their decisions, and how much their employers are paying them to influence their views.”
AFSCME strongly opposed the GOP resolution aimed at overturning this rule (see AFSCME’s letter to the Committee at: http://www.afscme.org/hjres87). AFSCME will continue to oppose the bill when it goes to the House floor for a vote or if it is tacked on as a “rider” to any spending bills.
House and Senate Take Different Paths on Funding to Combat Zika Virus
Earlier this year, the Obama administration requested $1.9 billion in new emergency funds to combat the Zika virus. This week the Senate voted in support of $1.1 billion to prepare for and respond to the spread of the Zika virus. The Senate attached the Zika funds to a spending measure by a bipartisan vote of 68 to 30. The overall bill with Zika funds added passed 89 to 8. These funds will be available through September 2017 and are a significant increase from the $622 million Zika funding provided in the bill (H.R. 5243) that was adopted by the House in a largely party line vote of 241 to 184. The White House had threatened to veto the House bill because the funding level is woefully inadequate, funding ends September 2016, and because it slashes other public health funding to offset spending on the Zika virus. AFSCME urged the House to reject H.R. 5243 for similar reasons and because it fails to address the urgent need in Puerto Rico, the hardest hit area in the U.S. It is unclear what the fate of Zika funding will be given the procedural and funding level differences between the Senate and House.
Banning Federal Contractors From LGBT Discrimination
During consideration of an annual bill to provide funding for Military Construction and the Veteran’s Administration, an amendment offered by Rep. Sean Patrick Maloney (D-NY) barring federal contractors from government work if they discriminate against LGBT individuals garnered enough votes to pass. But seven GOP members later switched their votes to kill the amendment. Those members were Reps. Darrell Issa (R-CA), David Valadao (R-CA), Jeff Denham (R-SC), Mimi Walters (R-CA), Greg Walden (R-OR), David Young (R-IA) and Bruce Poliquin (R-ME). Minority Whip Steny Hoyer (D-MD) demanded an inquiry into how members were permitted to switch their vote. House Speaker Paul Ryan (R-WI) held the vote open longer than allowed, so members could change their votes. Before the final 212 to 213 tally was announced, the vote was 217 to 209, in favor of the amendment.
Defense Bill Takes Aim at Labor Protections and Violates Funding “Parity” between Defense and Non Defense Spending
The National Defense Authorization Act (NDAA), a bill authorizing funding for the Defense Department, usually receives bipartisan support, but this year, the bill is controversial.
First, the bill violates the parity principle established in last year’s Bipartisan Budget Act which requires equal treatment for defense and nondefense spending. The House bill increases defense spending by $18 billion without increasing nondefense spending by an equal amount. The Obama administration has warned that this could result in a veto. In the Senate, Sen. John McCain (R-AZ) has stated his intentions to offer a floor amendment to add an additional $17-$18 billion to defense funding.
The House bill also includes anti-labor riders which would block recent Administrative actions to ensure fair wages and safe workplaces. The rider carves out Department of Defense contracts from President Obama’s Fair Pay and Safe Workplaces Executive Order issued in 2014. That order tightens enforcement of wage, hour, safety, equal opportunity and other workplace laws for contractors by requiring them to disclose labor law violations from the past three years when they bid on a federal contract and instructs federal officials to factor these violations into their decisions. The same amendment is in the Senate bill.
Another rider would eliminate protections from discrimination on the basis of sexual orientation and gender identity for employees of faith-based organizations contracting with the federal government and extend the religious exemption to permit all faith-based employees accepting any federal funding to discriminate on the basis of religion. This weakens President Obama’s 2014 Executive Order to prohibit discrimination on the basis of sexual orientation and gender identity by federal contractors, including faith-based organizations contracting with the federal government.
House Panel Questions Administration’s Proposal to Rein in Medicare Drug Costs
The House Energy and Commerce Health Subcommittee held a hearing on the Obama administration’s proposed Medicare Part B Drug Payment demonstration and a bill (H.R. 5122) to block the agency in charge of Medicare from finalizing and implementing this important demonstration project. Current payment rules for drugs administered in a doctor’s office or hospital outpatient setting promote the use of more expensive drugs and may encourage drug makers to inflate their prices continually. Under the current payment system, providers who prescribe equally effective but less expensive drugs are disadvantaged financially. The proposed demonstration would test new payment reforms that could help reduce out-of-pocket costs to beneficiaries, who are responsible for 20% of the cost of Part B drugs. AFSCME supports allowing the demonstration project to go forward.
Federal Agency Finds Little Economic Gain for U.S. from the Trans-Pacific Partnership
On Thursday, the U.S. International Trade Commission (USITC), which analyzes the impact of trade agreements on the U.S. economy, released its assessment of the Trans-Pacific Partnership (TPP). Based on its analysis, overall U.S. manufacturing employment would decline as a consequence of the agreement and the overall trade deficit would grow. The economic gains expected in other areas, such as agriculture, are relatively small. Overall, U.S. gross domestic product (GDP) would increase by less than two-tenths of a percent (0.15%) by the year 2032 and employment would increase by 7 one-hundredths of a percent (0.07%) by 2032.
But even these very small gains are not likely to hold up given the USITC’s flawed analysis. The report fails to measure costs that occur when workers lose their jobs or when communities lose tax revenue when a factory closes. The analysis does not consider the impact of currency manipulation which other countries use for competitive advantage to make their goods less expensive in the U.S. and make U.S. goods more expensive in their home markets. Even if the estimated gains were to be realized, they are a high price to pay for a trade agreement that would give corporations greater ability to sue our government in international trade courts to knock down regulations that protect the environment and our food supply, make our workplaces safer, make prescriptions drugs more affordable and more.
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