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Take a seat in the Break Room, our weekly round-up of labor news in Minnesota and beyond.
Subsidized labor abuse
North Star Policy Action, a union-backed Minnesota think tank, documented 33 construction projects that have received over $84 million in taxpayer subsidies while employing contractors tied to proven or alleged worker exploitation.
For example, they look at Absolute Drywall, a contractor previously cited by state and federal labor regulators for violating child labor laws and misclassifying workers to avoid paying overtime and payroll taxes. The Reformer has previously reported on allegations against Absolute Drywall of wage theft and firing a female employee after she reported being raped and sexually assaulted by a supervisor while working at Viking Lakes in Eagan.
According to the report, Absolute Drywall has worked on five tax-subsidized affordable housing projects across the Twin Cities, including Legends of Cottage Grove, Oaks Landing and Twin Lakes Family Apartments, all built by Dominium.
The report’s authors do not tie Absolute Drywall — nor any other problem contractor in the report — to labor abuses on tax-subsidized projects. But labor laws, especially in non-union construction, are often violated and seldom enforced.
Minnesota has passed several significant laws in recent years to combat labor abuses by making wage theft a felony, granting criminal investigatory powers to the Commerce Department and making general contractors liable for wage theft by their subcontractors.
State and local governments also often take steps to ensure tax dollars don’t fund exploitative projects through setting a prevailing wage, which requires contractors to pay higher minimum wages on publicly funded projects. But those protections rarely extend to projects funded through two of the largest and oldest forms of tax subsidies: the low-income housing tax credit and tax increment financing.
The report’s authors — Jake Schwitzer and Lucas Franco — recommend governments expand the use of prevailing wage and step up on enforcement; set contract terms to claw back funds from developers if labor laws are violated; and require developers to disclose their subcontractors and their track records.
32,000 Twin Cities workers illegally paid less than minimum wage
Employers are illegally paying less than minimum wage to an estimated 32,000 workers in the Twin Cities metropolitan area, according to a new report from the Workplace Justice Lab at Rutgers University.
On average, workers were shorted $2,700 per year over the past decade, with violations concentrated in high-demand, service sector jobs in places like restaurants, preschools, hair salons and entertainment venues.
The report’s authors — Jake Barnes, Janice Fine, Daniel Galvin and Jenn Round — praised the city of Minneapolis’ Labor Standards Enforcement Division for its proactive approach to enforcing minimum wage violations but say the city needs more investigators.
The hedge fund sucking the Pioneer Press dry
In 2006, the Pioneer Press’ editorial ranks exceeded 200 union news workers — reporters, editors, photographers. That year, New York-based hedge fund Alden Global Capital became a minority owner, ushering in a new era of disinvestment. Today, there are just 29 union news workers in the newsroom, plus a handful of managers, Racket’s Jay Boller reports in a deep dive into the hedge fund killing Minnesota’s oldest newspaper.
The past few decades have been bad for the entire newspaper industry to be sure, as tech giants have claimed the advertising revenue that used to support journalists in cities and towns across the country.
But it hasn’t been as bad in the news business as it would seem by looking at the PiPress. You can tell by looking at Alden’s profits. In 2017, for example, PiPress produced a $10 million profit at a 13% margin, according to Nieman Lab. Alden earned enough profit while it was siphoning profits away from the PiPress and papers around the country that its founder and chief executive Randy Smith was able to spend $57.2 million on 16 Palm Beach mansions.
“It’s vulture capitalism on steroids, no question about it,” retired PiPress editor and columnist Rubén Rosario said. “Before Alden came into the picture, there were layoffs and buyouts — human capital is always taken for granted. They’ve just taken it to the slash ‘n’ burn level.”
Starbucks union’s ‘Red Cup Rebellion’ hits Twin Cities
Workers at hundreds of Starbucks stores nationwide, including three in the Twin Cities, went on strike on Thursday for Red Cup Day, a highly popular promotional day when the coffee chain gives away red reusable cups.
Starbucks Workers United, the union representing the workers, said the strike by thousands of baristas was its largest to date as it nears two years since the union won its first election at a store in Buffalo, N.Y.
While more than 360 stores have unionized since, none has won a collective bargaining agreement governing wages, benefits and working conditions. That fact was at the heart of the strike, which workers hope will pressure the company to negotiate.
Workers say the company is refusing to bargain in good faith while waging an illegal union-busting campaign against them; federal labor regulators have largely agreed with union workers, issuing 111 complaints against the company for firing organizers, closing unionized stores and offering raises and better benefits to non-unionized workers.
Workers at a Starbucks in Duluth — at 1002 Woodland Ave. — also participated in the strike and filed a petition on Thursday for a union election with the National Labor Relations Board, which oversees private sector unions. It could be the first Starbucks union election in Minnesota in more than a year.
The stores where workers went on strike are located at 300 Snelling Ave. in St. Paul, 4712 Cedar Ave. in Minneapolis and 3704 Silver Lake Road in St. Anthony.
REI workers file slew of unfair labor practices charges
REI workers at eight unionized stores, including one in Maple Grove, filed 80 charges of unfair labor practices against their employer with federal labor regulators on Wednesday. The coordinated campaign is in response to what the workers’ unions say is “a pattern of egregious anti-union behavior” and bad faith bargaining on the part of the company.
The action comes on the heels of a one-day strike last month at the Maple Grove store over the company’s nationwide layoffs of more than 2% of workers. Workers at the Maple Grove location voted to unionize with the United Food and Commercial Workers Local 663 in June.
“As REI workers we want them to show up to bargain with us in a real way, treat us with respect and behave like a real co-op,” Maxwell Nagel, a sales specialist at the Maple Grove REI, said in a statement.
An REI spokesperson said the company disagrees with the union’s contentions and is “committed and engaged in good-faith bargaining.”
Minnesota sets record for job numbers
Minnesota posted its third straight month of job growth, adding 7,000 jobs from September to October, according to the state Department of Employment and Economic Development. The additional jobs pushed Minnesota to a record-setting 3,001,300 jobs in October.
The biggest gains were in education and health services; professional and business services; and hospitality. Even as the number of jobs increased, the unemployment rate also ticked up slightly to 3.2% — which is still lower than the nation as a whole. The state has plenty of employment opportunities, with 200,000 job openings in Minnesota as of August, according to national Jobs Openings and Labor Turnover Survey data.
Bemidji postal workers picket
Rural postal workers picketed the Bemidji Post Office Monday and Tuesday to protest unsustainable work hours and the local implementation of a recent agreement with Amazon, which has the postal service deliver Amazon packages in addition to the mail, The Bemidji Pioneer reports.
Postal workers say that managers evaluated postal carriers’ routes in October, just before the deluge packages arrived with the November Amazon deal, extending their working hours significantly. Workers also say Amazon packages have been unfairly prioritized over regular mail, leading to unacceptable delays in mail delivery.
Senator challenges union boss to duel
U.S. Sen. Markwayne Mullin, an Oklahoma Republican, challenged Teamsters President Sean O’Brien to fight during a Senate hearing on Tuesday.
O’Brien had previously derided Mullin on X, formerly known as Twitter, posting a picture of Mullin standing on a step behind a podium to make himself appear taller. In the tweet, he called Mullin a “greedy CEO who pretends like he’s self made” and said, “You know where to find me. Anyplace, Anytime cowboy.”
“So this is a time, this is a place,” Mullin said during the hearing. “You want to run your mouth, we can be two consenting adults. We can finish it here.”
Both men rose to their feet, forcing the chair, Sanders, to intervene.
It recalled political duels of yore, and Mullin defended himself on CNN by pointing out Washington has a long history of political figures brawling in public — including Abraham Lincoln. PolitiFact evaluated his comments and noted that while Lincoln was involved in a sword fight, he was the one who was challenged.
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