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EEOC advisory letter schools employers on accommodating individuals with hearing impairments

November 20th, 2013  |  Pamela Wolf  |  Add a Comment

By Pamela Wolf, J.D.

As the push to hire individuals with disabilities accelerates in both the private and public sectors, employers are likely coming into increasing contact with applicants and employees who have hearing-related disabilities. An EEOC informal advisory letter released on November 7 serves as a timely roadmap for accommodating such individuals, even though it’s not considered a formal opinion of the agency.

Where there is more than one effective accommodation available for a hearing-impaired employee or applicant, an employer is free to choose the easier or less expensive alternative, so long as it is effective for the individual in need of accommodation, according to the letter, dated October 28, 2013, and signed by EEOC Legal Counsel Peggy R. Mastroianni. However, that individual’s preference should get “primary consideration.”

Mastroianni’s letter responds to an inquiry as to whether employees with hearing impairments have a right under the ADA to choose their own communication access service provider for interactions with non-deaf employees and supervisors or when interviewing for promotions.

Accommodations for hearing-impaired individuals. Mastroianni noted that employers covered under Title I of the ADA are required to provide reasonable accommodations for the known physical and mental limitations of otherwise qualified applicants and employees with disabilities unless to do so would pose an undue hardship. She pointed to the following examples of reasonable accommodations necessary to provide effective communication for hearing-impaired employees:
• qualified sign language interpreters for different types of sign language;
• readers, or assistive technology such as Communication Access Realtime Translation (CART transcription);
• captioning of videos and video-streamed presentations; or
• use of video relay services and video remote interpreting services.

Individualized assessment. Like any other accommodation decision, the determination of what accommodation an employer will provide for an employee who is deaf or has a hearing impairment is an individualized one, Mastroianni pointed out. The appropriate accommodation may be dependent on the setting in which communication occurs, the ability of the employee to use certain means of communication, technological advancements that make once-effective accommodations obsolete or ineffective, and other factors.

By way of example, Mastroianni suggested that an individual with a hearing impairment who can lip read in one-on-one discussions about simple matters may still need a sign language interpreter for longer, more complex discussions or for larger meetings. Similarly, while using email, typing on a computer, or exchanging handwritten notes may be an effective accommodation for brief and infrequent communications, it may not work for longer or more complex communications. Although one employee with a hearing impairment may need a sign language interpreter, another employee who does not know or fluently use sign language may need CART or some other accommodation.

Choice of accommodations. What happens when there is more than one potential accommodation? Where “there is more than one effective accommodation, ‘the preference of the individual with a disability should be given primary consideration. However, the employer providing the accommodation may choose between effective accommodations,” Mastroianni said, pointing to EEOC regulations. “Therefore, if there are two or more effective means of enabling an employee with a hearing impairment to communicate at work, the employer may choose the easier or less expensive accommodation, as long as the accommodation chosen is effective for the individual.”

Don’t forget the interactive process. The EEOC attorney also suggested that using an interactive process with an employee will not only help ensure the initial selection of an effective accommodation, it will also be important for reassessing the situation should the employee request a change in accommodation. For example, where an interpreter is not effective for the individual because the interpreter does not use the same type of sign language as the employee, or cannot sign quickly or accurately enough, the employer should arrange to provide a different interpreter as an effective accommodation. Likewise, where a technological device is too slow or experiences frequent disconnections and thus inhibits communication, the employer should determine whether it needs to be repaired or replaced with a properly functioning or upgraded version, or whether a different accommodation is necessary. However, “if a change in accommodation is sought due to mere personal preference, the employer need not assign a different individual to interpret or provide different technology,” according to Mastroianni.

Information and assistance in identifying options and making accommodation evaluations is available from the Job Accommodation Network.

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Being an equal-opportunity jerk at work does not violate federal law

November 14th, 2013  |  Lorene Park  |  Add a Comment

By Lorene D. Park, J.D.
 

Fed up with a supervisor who tells dirty jokes, repeatedly drops F-bombs, or yells at subordinates for each mistake? Unless your boss treats some subordinates better than others and the difference is due to race, gender, religion, or other “protected” class, your potential responses do not include a successful lawsuit under federal law. Title VII is not a general civility code, or so we are told repeatedly by courts in opinions dispensing with claims by employees who were subjected to lewd, crude, and socially unacceptable language and behavior ― on an equal opportunity basis. Two other common flaws in cases where employees sue for a hostile work environment include a court finding inappropriate comments “isolated” (though perhaps the average person would disagree) or when the comments are directed at others and the employee simply has the misfortune of bearing witness.

Equal opportunity jerks. In one case, an African-American employee claimed his supervisor at a medical waste plant violated Title VII by repeatedly using profanity. He liked to yell and use phrases like “get your ass to work” and “don’t you ever f’ing do that again.” Granting summary for the employer, the federal court in Minnesota explained that even assuming the profanity was sufficiently severe to be considered harassment, the employee failed to show that it was based on race (Senter v Stericycle, Inc). In another case, a pregnant employee whose supervisor repeatedly called her “fat ass” and “fat cow” and made “mooing” noises in staff meetings, had her claims tossed by a federal court in Florida because she could not show non-pregnant employees were treated any better (Lewis v Aaron’s Sales & Lease Ownership, Inc). Conversely, a federal court in Louisiana refused to dismiss the claim by customer service rep that his supervisor yelled at him, wrote him up, and otherwise harassed him based on his race. The employer failed to provide competent evidence supporting its defense that the supervisor treated everyone poorly (Williams v Shred-It). As these cases show, you might succeed on a claim that your supervisor treats one class of employees better than another, but you can’t really sue someone under federal law for being an equal opportunity jerk.

“Isolated” comments. One thing I find interesting in reading these cases is when a court finds that “reprehensible” racist comments were too “isolated” to create an actionable hostile work environment (HWE). For example, in one federal case out of North Carolina, an African-American employee based her claim on allegations that her supervisor accused her of “not working and would snap her fingers” at her because “that is the only way ‘you people will listen;’” and said that she had to watch the employee carefully because “‘y’all blacks are sneaky people’ and are always trying to get around the rules.” In the court’s view, this wasn’t “sufficiently severe or pervasive” to create a racially hostile environment, though the fact that the employee was fired after complaining of the supervisor’s conduct was enough to support her discriminatory discharge and retaliation claims (Tims v Carolinas Healthcare System).

This type of holding is quite common and, I think, problematic because it really should be up to a jury to determine if comments like these were enough to create a HWE under Title VII. The fact that reasonable people could differ in their opinions is shown by the fact that other courts, under similar facts, would decline to impose judgment as a matter of law because even “isolated” comments can be severe enough to create an actionable HWE. Indeed, in one case, a D.C. Court of Appeals revived an employee’s HWE claim based on allegations that a company executive called him the n-word and that he was told he was being paid a lot of money for a young black man. “‘[P]erhaps no single act can more quickly alter the conditions of employment’ than ‘the use of an unambiguously racial epithet such as n***er by a supervisor’” (Ayissi-Etoh v Fannie Mae). The supervisor in the Tims case above used the phrases “you people” and “y’all blacks.” I would think some juries would find those to be unambiguously racist. 

When others are targeted. Even if the derogatory comments are race or gender related and are severe or pervasive, a court may toss Title VII claims if the employee was not the target of the comments but simply had the misfortune of overhearing them. For example, a Puerto Rican employee’s Title VII discrimination claims failed because his supervisor’s many inappropriate comments, including discussing females’ body parts, calling Puerto Rican’s pigs, making fun of accents, using the n-word when referring to black customers, and suggesting a sexual remedy for a female worker’s constipation, were not directed at the employee who filed suit. The silver lining in this case was that the employee’s retaliation claim survived summary judgment. He was allegedly sabotaged by the supervisor after complaining of what he reasonably believed was unlawful behavior (Saliceti-Valdespino v Wyndham Vacation Ownership).

What to do. The take-away is that, generally, having a supervisor who is an equal-opportunity jerk is not a good basis for a lawsuit. Even if the hostility is based on a protected characteristic like race, or gender, there are other legal hurdles such as a court’s consideration of whether the conduct was “severe or pervasive” enough and whether it was directed at the employee filing suit. However, employees in such situations are not without recourse. If the company has an anti-harassment policy, they can follow the steps for reporting inappropriate conduct. Complaining of harassment that an employee reasonably believes is unlawful is considered a “protected activity” under Title VII and any retaliatory actions by the supervisor or company against the employee can support a lawsuit. From a company perspective, defending a lawsuit is going to be expensive and burdensome regardless of the type of claim (harassment versus retaliation). There is thus a strong incentive for companies to take complaints seriously and adequately deal with supervisors who abuse subordinates, regardless of whether they are equal opportunity jerks.

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Attorney whistleblowers weighed down by ethical obligations

November 13th, 2013  |  Ron Miller  |  Add a Comment

Two recent cases found attorneys caught in ethical dilemmas involving the conduct of their employers. Each felt that their concerns about potential legal or ethical violations fell on deaf ears of management. Unfortunately, at least from the attorneys’ points of view, their strategies for dealing with their problems ran into stone walls with respect to the attorney ethical rules.

 In United States of America v Quest Diagnostics, Inc, the Second Circuit found that the former general counsel of a diagnostic lab violated his ethical obligations under the New York Rules of Professional Conduct by his participation in a qui tam action under the federal False Claims Act (FCA) based on allegations his former employer’s pricing structure perpetrated a fraud against the Medicare and Medicaid programs.

Ethical duty of confidentiality. The plaintiff in this case, Fair Laboratory Practices Associates (FLPA), was formed in 2005 by three former executives of Unilab for the purpose of bringing this qui tam action. FLPA alleged that Quest Diagnostics and Unilab violated the federal Anti-Kickback Statute. One of FLPA’s general partners was formerly general counsel to Unilab, and it was his involvement in the case that highlighted the tension between an attorney’s ethical duty of confidentiality and the federal interest in encouraging “whistleblowers” to disclose unlawful conduct harmful to the government.

According to FLPA, Unilab and Quest operated a “pull-through” scheme by which they charged managed care organizations (MCOs) and independent practice associations (IPAs) commercially unreasonable discounted prices on non-federal business to induce referrals of Medicare and Medicaid business and then billed the government at dramatically higher prices. While still employed at Unilab, FLPA principals questioned whether the pricing structure violated the Anti-Kickback Statute. After Unilab changed its pricing structure and negotiated price increases, customers began slipping away to competitors. Thereafter, the company reversed course on its pricing.                                           

From 1993-2000, the former general counsel was Unilab’s sole in-house lawyer. He was responsible for all of the company’s legal and compliance affairs and managed all litigation against the company. FLPA alleged that when the former general counsel expressed concerns that Unilab’s new pricing structure created an inference of illegality, he was instructed to work with outside counsel to “find a way around.” He was also subsequently “frozen out” by Unilab’s management and was no longer asked for advice on compliance matters. Quest acquired Unilab and the executives left the company then formed FLPA.

 The district court permitted Quest and Unilab to take discovery regarding whether its former general counsel and FLPA had improperly used or disclosed Unilab’s confidences in this lawsuit. It subsequently dismissed the action after concluding that the former general counsel’s participation violated Rule 1.9(a) — the “side-switching rule”— and Rule 1.9(c)’s prohibition on disclosing client confidences beyond what was “necessary,” within the meaning of Rule 1.6(b), to prevent the commission of a crime. The district court also concluded that the FCA did not preempt applicable state ethical rules. In light of those rulings, the district court dismissed the complaint, and disqualified FLPA and its counsel from bringing this suit and any subsequent suits based on the same facts.

 Disclosure of confidential information. The Second Circuit agreed with the district court that the former general counsel violated Rule 1.9(c). Under Rule 1.9(c) a lawyer who has formerly represented a client in a matter shall not reveal the client’s confidential information or use that information to disadvantage that client. In any event, the attorney may not disclose confidences beyond what was “necessary” to prevent the commission of a crime, within the meaning of Rule 1.6(b).

 The Second Circuit rejected FLPA’s assertion that the FCA preempts application of Rule 1.6, observing that nothing in the FCA evinces a clear legislative intent to preempt state statutes and rules that regulate an attorney’s disclosure of client confidences. Rather, the appeals court observed that Rule 1.6(b)(2) implicitly accounts for the federal interests at stake by permitting disclosure of information “necessary” to prevent the ongoing commission of a crime. Because Rule 1.6 balances the interests, it need not give way to FCA, Sec. 3730(b)(2)’s requirement of  disclosure of material evidence. Having found that the former general counsel violated ethical rules, the appeals court further concluded that the district court did not err or abuse its discretion in dismissing the complaint and disqualifying FLPA and its counsel from bringing this action or any subsequent action based on the same facts.

 Quid pro quo arrangement challenged. In an unpublished decision, in Gadlage v Winters & Yonker, PSC, a divided Sixth Circuit ruled that an attorney allegedly discharged because he refused to follow law firm policy of referring personal-injury clients to a specific chiropractor failed to state a claim for wrongful discharge in violation of public policy. The attorney believed that this quid pro quo arrangement created a conflict of interest in violation of Kentucky Supreme Court Rules.

The trial court granted the law firm’s motion to dismiss the complaint for failure to state a claim upon which relief could be granted, concluding that the employee’s allegations failed to establish that his termination was in violation of any public policy that would except him from the “at-will” employment doctrine in Kentucky.

 Supreme Court rules as source of public policy. Before the Sixth Circuit, the employee argued that the Kentucky Supreme Court Rules were derived from the state’s constitution and, therefore, triggered the public policy exception to the at-will doctrine.  Observing that because Kentucky has not addressed the precise issue presented in this case, the appeals court concluded that was required to predict how the state supreme court would rule “by looking to all the available data.”

 As an at-will employee, the plaintiff could be discharged for “for good cause, no cause, or for a cause that some might view as morally indefensible.” Moreover, Kentucky applies a narrow exception to this general rule when the termination undermines a “most important public policy.” The state permits this exception only when the discharge is shown to be “contrary to a fundamental and well-defined public policy as evidenced by existing law,” and when the policy is “evidenced by a constitutional or statutory provision.”

 After its ruling in Firestone Textile Co. Div. v. Meadows, the Kentucky Supreme Court adopted the additional caveat that “only two situations exist where ‘grounds for discharging an employee are so contrary to public policy as to be actionable’ absent ‘explicit legislative statements prohibiting the discharge.’” The first situation involves the failure or refusal to violate a law in the course of employment,” and the second is “when the reason for a discharge was the employee’s exercise of a right conferred by a well-established legislative enactment.”

Here, the Sixth Circuit majority noted that the employee failed to allege a single particularized rule violation in his complaint or appellate briefing, but relied on vague and generalized statements about third-party conflicts of interests and obligations to clients. Consequently, the appeals court determined that he had failed to state a claim that was “plausible on its face.”

 Whistleblower pitfalls for attorneys. Attorneys are not like your typical whistleblowers, they are constrained by ethical rules as to what actions they can take in reporting suspected wrongdoing. Foremost, they are to keep their clients’ confidences unless they seek to prevent criminal activity. Even then they are limited to making “necessary” disclosures. As a consequence, resorting to self-help or reporting to an outside agency to resolve an ethical dilemma presents pitfalls all their own as the attorneys in these cases found.

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OFCCP embraces sex stereotyping theory in EO 11246 enforcement

November 7th, 2013  |  Cynthia L. Hackerott  |  Add a Comment

While the EEOC has pursued Title VII gender discrimination claims under the sex stereotyping theory for some time now, it has, until recently, been unclear what the OFCCP’s policy is with regard to pursuing claims under Executive Order (EO) 11246 based on this theory. Several developments throughout this year, including a settlement announced by the OFCCP earlier this week, illustrate that the OFCCP, like its sister agency, has explicitly adopted the sex stereotyping theory.

Policy questions. In last year’s much publicized Macy v Holder decision, the EEOC — following earlier court precedents which held that Title VII’s prohibition against discrimination based on “sex” extends to claims for sex stereotyping, as well any other claim asserting that gender was taken into account — ruled that transgender workers are protected under Title VII.  Thus, the EEOC adopted the position that the sex stereotyping theory encompasses claims of discrimination based on transgender status.

The Macy ruling raised questions as to whether the OFCCP would follow suit in its enforcement of EO 11246. A July 19, 2013 Buzzfeed report quoted Tico Almeida, Founder and President of the LGBT advocacy group Freedom to Work, as saying that senior White House staff had “forbidden Labor [Department] officials from formally adopting the [Macy] decision.”  This assertion was also mentioned in an August 1, 2013 story published in the Washington Blade, citing the Buzzfeed report.

However, remarks made by an OFCCP official just a few days following the Buzzfeed report contradict the claim reportedly made by Almeida. During a panel discussion at the Industry Liaison Group National Conference in Indianapolis, Indiana on July 31, 2011, Mid-Atlantic Regional Director Michele Hodge confirmed that the OFCCP is pursuing sex stereotyping claims. In light of the Macy decision, an audience member asked whether the OFCCP held a view similar to the EEOC’s, and if so, whether sex stereotyping could be investigated by the OFCCP. Hodge responded that, as with compensation and other employment decisions, the OFCCP will apply “Title VII principles” to its compliance reviews and complaint investigations; thus, the OFCCP could investigate sex stereotyping during a compliance evaluation and could address complaints on that basis. When asked whether there have in fact been OFCCP investigations in this regard, Hodge answered in the affirmative, and added that sex stereotyping is included in the training currently provided to OFCCP staff.

FCCM. The sex stereotyping theory is specifically mentioned in several places in the OFCCP’s revised Federal Contract Compliance Manual (FCCM or Manual), which was publicly released on August 23, 2013. The revised manual, dated July 2013, covers how the OFCCP’s compliance officers (COs) conduct a desk audit, an onsite review, a construction industry compliance evaluation, a corporate management compliance evaluation and a complaint investigation. It also covers the agency’s functional affirmative action program (FAAP), the various types of discrimination remedies and ways to resolve noncompliance issues.

In Chapter 2 (Onsite Review), on page 81, the Manual states:

“COs must examine whether contractor policies make prohibited distinctions in conditions of employment based on sex, including the basis of pregnancy, childbirth or related medical conditions, or on the basis of sex-based stereotypes, including those related to actual or perceived caregiver responsibilities. Contractors must not make employment decisions based on stereotypes about how males and females are “supposed” to look or act. Such employment decisions are a form of sex discrimination prohibited by Executive Order 11246, as amended.”

According to OFCCP expert John C. Fox, the revised FCCM was actually completed as of December 2011 and OFCCP COs began implementing the revised Manual in the field last year. Thus, the sex stereotyping theory has apparently been applied to OFCCP enforcement since at least last year.

Recent settlement. On November 4, 2013, the OFCCP announced a conciliation agreement that settled pay and hiring discrimination claims against G&K Services Co., a federal contractor providing uniform rental services to a number of different government agencies. The contractor, according to the OFCCP, had a practice of assigning laundry workers to different tasks and different pay rates on the basis of gender stereotypes. The OFCCP alleged that, between July 1, 2009, and June 30, 2010, female employees who had been hired as general laborers were assigned to “light duty” jobs that paid less than the “heavy duty” jobs involving similar work and qualifications, which the company reserved for men. Investigators also found that male applicants were frequently denied the option to compete for a majority of the open general laborer opportunities during the review period because the company only considered them for so-called heavy duty work.

“Denying women access to higher-paying opportunities because of sex stereotyping is a form of pay discrimination in violation of Executive Order 11246,” the OFCCP announcement stated.

Whatever doubts there may have been, it is clear that the OFCCP has now adopted, and is implementing, the sex stereotyping theory in its enforcement efforts. While there has not yet been any public announcement that the OFCCP is specifically pursuing claims on behalf of transgendered workers based on the sex stereotyping theory, the FCCM’s language stating that “[c]ontractors must not make employment decisions based on stereotypes about how males and females are ‘supposed’ to look or act,” strongly suggests that the OFCCP considers transgender workers as a protected group under EO 11246.

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Secretary of Labor’s comments, EPI report offer insight into the “alt-labor” movement

November 1st, 2013  |  Pamela Wolf  |  Add a Comment

By Pamela Wolf, J.D.

In the wake of Secretary of Labor Thomas E. Perez’s remarks on October 29 at the Center for American Progress in conjunction the annual Half in Ten Anti-Poverty Report release, the Economic Policy Institute (EPI) released another report, The Legislative Attack on American Wages and Labor Standards, 2011–2012. Many of the Secretary’s remarks and the various developments noted in the EPI report echo the issues fueling the so-called “alternative labor” movement that has gained much momentum in United States this past year. The Secretary’s remarks also provide insight into his view of how workers and management should interact on the labor scene.

“There is an undeniable relationship — not just correlation, but direct causation — between declining poverty and the strength of the labor movement,” Perez said. “It just stands to reason: when workers have a strong voice and a seat at the table … they are able to bargain for their fair share of the value they help to create. But when someone muzzles that voice and cuts off the legs of that seat … that’s when you see stagnant wages even as productivity and corporate profits continue to record heights. Empowered, organized workers reduce inequality and build the middle class.”

According to the EPI report’s author, Gordon Lafer, state legislators have over the last two years “launched an unprecedented series of initiatives aimed at lowering labor standards, weakening unions, and eroding workplace protections for both union and non-union workers. This policy agenda undercuts the ability of low- and middle-wage workers, both union and non-union, to earn a decent wage.”

For his part, Perez offered this prediction: “In the coming years, we’re going to see a rapidly evolving workers movement that takes many forms. More and more, we’re seeing new groups of workers beginning to organize at the grass roots level. Fast food workers, taxi drivers, domestic workers and others in low-wage industries are taking action and speaking up for their right to a fair day’s pay for a hard day’s work. The labor movement and other allies (many of them in this room) are welcoming and supporting these independent movements.”

The Labor Secretary applauded this grassroots movement, calling it “exactly what we need: everyone working together, forging new strategies and building new alliances, in support of working people taking courageous action to improve their lives and communities.”

State legislative action. Lafer, in the EPI report, ticked through the many efforts taken by state legislatures in 2011 and 2012 that he characterized as “efforts to undermine wages and labor standards”:

• Four states passed laws restricting the minimum wage, four lifted restrictions on child labor, and 16 imposed new limits on benefits for the unemployed.
• States also passed laws stripping workers of overtime rights, repealing or restricting rights to sick leave, undermining workplace safety protections, and making it harder to sue one’s employer for race or sex discrimination.
• Legislation has been pursued making it harder for employees to recover unpaid wages (i.e., wage theft) and banning local cities and counties from establishing minimum wages or rights to sick leave.
• For the 93 percent of private-sector employees who have no union contract, laws on matters such as wages and sick time define employment standards and rights on the job. Thus, this agenda to undermine wages and working conditions is aimed primarily at non-union, private-sector employees.

According to Lafer, the above-noted efforts provide important context for the actions taken to undermine public employee unions that have been much more publicized. He pointed to what he considered the most galvanizing and prominently reported legislative battle — Wisconsin Governor Scott Walker’s “budget repair bill” that “largely eliminated collective bargaining rights for the state’s 175,000 public employees.”
In the wake of Governor Walker’s move, Lafer cites to these legislative efforts in 2011 and 2012 to curb the workplace rights of public employees:

• Fifteen states passed laws restricting public employees’ collective bargaining rights or ability to collect “fair share” dues through payroll deductions.
• Nineteen states introduced “right-to-work” bills, and “right-to-work” laws affecting private-sector collective bargaining agreements were enacted in Michigan and Indiana.

Despite portrayals of those who supported such anti-union legislation as defenders of non-union workers, whom they cast as the hardworking, private sector taxpayers who were stuck with picking up the tab for public employees’ lavish pay and pensions, Lafer asserts that it is now “clear that the attack on public employee unions has been part of a broader agenda aiming to cut wages and benefits and erode working conditions and legal protections for all workers —whether union or non-union, in the public and private sectors alike.”

The evolving labor movement. Perez, for his part, apparently finds renewed hope in the “new” labor movement: “This isn’t your father’s labor movement as you know. For more reasons than I have time to enumerate, our unions are seeking out new and innovative ways of doing business. Around the country, I see example after example of labor working with management to forge win-win solutions that get workers the good jobs, skills and opportunity they need.”

Perez cited to these examples, among others:

• The Culinary Academy in Las Vegas, a partnership between the local hospitality industry and the unions that is training thousands of people a year for good jobs — as cooks, maids, bartenders, stewards and more — paying a middle-class wage and providing a secure career path.
• The Building Trades working together with construction companies to leverage $750 million a year in private sector money to provide state-of-the-art apprenticeship training that helps people find good work and skills that create the foundation for a stable career.
• SEIU 1999, which working directly with health care employers, has training centers in several states designed to prepare people for careers as nurses, homecare workers, pharmacists and more. This is labor and management working hand-in-glove, rejecting the stale debates of yesterday, finding common ground and identifying mutual interests, Perez said.

The Labor secretary cast a wide net in offering examples for the evolving U.S. model: “As we aspire to build more of these partnerships, we can look overseas for a model. Take Germany, a manufacturing powerhouse, and what they have accomplished with their werks councils. Workers and employers there have demonstrated conclusively that labor-management cooperation increases productivity, spurs innovation and creates shared prosperity. We can do the same as we rebuild manufacturing here in the states — if we reject false choices and work together on creative solutions.”

Pointing to Henry Ford’s move in 1914, when he doubled the wages of Dearborn, Michigan, assembly line workers, Perez quoted the successful capitalist with approval: “If we can distribute high wages, then that money is going to be spent and it will serve to make storekeepers and distributors and manufacturers and workers in other lines more prosperous and their prosperity will be reflected in our sales. Countrywide high wages spell countrywide prosperity.”

Decrying the low-wage model that is so common in the fast food and retail industry, the Labor Secretary said: “Costco, one of the nation’s most successful retailers, sells great products at reasonable prices while paying employees around $15 or $20 an hour plus benefits. I went to a Costco opening in northern Virginia this summer and talked to the manager who’s been with the company for several years. She started by pushing carts, now she’s running a store. Costco provides these kinds of opportunities for upward mobility and middle-class employment while still being quite profitable.”

For those who are trying to figure out how to deal with both the changing face of labor in the United States and the impetus for the alt-labor movement, the Secretary of Labor’s remarks and the EPI report are both well worth the read.

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