A good day for workers rights in California

By Michell K. McIntyre, NCL’s Special Project on Wage Theft

October 9 was not only a good day in California history, but also a good day in labor history, for Governor Jerry Brown signed some great workers’ rights bills into law. He signed the Wage Theft Prevention Act (AB 469), the Employee Classification Act (SB 459), a farm workers’ right bill (AB 243) and many others. These laws represent huge steps forward in the battle to protect workers’ rights in a difficult political climate.

While the majority in House of Representatives is looking to erode workers’ rights in favor of corporate interests, often under the mantle of ending “job killing regulations,” it’s encouraging to see three workers’ rights bills become law in a state that, in 2009, was the world’s eighth largest economy.

These laws strive to prevent wage theft, strengthen existing laws protecting workers’ rights and increase penalties on employers caught cheating their employees. Some of the main points of each of the new laws:

The Wage Theft Prevention Act (AB 469):

• Employers are to provide workers, at the time they’re hired, a written disclosure of their basic terms of employment – the pay rate, the pay day & the name and address of the legal employer
• Strengthens misdemeanor criminal penalties for employers who willfully fail to pay wages due in 90 days after final judgment
• Allows a worker to recover attorney’s fees to enforce a court judgment for unpaid wages

The Employee Classification Act (SB 459):

• Makes it unlawful for any person or employer to engage in willful employee misclassification – classifying an employee as an independent contractor rather than an employee
• Makes it unlawful to charge any fees or make any deductions in a worker’s paycheck for expenses such as space rental, services, repairs, goods or materials, where such deductions would have been unlawful had the worker been classified as an employee
• Increases penalties that can be assessed against any employer for willful employee misclassification.
• Requires employers who have been found to have committed employee misclassification to display a notice to its employees and the general public on their website and/or each location where it occurred

One of many farm workers’ rights bills signed into law was Assembly Bill 243 that requires farm labor contractors to disclose on workers’ pay stubs the name and address of the legal entity that secured the farm labor contractor’s services. Many farm workers do not know who their legal employer is nor whom they should be addressing with employment and payment issues.

These three laws are good practical examples of what can happen on a state level since the federal government is slower to move and faces larger lobbying efforts by big business and industry. Other state governments should take notice of these workers’ rights victories and try passing similar laws in their states.

Airline industry disappoints consumers. Again.

$25 for one checked bag? Another $20 to choose your seat? Is it any wonder that the airline industry consistently scores the lowest in consumer satisfaction surveys? Earlier this summer, the American Customer Satisfaction index reported that, out of the 47 industries evaluated, airlines tied newspapers for the lowest-satisfaction rating, and airline satisfaction only continues to spiral downward.

The airline industry’s actions over the past few months will do nothing to improve consumer confidence. When the government failed to reauthorize the FAA in July, several federal taxes were discontinued, which could have meant a 15-percent break on airfare for passengers. Instead of passing the money saved from the tax holiday on to consumers, most airlines actually raised prices–allowing them to collect nearly $70 million a day, almost $500 million in total, before the FAA’s taxing authority was reinstated.

NCL, along with a coalition of consumer interest groups, condemned airline executives in a letter to the CEO of the Air Transport Association for their greed and lack of transparency in ticketing fees.

If airlines continue to exhibit this type of anti-consumer behavior, it’s a fair bet that the industry can expect a permanent spot on the bottom of the consumer satisfaction scale.

‘But Moooooommm!’ – help for parents shopping for tweens’ cell phones

By John Breyault, NCL Vice President of Public Policy, Telecommunications and Fraud

As kids head back to school this time of year, parents will undoubtedly soon be deluged with requests to buy cell phones for their children. Research shows that children are having these wishes fulfilled at progressively earlier ages, as well.

For example, a 2009 Pew Internet and American Life Project survey found that 5 percent of 16-year-olds say they received their first cell phone at age 11 or before. Conversely, 57 percent of 12-year-olds say they received their first cell phone at age 11 or before.

The complaints of family blogger Carol Brooks Ball mentioned recently are typical when it comes to parents’ headaches surrounding their tweens’ first phones:

“Both of my children have cell phones. And both phones, in my mind, were purchased for the sole purpose of keeping in touch. With me.

Them, not so much. To them, their cell phones serve the purpose of allowing virtually-constant contact with friends.

…

When I first got the kids their cell phones – when they were both ‘tweens’ – I learned the hard way about the cost of going over the wireless plan’s small monthly allotment for text messaging. My daughter quickly burned through the texting limit (my son wasn’t, and still isn’t, much of a texter; if I send him a text message, he calls me back).

While I soon set limits for my daughter due to her texting proclivities, I also quietly signed up for unlimited texting through my wireless carrier. But, how great it would have been to have had some objective guidance on the subject at the time.”

It’s for parents like Carol that NCL, through an educational grant from TracFone Wireless, has produced a new consumer guide for parents of tweens getting their child’s first cell phones.

When considering a tween’s first cell phone, parents have a number of important considerations to keep I mind. For example, an older teenager is likely to be using their phone to stay in touch while at an after-school job. On the other hand, a tween is less likely to be roaming far from home on their own, needing a phone only to call Mom for a ride home from soccer practice.

Older teens are more likely to be riding in cars with other teens, so a serious discussion about texting-while-driving will likely be in the cards. Pre-teens probably won’t find themselves without an adult in a car, but they do take their phones with them while on two wheels, so texting-while-biking should be a topic of discussion. Tweens also may not have had as much practice in taking care of their own personal (and expensive!) electronics as older teens.

To help parents with these and other issues, NCL’s new guide contains a wealth of tips for parents for figuring out why (or even if) your tween needs a cell phone, sorting through the vast universe of handsets and service plans and setting “rules of the road” for responsible use.

Welcome to the 2011-2012 LifeSmarts program year!

By Lisa Hertzberg, LifeSmarts Program Director

The pencils are sharpened, the new tennis shoes are squeezing the toes, and students across the country are primed to learn about consumer issues and tackle NCL’s competition about real-life: LifeSmarts.

LifeSmarts introduces middle school and high school students to real-world knowledge they can use now. We quiz them about workers’ rights, managing money, eating well, using technology, and much more.

Students may begin competing today!  Students can practice using the vast array of consumer resources available at lifesmarts.org, including practice quizzes.

Highlights at lifesmarts.org include:

• TeamSmarts: Monthly 100-question quizzes focus on one topic area. Teams of students can work together and test their smarts against other teams from across the country. Prizes go to the top LifeSmarts and FCCLA teams each month. To warm up, try the practice quiz first (password: practice)

• New health and safety lessons are available at LifeSmarts U: the LifeSmarts Virtual Classroom. Learn about medicine 101 and drug safety.

• New Question of the Day calendars which are a treasure trove of competition questions! Coming soon: Questions in Flash Card format!

• An index by topic or type of activity of all of our learning resources.

We are excited to kick-off the new LifeSmarts program year today! We expect it will be our best year yet. Join us!

Labor Day is too often a missed opportunity

By NCL Executive Director Sally Greenberg

This weekend we celebrated Labor Day. This should be a time to look back on the struggles of the American worker to achieve the rights and protections that too many of us take for granted today – an 8 hour day, an expectation of safe working conditions, children in school and not at a work site, minimum wage law protections, pay for overtime work, workers compensation and unemployment insurance. Each one of those protections was hard-won.

I think all of us – including the labor movement – could do a far better job of using Labor Day Weekend as a “teaching moment.” What’s the history of the union movement in this country? Why do we need unions? How many workers died in violent confrontations with owners of factories, mills and coal mines? Conditions were dangerous and the pay was low. In 1907, one coal mining accident in West Virginia killed 361 miners.

How about the women who worked in laundries at the turn of the century, (see the case brought by NCL – Muller vs. Oregon against laundry owner Curt Muller limiting the hours women could be forced to work) standing all day with few breaks, lifting soaking wet towels and sheets whose weight caused back and joint injuries, some of them pregnant or suffering chronic illnesses? Or African Americans who stood for 12 to 14 hours a day, often next to their children in a foot of water at canneries? Child labor was scandalous, with children as young as five and six going to work in mills and mines in America only 100 years ago.

I heard Teamsters President James Hoffa speaking over the weekend on the importance of good jobs with good benefits bringing us a middle class in America that can enjoy the fruits of our labor. He called Apple – the company – unpatriotic because they ship jobs overseas and sell their products here to affluent Americans. I see his point.

And sadly today, the middle class jobs that labor union membership can bring have dwindled, as has union membership. Union busting – of the kind we’ve seen with Boeing moving its operations from Washington State –a union friendly place, to South Carolina – an anti-union state, and attacks on the National Labor Relations Board in Congress are at a fever pitch.

But sorry to say we heard precious little about why unions came about over the weekend. That should change – NCL and others must be leaders in having that conversation and continuing to push for good jobs, good benefits and keeping jobs in the hands of the most productive and well-educated workforce in the world – U.S. workers.

Helping the exploited students at the Hershey plant

By Michell K. McIntyre, Project Director of NCL’s Special Project on Wage Theft

As the nation’s oldest consumer advocacy group, who’s been protecting and promoting social and economic justice for workers and consumers, we were disturbed to learn about the exploitation the J-1 visa students experienced at a Hershey packing facility.  Since then we’ve sent a letter to the Hershey Company, partnered with various unions and explored ways to ensure that these terrible acts of exploitation are never repeated.

The International Union of Food Workers wrote a wonderful letter detailing the work unions have been doing to help the J-1 students and offer solutions to the Hershey staffing problem. Click here to read it.

Politicians, please take note: regulation works

By Sally Greenberg, NCL Executive Director

Today’s New York Times featured a piece about conservatives attacking the Environmental Protection Agency. Never mind that a substantial majority of Americans are concerned about air and water pollution and largely trust the E.P.A.

Conservative presidential candidate and member of Congress Michelle Bachmann drew applause ten days ago at a rally in Iowa when she declared: “I guarantee you the EPA will have doors locked and lights turned off, and they will only be about conservation. It will be a new day and a new sheriff in Washington, DC.”

Sorry to upset your apple cart, Ms. Bachmann, but it just so happens that regulation works. One of my favorite examples is the dramatic reduction in highway deaths over the past decade. Have we become safer drivers? I don’t think so. Have cars become safer and have we been more successful in cracking down on drunk driving? Absolutely.

How’s this for a statement of fact: Americans are less likely to die on the highway today than at any time since the middle of the Truman Administration (that was 1948-1952, 59 years ago) The number of people killed in accidents dropped to 32,788 in 2010, the lowest since 1949, according to the National Highway Traffic Safety Administration.

In fact, the 3 percent decrease in traffic fatalities since 2009 occurred even as drivers put nearly 21 billion more miles on their cars than they had the year before. Imagine: the death rate has declined by 25 percent since a peak of 43,000 in 2005. The reason for this reduction: stronger drunk driving laws, mandatory safety standards on vehicle for both crash protection and crash avoidance, including head and side air bags, better seat belts, head rests and crush zones in cars. Add anti lock brakes and rollover prevention (known as “stability control”) have all contributed to safer cars and thousands of lives saved. And guess what – all of these safety features came about as a result of regulation. EPA prevents our cities from being engulfed by smog and keeps our water clean and safe to drink, especially for children.

This talk about closing the EPA or any other regulatory agency is reckless, ill-informed, and not supported by the American people. Politicians should look elsewhere in their quest to garner votes.

New bill addresses confusion over meaning of “4G”

By Larry Rose, NCL Public Policy Intern

You’ve probably heard the term “4G” being mentioned a lot recently. And, if you’re like most consumers, you probably have no clue as to what that means. In theory, a fourth generation, (4G) wireless network is a network that offers significantly greater speed than the third generation (3G) wireless networks that most smartphones run on.  The International Telecommunications Union (ITU) used to define 4G services as broadband technology that has a speed exceeding 100 M bit/s.  ITU later changed the definition of 4G to any form of mobile broadband that marks a meaningful improvement over 3G services. This definition is vague and allows the telecommunications industry to refer to many different types of mobile broadband as “4G.”

The four largest members of the telecommunications industry all provide services that are advertised as being “4G.” However, these four companies use the term “4G” to refer to three different types of mobile broadband technology. AT&T and T-Mobile advertise their Evolved High Packet Speed Access (HSPA+) networks as being “4G” despite the former company considering its HPSA+ network to be a mere “transition” to “true” 4G technology.  On the other hand, Verizon uses the term to refer to its Long Term Evolution (LTE) network, which typically provides faster speeds than the HPSA+ network. Sprint markets its WiMax technology as “4G” despite being somewhat slower than Verizon’s LTE network. These three services are considerably different from one another from a technological point of view, but they all operate under the same marketing label.  This creates difficulties for consumers who are trying to determine which wireless service to purchase.

Fortunately, consumers have found themselves a champion in Congress. Last month, Representative Anna Eshoo of California introduced H.R. 2281, the Next Generation Wireless Disclosure Act.  This bill requires wireless service providers to disclose information about the speed, reliability, price, network management policies and the terms of the wireless service, as well as costs for the service that are not included in the stated price and the technology used to provide the service. The bill would also direct the Federal Communications Commission (FCC) to create a side-by-side comparison of the speeds and prices of the 4G services provided by the top 10 U.S. wireless carriers.

The telecommunications industry isn’t pleased with this bill. According to the CTIA, the bill adds unnecessary regulation at a time that Congress should be focused on finding more spectrum to devote to 4G technology.

A study from Nielson found that only two out of five consumers understand what the term “4G” actually means. 27% of respondents incorrectly believed that Apple’s iPhone 4 offers 4G technology . That false assumption was most likely aided by the fact that a previous version of the iPhone was called “iPhone 3G,” after the type of mobile broadband that it used.

Last week, NCL, joined the ranks of Consumers Union, Public Knowledge, Media Access Project and the New America Foundation’s Open Technology Initiative in endorsing the Next Generation Wireless Disclosure Act. In an economy where many consumers rely on mobile broadband for Internet access, it is essential that consumers know what type of mobile broadband service they are purchasing.

The good banker

By Sally Greenberg, NCL Executive Director

One of the best brains on financial reform is, in my view, Joe Nocera. He writes for the NYTimes and is a frequent guest on NPR. Nocera recently wrote a NY Times piece about a man he calls “the good banker.” Why does this man, Robert Wilmers, CEO of M& T bank, earn Nocera’s respect? Wilmers is a unique critic of his profession. I find that folks in the business community that are capable of self-criticism are rare indeed; most want to ignore or overlook the bad practices that are perpetuated by their companies.

But Wilmers finds plenty of fault in the banking business and it bothers him that bankers have fallen to the “third worst profession” in the public’s mind. He says that much of the money banks earn comes from trading profits “rather than prudent extension of credit that furthers commerce.” We agree. Wilmers believes that derivatives helped bring about the financial crisis and should be regulated. We agree. He says that bank executives are wildly overpaid. Boy, do we agree with that. He says that the biggest banks, the Too Big to Fail Banks – were operating in an “unsafe business model.” We agree.

I’ve said in previous blogs that I wish banks would make money the old-fashioned way – extend loans at 6 or 7 percent and pay depositors 2-3 percent interest. But that’s not big bucks, so that business model – while still in use – is sidelined. Instead, banks use excessive fees – $39 overdraft charges, fees for going over your spending limits – often paid by those with the most limited incomes–the stuff that Elizabeth Warren calls “tricks and traps” - are used to make their executives rich. Or they trade in derivatives and earn big fees for the transactions.

Nocera notes that in 2007, the chief execs of the Too Big To Fail Banks made, on average $26 million. That’s more than double the compensation of the top nonblank Fortune 500 executives. Wilmers himself made $2 million, a great salary by any standard but reasonable relative to his performance (in 30 years he built the bank from a $2 billion operation to assets of $68 billion today).

Wilmers also believes that Glass Steagall Act – the Depression era law that separated commercial and investment banks – should never have been abolished. I couldn’t agree more. The repeal of Glass Steagall is one of the worst disasters of deregulation. Nocera quotes from Wilmers speech at his company’s annual meeting. He said he wants to find “ways to continue to attract deposits, make sound loans and grow in accordance with our historic credit quality standards.”  Someone should give this very unusual CEO an award!

An Independence Day flick: ‘Hot Coffee,’ tort reform, and the American lawsuit

By Michael Finch, Roosevelt Summer Academy Fellow at NCL

Newspapers and the blogosphere are buzzing about Susan Saladoff’s documentary, “Hot Coffee,” which premiered July 27^th on HBO. The award-winning documentary explores the issues of tort reform and mandatory arbitration clauses in contracts, and the people they can hurt. Saladoff also wrote a blog at Politico, called “Signing away constitutional rights,” which deals with the same issues as the film.

Saladoff’s Politico blog and documentary seem to be pretty effectively spreading the word about the inaccuracy of the “Americans love to file frivolous lawsuits” meme that exists in our culture.

The movie’s namesake is the widely-known and oft-maligned case of a woman (Stella Liebeck) who spilled McDonald’s coffee on herself and sued for millions. But as Saladoff’s documentary shows, the situation is nothing like people think. Liebeck’s injuries were extensive, McDonald’s had received reports that their coffee was too hot and had burnt other consumers, and Liebeck never asked for, nor did she receive, “millions.” She initially asked only for $20,000, to pay for past and projected medical expenses and loss of income. McDonald’s offered her $800. The case escalated, repeatedly, and Liebeck ended up being awarded less than $600,000 in an out-of-court settlement.

Liebeck’s case, however, is an outlier. The even more important issue that Saladoff’s film brings up is the push for tort reform. There is a great deal of risk that enacting tort reform will deprive people of help that they desperately need. People use the court system as a last resort, not as a quick way to make a buck. If the number of people suing for frivolous reasons is grossly exaggerated, then the only result of making it even more of a hassle to bring a case to court will be hampering people with legitimate concerns.

For example, medical malpractice is an area that many people say is full of frivolous lawsuits, and many tort reform discussions center around this issue. However, according to an article by Drs. John Glasson and David Orentlicher in the Journal of the American Medical Association, only 2% of “adverse events due to negligent practice” lead to malpractice claims.

For most people, the court system is simply too difficult to navigate, and the expense and time required to bring a suit outweigh the potential benefits. Unless we greatly change how we view access to and use of the American legal system, any tort reform we enact will carry too great a risk of harming innocent people.

Hopefully “Hot Coffee” will spread the truth and open some eyes to the very real dangers of mandatory arbitration clauses, and this pervasive but inaccurate view of our justice system. Susan Saladoff should be applauded for bringing attention to this very important issue.