Today’s News & Commentary — July 15, 2021

The Senate Democrats’ new budget reconciliation bill plans to financially penalize companies that violate workers’ rights. The proposal is planned to be embedded into the $3.5 trillion bill, utilizing the National Labor Relations Board to levy penalties where appropriate. Senator Bernie Sanders remarked that this provision would be part of the PRO Act’s integration into the bill. He did not expand on what other provisions might also make it into the legislation. These monetary penalties would give unions much more leverage at the bargaining table with employers, who frequently only face the penalty of potential backpay. The absence of meaningful penalties makes it economically rational for employers to fire pro-union employees even if they are forced to rehire them. Union officials remain committed to passing the entire PRO Act into law.

Hundred of workers at snack and beverage company Frito-Lay have remained on strike since July 5th at its Topeka plant in response to crushing working conditions. In response to surging pandemic demand, employees have been forced to work 84-hour workweeks; many employees have worked 12-hour days, seven days a week with only eight hours between clocking in and out. Anthony Shelton, President of the Bakery, Confectionery, Tobacco Workers and Grain Millers Local 218 remarked, “They are forcing the current workforce to work double and triple shifts,” preventing employees from even seeing family. Frito-Lay responded saying it is committed to a safe and fair workplace. Yet workers have failed to receive a fair share in the gains of the company even amid its success. Frito-Lay’s parent company, PepsiCo, took in over $70 billion dollars in revenue in 2020, increased its stock valuation by 19%, and reverse three quarters of negative growth while some workers’ wages only rose 77 cents in the past 12 years. This comes amid poor records of safety at the plant; in recent years, OSHA has fined the Topeka factory for vehicle accidents and even amputations. The proposed contract would provide pay increases of 4% over two years and cap the workweek at 60 hours maximum. Negotiations resume Monday.

Employee-ownership think tank Fifty by Fifty recently released its opinion on the State Small Business Credit Initiative (SSBCI) component of the American Rescue Plan Act of 2021. The SSBCI would include provisions to expand employee ownership of businesses. The organization applauded the initiative but urged Congress to lift its sights higher beyond small businesses and towards larger concentrations of corporate wealth in bigger corporations. The group emphasized that much like during the Great Depression where few workers could qualify for a home mortgage before federal assistance, so too are many workers facing a future where their wages are not enough to sustain their retirement. They propose promoting employee ownership of companies by increasing the amount of credit enhancement —federal regulation to improve creditworthiness of a company— available to larger businesses. That way, they are able to sell portions of the company to their employees at lower risk to later investment. The think tank recommends a $100 billion total federal loan guarantee to aid in transition to employee ownership of companies.

Japanese multinational conglomerate Softbank has faced significant hurdles in rolling out Pepper, its robot employee for hire. Namely, Pepper the robot keeps getting fired. Softbank originally designed the robot to understand basic conversation and have a chipper demeanor. But when faced with actual human labor, the robot failed. Pepper malfunctioned during religious scripture readings, and was fired; Pepper took breaks while attempting to teach exercise classes in a nursing home, and was fired; Pepper failed to recognize the faces of family members when purchased for personal use, and was fired. At $2,000 plus monthly fees for individuals and $550 a month for businesses, Pepper has been a costly failed investment for people looking for a competent human connection. After having spent $9,000 on renting the robot, one customer complained, “It was such a waste of money. I still regret it.”

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