Unions Step Up Attacks on Independent Contractor Status UBER

Unions Step Up Attacks on Independent Contractor Status

Facing loss of members, unions take aim at ride-sharing companies and other transportation providers.

As unions' membership continues to decline and their allies in federal government decamp, they're seeking to rebuild membership by transforming independent contractors into employees, especially commercial drivers.

Some courts and state and local governments are helping unions pursue this strategy, but even during the Obama era successful outcomes were not assured, and recent court decisions and the stiffening of employer resolve could slow their advance.

In 2016 only 10.7% of the U.S. workforce were union members, the federal government reports, representing a loss of 236,700 members, or 0.4%, from 2015, when they represented 11.1% of the workforce. Subtract government workers who are union members and the picture gets even worse. The union membership rate for government employees is over five times that of private sector workers, with 34.4% belonging to a union—only 6.4% of private sector workers do.

Also expected to dilute union membership more is the effect of 28 states enacting right-to-work laws and nationwide right-to-work legislation being under consideration in Congress.

In recent years many federal agencies worked individually and in alliance to support the union assault on independent contractors. One high official even stated that there are no independent contractors, just employees who have been misclassified.

Teamsters efforts to organize drayage drivers at West Coast ports have enjoyed some success. Supported by a draconian state law and enforcement threats by the California Labor Commissioner, some fleets have switched to employee drivers or simply ceased operating.

Brad Jacobs, who heads XPO Logistics, which owns drayage fleets on the West Coast, recently told an interviewer, "I don't believe in the Teamsters." While Jacobs says he gets along well with labor unions in Europe, he declares, "the Teamsters are out of control."

The Teamsters suffered a recent legal defeat in their campaign to organize FedEx Ground drivers when a federal appeals court struck down a National Labor Relations Board decision supporting the union's argument that FedEx home delivery drivers are not independent. Years ago Teamsters' court victories led to its discovery that many FedEx Ground drivers insist they prefer being independent, even if the union and courts say they aren't.

Other unions also have run smack into the reality that while they deny there are any real independent contractors, large numbers of such people strongly insist that they are exactly that. 

Lyft and Uber also are under siege, fighting organizing attempts throughout the country. In Seattle the city council enacted a law ordering Uber to accept unionization of its drivers. Now the company is battling a representation election, trying to persuade drivers to reject the union by deploying phone calls, e-mails, podcasts, text messages and even television commercials. A Teamsters victory could add as many as 10,000 drivers to the union's ranks. The San Francisco Bay area could be next.

The old union truism says that you can't organize a company where the employees believe they are paid fairly and well treated. Uber's immature top leadership seems to have embraced the opposite tack. Many drivers believe the company's financial compensation formulas are unfair and are not shy about saying so. A sexual harassment charge grabbed headlines. A video of CEO and co-founder Travis Kalanick in the backseat of an Uber car berating a driver who had complained about pay and work conditions went viral, forcing Kalanick to apologize.

Uber also is seeking to overturn the Seattle law in court. In the meantime it's providing an example of how employers can embrace innovative tactics to oppose unions, while also showing what not to do when trying to win owner-operators over to your side.

David Sparkman is founding editor of ACWI Advance, the newsletter of the American Chain of Warehouses Inc., as well as a member of the MH&L Editorial Advisory Board.

TAGS: MHL Magazine
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