Labor unions as 'fixers'

Matthew Hoy
By Matthew Hoy on May 28, 2015

Los Angeles appears likely to follow in the footsteps of Seattle and San Francisco in mandating a $15/hour minimum wage. If you want to make sure youth unemployment skyrockets, you couldn't come up with a better plan. The number of no-experience 16-year-olds who add more than $15 per hour to your business's value is vanishingly small. For those 16-year-olds who do, they've got better business opportunities on their own than flipping burgers at McDonald's.

The Los Angeles Times yesterday reported on an interesting snag that's come up in the City of Angels' plan to mandate a so-called "living wage." The city's labor unions want an exemption.

Labor leaders, who were among the strongest supporters of the citywide minimum wage increase approved last week by the Los Angeles City Council, are advocating last-minute changes to the law that could create an exemption for companies with unionized workforces.

For much of the past eight months, labor activists have argued against special considerations for business owners, such as restaurateurs, who said they would have trouble complying with the mandated pay increase.

But Rusty Hicks, who heads the county Federation of Labor and helps lead the Raise the Wage coalition, said Tuesday night that companies with workers represented by unions should have leeway to negotiate a wage below that mandated by the law.

"With a collective bargaining agreement, a business owner and the employees negotiate an agreement that works for them both. The agreement allows each party to prioritize what is important to them," Hicks said in a statement. "This provision gives the parties the option, the freedom, to negotiate that agreement. And that is a good thing."

Let's set aside a moment the utter hypocrisy involved in labor leaders arguing for the "freedom" to have union members work for lower wages (rather than collecting unemployment), but workers themselves not being allowed the freedom to make the same choice.

What we have here is the labor unions as 'fixers' who can shield businesses from the onerous government regulation.

Here's how it will work:

Small, low-margin business that can't afford to pay burger-flippers $15 an hour is approached by the union.

Union says: "You're paying your employees $8/hour now, but without us unionizing your employees, you'll have to pay $15. Let us unionize your workforce and you'll only have to pay them $11."

Business owner agrees because it's the only way they can stay in business.

Employees agree because it's the only way they'll still have a job.

Union gets to count a couple dozen more people as "union members" when they go to politicians to lobby for special benefits, along with the additional union dues to line their own pockets.

This has one advantage over the way the mob used to do it: It's government approved.

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