The purpose of this newsletter is to inform you of recent activities by the Department for Professional Employees, AFL-CIO as well as emerging issues affecting the professional and technical workforce. NewsLine will be published on the first of every month. Issues of NewsLine are accessible on the DPE web page www.dpeaflcio.org. Feedback welcomed; send to palmeida@aflcio.org.

In This Issue:

BREAKING NEWS – WHITE COLLAR MELTDOWN http://www.dpeaflcio.org/news/news/news_2004_06_04.htm

OFFSHORE/OUTSOURCING - The Senate completed action on S. 1637 to reconfigure the Foreign Sales Tax/Extra-territorial Income (FSC/ETI) export tax exemption that violates WTO rules. DPE backed AFL-CIO efforts in the Senate to slash tax breaks in the Finance Committee bill for U.S. based multi-national companies that were seen as incentives to offshore U.S. jobs. During on-again, off-again debate the Senate:

• Approved a modified amendment by Sen. Chris Dodd (D-CT) restricting federal government contracts from being outsourced under certain circumstances.
• Rejected by a 45- 54 vote a bipartisan effort by Senators Norm Coleman (R-MN), Max Baucus (D-MT) and Ron Wyden (D-OR) to extend Trade Adjustment Assistance benefits to white collar and service sector workers displaced by trade policy actions. The amendment failed to get the 60 votes necessary under Senate budget waiver procedures.
• Rejected on a 60-39 motion to table an amendment by Senators Byron Dorgan (D-ND) and Barbara Mikulski (D-MD) to eliminate foreign tax deferral for companies that export U.S. jobs.
• Defeated by a 74 to 23 vote a labor-backed amendment by Sen. Fritz Hollings (D-SC) to strip out of the bill some $37 billion in tax breaks that underwrite outsourcing of U.S. jobs

Action in the House is stalled due to the refusal of 25-30 republicans to support the underlying bill—H.R. 2896—because its tax breaks for U.S. firms that relocate jobs overseas are too large. This GOP breakaway has been lead by Rep. Don Manzullo (R-IL) who chairs the House Small Business Committee. (Under his leadership the committee has held several hearings about offshore outsourcing at which both the DPE and AFL-CIO have testified.)

In May President Almeida attended a briefing sponsored by the New America Foundation where Senator Lieberman introduced his white paper titled “Offshore Outsourcing and America’s Competitive Edge: Losing out in the High Technology R&D and Services Sectors.” (http://lieberman.senate.gov/newsroom/whitepapers/Offshoring.pdf)

In Maryland, the Democratically-controlled state legislature passed a watered down version of anti-offshore legislation. The original bill, introduced by Delegate Pauline Menes and Senator Paul Pinsky would have banned the offshoring of state contracts. President Almeida had testified earlier in the year in support of the legislation before the MD House of Delegates Health and Government Operations Committee. The final legislation only authorized the state Board of Public Works which has authority over public contracts to consider offshoring as a factor in awarding the contract. But even this was too much of an intrusion for Maryland’s pro-business GOP governor Bob Ehrlich who vetoed the bill in late May.

IMMIGRATION:GUEST WORKER VISAS—During May, the Senate Judiciary Committee scheduled and rescheduled a markup on S. 1635 introduced by Immigration Subcommittee Chairman Saxby Chambliss (R-GA) dealing with the much abused L-1 guest worker visa program. Under L-1, multinational corporations are authorized to bring into the country employees from their overseas subsidiaries on an “intra-company transfer” basis. The only requirements are that these guest workers must have worked for the company for one year out of the past three prior to the transfer and have “specialized knowledge” of the companies operations or products. Media exposés have uncovered significant program abuse: 

• L-1s are being used to replace U.S. workers, who are often forced to train their L-1 replacements before they themselves are laid off; nothing in current law prevents this displacement.
• Foreign-owned outplacement firms—also known as “body shops”—are bringing in thousands of foreign L-1 visa workers and then contracting them out to other employers, contrary to congressional intent.
• While the L-1 visa is supposed to be reserved for executives, managers and workers with “specialized knowledge,” the so-called body shops are importing run-of-the-mill tech workers and other low-level workers for U.S. firms.
• Many L-1 workers lack the requisite credentials to do the high-level work envisioned under this visa program.
• L-1 brokers are filing open-ended, blanket petitions that allow mass importation of these foreign workers instead of an individualized application process.

 Other serious problems also exist. Unlike the H-1B visa program there is no limit on the total number of foreign workers that can be brought into the United States annually under the L-1 program. From 1995 through 2001 the volume of L-1 visas issued doubled to nearly 60,000 as firms sought to bypass the minimum worker protection standards in the H-1B program; and companies began to use the program as a tech transfer pipeline that enables off-shore outsourcing by facilitating the training of large numbers of foreign guest workers in the latest technologies who then return to their home countries with their jobs soon to be followed by many more. In addition, the duration of the visa—up to five years—exceeds a reasonable definition of a temporary program, there is no requirement that L-1 foreign guest workers be paid prevailing wages and benefits for the duration of their employment. Meanwhile, government agencies responsible for administration of the program freely admit there is little or no oversight or enforcement, a situation made worse because there are no effective sanctions that deter abuse of this visa program.  

In 2003 the DPE worked with Rep. Rosa Delauro (D-CT) on the introduction last year of H.R. 2702, comprehensive, bi-partisan, L-1 reform legislation. Some of these provisions were later included in a bill introduced by Sen. Chris Dodd (D-CT). However, the Chambliss bill dealt with only one of the Delauro-Dodd revisions namely to eliminate access to these visas by so-called “body shops”, i.e. outplacement firms many of whom are Indian-owned and use the visas to bring in thousands of these workers to facilitate off-shore outsourcing. As the Committee markup approached, DPE Executive Director Mike Gildea, who had testified before the House and Senate regarding needed L-1 reforms, lobbied Senate Judiciary Democratic and Republican staff to consider offering possible amendments along the lines of reform legislation. As of this writing another markup was scheduled for early June.

BROADCASTERS RIGHT TO WORK BLOCKED IN MARYLAND - AFTRA’s campaign in the Maryland legislature to outlaw non-compete agreements in broadcast and radio markets throughout the state made it halfway through the General Assembly in just its second year of consideration. The Free State effort, which had the active support of the DPE, is part of a national, state-by-state initiative to prohibit these covenants in as many jurisdictions as possible.  

Non-compete covenants, which are forced upon off and on-air talent, forbid these employees from working for a competitor within the same media market even if they are terminated--with or without cause--or their contracts are not renewed. These restrictions can be imposed for up to a year or longer and often preclude a media professional from working within a broadcast market that can cover hundreds or even thousands of square miles. Such restrictions have a devastating effect upon the careers of these workers by, in effect, preventing them from earning a living or improving their economic standing within their chosen profession. For both aspiring and veteran broadcasters and journalists, these caveats are often the non-negotiable price of being hired in a take-it-or-leave-it environment that allows media employers to amass unreasonable economic leverage over these professionals.  

After a full court press in the House of Delegates and leadership support from Democratic Speaker Michael Bush and Majority Leader Kumar Barve, the anti-non-compete bill won overwhelming approval in the House of Delegates by a 106-31 vote. However,  Senate Finance Committee Thomas “Mac” Middleton—a southern Maryland conservative Democrat—blocked his committee from considering the bill even though a majority of its 11 members were prepared to support the bill. 

OVERTIME – In the battle to protect overtime pay, Republican obstructionism in the House of Representatives reached an election-year low.

On May 4, 2004, a bipartisan majority of the Senate voted for the Harkin amendment.  That amendment would allow the Bush Department of Labor (DOL) to expand overtime pay protections but stop the Bush DOL from ending them for workers who are protected now.  Rep. George Miller (D-CA) sought a vote on the record in the House of Representatives.  The Republican House leadership was determined to prevent it – and did, twice, on party-line votes.  On May 12, 222 Republicans voted against 202 Democrats, two Republicans, and one Independent to table Miller’s motion.  Miller tried again, and on May 18, 216 Republicans voted against 197 Democrats, one Republican, and one Independent to table his motion a second time.

DPE President Paul E. Almeida e-mailed a DPE Alert! to all DPE affiliates just before the May 12 vote and reported its results on May 14.  Despite the short turn-around time, DPE affiliates, as always, did their best to mobilize constituent support.  But most of the House Republicans who voted with us on October 2, 2003 saw the votes this month as procedural rather than substantive and had no interest in this election year in voting on the record on the Bush DOL regulations.

Absent legislative intervention, the final regulations that the Bush DOL issued on April 23 will take effect on August 23.  Backed by the Bush White House, the House Republican leadership will do all it can to prevent legislative action.  Our next step is to seek House Republican pressure on the leadership to allow a real vote, but the time is short:  The House is scheduled to begin a summer recess on July 24 that will run through September 6.

The proposed regulations that the Bush DOL issued on March 31, 2003 defined a floor beneath which workers would automatically receive overtime pay protections of $22,100.  They also set a cap of $65,000 above which employees would be highly unlikely to receive overtime pay.  The national outcry that DPE affiliates, DPE, and the AFL-CIO led resulted in important changes in the final regulations:  an increase in the floor to $23,660, and in the cap to $100,000, as well as better protection for many first responders.  To see the final regulations, go to http://www.dol.gov/esa/regs/fedreg/final/2004009016.htm.

But the voluminous fine print of the final regulations continues to hide disastrous take-aways from workers.  Though the Bush DOL claims that workers earning between $23,660 and $100,000 will not lose overtime pay protections, this is simply not true.  The final regulations redefine the salary basis test to allow employers to pay employees on an hourly, daily, or shift basis, still treat them as not entitled to overtime pay, and even use compensatory time (at the suggestion of the National Association of Manufacturers).  The final regulations also end overtime pay protections for some 1.2 to 2.3 million team leaders as well as millions of other workers:  registered nurses, nursery school teachers, assistant managers in retail establishments, insurance claims adjusters, chefs and sous chefs, many financial services employees, and others.  The final regulations also lessen the requirements for eliminating overtime pay protections for computer employees.

The final regulations thus represent a Bush payoff to campaign contributors.  That payoff comes at the expense of workers, the 40-hour week, and a chance to encourage employers to hire more workers rather than making the already employed work longer hours for nothing.  A hearing on May 20 before the House Committee on Small Business showed the constituency for the Bush DOL.  At the hearing, the “O.T. Coalition” distributed a letter praising the final regulations.  The 50 signers were, without exception, business groups:  the American Bakers Association, the American Bankers Association, the American Council of Engineering Companies, the American Hotel & Lodging Association, the American Insurance Association, the American Shareholders Association, and even the Grover Norquist organization, Americans for Tax Reform.  In the words of a May 18 Des Moines Register editorial:  “Why not let the Commerce Department look after business interests, and let the Labor Department go back to working on behalf of workers?”

For questions or comments, please contact David Cohen at 202-638-0320 extension 13, mailto:dcohen@dpeaflcio.org.

BRINGING WORKPLACES ISSUES TO THE CLASSROOM – DPE and AFT have been among the labor sponsors for a joint labor-management project funded by the Federal Mediation and Conciliation Service, "Workplace Issues and Collective Bargaining in the Classroom."  Administered by the Community Services Agency of the Metropolitan Washington Council, AFL-CIO, the project will be running a two-day train-the-trainer class for teachers who want to introduce a labor-management and union issues curriculum into social studies and U.S. history courses in the metropolitan Washington, DC area:  the District of Columbia Public Schools, Montgomery County, MD Public Schools, Prince George’s County Public Schools, and Alexandria, Arlington, and Fairfax County, VA Public Schools.  The class will be held June 28-29 at AFT.  The deadline for registration is June 15.  Call Louise Woodland or Kathleen McKirchy at 202-857-3410 or e-mail lwoodlan@dclabor.org or kmckirch@dclabor.org.  For questions about DPE’s participation in the project, please contact David Cohen at 202-638-0320 extension 13, mailto:dcohen@dpeaflcio.org.

BILL TO ESTABLISH MANDATORY NURSE-TO-PATIENT STAFFING RATIOS INTRODUCED– In conjunction with National Nurse Day, May 6, Rep. Jan Shakowsky (D-IL) introduced The Nurse Staffing for Patient Safety and Quality of Care Act of 2004 (H.R. 4316) legislation that would establish mandatory nurse-to-patient staffing ratio requirements for different units in hospitals around the country. Addressing the crucial problem of nurse understaffing, it is the first federal legislation to deal with nurse staffing ratios in hospitals. Co-sponsored by 16 House members, this bill had the support of 11 AFL-CIO unions, including seven DPE affiliates: AFSCME, AFT, AFGE, CWA, SEIU, UAN and UFCW, all of whom were represented on the AFL-CIO Nurse Committee that worked toward this bill.  

Most nurses believe that current understaffing endangers patients’ lives. And they are not alone. A 2003 study by the Institute of Medicine (IOM) found the environment in which nurses work a breeding ground for medical errors which will continue to threaten patient safety until substantially reformed. The IOM pointed to numerous studies showing that increased infections, bleeding and cardiac and respiratory failure are associated with inadequate numbers of nurses. For example, in 2002, researchers from the University of Pennsylvania found that for each additional patient over four in an RN’s workload, the risk of death increases by seven per cent for surgical patients. Patients in hospitals with eight patients per nurse have a 31 per cent higher risk of dying than those in hospitals with four patients per nurse. Further, as working conditions worsen and the quality of patient care deteriorates as a result of understaffing, nurses are leaving the profession and hospitals face great difficulty in recruiting new nurses. A study by the Agency for Healthcare Research and Quality found that 40 per cent of the nurses surveyed were dissatisfied with their jobs and 83 per cent reported that there had been an increase in the number of patients assigned to them the previous year.  

For more information about the bill, contact Pamela Wilson by email: pwilson@dpeaflcio.org; for an overview of the state of the nursing profession in the U.S., see the DPE fact sheet, NURSES: VITAL SIGNS, www.dpeaflcio.org/policy/factsheets/fs_2004_nurses.htm; for information about staffing ratios, see the DPE fact sheet, THE COSTS AND BENEFITS OF SAFE STAFFING RATIOS, www.dpeaflcio.org/policy/factsheets/fs_2004_staffratio.htm. 

LUNCH AND LEARN: UNDERSTANDING THE POWER OF THE HEALTH INSURANCE INDUSTRY, May 11 – More than 45 people participated in a special lunchtime program and discussion on the power of the health insurance companies and their role in our current health care problems, as well as the barriers to change. Gail Shearer, Director, Health Policy Analysis at the Consumers Union, and Jon Gabel, Vice President of Health Systems Studies at the Health Research and Educational Trust, presented a brief history of the health insurance industry in the U.S. They discussed the political power of the insurance companies; developments in the employer marketplace, including the impact of the trend toward defined contribution health care; and the possibilities for change.  The meeting was chaired by DPE president, Paul E. Almeida. Participants included representatives from AFA-CWA, AFSCME, AFT, AFTRA, IFPTE, UFCW, IBT, UE, ARA, ILCA, the Labor Heritage Foundation, and the AFL-CIO, as well as a broad range of public interest groups and associations.

This was the second in a series of DPE programs examining the state of the health care system and proposals for change. A third program, on Health Care Disparities, is being planned. For further information about specific programs or the series, contact Assistant to the President, Pamela Wilson by phone: 202/638-6684 or email, pwilson@dpeaflcio.org

ALMEIDA ADDRESSES THE NORTHEAST COUNCIL OF THE AFL-CIO – In May President Almeida was invited by Robert Haynes (NE Council Chair, MA State Federation President) to address their meeting. Almeida addressed the council on the work of the Department and the growing trend of white collar organizing. President Haynes knew of the work that the Department has done on offshoring and overtime and wanted to establish closer ties to their Council.

ORGANIZING CONFERENCE 2005 – Progress continues on formalizing the agenda for the March 14-16, 2005 DPE organizing conference, “Organizing Professionals in the 21st Century.” DPE circulated the latest draft of the conference proposal to the Organizing Directors of all DPE affiliates, and invited their input.  The Committee will meet in June and July.  For questions or comments, please contact David Cohen, 202-638-0320 extension 13, mailto:dcohen@dpeaflcio.org. 

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