In the afterglow of the 50-year anniversary of an impromptu, off-script “I Have a Dream” speech by the late Rev. Dr. Martin Luther King, Jr., fading from the national consciousness is the full name of the Aug. 28, 1963, event: the March on Washington for Jobs and Freedom. In addition to King’s “I Have a Dream,” speech, also heard was: “The revolution is at hand, and we must free ourselves of the chains of political and economic slavery,” by a then-younger John Lewis, who currently serves as a Georgia Congressman.
The event called for the passage of civil rights legislation; the elimination of racial desegregation in public schools; protection from police brutality; and, the implementation of a major public-works project to stimulate job growth.
However, as the more than 250,000 attendees age, fading with them is the memory of one of the event’s key demands: adjust the federal minimum wage to match economic realities. Specifically, March organizers wanted the then wage of $1.25 increased to $2 per hour. In today’s dollars, based on an averaging of the Consumer Price Index, the 1963 figures equate to $9.54 and $15.27, respectively.
The Demand Resurfaces
Fast-forward to 2013, the need, the fervor, and the urgency of the latter demand are again resonating in central Ohio and across the nation.
Fast food as well as service-oriented workers, including janitors, security officers, airport staff, and higher education food service workers are stepping from the shadows and making their plight known through a series of ongoing public campaigns.
Justice For Janitors
Since December, the SEIU Local 1 bargaining unit representing nearly 1,000 Columbus janitors has been in negotiations with the firms contracted to clean many downtown commercial office buildings, including:
• Aetna Building Maintenance
• American Building Maintenance Service (ABM)
• Circle Building Services, Inc.
• O.C.M. Building Services Limited
• Professional Maintenance, Inc.
• Scioto Services, L.L.C.
The primary points of contention are the proposal for a two-year salary freeze, increasing the janitor’s share of healthcare premiums, and/or a reduction to part-time status, essentially disqualifying them for company-provided health insurance.
In July, bargaining unit members overwhelmingly approved an authorization vote setting the stage for a formal strike at any point. Neither side has met at the bargaining table since Aug. 1.
Calls from the Columbus Post to the respective corporate offices were unreturned at press time.
“Cleaning firms such as ABM, Professional Maintenance, Mid-American Cleaning Contractors, and Scioto Inc. boast annual revenues into the billions, but are paying the custodians an unsustainable wage of about $18,000 annually,” said SEIU spokesperson Ivan Moreno.
We believe that American Building Maintenance and Professional Maintenance, Inc. are the two primary contractors preventing a deal from being reached,” Moreno said. Both cleaning companies are contracted by Nationwide Insurance, Huntington Bank and the Columbus Downtown Development Corporation.
Moreno acknowledges that while these firms do not directly employ the janitors, “they certainly have influence over the terms and work atmosphere the cleaning companies provide to the janitors.”
Thursday, Sept. 5, bargaining unit members plan to deliver an oversized invoice to Nationwide Insurance demanding repayment of millions granted in tax breaks or to make good on its promise to deliver the 1,400 good paying jobs it promised. At press time, SEIU representatives had tentatively scheduled the event for noon.
Rep. Heard Launches Food Drive
“King had a dream, if you work hard, you should be able to provide for your family. This is simply not possible for thousands of low-wage workers in Columbus… to work full time and still not make enough to put food on the table is wrong,” said State Representative Tracy Maxwell Heard (D-26), reaffirming her support for SEIU Local 1 bargaining unit’s efforts.
Accordingly, in partnership with SEIU, Heard recently announced an ongoing food drive placing donation bins outside the office buildings throughout downtown traditionally staffed by SEIU janitors.
“Simply put, they are among the thousands of working people in our city who despite working full time, still qualify for public assistance,” said Tyler French, a SEIU Local 1 regional coordinator. “The vast majority of these workers are people of color, thus making Columbus increasingly segregated by race and class. … in an economy as healthy as Columbus,’ there is no excuse for this.”
French also said Columbus’ preponderance of low-wage jobs and efforts such as suppressing the janitors’ benefits mask the resulting “under-employment” as well as being a leading contributor to the rising poverty levels.
Moreno said SEIU has collectively represented the janitors since 2006. The janitors have been working without a contract since December. With a strike pending any day, the donations could make a big difference for the janitors forgoing paychecks to be heard.
Are Taxpayers Subsidizing Low Wages?
Opinions vary on this question but simple theoretical economics suggests so.
Most employers are subject to the federal minimum wage of $7.25 per hour; however, states and municipalities may set a higher benchmark. Effective Jan. 1, 2013, Ohio’s minimum wage was set to $7.85 an hour.
Working 40 hours per week for 52 per weeks per year without vacation or sick leave, the minimum wage provides $16,328 of pre-tax income, annually. This places the hypothetical worker above the defined federal poverty line; but, one could argue it says more about the federal poverty line than the affluence of this worker. In addition, there is no guarantee such workers can or would be actually scheduled to work full-time equivalent hours.
An April 2013 report by the Brookings Metropolitan Policy Program certainly supports the janitors (and fast food workers) argument. It says the number of poor in central Ohio have increased from eight to 24 percentage points over the last decade. It also states that the number and density of neighborhoods with poverty rates of 40 percent or more has risen by one-third since 2000.
The 2013 Ohio Poverty Report, an additional study, also illustrates how Columbus’ poverty rate has risen over the last decade from 14.8 percent in 1999 to 21.8 percent in 2011.
“Poor families – even if they’re working, are much more likely to receive public assistance than families above the poverty level,” states Don Larrick, the report’s principal analyst.
Not So Fast!
Representatives from various industry associations and franchise owners assert raising the minimum wage would have a negative impact on the employment rate of the population it is trying to help.
French and Moreno counter Columbus’ wealthiest companies did not succeed on their own.
“They received tens of millions of our tax dollars in the form of subsidies, all while contributing to rising poverty and increased strain on taxpayer-funded public assistance programs. Together, companies such as Huntington, Nationwide, and JPMorgan Chase have received an estimated $50,039,147 in state and local tax breaks,” said Moreno.
Josh Bersin of Bersin & Associates LLC, the human resource research arm of Deloitte Consulting LLP, suggests that industry practices could be changed to address the initial cost of creating a livable wage by reevaluating employee retention practices, or lack thereof.
“Nearly all companies measure turnover. In some industries, especially retail, customer service and hospitality, the turnover rate approaches 30-40% and is accepted, but it’s not a sound strategy,” said Bersin, adding, “The cost of replacing an employee can range from 1.5x to 2x of their annual salary. Regardless of the role, tenured employees drive far greater value to any organization than those who are ‘cycling through’ the business.”
Philip Rudolph, a janitor at the Lazarus building in downtown Columbus says the days ahead will be difficult. “This was a very hard decision for us to make, but we are doing what we have to do by standing up for a wage that will allow us to support our families, and in response, we are being punished and harassed.”