President Barack Obama argued unions must be strengthened to protect the very middle class they helped create during a Wednesday appearance at the White House Worker Voice Summit.
“Labor unions were often the driving force of progress,” the president said. “The middle class itself was built on a union label.”
The president spoke to a room full of workers, union leaders and business representatives. Expanding upon points made by Secretary of Labor Tom Perez and guest speakers earlier in the day, the president said unions are more necessary now than ever. As the economy begins to recover and technologies become more innovative, the president claimed unions are the best way to make sure average workers aren’t left behind.
“I believe when people attack unions, they’re attacking the middle class,” the president said. “In today’s economy, we should make it easier for people to join unions, not harder.”
A primary issue for the president is a state-level law known as right-to-work. The policy, which has passed in 25 states, outlaws mandatory union dues or fees as a condition of employment. The president said the policy has led to a decline in union membership, which has hurt middle class workers.
“Wages need to rise more quickly,” the president continued. “In order to do that, workers need a voice.”
The Obama Administration has also pursued unilateral policy changes to help unions. Primary among them are changes to union election procedures as well as those governing contracting and franchising. Ciara Stockeland, owner and operator of retail outlet MODE, actually used her summit invite to speak out against the changes to franchising.
“Our business model is working and franchises have worked for years,” Stockeland told The Daily Caller News Foundation before the summit. “Let’s not look at this as a partisan issue, let’s look at what will help grow the economy.”
The change enacted by the National Labor Relations Board (NLRB) expands what is known as the joint-employer standard. It allows two companies that contract together to be considered an employer over the same workers if one has significant enough control over the employees of the other. Expanding the standard makes it much easier for companies to be declared joint-employers.
“They really own and operate their own business,” Stockeland said.
Many businesses rely on contracting, especially franchises. Business groups say the new standard will likely result in corporations being less likely to participate in the franchise model because they will have to except more responsibility over the businesses they contract with. This, in turn, will limit opportunities for those that want to open their own businesses and could cause a decline in employment.
Franchising is a unique form of contracting. It allows a small business to contract with a large corporation, like McDonald’s, so that it can to use its brand name and sell its products. Though the small company has to accept its own risk, it gets to run its business the way it wants. This while having the backing of a well-known brand and products.
Critics contend the new standard is an unfair attempt to help unions. It’s easier for unions to organize one large group of employees as opposed to many different businesses that contract with one another. Stockeland was in the minority, as most guest speakers at the summit supported the recent efforts to strengthen unions.
“I think from what I have heard, I am in the minority there,” Stockeland added. “But I am excited to tell my story.”
Stockeland has spoken previously on behalf of The Coalition to Save Local Businesses, which has opposed the recent NLRB rulings. The coalition includes franchisees and other small business.
Additionally, the conservative Heritage Foundation and the Manhattan Institute among others assert unions may not be as critical as the White House claims. The U.S. Chamber of Commerce argued in a report, release alongside the summit, that the economy has changed so much over the decades, many other factors could also be contributing to problems faced by the middle class. The report also noted the claims there is a significant wage gap is misleading because it compares unrelated industries.
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