Westinghouse & Southern Company: Good News and Bad News for Workers

Late on Friday, May 12, 2017, the Southern Company agreed to take over construction of the nuclear construction site at Plant Vogtle.

This means that the 6,000 workers on site in eastern Georgia will be able to continue building the reactors at least until June 3.

Southern Nuclear (a subsidiary of the Southern Company) and Georgia Power will become the main contractor for the Plant Vogtle expansion whose ownership is shared between Georgia Power, Oglethorpe Power, the Municipal Electric Authority of Georgia, and Dalton Utilities.

Westinghouse, which had filed for bankruptcy in March, appears ready to walk away from the project if it can receive approval from the bankruptcy court, leaving the future of the two reactors in the hands of the utilities and the Georgia Public Service Commission.

Georgia Power still has not committed to completing both reactors.

Options include completing one or both reactors, converting one or both reactors to natural gas, or giving up on the project entirely.

The role of the Georgia Public Service Commission is becoming extremely important as discussions continue on how to pay for the two new reactors, which are billions of dollars over budget.

E&E News reports that

"Georgia Power has a settlement with the Public Service Commission on how to handle Vogtle's costs going forward. The utility and the PSC staff negotiated the agreement, in part, after the project's costs rose 30 percent from when it started.

The settlement includes the utility absorbing an amount through a lower rate of return on equity if the reactors are not online by 2020. Consumers would shoulder the rest.

Southern stated in filings earlier this month that the project is not likely to meet that deadline. Georgia Power executives confirmed the same in a routine hearing about the project's cost and schedule last Thursday.

Georgia Power has already hinted that it will want to revisit that settlement, which was put in place months before Westinghouse filed for bankruptcy protection. The PSC staff has held firm that the agreement remains in place, according to emailed statements obtained by E&E News (Energywire, May 5)."

The PSC took comments from the public at last Thursday’s meeting, and many were not pleased that Georgia utility ratepayers have been paying for the plants since 2009 when Georgia Power began charging customers for the project’s costs years before the plants would come actually generate electricity.

WSAV-TV (Savannah, Ga.) has nicely captured the current situation and you can watch their report here.

Atlanta Progressive News reports that the next public hearing on Vogtle will be June 29, 2017, when the construction monitors on PSC staff will testify. 

Anger over University of Georgia pay policy is creating an opening for organized labor at UGA

Resentment over how the University of Georgia has handled changes to its overtime policy has created an opening for United Campus Workers, an affiliate of the Communications Workers of America, who are helping UGA employees angered by the recent changes that slashed their take-home paychecks in December.

Problems began when UGA reclassified 3,000 of its employees from exempt to nonexempt to comply with changes to the Fair Labor Standards Act, which was due to go into effect December 1.

Switching these employees from the university’s monthly payroll to a biweekly paycheck resulted in employees being paid for only half of month in November even though deductions such as health insurance premiums were taken for the full month leaving employees with very small paychecks prior to Christmas.

Employees have been quoted as complaining about struggling to cover their living expenses and needing to cash in vacation leave to make up for the shortfall. Many UGA staff have low salaries that make it difficult for them to save money for unexpected emergencies such as suddenly losing a half month’s pay.

While other Georgia public universities have needed to make similar classification changes, they have had a smoother transition. Georgia Tech has been repeatedly cited as an example on how the process should have been occurred.

The damage to morale at UGA, which was already low due to tight budgets, is creating an opportunity for a labor organizing effort.

Increasingly, labor unions are finding more success at organizing government workers than those in the private sector.

Nationally, public-sector workers have a union membership rate (35.2 percent) more than five times higher than that of private-sector workers (6.7 percent).

UCW-CWA has been focused on campuses in Tennessee, but according to the Athens, Ga., Flagpole, one of its organizers, Tom Smith, is helping the University of Georgia employees survey their fellow workers on their views towards the change where 3,000 UGA employees were switched from monthly to biweekly paychecks.

Not surprisingly, most of the comments in the survey were negative, and it is likely UCW-CWA will see this as an opening to begin an underground organizing effort at UGA.

Complicating the situation, the new FLSA rule has been put on hold by a federal judge in Texas, meaning it is unclear whether UGA needs to reclassify the 3,000 employees, which is adding to staff confusion and uncertainty.

No doubt, UGA President Jere Morehead hopes that staff unhappiness will fade in the new year, since most employees’ annual pay will remain unchanged, and they will receive three paychecks during two of the next twelve months.

While the pay policies will eventually sort themselves out, the bad feelings will remain and give UCW-CWA an opening to begin quietly organizing UGA staff under the radar.  

Workers protest outside of Federal Labor Department offices in Atlanta

The Southeast regional offices of the U.S. Department of Labor's Bureau of Labor Statistics were picketed on Wednesday by 81 employees who work for Office Resources Inc. (ORI), a contractor at the Atlanta offices of BLS.

The group was joined by Charlie Flemming, president of the Georgia AFL-CIO.

An online video of the protest is available here.

The ORI workers are fighting for their first union contract after joining the International Association of Machinists last year.

BLS contracts out part of its collection activities including telephone collection for their Job Openings and Labor Turnover Survey (JOLTS) and the Current Employment Statistics (CES) survey that produces national employment information.

The BLS Southeast Region handles data collection for a number of statistical surveys, including the Consumer Price Index, most of which are collected by federal employees led by long-time Regional Commissioner Janet Rankin.

While BLS is an agency of the U.S. Department of Labor, it has traditionally kept its distance from other USDOL agencies and tried to avoid controversial and political issues.

The agency describes itself as “the principal fact-finding agency for the Federal Government in the broad field of labor economics and statistics.”

The BLS mission “is to collect, analyze, and disseminate essential economic information to support public and private decision-making. As an independent statistical agency, BLS serves its diverse user communities by providing products and services that are objective, timely, accurate, and relevant.”

The BLS Director for Public Affairs was unavailable for comment.

Time for Georgia to take a positive approach to labor development

Low wages, pay equity, public assistance, and drug use are related issues for Georgia.

This month, a series of reports have been published concerning Georgia’s labor force, most of them negative. The UC Berkeley Center for Labor Research and Education published a study titled “Producing Poverty: The Public Cost of Low-Wage Production Jobs in Manufacturing”. 

In it they found that 47 percent of production workers in manufacturing and temporary services relied on some form of public assistance:

	Earned Income Tax Credit	Medicaid/CHIP	Food Stamps	TANF	Total Participation
Georgia	39%	15%	22%	1%	47%

(Some workers participate in more than one public assistance program.)

The study also provides an explanation for these high rates of public assistance. “Historically, blue collar jobs in manufacturing provided opportunities for workers without a college education to earn a decent living. For many manufacturing jobs, this is no longer true. While employment in manufacturing has started to grow again following the great recession, the new production jobs created are less likely to be union and more likely to pay low wages. When jobs do not pay enough for workers to meet their basic needs, they rely on public assistance programs to fill the gaps,” according to the report.

This past Tuesday, the U.S. Department of Labor issued its new rules for overtime. In a map accompanying the announcement, USDOL indicated that the updated protections would extend protections for an additional 158,000 workers in Georgia. This in a state where 4.4 percent of workers were already at or below the minimum wage, a figure much higher than the national average.

The American Association of University Women published a study showing the median earnings for men and women across the nation. In Georgia, the gap was widest in Congressional Districts 6 (Price, R-GA) and 11 (Loudermilk, R-GA). In the 6th Congressional District, women earned on average 27.4 percent less than men. In the 11th Congressional District, the difference was 25.8 percent. This compares to a 21 percent gap nationally.

Georgia Congressional Districts with widest earnings gaps between men and women (2014)

Member of Congress	District	Earnings Ratio
Price (Republican)	GA-6	72.6%
Loudermilk (Republican)	GA-11	74.2%
Scott, A. (Republican)	GA-8	75.6%
Westmorland (Republican)	GA-3	76.3%
Hice (Republican)	GA-10	77.0%

As it happens, the two Congressional districts are side-by-side, with the 6^th District including much of the northern suburbs of Atlanta including portions of Cobb, Fulton, and Dekalb counties. The 11^th District is located in the northwestern part of the Atlanta metro area and includes Cartersville, Marietta, and Woodstock proving that the worse problems were not just in the traditionally rural parts of South Georgia.

Finally, The New York Times published a story this week on “Hiring Hurdle: Finding Workers Who Can Pass a Drug Test.” In the story, Georgia officials and company managers were dismayed to find that companies in Georgia are having trouble finding workers due to the number who fail company drug tests.

Taken individually, the stories can be read as a series of “what’s wrong with Georgia”, but they should not be read as unrelated issues.

Low wages, low rates of unionization (only 4 percent of workers in Georgia are members of unions), and significant problems in pay equity between men and women feed on each other. The results show up as social problems including greater need for public assistance and greater drug use.

Georgia has done an excellent job of luring companies, and most recently the film industry, to the state. Now they need to commit to raising their labor force, not by creating more rules and barriers but by taking a positive approach to developing its workforce by supporting efforts at great pay equity and higher wages for both men and women even if that means taking a less confrontational approach towards unions. 

The same positive approach Georgia officials take to economic development should be applied to labor development.