Seattle's $15 Minimum Wage Agreement: Collective Bargaining Reborn?
We have seen the future of collective bargaining, and it just may work. It should work brilliantly in Seattle if the city council doesn’t screw it up.
Last Thursday—May Day, for the nostalgic among you—Seattle Mayor Ed Murray announced that a business-labor task force he appointed had agreed on a plan to raise the minimum wage in the city to $15 per hour, over four years (with annual incremental increases) for businesses with more than 500 employees, and up to seven years for smaller businesses. By the end of the process, tipped employees would have an assured hourly income of $15, not counting whatever tips they received on top of that, and the wage would thereafter be indexed to the rise with the cost of living.
Business, labor and the mayor having agreed, the plan now goes before the city council, whose members, like Mayor Murray, have backed the $15 hourly rate, but who may yet change some elements of the proposal. If enacted, Seattle will have the nation’s highest municipal minimum wage, just as Washington state currently has the nation’s highest state hourly minimum ($9.32).
Seattle’s plan sets a template not just for minimum-wage levels, but for collective bargaining more generally. At a time when collective bargaining has all but vanished from the private-sector economy—just 6.7 percent of private-sector workers are union members—Seattle has charted a new path to raise wages for workers, whether union members or, mainly, non-members. The process of getting to $15 has been every bit as groundbreaking as the $15 standard itself.
The “Fight for 15” began with the campaigns of fast-food workers, appearing first with workers staging protests demanding a $15 hourly wage in the burger joints of New York City, and then in cities across the nation. Though the campaign was quickly backed by the Service Employees International Union (SEIU), a labor powerhouse, it was never even remotely apparent how SEIU could persuade chains such as McDonald’s and Burger King to enter into contractual relations with the hundreds of thousands of workers employed in their franchises.
That’s not to say the campaigns didn’t have an effect. By dramatizing the plainly inadequate wages for which millions of Americans worked, the fast-food workers and SEIU, building on the foundation laid by the Occupy movement, placed the issue of low wages on the national agenda. While the Obama administration and congressional Democrats have been stymied in their efforts to raise the national minimum wage, states and cities under Democratic control have been raising their own wage standards. But none, until Seattle, came anywhere close to the $15 for which the fast-food workers had demonstrated.
So why was Seattle different? The answer begins with a strategically savvy and far-sighted labor movement. When the fast food strikes reached Seattle, says David Rolf, who heads the state’s largest SEIU local, “we coordinated the escalation of the actions with our coming municipal election.” A coalition of progressive groups (much like those in New York, Pittsburgh, Minneapolis, and the other cities I’ve written about in The American Prospect’s current issue) hosted a mayoral candidate debate in which the panelists asking questions were low-wage workers.
The issue of what it cost to live in Seattle and the city’s minimum wage was put front and center before the mayoral contenders, and Murray endorsed the $15 standard. Raised repeatedly in forum after forum, Murray consistently reiterated his support for it. Not surprisingly, the city’s two large SEIU locals and 19 other locals endorsed Murray’s campaign and provided it with foot soldiers and funding.
At the same time, a campaign to raise hourly wages to $15 for airport workers in the small community of SeaTac, 20 miles south of Seattle, began making national headlines. Rolf and the labor and community leaders behind the Seattle campaign had not foreseen the rise of the SeaTac battle to national prominence, but it had the effect of highlighting the issue in Seattle as well.
In September, a month and a half before the mayoral runoff election, Murray released a white paper that laid out the process by which he’d get the city to $15. Pledging to set up a task force representing a range of unions and businesses—particularly unions representing workers in low-wage service-sector jobs and businesses such as restaurants and hotels with large numbers of low-wage employees—Murray said he would charge the task force with producing a plan that both sides could accept. At his first post-election press conference, he announced the task force’s members.
Public policy in the United States is seldom the product of the type of bargaining that Murray set in motion, but Murray—and Rolf, as well—were familiar with the kind of stakeholder bargaining that has helped create the more egalitarian economies of Northern Europe. Labor enthusiastically backed Murray’s task-force proposal. After Murray was elected last November, Seattle’s business leaders understood that raising the wage to $15 was central to the new mayor’s political identity. A number of them, including the head of the city’s Chamber of Commerce and the leaders of its hotel and restaurant industry organizations, took their seats on the task force.
What followed were months of intense negotiation, including, as the mayor’s May 1 deadline drew nigh, four weeks of nearly round-the-clock talks between a subcommittee of three labor officials and four business leaders. Murray told the business side that if no agreement was reached, he was prepared to submit to the council a plan less to their liking than the one that was being negotiated—presumably, one in which the time period to scale up to $15 would be shorter. In the end, an agreement was reached to require businesses with tipped workers to pay them $15 regardless of their income in tips, and labor accepted a longer phase-in period than they had been advocating. Of the 24 task force members, 21 endorsed the recommendation. The two dissenters were a libertarian businessman and a Trotskyist member of the city council who wanted the full raise to $15 to take effect immediately. The president of the Chamber of Commerce abstained, not because she opposed the accord but because she wanted to present it to her board first.
So what was different about Seattle? First, the labor movement had long cultivated close ties with community groups, whose members turned out to support the fast-food workers demonstrations. Aided by the national SEIU’s campaign to foster progressive coalitions in a number of cities, the bonds between Seattle’s service-sector unions and community organizations were particularly strong. The fast-food demonstrations, in turn, garnered substantial media coverage, and Rolf and other labor and community leaders made sure that the workers’ demands were effectively translated into an issue at the center of the mayoral election.
Second, Murray’s decision to create a stakeholder process to come up with the plan he’d submit was a clear departure from both standard-issue civic ordinance drafting and standard-issue labor-management bargaining—at least, in the United States. In a number of Northern European nations, however, union leaders bargain with leaders of entire industrial sectors to set wage levels within those sectors, often producing agreements that cover not just union members but all the workers in those sectors. That’s a model that has never really taken root in the U.S.—until the last four months in Seattle.
“It was complex multilateral bargaining,” says Rolf, who chaired the labor side of the task force while Howard Wright, a local businessman whose family owns Seattle’s famous Space Needle, chaired the business side. Wright, Rolf reports, was motivated not only by his concern about the erosion of middle-class incomes; he very much liked the idea that the legislation would emerge from stakeholder bargaining.
For the unions, the process enabled them to bargain for workers who, given the dysfunctions of American labor law, weren’t likely to become union members.
“Some of the people who will benefit will be union members working in home care or in supermarkets, but most will never be union members, “ Rolf says. “If the council ratifies the agreement, it will cover more workers than any contract any of us could get for our members. This is a politically constructed form of bargaining; it’s really without any precedent I know of within the U.S.”
Then again, Rolf isn’t big on past precedent. He has long urged his fellow labor leaders to find new ways to champion workers’ interests, ways that might not resemble the union-representation model of the past two centuries. A few years ago, he put together a slide show documenting organized labor’s decline and proposing new directions the movement could take. “Today’s union leaders,” he wrote in the Prospect’s special issue on long-term strategies for the left, “won’t be remembered … for the workers they organized under the NLRA [National Labor Relations Act]. We’ll be remembered—or won’t be—for whether we had the vision to reallocate our resources and our talent on a massive scale to create a new model for worker advocacy.”
Long before Seattle, Rolf had already won a paragraph in labor’s history book for master-minding the campaign that unionized 74,000 home care workers in Los Angeles County in 2000, the largest single successful unionization campaign since the United Auto Workers organized Ford in 1941. Even that was an unconventional operation: Rolf ran SEIU’s campaigns for the local and state elected officials who had pledged to give collective bargaining rights to home care workers. Once Governor Gray Davis and a majority on the Los Angeles County Board of Supervisors established that right, getting home care workers to form a union was effectively a done deal.
In both Los Angeles and Seattle, Rolf leveraged the power that unions still have—the power to affect electoral outcomes and raise morally compelling issues—to win victories that old-style unionization campaigns could not have produced, given the erosion of workers’ rights to join a union under the greatly weakened National Labor Relations Act.
Indeed, if the Seattle city council follows through by ratifying the labor-business agreement that Murray has put before them, Rolf, together with Murray, can claim credit for devising a form of collective bargaining that benefits workers with no ties whatever to unions—precisely the kind of “new model for worker advocacy” for which Rolf argued in the Prospect, and perhaps the only kind of worker advocacy that can succeed so long as the legal protections for workers seeking to join unions remain so weak.
There are an estimated 102,000 workers in Seattle whose wages would be raised if the $15 standard becomes city law. The strategies that have brought Seattle’s Fight for 15 this far can be brought to other cities as well—provided they have the kind of strategic labor-community coalitions, the kind of elected officials, and the kind of commitment to broad stakeholder bargaining that have marked the efforts in Seattle.
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