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Latest Senate Food Workers Victory Highlights Perils of Privatization

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Reprinted from Campaign For America's Future

U.S Senate contract employees along with hundreds of workers from the U.S. Capitol, Pentagon, Smithsonian Institution and other federal landmarks marched to the Capitol to call on a living wage of at least $15 an hour on Wednesday, April 22, 2015.
U.S Senate contract employees along with hundreds of workers from the U.S. Capitol, Pentagon, Smithsonian Institution and other federal landmarks marched to the Capitol to call on a living wage of at least $15 an hour on Wednesday, April 22, 2015.
(Image by (Bill Clark/CQ Roll Call))
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The long-abused cafeteria workers of the U.S. Senate, who risked their jobs to fight to earn a living wage only to have the private contractor that runs the cafeteria renege on an order to increase their pay, won a key victory this week.

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The Labor Department declared that the contractor had engaged in wage theft from 674 of its workers, deliberately misclassifying them so that they would earn less than their actual work entitled them to earn. The contractor also forced employees to do unpaid work "off the clock." As a result, the multinational conglomerate Restaurant Associates and a subsidiary will have to give the workers back pay totaling $1,008,302.

Roll Call has more details, in "Senate Food Service Vendor Ordered to Pay $1 Million in Back Wages":

"Senate food service vendor Restaurant Associates and its subcontractor, Personnel Plus, improperly classified workers in order to pay them for lower-wage positions and required them to work overtime without compensation in violation of federal and local labor laws, the agency said in a news release. The contractors also failed to pay required health and other benefits.

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"'Workers in the restaurant industry are among the lowest-paid workers in our economy,' said the department's Wage and Hour Division Administrator David Weil. 'Most struggle to afford life's basic expenses and pay their bills; they shouldn't have to deal with paychecks that don't accurately reflect their hard work and the wages to which they are legally entitled.'"

The Privatization Scam

"Privatization" transfers something that We the People publicly own for OUR benefit, and hands it over to private interests so a few can make a profit for THEIR benefit. The scheme is sold with claims that privatization "saves money" because the private contracting company is "run like a business." The bet is that no one will think through just how a private company might "save money" when they have to "run like a business" and make a profit that government doesn't have to make.

Of course what happens is the private company "saves money" by laying off the government employees and hiring them back or replacing them at minimum wage with no benefits, then transferring the wage and benefit differential into a few pockets at the top of the company. But guess what? Now those workers make so little they qualify for government benefits, other poverty programs are strained, local stores are selling less, homes are foreclosed so local property values drop, the tax base is reduced ... so the government didn't "save money" at all, it just cut its own revenue and shifted spending from one part of the government to another -- all at the expense of working people. And the money that was "saved" went into a few private pockets.

Beyond impoverishing workers with low wages, there are even worse ways private corporate contractors "save money," such as cutting service, cutting quality, cutting corners, fighting unionization -- all of which hurt the public that is supposed to be served. Plus, because it is "run like a business," contracting corporations cut some of those corners by doing things like committing outright wage theft.

The Privatized Senate Cafeteria

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In 2008 the U.S. Senate "saved money" by privatizing its food services. At the time California Democratic Sen. Dianne Feinstein said, "There are parts of government that can be run like a business and should be run like businesses."

The Senate cafeteria was, indeed, "run like a business." The company paid low wages, fought against unionization efforts and engaged in various schemes to keep the workers down. After a while things got so bad that workers had to work two, even three jobs just to get by. Some of the workers were even homeless. In April 2015, the Washington Post reported on that:

"For a week's work at the Senate cafeteria -- sweeping floors, mopping bathrooms, cleaning dishes, composting leftovers, transporting laundry -- he says his take-home pay is about $360. And while he takes enormous pride in serving the country's public servants, he is not sure these public servants are returning the favor.

"'Our lawmakers, they don't even realize what's going on right beneath their feet,' he says. 'They don't have a clue.'"

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Dave has more than 20 years of technology industry experience. His earlier career included technical positions, including video game design at Atari and Imagic. He was a pioneer in design and development of productivity and educational (more...)
 

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