WBEZ | Labor http://www.wbez.org/news/labor Latest from WBEZ Chicago Public Radio en Global Activism: 'The Mustard Seed' Fair Trade shop is transforming lives http://www.wbez.org/series/global-activism/global-activism-mustard-seed-fair-trade-shop-transforming-lives-110683 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/GA Mustard Seed.jpg" alt="" /><p><p dir="ltr" id="docs-internal-guid-7b5392bd-f92b-6cd4-778d-f28929d6d597">Judy Kohl grew up in a missionary family in Belgian Congo. When the Belgians were overthrown, her family was forced to flee to Kenya, where she spent much of her childhood. Those times developed Judy&rsquo;s sense of social justice and giving back. She eventually created The Mustard Seed, a fair trade shop in Lake Forest, IL. They say they&rsquo;re &ldquo;committed to donating its profits to organizations that help empower women and children,&rdquo; especially those stricken with HIV/AIDS. Judy will tell us about the importance of fair trade and how witnessing history as a child changed her life.<iframe frameborder="no" height="166" scrolling="no" src="https://w.soundcloud.com/player/?url=https%3A//api.soundcloud.com/tracks/164166396&amp;color=ff5500&amp;auto_play=false&amp;hide_related=false&amp;show_comments=true&amp;show_user=true&amp;show_reposts=false" width="100%"></iframe></p><p><em>Judy tells us about her life&#39;s journey, which had an extraordinary beginning:</em></p><p>&quot;Just 8 months old when I arrived in the Belgian Congo, I had no idea the journey my life would take over the next five decades. As the daughter of missionaries to Africa, cross-cultural thinking became part of my DNA as I experienced from a young age what it was to live in a global context. Growing up in this environment, my parents and other missionaries modeled selfless love as they cared for those around them. As we fled the Congo in 1964 during the uprising that led to independence, it was with mixed emotions. We had no choice but to leave because of the advancing Rebels, but our hearts remained with those who had become like family. Relationships were a high value within our family culture.</p><p>Fast forward to the present - I&rsquo;m still passionate about giving back to those less fortunate. Though I live on the North Shore, decisions I make on how I spend my time and my money can literally change the lives of a community halfway across the world. Serving with other volunteers at The Mustard Seed - A Fair Trade Shop, we are committed to partnering with cooperatives and artisans in developing countries to provide a market for their creations while paying them a fair price. We also donate our profits to organizations that help empower women and children both domestically and internationally. Each of these ways enable others to make a sustainable living and emerge from poverty. It is still all about relationships. By having a world view, we can continue to change the lives of people we will never even meet - and that is the whole point.&quot;</p></p> Thu, 21 Aug 2014 09:39:00 -0500 http://www.wbez.org/series/global-activism/global-activism-mustard-seed-fair-trade-shop-transforming-lives-110683 Ruling backs Illinois retirees on health benefits http://www.wbez.org/news/ruling-backs-illinois-retirees-health-benefits-110445 <p><p>The Illinois Supreme Court on Thursday sided with retired state employees who argue that health insurance premiums are a protected retirement benefit, in a case that could have implications for how justices might rule on several high-profile challenges to recent overhauls of state worker pensions.</p><p>The court&#39;s 6-to-1 ruling reverses a lower court decision allowing the state government to force retirees to pay for a portion of their own health care.</p><p>The justices sent the case back to the lower court, where retirees can proceed with their challenge.</p><p>At issue is a law passed in 2012 that allows the state to collect premiums from retirees for their state-subsidized health care. Prior to that, state workers who retired with 20 or more years of service were entitled to premium-free health insurance. Under the new law, retirees had to cover part of the cost.</p><p>Writing for the majority, Justice Charles Freeman said the plain language of the constitution supports the conclusion that health insurance premium subsidies are part of a contractual relationship with retirees that can&#39;t be diminished.</p><p>&quot;Giving the language ... its plain and ordinary meaning, all of these benefits, including subsidized health care, must be considered to be benefits of membership in a pension or retirement system of the State and, therefore, within that provision&#39;s protections,&quot; Freeman wrote.&nbsp;</p><p>Retirees filed several lawsuits after the 2012 law was passed. A Sangamon County judge dismissed the cases, saying health insurance benefits aren&#39;t protected by the constitution. Retirees and the state then agreed to appeal directly to the Supreme Court.</p><p>The case is seen as a possible indicator of how the court will rule on a wider challenge to a statewide pension overhaul approved last year. That law aims to shore up the state&#39;s under-funded pensions by cutting annual automatic benefit increases received by retirees. A coalition of powerful state workers&#39; unions argued those cuts violate a clause in the Illinois Constitution that says pension benefits can not be &quot;diminished or impaired.&quot; Backers of the bill say it passes constitutional muster because cutting the amount by which benefits increase each year is different than cutting the benefits themselves.</p><p>While the court&#39;s Thursday ruling did not directly address the pension bill, Freeman did write that the clause &quot;must be liberally construed in favor of the rights of the pensioner.&quot;</p><p>That bodes well for retirees who are suing to overturn the state&#39;s new pension law, said Gino DiVito, a lawyer for the plaintiffs in the retiree health care case.</p><p>&quot;Without question, that implicitly signals that [cost-of-living adjustments] are certainly a protected benefit,&quot; DiVito said. &quot;It may signal a favorable decision in the ongoing litigation concerning pension benefits.&quot;</p><p>The ruling prompted quick praise from the American Federation of State, County and Municipal Employees, a state worker union that has been fighting against the health care and pension changes.</p><p>&quot;The Supreme Court ruled today that men and women who work to provide essential public services -- protecting children from abuse, keeping criminals locked up, caring for the most vulnerable and more -- can count on the Illinois Constitution to mean what it says,&quot; AFSCME Council 31 executive director Henry Bayer was quoted as saying in an emailed statement. &quot;Retirement security, including affordable health care and a modest pension, cannot be revoked by politicians.&quot;</p><p>Illinois Senate President John Cullerton, a Chicago Democrat who pushed an alternative pension overhaul bill on the grounds that it would survive a legal challenge, quickly released his own statement suggesting Illinois lawmakers may have to return to the drawing board to solve the state&#39;s massive pension problem, which had been estimated to be at least $100 billion deep.</p><p>&quot;If the Court&rsquo;s decision is predictive, the challenge of reforming our pension systems will remain,&quot; Cullerton was quoted as saying. &quot;As I have said from the beginning, I am committed to identifying solutions that adhere to the plain language of the constitution.&rdquo;</p></p> Thu, 03 Jul 2014 11:16:00 -0500 http://www.wbez.org/news/ruling-backs-illinois-retirees-health-benefits-110445 Left out of economic recovery, workers go underground http://www.wbez.org/news/left-out-economic-recovery-workers-go-underground-110399 <p><p>&nbsp;</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Santana%20CROP.jpg" style="height: 377px; width: 300px; float: right; margin-top: 4px; margin-bottom: 4px;" title="‘I barely make ends meet. Why should I pay taxes?’ a Chicago ice-cream vendor asks. (WBEZ/Chip Mitchell)" />Santana does not want to be part of Chicago&rsquo;s underground economy but says he has struck out everywhere else.</p><p>&ldquo;I&rsquo;ve tried getting a formal job at Menard&rsquo;s, Home Depot, Target, Walmart &mdash; all these big corporations, which usually do hire a lot of ethnicity people,&rdquo; he said. &ldquo;I have not been called back for an interview.&rdquo;</p><p>So Santana &mdash; who, like other workers in this story, spoke on condition we not publish his full name &mdash; spends most days pushing an ice-cream cart in Little Village, a Mexican-American neighborhood.</p><p>Santana does not earn much. &ldquo;On a decent day, maybe about $90,&rdquo; he said.</p><p>And he comes from a low-income family. &ldquo;I actually have to claim homelessness to get funds from the government such as a Link card,&rdquo; he said, referring to Illinois&rsquo;s food-stamp program. &ldquo;I&rsquo;ve been paying rent at my mom&rsquo;s since I was 16.&rdquo;</p><p>So Santana says he has good reason to skip paying taxes on his income.</p><p>&ldquo;It&rsquo;s all off the books,&rdquo; he said.</p><p>Five years since the Great Recession, the U.S. economy has grown but a <a href="http://www.wbez.org/news/left-out-economic-recovery-workers-go-underground-110399#charts" target="_self">key labor-market gauge</a> shows little evidence of the recovery. As of May, more than 41 percent of the working-age population lacked employment, according to U.S. Bureau of Labor Statistics data on civilian, noninstitutionalized individuals. The most recent figure for Chicago, from 2012, is almost 44 percent.<br /><br />Many of the jobless folks are, like Santana, finding other ways to earn money. And there is reason to believe this shadow economy is expanding.<br /><br /><br /><span style="font-size:22px;">Down but not out</span><br /><br />It is hard to know how many jobless individuals have resorted to working off the books. Few economists will even hazard a guess.<br /><br />But Edgar Feige, a professor emeritus at the University of Wisconsin-Madison, estimates that income not reported to the U.S. Internal Revenue Service is as high as $2 trillion a year &mdash; equivalent to roughly 20 percent of the nation&rsquo;s total adjusted gross income. Feige said that number is &ldquo;approaching the levels that we observed during the Great Depression.&rdquo;</p><p>He means the one in the 1930s.<br /><br />Nowadays a business may look legitimate from the street while most of its staff works off the books.</p><p>&ldquo;I get paid $8 an hour to basically just clean this restaurant,&rdquo; a 25-year-old man said as he hosed off a grill in back of a South Side jerk chicken joint. &ldquo;No one here ever gets a check or pay stub. It&rsquo;s all paid in cash.&rdquo;<br /><br />What is driving people to take these shady jobs? Many of the workers say formal employment is beyond their reach. The labor market is particularly tough for young workers, African Americans, people with a criminal record, immigrants in the country illegally and high-school dropouts.<br /><br />And it can be tough even with a college degree. &ldquo;I have a bachelor&rsquo;s in information technology and I&rsquo;d like to be a Web developer,&rdquo; said a man I&rsquo;ll call Jonathan, a 27-year-old in Flossmoor, a suburb south of Chicago.<br /><br />Jonathan says he came up with nothing in searches for an internship or apprenticeship &mdash; anything that would put food on the table while he developed his skills. So he works on cars.</p><p>&ldquo;I go to the junkyard and I pick out an engine,&rdquo; he said. In his mom&rsquo;s garage, he installs those engines in cars he finds on Craigslist. Then he sells the cars.<br /><br />And the title on those vehicles?</p><p>&ldquo;I don&rsquo;t even transfer the title into my name first,&rdquo; he said. &ldquo;I actually just pass it straight on to the person that&rsquo;s buying because I&rsquo;ve reached my limit as far as how many cars I can sell.&rdquo;<br /><br />Jonathan admits he is paying no income tax on this work. &ldquo;The choice is, Do I pay my water bill or do I pay my taxes?&rdquo; he said.<br />&nbsp;</p><p><span style="font-size:22px;">Everyone affected</span><br /><br />If you think Chicago&rsquo;s underground economy operates only in low-income neighborhoods, you are wrong.<br /><br />&ldquo;I live on the North Side of Chicago,&rdquo; said a 45-year-old woman I&rsquo;ll call Jennifer. &ldquo;I&rsquo;m a presentation designer and writer. I&rsquo;ve had no full-time employment since 2008.&rdquo;<br /><br />Jennifer does get freelance gigs in her field. &ldquo;But that&rsquo;s infrequent,&rdquo; she said.<br /><br />So she resorts to other paid work, much of it off-the-books. It includes dog walking, cat sitting and handing out swag at trade shows and street festivals. &ldquo;Then I figure out what things probably won&rsquo;t go noticed if I don&rsquo;t claim them,&rdquo; Jennifer said.<br /><br />She&rsquo;s not talking about hiding income from the IRS but from the Illinois Department of Employment Security. She doesn&rsquo;t want officials there to dock her unemployment checks.<br /><br />Jennifer says her options are few. &ldquo;Right now, I don&rsquo;t have electricity,&rdquo; she said. &ldquo;My electricity was turned off five weeks ago. And I guess I owe ComEd $500 and I have no idea how I&rsquo;m going to get that $500.&rdquo;<br /><br />Even if people report all their income and pay taxes on it, they might still have close ties to the shadow economy. Maybe they have a nanny and do not report her pay to the IRS.</p><p>Or maybe the taxpayers shop at a big-box store. The prices might be great, but that could owe partly to shady contractors that clean the place at night. Those contractors might bring in janitors working off-the-books.<br /><br /><br /><span style="font-size:22px;">Drawbacks</span><br /><br />&ldquo;You can think of these underground economies as actually being a buffer that helps families get through difficult times,&rdquo; said Feige, the economist, pointing out that people making money off-the-books also spend it. &ldquo;It contributes to economic growth in the official economy as well.&rdquo;<br /><br />The informal economy does have its downsides. It does not generate many tax dollars to fund the job training or social services that some workers might need. The workers may also lack benefits and protections such as unemployment compensation and a minimum wage.<br /><br />&ldquo;A young person will have fewer and fewer contacts to the outside regional economy,&rdquo; said Steven Pitts, a labor economist at the University of California, Berkeley. &ldquo;They&rsquo;ll have a résumé that&rsquo;s undeveloped for use in that economy. So you may get a reproduction of poverty because of that.&rdquo;<br /><br />There are other risks, especially when the work is further outside the law, such as drug dealing.<br /><br />On Chicago&rsquo;s West Side, a 23-year-old who calls herself Ebony faces workplace hazards every day. &ldquo;I&rsquo;m a prostitute,&rdquo; she said. &ldquo;I work the streets.&rdquo;<br /><br />Ebony, a Chicago Public Schools graduate, says she does not enjoy her trade but considers it her best option. &ldquo;I&rsquo;ve applied for McDonald&rsquo;s, Walmart, White Castle,&rdquo; she said.<br /><br />Employers have all passed on her &ldquo;because I don&rsquo;t have a work history,&rdquo; she said. Or at least not a formal work history.<br /><br />Ebony says she has been earning a living since she was 16.</p><p>&ldquo;I stand and wait for guys to pick me up,&rdquo; she said. &ldquo;You get in a car. They ask you, &lsquo;How much is this?&rsquo; and &lsquo;How much is that?&rsquo; You give them a price. They give you the money. You either do it in the car, you rent rooms from people, or you go to a hotel.&rdquo;<br /><br /><br /><span style="font-size:22px;">Desperate measures</span></p><p>That brings us back to Santana, the young man who pushes the ice-cream cart. Even without paying taxes, he says he is not making enough money. And he could be heading down the same road as Ebony.<br /><br />&ldquo;I&rsquo;ve actually even considered being a sugar baby,&rdquo; Santana said, describing that as spending time with an older woman and providing her all sorts of services. &ldquo;She&rsquo;d be a cougar. I&rsquo;d be a cub. She&rsquo;d basically pay for my bills and stuff like that.&rdquo;<br /><br />To become a sugar baby &mdash; to find his sugar mama &mdash; Santana says he might have to become a stripper.</p><p>With that in mind, he says, he has been lifting weights. He has the shoulders and arms to prove it. &ldquo;I&rsquo;m never going to look this good again in my life,&rdquo; he said.</p><p>In Chicago&rsquo;s underground economy, Santana figures his body might be the best thing he&rsquo;s got.</p><p>&nbsp;</p><p><span style="font-size:22px;">Employment-population ratio<a name="charts"></a></span></p><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/chart%201.PNG" style="height: 370px; width: 500px;" title="" /></div><div class="image-insert-image "><div class="image-insert-image ">&nbsp;</div></div><div class="image-insert-image "><div class="image-insert-image "><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/chart%202.PNG" style="height: 390px; width: 500px;" title="" /></div><div class="image-insert-image "><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/chart%203.PNG" style="height: 478px; width: 500px;" title="" /></div><div class="image-insert-image "><div class="image-insert-image "><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/chart%204.PNG" style="height: 426px; width: 500px;" title="" /></div></div></div></div></div></div><p><em><strong>SOURCE:</strong> U.S. Bureau of Labor Statistics. <strong>NOTES: </strong>The employment-population ratio is the proportion of the U.S. working-age population (ages 16 and over) that is employed, either full- or part-time. That population includes everyone except members of the military and institutionalized persons. A 2013 figure for the city of Chicago is not yet available. Annual figures are averages of monthly figures. <strong>REPORTER:</strong>&nbsp;</em><em><a href="http://www.wbez.org/users/cmitchell-0">Chip Mitchell</a> is WBEZ&rsquo;s West Side bureau reporter. Follow him on Twitter <a href="https://twitter.com/ChipMitchell1">@ChipMitchell1</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>, and connect with him through <a href="https://www.facebook.com/chipmitchell1">Facebook</a>, <a href="https://plus.google.com/111079509307132701769" rel="me">Google+</a> and <a href="http://www.linkedin.com/in/ChipMitchell1">LinkedIn</a>.</em></p></p> Tue, 24 Jun 2014 14:30:00 -0500 http://www.wbez.org/news/left-out-economic-recovery-workers-go-underground-110399 Mexico City startups eye Chicago as U.S. tech hub http://www.wbez.org/news/mexico-city-startups-eye-chicago-us-tech-hub-110229 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/288732880_a35cf41b31_z.jpg" alt="" /><p><p>Chicago could be further expanding its tech reach with help from Latin America.</p><p>Last fall, Chicago Mayor Rahm Emanuel and Mexico City Mayor Miguel Mancera signed an economic partnership that includes joint trade initiatives and strengthening overall global competitiveness. As part of that agreement, a delegation from Mexico City this week got a first-hand look at Chicago&rsquo;s economic strategy.</p><p>It&rsquo;s part of an experimental exchange initiated by the Brookings Institution.</p><p>The group learned about Chicago&rsquo;s restaurant business, its tourism efforts and tech scene.</p><p>Felipe Lara was part of the delegation. He was particularly interested in learning more about Chicago&rsquo;s startup environment. He founded a company called <a href="http://www.cono-c.com/" target="_blank">Conoce</a> in Mexico City. It uses camera and algorithm technologies to track shopper behavior. He&rsquo;s hoping to find partners in Chicago to help sell his product in the U.S.</p><p>WBEZ&#39;s Susie An spoke with Lara and Greg Stevens from the Chicagoland Chamber of Commerce. Lara explained why international startups might choose Chicago over Silicon Valley.</p><p><em>Susie An is a business reporter for WBEZ. Follow her <a href="http://twitter.com/soosieon" target="_blank">@soosieon.</a></em></p></p> Fri, 23 May 2014 14:36:00 -0500 http://www.wbez.org/news/mexico-city-startups-eye-chicago-us-tech-hub-110229 After Haymarket: Anarchism on trial and a city in search of its soul http://www.wbez.org/series/curious-city/after-haymarket-anarchism-trial-and-city-search-its-soul-110098 <p><div class="image-insert-image "><a name="top"></a><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/TIOOR_0.jpg" style="height: 223px; width: 620px;" title="" /></div><p><iframe frameborder="0" height="166" scrolling="no" src="https://w.soundcloud.com/player/?url=https%3A//api.soundcloud.com/tracks/147277419&amp;color=ff5500&amp;auto_play=false&amp;hide_related=false&amp;show_artwork=true" width="100%"></iframe></p><p>No one knows who threw the bomb near Haymarket Square on the night of May 4, 1886. It&rsquo;s one of Chicago&rsquo;s most vexing unsolved mysteries. But there&rsquo;s little question that this violent act had huge repercussions &mdash; not only in Chicago but around the world.</p><p>Curious City received a question about this legendary and controversial event from a Naperville resident named Sabina:</p><p style="text-align: center;"><em>&ldquo;How did the Haymarket Square Massacre affect Chicago&rsquo;s culture at the time?&rdquo;</em></p><p>(Sabina didn&rsquo;t leave her last name or reply to our follow-up emails, but that didn&rsquo;t dissuade us from answering this fascinating and important question.)</p><p>We took a wide-angle view of what &ldquo;culture&rdquo; means &mdash; to quote one dictionary definition, it&rsquo;s the &ldquo;ideas, customs, skills, arts, etc. of a particular people or group in a particular period.&rdquo; Talking with five historians who have written about Haymarket, it becomes clear that this 1886 incident changed Chicagoans&rsquo; ideas about many things, especially labor, politics and justice. And in countless ways, it changed how the city&rsquo;s people looked at their fellow Chicagoans &mdash; whether it was a factory owner and a laborer facing off, or a person born in America suspiciously eyeing an immigrant from Europe. &nbsp;</p><p>Haymarket left a lasting stigma on radical movements. Ever since, the public has imagined&nbsp;<a href="#slideshow">anarchists as bomb-throwing fiends</a>. Tensions were already running high between wealthy business owners and poor workers in Chicago, but Haymarket made them even worse. Historians say it set back the labor movement for decades. But it also spurred some Chicagoans to seek ways of defusing that tension and making the city a more civic place.</p><p><span style="font-size:22px;"><strong>The explosion at Haymarket</strong></span></p><p>First, here&rsquo;s a quick summary of the Haymarket story. (Although our question-asker called it a &ldquo;massacre,&rdquo; it&rsquo;s probably best to avoid using that controversial term.)</p><p>On May 1, 1886, hundreds of thousands of people across the country &mdash; and 30,000 in Chicago &mdash; went on strike, demanding an eight-hour workday. Two days later, strikers scuffled with replacement workers at the <a href="http://www.encyclopedia.chicagohistory.org/pages/2204.html" target="_blank">McCormick Reaper Works</a> on the Southwest Side. Police fired into the crowd, killing two strikers.</p><p>Outraged by the police violence, anarchists held a rally on the night of May 4 at Haymarket Square, near Randolph and Desplaines streets. Around 1,500 people gathered to hear speeches. Mayor Carter Harrison Sr. watched for a while, then decided to go home. It looked peaceful to him. By 10:30 p.m., as the crowd was dwindling, a line of nearly 200 police officers came marching down the street. The police ordered the crowd to disperse.</p><div class="image-insert-image " style="text-align: center;"><a href="#slideshow"><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/v37v.jpg" style="height: 337px; width: 450px;" title="" /></a></div><blockquote><div class="image-insert-image " style="text-align: center;"><strong>Anarchist Lookbook:&nbsp;<a href="#slideshow">Haymarket&#39;s pictorial impact on radical politics</a></strong></div></blockquote><p>Just then, a bomb came flying toward the cops and exploded. Gunfire erupted. Some witnesses said later that the police fired most of the bullets. Others said that people in the crowd were shooting, too. By the time it was all over, seven officers were dead or dying. Four people in the crowd died. Dozens of people on both sides were wounded.</p><p>In the coming days, police rounded up dozens of anarchists across the city. That summer, eight radicals were put on trial. Just a few of them had actually been at the rally in Haymarket Square. Prosecutors didn&rsquo;t know who threw the bomb, but they persuaded a jury that these men were guilty of a bombing conspiracy.</p><p>Seven of the men were sentenced to hang, and one (Oscar Neebe) received 15 years in prison. Two of the men facing the death penalty (Samuel Fielden and Michael Schwab) asked for clemency, and Republican Gov. Richard Oglesby reduced their punishment to life in prison. Another one of the men on death row, Louis Lingg, killed himself in his jail cell with a smuggled blasting cap.</p><p>That left four men who had refused to ask the governor for mercy: Albert Parsons, August Spies,&nbsp;George Engel and Adolph Fischer. On Nov. 11, 1887, they were hanged at the same time on the gallows at Cook County Jail.</p><p>Six years later, a new governor &mdash; Democrat John Peter Altgeld &mdash; pardoned the three Haymarket defendants who were serving time in prison (Fielden, Schwab and Neebe). Altgeld called the trial a miscarriage of justice.</p><p>To find out what effect these events had on Chicago&rsquo;s culture, <a href="#historians">we spoke with five experts</a>. The following is an edited transcript from separate phone interviews with these five authors.</p><p><span style="font-size:22px;"><strong>What sort of tensions was Chicago experiencing leading up to Haymarket?</strong></span></p><p><strong>Dominic A. Pacyga: </strong>We sometimes don&rsquo;t realize how violently divided we were in the 19th century. After the Civil War, people thought there was going to be another civil war, but this would be between the working poor and the rich. It didn&rsquo;t happen, but it certainly seemed like it was going to happen.</p><p><strong>James Green:</strong> It isn&rsquo;t surprising that (the bombing) happened, given the culture of violence and conflict that had been festering in Chicago ever since 1867. Gov. Oglesby signed a bill, making eight hours the legal workday, on May 1, 1867. What happens? Well, employers refuse to obey the law. There&rsquo;s rioting. That starts a cycle of violence. Employers don&rsquo;t want any sort of state intervention. The unemployed demand relief. Well, that causes a riot.</p><p>The radical Republicans &mdash; Oglesby and the folks who saw themselves in Lincoln&rsquo;s tradition &mdash; wanted to mediate this. The failure of that means the more savage forces inherent in the industrial process in Chicago take over. There&rsquo;s a lot of violence in the workplace. There&rsquo;s violence in the streets. People were engaged in violent acts on both sides. And the police are in the middle and often blamed for it.</p><p><strong>Timothy Messer-Kruse: </strong>The bombing occurred in the context of the first-ever national general strike. The idea was that any worker who had not achieved the eight-hour workday at their place of employment would go on strike on May 1. The simultaneous striking of millions of workers would simply create a cascading change across the country. And that would force both politicians and employers to recognize labor&rsquo;s power.</p><p>Everybody in industrial settings, they did toil very long days. In those days, 10 hours was standard. In many areas, it was sunup to sundown.</p><p><strong>Pacyga:</strong> In the packinghouses, they generally worked until all of the animals were slaughtered. Most male workers were completely removed from their family because of the 12-hour or 16-hour day. In the steel mills, there were two 12-hour shifts. You worked six days a week.</p><p><strong>Leon Fink: </strong>The anarchists were the left wing of the eight-hour movement. And within that left wing, there was a fringe of anarchists who counseled the use of bombs and dynamite. They justified it &mdash; at least publicly &mdash; as something they would only resort to in the face of police violence and as a defensive mechanism. But it seems clear there was a fringe of anarchists who were stockpiling bombs.</p><p><strong>Carl Smith:</strong> I think most of (the Haymarket defendants) are nonviolent people. They were convicted for what they said, not what they did. But yes, they certainly rhetorically preached violence as a solution. They preached a sense that violence is being practiced on them, day in and day out in the system &mdash; the billy clubs of the police. In their worldview, it was a life-and-death battle.</p><p><strong>Messer-Kruse: </strong>Among those <a href="http://law2.umkc.edu/faculty/projects/ftrials/haymarket/haymarketdefendants.html">eight defendants</a>, there clearly were people who were willing to use violence for political ends &mdash; Louis Lingg, very clearly. The evidence is overwhelming that he made the bombs, including the bomb that was thrown at the Haymarket rally. He had dedicated his life to the violent overthrow not only of the government but essentially all bourgeois institutions. (The Haymarket defendants include) individuals who philosophically agree that the industrial society was so unjust, so murderous in its daily operation, that it had to be overthrown through some sort of mass, violent insurrection.</p><p><span style="font-size:22px;"><strong>How did Haymarket affect the labor and radical political movements?</strong></span></p><p><strong>Pacyga: </strong>Oh, it devastated the labor movement and the radical movement. Everybody who was involved with the May Day strike was tainted by the bombing. We still don&rsquo;t know really who threw the bomb. But the people in power used this as an excuse to really destroy the labor movement, to destroy the labor press and to move against all attempts to organize workers across the city.</p><p><strong>Smith: </strong>What the press and leading businessmen tried to do was tar all labor organizing with the brush of anarchism and to link anarchism with bombing. People started associating labor unions with bomb-throwers.</p><p><strong>Messer-Kruse: </strong>Haymarket definitely threw a big monkey wrench into the direction of American labor activism. When the bomb went off, Chicago went from being a city involved in what was becoming a complete general strike to a city pretty much on lockdown, with police investigations of this bombing.</p><p>The eight-hour movement was stopped in its tracks. Many workers in Chicago and elsewhere were actually winning concessions from their employers. Workers had been peacefully on strike, negotiating with their employers. When that bomb went off and police were killed, (labor activists) suddenly lost a lot of power and lost a lot of respect. Many employers who had conceded the eight-hour day in Chicago took it back. They simply tore up those contracts and took it back.</p><p>Had that (bombing) not happened, it could very well have gone otherwise. If the eight-hour day had been secured, then labor leaders would&rsquo;ve been emboldened to continue those kinds of tactics &mdash; and to view their role as being not only involved in their individual labor unions but involved in the general politics of the nation.</p><p>When the bomb went off, it went exactly the other direction. Labor leaders abandoned any idea of mobilizing this kind of public activism. America&rsquo;s trade union leaders become very conservative after Haymarket. They primarily become concerned with the interests of their own narrow sector of the workforce, and not with the nation as a whole.</p><p><strong>Green: </strong>It was certainly a crushing blow to that revolutionary left wing. The doctrine of force as a political philosophy disappears. What it did was drastically limit what the public debate about working conditions could be. It was no longer admissible to talk about it being so bad that something radical had to happen. That was out the window.</p><p>If the bomb hadn&rsquo;t exploded that evening, it might have (shown) that citizens could go into the streets and nonviolently protest for their rights, and that the employers would concede and people would move on in some nonviolent way to some kind of mediated workplace situation.</p><p>It would also have meant that there was still a radical voice within the house of labor, saying, &ldquo;We may have the eight-hour day, but there&rsquo;s something fundamentally rotten about this system. And ultimately, unless we replace it with another kind of economy, we&rsquo;re going to be in trouble.&rdquo; But that voice was gone. After Haymarket, the American Federation of Labor started to embrace a very limited version: just shorter hours and better living wages &mdash; that&rsquo;s all we want, you know?</p><p><strong>Pacyga:</strong> There was a tremendous amount of public reaction against labor unions and against<a href="http://www.encyclopedia.chicagohistory.org/pages/693.html" target="_blank"> the Knights of Labor</a>, which was the largest union at the time. There were about 700,000 members nationally. From that point on, the Knights of Labor really struggled and there was not that much future for it.</p><p><strong>Fink: </strong>Chicago was a leading Knights of Labor center. The Knights encompassed everyone from small businessmen and professionals down to the unskilled, including African-Americans and women. They were probably the most inclusive social movement of the late 19th century. And they were a powerful social force. They saw themselves as the preserver of the American Dream for the mass of people in the aftermath of the Civil War. They were against monopoly and against the seizure of the political system by a new moneyed elite. They believed in the ballot box. They believed in peaceful protest. They really were not in favor of strikes or confrontations, and engaged in them only as a last resort. So, their leadership was quick to disassociate itself from the anarchists, but Haymarket tarred their&nbsp;public reputation. They never ever recovered. The setback here reverberated around nation. &nbsp;</p><p><strong>Pacyga:</strong> It wasn&rsquo;t until the beginning of the 20th century that the (labor movement&rsquo;s) recovery over Haymarket began to take place. But even then, the labor unions were pretty much kept out of power until well into the 1930s.</p><p><strong>Green: </strong>Eventually, more and more workers win the eight-hour day. In 1938, it becomes a mandate of Congress.</p><p><span style="font-size:22px;"><strong>How did Haymarket affect politics in the Democratic and Republican parties?</strong></span></p><p><strong>Messer-Kruse: </strong>It probably didn&rsquo;t shift too much of the politics on the ground. Chicago remained a labor stronghold throughout this period and well into the 20th century, and the politics revolved around labor.</p><p><strong>Pacyga: </strong>People on both sides of the political spectrum, Democrats and Republicans, tried to get leniency for the Haymarket martyrs. But Marshall Field really pushed &mdash; he wanted them to be punished. People like (Haymarket defendant Albert) Parsons had been a pain in his side for a long time. Marshall Field wanted them hanged.</p><p><strong>Green:</strong> Lyman Trumbull (a former U.S. senator who lived in Chicago), who&rsquo;s another one of these Lincolnian Republicans, thinks that these men&rsquo;s lives should be spared. It&rsquo;s a conflict within the Republican Party over this whole thing. In the end of course, there&rsquo;s no question what will be the outcome.</p><p><strong>Smith: </strong>No mainstream politician defended them. And Altgeld (Gov. John Peter Altgeld, the Democrat who pardoned the three Haymarket defendants serving prison sentences in 1893) didn&rsquo;t defend them. He said that they didn&rsquo;t get a fair trial. He called it a miscarriage of justice. He didn&rsquo;t say they were right.</p><p><strong>Pacyga: </strong>He hurt his political career with the pardons, absolutely. He turned the power elite against him.</p><p><strong>Messer-Kruse: </strong>I don&rsquo;t think that&rsquo;s really true. In fact, you could argue that it actually was a springboard into other politics. For example, during the great 1896 Democratic convention in Chicago, Altgeld was clearly the toast of the convention.</p><p><strong>Fink:</strong> For the conservative forces in either party, Haymarket provided a kind of ready reference for the fears and threats of radicalism. The Haymarket defendants were quickly seen as un-American, as a&nbsp;threat to the social order. The Democrats would try to peel off the rank-and-file of the labor and radical movement. They would say: &ldquo;We can provide certain benefits if you&rsquo;ll come under our umbrella.&rdquo; For many former labor movement types, the Democratic Party became the only game in town.</p><p><strong>Pacyga:</strong> The Democratic Party appealed to solid bread-and-butter unionists who simply wanted things like better conditions, better pay, paid vacations.</p><p><span style="font-size:22px;"><strong>How did Haymarket affect immigrants living in Chicago?</strong></span></p><p><strong>Fink:</strong> It forced most immigrant groups to prove their respectability.</p><p><strong>Pacyga:</strong> There was tremendous anti-immigrant reaction and anti-Catholic reaction. Here were these Germans talking about throwing bombs and a bomb gets thrown. It proved the point that these radical ideologies were coming in from Europe and the gates should be closed.</p><p>There was a lot of class tension within (immigrant) communities. A lot of the cops that were killed were Irish working-class cops. (They) were putting down a working-class demonstration, which Irish attended. This ripped all these ethnic communities apart in one way or the other.</p><p><strong>Messer-Kruse: </strong>Haymarket provided tinder for (the anti-immigrant) movement by associating immigration and lawlessness and anarchy, but I wouldn&rsquo;t take that too far. The anti-immigrant tensions in a city like Chicago are not necessarily caused by the Haymarket bombing. They&rsquo;re caused by many factors.</p><p><strong>Green: </strong>Chicago was such a polyglot city that it was almost a little too late to be talking about pulling up the gates. I wouldn&rsquo;t say Chicago in the 1890s was a particularly hostile place for immigrants, more so than any other city.</p><p><span style="font-size:22px;"><strong>How did Haymarket change the police and courts in Chicago?</strong></span></p><p><strong>Messer-Kruse: </strong>The Chicago police were already beginning a long process of professionalization and modernization. And this event certainly sped that process up quite a bit. It also leads many states to take on more responsibility for the policing of labor struggles.</p><p><strong>Smith: </strong>It&rsquo;s the first major Red Scare. It sets a pattern: When something happens like this, you say it&rsquo;s outside agitators who are making this happen, so round them up and punish them. &ldquo;If we catch these guys and hang these guys, the problem will be solved.&rdquo;</p><p>You could never hold a trial like that now. There were plenty of other miscarriages of justice of all&nbsp;kinds, but generally speaking, in this country, trials got fairer. I think there was a sense afterwards that the trial was a case of &ldquo;the ends justify the means.&rdquo;</p><p><span style="font-size:22px;"><strong>How did Haymarket shape Chicago&rsquo;s reputation?</strong></span></p><p><strong>Messer-Kruse: </strong>Not that Chicago needed a lot of help, as far as its reputation goes, but from this time on, it does have a reputation as a hotbed of radicalism.</p><p><strong>Fink: </strong>It was an immigrant city. It was not in the hands of &ldquo;respectable&rdquo; Americans. So it had a kind of dangerous edge to it in the popular mind. On the other hand, for the political left, especially internationally, Chicago became famous for its radicalism and its martyrs. Like other flamboyant episodes of violence &mdash; like (John) Dillinger or (Al) Capone or other moments of disorder &mdash; it added to Chicago&rsquo;s reputation as a city on the edge.</p><p><strong>Smith: </strong>The bombing hurt Chicago&rsquo;s reputation, certainly. But it didn&rsquo;t slow its growth in any way. The population doubled in the 1880s and then doubled again in the 1890s. So in terms of people voting with their feet or capital coming in &mdash; or the decision to hold a World&rsquo;s Fair here (in 1893) &mdash; Haymarket didn&rsquo;t stop any of that.</p><p><strong>Pacyga:</strong> Chicago&rsquo;s position along the railroad lines and water make Chicago such an optimal place to invest in that (business owners) ignore these things. Plus, you&rsquo;ve got a government that generally supports big business. Ignores pollution. Ignores the times when big business steals water.</p><p><strong>Green: </strong>I&rsquo;m sure that the city fathers, (Tribune publisher) Joseph Medill and all of the big business guys were saying, &ldquo;Well, see, we took care of this problem now. We&rsquo;re not going to let that happen again.&rdquo; It may have in fact enhanced their reputation as tough law-and-order people keeping the lid on things. Of course, they failed. Something far worse occurs in 1894, the Pullman Strike. That was much, much worse violence.</p><p><strong>Green:</strong> In Jane Addams&rsquo; <em>Twenty Years at Hull House</em>, she talks about coming back from England around 1889. The city was still taken up with Haymarket. People were still tense. There was this attempt on her part and other liberals to try to create a civic forum where all of the hard feelings about Haymarket could be discussed and opened up and a new civic culture could be created and there wouldn&rsquo;t be so much hatred and class bitterness. That&rsquo;s what <a href="http://www.encyclopedia.chicagohistory.org/pages/615.html" target="_blank">Hull House</a> was about.</p><p>That&rsquo;s what the liberal Chicago was about: Let&rsquo;s make it a better city. Let&rsquo;s make it a city where there isn&rsquo;t so much hatred, and where immigrants don&rsquo;t feel so exploited, and where the police are not killing&nbsp;people. So that did begin to happen. People were saying, &ldquo;This is terrible. We&rsquo;ve got to fix this.&rdquo;</p><p>The <a href="http://www.wbez.org/series/curious-city/your-ticket-white-city-108994" target="_blank">1893 World&rsquo;s Fair</a> is the symbolic triumph of that spirit: the great Chicago, the beneficent Chicago, the modern Chicago. Sometimes, these horrific events, acts of political violence, cause a city to do some sort of soul-searching.</p><p><strong><a name="slideshow"></a><span style="font-size:22px;">How did Haymarket affect the image of anarchists?</span></strong></p><p style="text-align: center;"><iframe allowfullscreen="true" frameborder="0" height="367" mozallowfullscreen="true" scrolling="no" src="http://docs.google.com/presentation/d/1Lz86udgxtNKfpd18q1R-9DFj51O97pEeJ_eELlEnS6E/embed?start=false&amp;loop=false&amp;delayms=5000" webkitallowfullscreen="true" width="600"></iframe></p><p><strong>Messer-Kruse:</strong>&nbsp;Before that time, anarchism was a much broader movement. It included a lot of philosophical anarchists who today we might term libertarians. After the Haymarket bombing, the popular understanding of anarchism becomes the bomb-throwing fiend, hiding behind a cape. A very rich and diverse philosophical movement gets collapsed into this one dimension of nihilism.</p><p><strong>Pacyga:</strong> Anarchism seems to me to be a utopian kind of idea. But after Haymarket, anarchists became these kind of slimy, bearded, bomb-throwing, evil monsters. All the cartoons in the press that appeared have people with long beards and long hair, and holding bombs in their hands and knives in their other hand &mdash; just these hideous kinds of criminals.</p><p><strong>Smith:</strong> Look at the (Thomas) Nast illustrations &mdash; a longhaired, wild-eyed, bomb-throwing mad person. No sane person could be an anarchist. And anybody who protested against the existing order was, in some people&rsquo;s eyes, an anarchist. The anarchists became this caricature. And if you didn&rsquo;t like a person who protested against the current order, you called him or her an anarchist &mdash; whether or not they really were. Anarchy became: &ldquo;I want chaos. I want disorder. I want to destroy any kind of order that&rsquo;s out there.&rdquo;</p><p><strong>Fink: </strong>The anarchists were through after Haymarket. Basically, they were rounded up. They were deported if they weren&rsquo;t jailed. Haymarket &mdash; followed by the assassination of (President William) McKinley at the hands of an anarchist just after the turn of the century &mdash; that finished (them) off as all but a fringe within the radical left of the country.</p><p><strong>Messer-Kruse: </strong>The cultural image of the bearded, stooped, dark, bomb-throwing anarchist has carried through to the present day. The very symbol of the sort of the round, globe bomb with the hissing fuse on it passes (through) the popular culture right up to Boris and Natasha and &ldquo;Spy vs. Spy.&rdquo; I think that image was born in the Haymarket. That image of the sulking, loner foreign, bomb-throwing anarchist has a great resonance in American culture.</p><p><span style="font-size:22px;"><strong>What connections do you see between the events of Haymarket and today?</strong></span></p><p><strong>Green: </strong>As in the 1880s, Chicago is a city of immigrants and a city of immigrants who are wage-earning people, many of whom are in low-wage occupations, many of whom may not be citizens&nbsp;at all or are viewed as second-class citizens. There are similarities with the Gilded Age and the extremes of wealth.</p><p>The unions are pretty tough in Chicago, but they&rsquo;re under assault. The mayor (Rahm Emanuel) would certainly love to get rid of the teachers union. There&rsquo;s a lot of pressure on unions to give up things. The eight-hour workday &mdash; for a lot of people &mdash; is not feasible anymore. You need to work two jobs and overtime.</p><p><strong>Fink: </strong>The larger issues of inequality, worker rights, the basic decency of the workplace are still very much alive today. And some of the issues &mdash; the length of the workday and whether there&rsquo;s a minimum wage &mdash; have returned to the political surface. Our culture is also constantly challenged by those who would find scapegoats as a way of turning away from the central issues raised by a movement or by radicals<a name="rhymefest"></a>.</p><p style="text-align: center;"><iframe allowfullscreen="" frameborder="0" height="343" scrolling="no" src="//www.youtube.com/embed/iTEcyfQDdIk" width="610"></iframe></p><p style="text-align: center;"><em>(Rapper Rhymefest performs his update of the Haymarket-era &#39;Eight Hour Song&#39;</em><em>)</em></p><p><strong>Pacyga: </strong>The Occupy Chicago movement &mdash; I suppose the police are making these people out to be anarchists, but I don&rsquo;t think that, generally, the Occupy people are violent.</p><p>Think about how (Chicago Teachers Union President Karen) Lewis thinks about (Mayor) Rahm Emanuel today. Whose side is he on, according to the Chicago Teachers Union? There&rsquo;s always been that sort of conflict. In Chicago, people with clout are generally people who have money. And people who have money are not interested in supporting strikes &mdash; generally speaking.</p><p>America is a very middle-class culture. Revolutionary movements sprout up periodically, but they pass &mdash; because the majority of people do not embrace these ideologies. And if they embrace ideologies, they embrace them on the right rather than the left. That&rsquo;s part of our historical tradition.</p><p><strong><span style="font-size:20px;">Our five historians</span><a name="historians"></a></strong></p><p>Sincere thanks to the following the experts, who provided extensive interviews for our coverage of the Haymarket riot and its effects:</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/james%20green%20copy.png" style="float: left; height: 93px; width: 100px;" title="" /><strong>James Green</strong>, a history professor at the University of Massachusetts Boston, wrote the 2006 book <em>Death in the Haymarket: A Story of Chicago, the First Labor Movement, and the Bombing that Divided Gilded-Age America</em>.</p><p>&nbsp;</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/carl%20smithcopy.jpg" style="height: 92px; width: 100px; float: left;" title="" /><strong>Carl Smith</strong>, an English professor at Northwestern University, focused on the incident&rsquo;s cultural effects in his 1995 book <em>Urban Disorder and the Shape of Belief: The Great Chicago Fire, the Haymarket Bomb, and the Model Town of Pullman</em>. He also curated the Chicago History Museum&rsquo;s <a href="http://www.chicagohistory.org/dramas/" target="_blank"><em>The Dramas of Haymarket </em></a>website.</p><p>&nbsp;</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/dompac%20copy.jpg" style="height: 93px; width: 100px; float: left;" title="" /><strong>Dominic A. Pacyga</strong>, a history professor at Columbia College Chicago, put Haymarket into the context of the city&rsquo;s history with his 2009 book <em>Chicago: A Biography</em>.</p><p>&nbsp;</p><p>&nbsp;</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/cruse%20copy.jpg" style="float: left; height: 93px; width: 100px;" title="" /><strong>Timothy Messer-Kruse</strong>, a history professor at Bowling Green State University in Bowling Green, Ohio, has stirred controversy with his books <em>The Haymarket Trial: Terrorism and Justice in the Gilded Age </em>(2011) and <em>The Haymarket Conspiracy: Transatlantic Anarchist Networks</em> (2012), asserting there was actual evidence connecting some of the Haymarket defendants to a bombing conspiracy.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/leonfink%20copy.jpg" style="height: 93px; width: 100px; float: left;" title="" /><strong>Leon Fink</strong>, a history professor at the University of Illinois at Chicago, has written several books on the Gilded Age and labor movements in the late 1800s.</p><p>&nbsp;</p><p>&nbsp;</p><p><em>Robert Loerzel is a freelance journalist and the author of </em>Alchemy of Bones: Chicago&rsquo;s Luetgert Murder Case of 1897.<em>&nbsp;Follow him at <a href="https://twitter.com/robertloerzel" target="_blank">@robertloerzel</a>.</em></p></p> Tue, 29 Apr 2014 13:03:00 -0500 http://www.wbez.org/series/curious-city/after-haymarket-anarchism-trial-and-city-search-its-soul-110098 7-Eleven warns Chicago franchisee who criticized company http://www.wbez.org/news/7-eleven-warns-chicago-franchisee-who-criticized-company-110064 <p><p>&nbsp;</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Syed.jpg" style="margin: 4px 0px 0px 0px; float: right; height: 263px; width: 300px;" title="Hashim Syed, owner of a 7-Eleven franchise on the city’s North Side, received a written warning from the Dallas-based company eight days after WBEZ aired his grievances. (WBEZ/Shannon Heffernan)" />7-Eleven Inc. is coming down on a Chicago franchisee who criticized the Dallas-based company on WBEZ.</p><p>Hashim Syed, who has run a 7-Eleven in the city&rsquo;s Rogers Park neighborhood since 1990, invited two WBEZ reporters to his store for an interview. He told them how the world&rsquo;s largest convenience-store chain has tightened rules for its franchisees over the years.</p><p>Syed said the company, a subsidiary of the Japanese conglomerate Seven &amp; I Holdings Co., had dumped its employment responsibilities on franchisees.</p><p>&ldquo;We are nothing more than a glorified manager,&rdquo; Syed said in the <a href="http://www.wbez.org/news/bigger-burgers-and-fries-franchising-blamed-low-wages-109978" target="_blank">WBEZ report</a>, broadcast April 8. &ldquo;I take the heat from the customer if anything goes wrong. I take the heat from the workers if something goes wrong.&rdquo;<br /><br />One week after the broadcast, 7-Eleven officials inspected his store. Syed said the inspection took place without notice. He identified the officials as Bill Engen and Ena Williams, both senior vice presidents based at the Dallas headquarters.</p><p>The next day, a 7-Eleven &ldquo;letter of notification&rdquo; accused Syed of violating his franchise agreement because some products were out of stock and because he allegedly was not using one of his hot-dog grills as required. The letter was accompanied by 17 photos showing spots on Syed&rsquo;s shelves where products were sold out. The letter did not mention his statements to WBEZ.</p><p>Warning letters from franchisors are not uncommon. The franchisees usually have a chance to fix the problems. But a letter could also lead to trouble, even a 7-Eleven takeover of the store.</p><p>&ldquo;This is nothing but retaliation,&rdquo; said Jas Dhillon, a 7-Eleven franchisee in Los Angeles and vice chair of the National Coalition of Associations of 7-Eleven Franchisees. &ldquo;We carry over 2,500 items in our store, from soda pops to candies to hot dogs to magazines to lottery tickets. Being out of stock of 17 &mdash; that&rsquo;s less than 1 percent. Any given day, not just at 7-Eleven, at any of the other stores, you&rsquo;re going to have items that we run out of, especially when you just had a hot weekend.&rdquo;<br /><br />Dhillon said 7-Eleven was trying to silence Syed and pointed out that the Chicago franchisee once won a national award from the company because, Dhillon said, &ldquo;he ran the best store in the country.&rdquo;<br /><br />Engen and Williams did not respond to WBEZ requests for comment on Syed&rsquo;s case. Neither did the Chicago-area 7-Eleven official who issued Syed the warning letter.</p><p>Company spokeswoman Margaret Chabris sent a written statement that said her company &ldquo;does not discuss publicly matters concerning our relationships with individual 7-Eleven franchisees.&rdquo; Asked whether the 7-Eleven letter to Syed came in response to his WBEZ interview, Chabris did not answer.<br /><br />The interview was not the first time Syed had criticized 7-Eleven. He publishes a <a href="http://7-elevenfoac.com/data/newsletter/FOACMay2013FinalNewsletter.pdf" target="_blank">newsletter</a> for Chicago-area 7-Eleven franchisees that questions how the company treats them.<br /><br />In the WBEZ report, Syed blamed 7-Eleven policies and the franchise model for his store&rsquo;s low wages. &ldquo;That worker who is working also thinks &mdash; and I know it for a fact &mdash; that I am just greedy and I want to keep all the money in my pocket instead of giving him fair wages,&rdquo; he said.<br /><br />The report included competing claims by economists about how franchising affects wages and jobs.</p><p>In the report, Chabris and another 7-Eleven official said workplace conditions were the responsibility of franchisees.</p><p>Chabris added that Syed had a right to speak out. &ldquo;It&rsquo;s freedom of speech,&rdquo; she said. &ldquo;That&rsquo;s fine.&rdquo;</p><p>Syed, meanwhile, is planning to board a Thursday flight from Chicago to Japan, where he will meet with other 7-Eleven franchisees. He said he is working to strengthen ties between 7-Eleven franchisees around the world so they have more power to stand up to the company.</p><p><em><a href="http://www.wbez.org/users/cmitchell-0">Chip Mitchell</a> is WBEZ&rsquo;s West Side bureau reporter. Follow him on Twitter <a href="https://twitter.com/ChipMitchell1">@ChipMitchell1</a> and <a href="https://twitter.com/WBEZoutloud">@WBEZoutloud</a>, and connect with him through <a href="https://www.facebook.com/chipmitchell1">Facebook</a>, <a href="https://plus.google.com/111079509307132701769" rel="me">Google+</a> and <a href="http://www.linkedin.com/in/ChipMitchell1">LinkedIn</a>.</em></p></p> Wed, 23 Apr 2014 18:02:00 -0500 http://www.wbez.org/news/7-eleven-warns-chicago-franchisee-who-criticized-company-110064 Northwestern appeals NLRB ruling on athletes union http://www.wbez.org/news/northwestern-appeals-nlrb-ruling-athletes-union-109999 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/NU NLRB Kain Colter.jpg" alt="" /><p><p>Northwestern University is asking the National Labor Relations Board to overturn a regional director&#39;s ruling that the school&#39;s football players are employees under federal law and thus entitled to unionize.</p><p>The university filed a formal appeal Wednesday.</p><p>Northwestern says that it had presented &quot;overwhelming evidence&quot; that its athletic program &quot;is fully integrated with its academic mission, and that it treats its athletes as students first.&quot;</p><p>The players are set to vote by secret ballot April 25 on whether to form a union.</p><p>Former Northwestern quarterback Kain Colter and Ramogi Huma of the College Athletes Players Association met in Washington with members of Congress earlier this month to press their case for unionization.</p></p> Wed, 09 Apr 2014 16:35:00 -0500 http://www.wbez.org/news/northwestern-appeals-nlrb-ruling-athletes-union-109999 Mayor Emanuel’s pension plan headed to governor http://www.wbez.org/news/mayor-emanuel%E2%80%99s-pension-plan-headed-governor-109989 <p><p>Controversial legislation that would change the retirement benefits of some City of Chicago employees raced through the state legislature on Tuesday and is now headed for Gov. Pat Quinn&#39;s desk.</p><p>The plan, backed by Chicago Mayor Rahm Emanuel, cleared the State House of Representatives on a 73-41 vote. A few hours later, it passed through the State Senate on a 31-23 vote. Gov. Pat Quinn has not said whether he&#39;ll sign the plan, which is opposed by several powerful city workers&#39; unions because it scales back benefits for retirees.</p><p>The debate on the House floor largely centered around what would happen to the two pension funds for city laborers and municipal workers if they continued their current benefit structure. City officials had warned lawmakers the retirement funds could run out of money to pay retirees their benefits within 10 years.</p><p>&ldquo;The numbers alone would behoove us to take action and pass this bill,&rdquo; said Democratic House Speaker Michael Madigan, who sponsored the bill for &nbsp;Emanuel.</p><p>Of the two pensions affected, the municipal pension is currently funded at 37 percent, while the laborers&rsquo; system is funded at 55 percent.</p><p>&ldquo;These plans will be out of money, insolvent, bankrupt, unable to pay any of their obligations in somewhere between 10 and 15 years,&rdquo; said State Rep. Elaine Nekritz, D-Buffalo Grove.</p><p>Most of the opposition came from members of the black caucus, who represent parts of Chicago, and suburban and downstate Republicans, who warned that the legislation depends on the city council to raise property taxes.</p><p>&ldquo;If&nbsp; you vote for this bill, you are voting for at least $2 billion of higher property taxes over the next 10 years,&rdquo; said Rep. David McSweeney, R-Cary.</p><p>An earlier version of the bill required Chicago&rsquo;s city council to approve a property tax increase, but Speaker Madigan removed that language after objections from several lawmakers.</p><p>The bill&rsquo;s main goal is to pump more money into the Chicago pension funds for city laborers and municipal workers, while scaling back benefits to cut costs. Under the proposal, the city would finally scratch the inadequate funding formula it has used for decades, which experts say is a big reason the city&rsquo;s retirement systems are now in such dire shape.</p><p>Much of that ramped up funding would come from Emanuel&rsquo;s proposal to raise Chicago property taxes by $50 million a year, ultimately netting the city $750 million more revenue over the next five years. For the owner of a $250,000 home, that would cost about $58 dollars more per year on their property tax bills, according to the mayor&rsquo;s office.</p><p>Lest City Hall try to wriggle out of its pension obligations during tough budget times, the bill also gives pension funds the power to sue the city if it fails to pay up. By 2018, the pension funds would also be able to garnish all state grant money headed for the Chicago if the city fails to meet its obligations.</p><p>City workers, meanwhile, would pay more money into the system but get less out of it. By 2019, they&rsquo;d be paying 11 percent of each paycheck toward their pension, compared with the current 8.5 percent. That contribution would drop back down to 9.75% once the pension funds are healthy, which could take decades.</p><p>The bill also does away with the annual, compounding 3 percent benefit increases that have been blamed for much of the strain on the laborers and municipal workers&rsquo; pension funds. Instead, workers would now see their pension checks increase each year by a flat 3 percent or half the rate of inflation, whichever is less. And most workers wouldn&rsquo;t receive any increases in 2017, 2019 and 2025.</p><p>Retirees who earn less than $22,000 would be guaranteed to see their benefits grow by at least 1% a year, and also would not be subject to the three years of skipped increases.</p></p> Tue, 08 Apr 2014 14:17:00 -0500 http://www.wbez.org/news/mayor-emanuel%E2%80%99s-pension-plan-headed-governor-109989 Madigan drops property tax mandate in pension bill http://www.wbez.org/news/madigan-drops-property-tax-mandate-pension-bill-109983 <img typeof="foaf:Image" src="http://llnw.wbez.org/main-images/Pat-Quinn-AP-Seth-Perlman.jpg" alt="" /><p><p>Illinois House Speaker Michael Madigan is removing a controversial provision from a Chicago pension bill that would have required the City Council to raise property taxes in order ease the city&rsquo;s nearly $20 billion pension crisis.</p><p>The move to strip the property-tax language in the bill came late Monday, just a few hours after Gov. Pat Quinn signalled he would not back a proposed property tax hike that Mayor Rahm Emanuel is pushing in order to bolster the ailing pension funds for Chicago laborers and municipal workers.</p><p>&ldquo;Working with legislative leaders, bill sponsors, the Governor, and our partners in labor, we have addressed their concerns and can now move forward to save the retirements of nearly 60,000 city workers and retirees in Chicago,&rdquo; Emanuel was quoted as saying in an emailed statement late Monday afternoon.</p><p>But the removal of the property tax language doesn&rsquo;t mean Emanuel&rsquo;s tax hike proposal is going away. That plan, which would bring the city $750 million in revenue over the next five years, still seems to be central to the mayor&rsquo;s plan to pump more money into the city&rsquo;s pensions.</p><p>The difference is that state legislators, who must approve changes to Illinois pension law, don&rsquo;t have to worry about being blamed for raising Chicago property taxes during an election year. The bill&rsquo;s original language mandated that the City Council raise property taxes to pay for pensions. The latest version allows the city to use &ldquo;any available funds&rdquo; to make its annual payments.</p><p>Speaking at an event Monday morning, Emanuel said he is not trying to hang a potential property tax hike around legislators&rsquo; necks.</p><p>&ldquo;It was never anybody&rsquo;s intention to have Springfield deal with that,&rdquo; Emanuel said. &ldquo;That&rsquo;s our responsibility. But I do believe to actually give the 61,000 retirees and workers the certainty they deserve, you need reform and revenue. And we&rsquo;ll deal with our responsibility.&rdquo;</p><p>Emanuel said he will continue to &ldquo;address people&rsquo;s concerns&rdquo; about the pension plan, though he would not speak directly to its fate in the City Council, which would also need to approve any property tax hike.</p><p>To placate public worker unions who had wanted a dedicated revenue stream, Madigan&rsquo;s changes also beef up the penalties if City Hall wriggles out of paying its pension contributions. The bill directs Illinois&rsquo; Comptroller to cut off state funding to the city indefinitely if it doesn&rsquo;t pay its pension tab, and it gives pension funds the right to sue City Hall in order to get their money.</p><p>The new bill would also guarantee that retirees who make $22,000 or less in annual benefits would get a cost-of-living increase of at least 1 percent each year. Prior proposals set the annual increases at the lesser of 3 percent or half the rate of inflation. Right now, city laborers and municipal workers get a guaranteed annual benefit increase of 3 percent, which builds on the previous years&rsquo; increases.</p><p>The changes to the mayor&rsquo;s proposed pension fix came just hours after Gov. Pat Quinn slammed Emanuel&rsquo;s proposed property tax hike.</p><p>&ldquo;They&rsquo;ve gotta come up with a much better comprehensive approach to deal with this issue,&rdquo; Quinn said at an unrelated press conference. &ldquo;But if they think they&rsquo;re just gonna gouge property taxpayers, no can do. We&rsquo;re not gonna go that way.&rdquo;</p><p>Quinn, a populist Democrat who is seeking re-election in November, has made property tax relief central to his 2015 state budget proposal. And while he shot down Emanuel&rsquo;s proposed property tax hike, the governor did not offer an alternative source of revenue for Chicago pensions.</p><p>&ldquo;I think they need to be a whole lot more creative than I&rsquo;ve seen so far,&rdquo; Quinn said.</p><p>State legislators could consider the new amendment as soon as Tuesday.</p></p> Mon, 07 Apr 2014 15:32:00 -0500 http://www.wbez.org/news/madigan-drops-property-tax-mandate-pension-bill-109983 Bigger than burgers and fries, franchising blamed for low wages http://www.wbez.org/news/bigger-burgers-and-fries-franchising-blamed-low-wages-109978 <p><p><iframe frameborder="0" height="310" scrolling="no" src="https://w.soundcloud.com/player/?url=https%3A//api.soundcloud.com/playlists/29724231&amp;color=ff5500&amp;auto_play=false&amp;hide_related=true&amp;show_artwork=false" width="100%"></iframe></p><p><br /><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Franchising%201%20FINAL_sh.jpg" style="margin: 4px 0px 0px 0px; float: right; height: 233px; width: 350px;" title="Hashim Syed, owner of a 7-Eleven in Chicago, says company rules make it hard for him to cut costs so he could pay employees more. (WBEZ/Shannon Heffernan)" />When we asked what it is like to own a franchise of the world&rsquo;s largest convenience-store chain, Hashim Syed took us to a cramped back room of his store, a 7-Eleven on Chicago&rsquo;s North Side.</p><p>Sitting next to a wall of tubes filled with bright-colored syrup for the soda machine, Syed recalled a young man working the graveyard shift a few years back. This employee wanted to be with his father, who was gravely ill.</p><p>&ldquo;Where we come from,&rdquo; said Syed, 71, who was born in India, &ldquo;it&rsquo;s very important that you spend the final days with parents for the comfort.&rdquo;</p><p>But the worker could not afford to take unpaid leave. And Syed could not afford to replace him. &ldquo;I&rsquo;d have had to have somebody else do his work,&rdquo; Syed said, his voice becoming faint. &ldquo;I would have ended up paying two wages.&rdquo;</p><p>The employee kept most of his shifts and, to this day, Syed regrets it. &ldquo;I wish I would have given him some time off,&rdquo; he said.</p><p>In Syed&rsquo;s nearly quarter century as a 7-Eleven franchisee, he has worked brutally long hours, his profits have fallen far short of his expectations, and the Dallas-based chain has imposed tighter rules on how he runs the store.</p><p>But something that particularly steams Syed is his role as an employer. He says all of those 7-Eleven rules limit his ability to cut costs and free up resources to treat his workers better. &ldquo;When I lived in Bombay,&rdquo; Syed said, &ldquo;this is not what I thought they meant by the American Dream.&rdquo;</p><p>An array of signs suggests Syed is not the only one questioning how franchising affects the workplace.</p><p><iframe allowfullscreen="" frameborder="0" height="400" src="//www.youtube.com/embed/6fidL51oakg?list=UUkpMCLrDFxb1n74GOOw81-w" width="600"></iframe></p><p>Franchisees are pushing several states to clamp down on allegedly predatory franchisor practices. Web sites such as <a href="http://www.bluemaumau.org/">Blue MauMau</a> and <a href="http://www.unhappyfranchisee.com/">Unhappy Franchisee</a> have sprung up to connect these small business owners and give them a voice.</p><p>In one industry, &ldquo;franchisees&rdquo; have won a string of class-action lawsuits claiming that they are really employees and that their employers are using the franchise model to skirt wage-and-hour laws.</p><p>Franchises, especially those serving fast food, have also become frequent protest sites for a movement demanding higher wages and benefits such as paid sick leave. Those protests have grown louder as some politicians, ranging from Illinois Governor Pat Quinn to President Barack Obama, call for raising the minimum wage.</p><p>And, while many economists and business groups praise franchising as efficient, the model is taking hits from some scholars, including an Obama nominee to head the U.S. Department of Labor&rsquo;s Wage and Hour Division. That nominee says franchising is part of something much bigger &mdash; something bad for the workplace.</p><p><strong>How Franchising Works</strong></p><p>Franchising dates back to the 19th century, when manufacturers such as the Singer Sewing Machines Company developed the model for sales representatives. By the 1960s, franchising was ubiquitous, thanks to fast-food chains such as McDonald&rsquo;s and Burger King. Today franchising takes place in a dizzying range of industries, from tax services to child care, from real estate to car repair.</p><p>The number of U.S. franchise jobs in recent years has grown, now totaling more than 8.1 million &mdash; about 7 percent of private-sector jobs, according to data from payroll processor ADP. Franchise employment growth has outpaced jobs growth in the economy as a whole for 12 consecutive months, the data show.</p><p>In Illinois, franchise employment totals almost 345,000, according to the<a href="http://www.franchise.org/"> International Franchise Association</a> Educational Foundation. As of January, 1,152 companies had active registrations to sell franchises in Illinois, the state attorney general&rsquo;s office says.</p><p>Here is how the model works. A company thinks it has a good thing going and decides to expand. But it may not be familiar with the new places and may be short on capital. It also does not want to employ the necessary workers. It would rather have someone else do that &mdash; someone with skin in the game.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Franchising%202%20FINAL_sh.png" style="margin: 4px 0px 0px 0px; float: left; height: 244px; width: 350px;" title="Amjad “AJ” Haj, who co-owns three Al’s Beef franchises in Chicago, praises the company’s support to run them. (WBEZ/Shannon Heffernan)" />&ldquo;A franchisee will do the best job,&rdquo; said David Howey, who bought an old Chicago sandwich brand, <a href="http://alsbeef.com/">Al&rsquo;s Beef</a>, and stepped up the chain&rsquo;s franchising. &ldquo;Instead of a large company having a bunch of managers who are running the stores, a franchisee buys into the system and it becomes their business. It becomes their life. So the brand is represented properly by people who really care.&rdquo;</p><p>For the franchisees, the model allows them to run their own business and take advantage of company resources for things such as property, equipment, training and marketing.</p><p>The franchisees also pay an upfront sum known as the franchise fee, typically five figures. Once in business, they pay a specified royalty &mdash; often 5-10 percent of sales &mdash; and fees for things such as advertising, management and insurance.</p><p>Amjad &ldquo;AJ&rdquo; Haj, who owns three Al&rsquo;s Beef franchises with his brother, says he appreciates being able to focus on day-to-day tasks. &ldquo;You do not have to go test 20 different burgers to see which one you want to sell,&rdquo; Haj said. &ldquo;They&rsquo;ve already done that. They&rsquo;ve tested out all the different mayos for you.&rdquo;</p><p>Successful franchising depends on a good brand &mdash; which means, above all, consistency. At all 16 locations of Al&rsquo;s Beef, the sandwiches not only taste the same, they drip the same, thanks to a uniform recipe for their <em>jus</em>.</p><p>What protects the brand is the franchise agreement, which spells out franchisee rules on topics such as operating hours, dress codes, supply vendors and payroll processes.</p><p>Despite paying all the fees and following the rules, a franchisee has no guarantee the unit will flourish. Franchises go belly up about as often as independent businesses in their industry, according to the<a href="http://www.sba.gov/"> U.S. Small Business Administration</a>.</p><p>Many franchisees do hang on &mdash; some for decades, like Syed, the 7-Eleven operator. A third of franchisees run multiple units, usually two or three, according to Franchise Business Review.</p><p>&ldquo;We see that this is successful &mdash; businesses being franchised &mdash; simply by the fact that they exist all around us,&rdquo; said <a href="http://www.bus.umich.edu/FacultyBios/FacultyBio.asp?id=000119727">Francine LaFontaine</a>, a University of Michigan professor of business economics and public policy. &ldquo;And then consumers are voting with their feet by consuming the goods and services that are offered this way. That means we&rsquo;ve made that sector more efficient.&rdquo;</p><p>That efficiency can lower prices, said LaFontaine, a&nbsp;<a href="http://books.google.com/books/about/The_Economics_of_Franchising.html?id=HaZuDYzXLSYC">leading researcher</a>&nbsp;on franchise economics. &ldquo;That&rsquo;s good for consumers. It probably also means we consume a bit more of these things, which means there are more jobs in this sector than there would be otherwise.&rdquo;</p><p>But the model is fraught with tensions. When a franchise agreement expires, companies sometimes take the opportunity to increase the royalty or impose tighter rules. If the franchisee does not follow the rules, the company might take over that unit. Last summer, 7-Eleven ousted franchisees from several Chicago stores for alleged franchise-agreement violations.</p><p>The company, for its part, has reasons to establish rules &mdash; and enforce them. Making all franchises buy from the same supplier can help bring down costs. Higher fees can fund more advertising. Quality standards help keep franchisees from freeloading on the brand.</p><p>Other tensions stem from the wages and work conditions of franchise employees &mdash; the workers who flip the burgers or ring up the Slurpees.</p><p>Last June, federal <a href="http://www.justice.gov/usao/nye/pr/2013/2013jun17.html">authorities seized</a> fourteen 7-Eleven stores in New York and Virginia and arrested the franchisees for allegedly employing illegal immigrants, forcing them to work long overtime hours, paying them for just a fraction of their work and forcing them to live in substandard housing owned by the franchisees. After the arrests, the corporation said it planned to step up its franchisee monitoring.</p><p>This March, McDonald&rsquo;s workers in California, Michigan and New York <a href="https://drive.google.com/folderview?id=0BwU-XxSsYz21eXluRzFpVFFzMFE&amp;usp=sharing">filed lawsuits</a> claiming that the Oak Brook-based corporation is responsible for alleged wage-and-hour violations, even at franchises. A company statement about the suits said McDonald&rsquo;s was committed &ldquo;to the well-being and fair treatment of all people who work in McDonald&rsquo;s restaurants&rdquo; and that it would investigate the allegations and &ldquo;take any necessary actions.&rdquo;</p><p><img alt="" class="image-original_image" src="http://llnw.wbez.org/styles/original_image/llo/insert-images/book cover.jpg" style="margin: 4px 0px 0px 0px; float: right; height: 296px; width: 200px;" title="A Boston University economist likens franchising to outsourcing." />Economists disagree about what causes such work conditions. Some cite the low-skilled jobs in many heavily franchised industries. They point to cutthroat competition. &ldquo;It&rsquo;s more the industry that determines the working conditions of the employees than it is the way in which this is organized,&rdquo; said LaFontaine, the University of Michigan economist, defending the franchise model.</p><p>Other experts tie the low wages to the franchising. When a company franchises, they point out, it is adding extra owners and a new layer of competition. That means more people taking slices of the pie and more pressure to cut costs such as wages. &ldquo;Each different business is operating on a thinner margin,&rdquo; said David Weil, the Labor Department nominee, who is a business professor at Boston University.</p><p>Weil co-authored a study that found that fast-food restaurants operated by a franchisee are more likely to violate wage-and-hour laws than eateries the big corporation runs itself.</p><p>When workers earn less, a related argument goes, they also consume less &mdash; a drag on the economy.</p><p>In a <a href="http://www.hup.harvard.edu/catalog.php?isbn=9780674725447">new book</a>, Weil acknowledges the benefits of franchising for businesses that want to expand, but he also likens the model to&nbsp;various forms of outsourcing. He says they are all ways for big companies to shed employment responsibilities.</p><p><strong>The Slurpee Economy</strong></p><p>Syed says he bought his 7-Eleven franchise in 1990. &ldquo;I was very excited,&rdquo; he said. &ldquo;I could buy everything from where I wanted to.&rdquo;</p><p>After a while, however, Syed decided that being a franchisee was not all it was cracked up to be. It was not just the long hours. The company allowed another 7-Eleven to open just a few blocks away. Then it changed the terms of his franchise agreement.</p><p>Franchisees learned they had to buy 85 percent of supplies from approved vendors. &ldquo;Now everything will be controlled by 7-Eleven Company,&rdquo; Syed said. &ldquo;They will decide what to buy, where to buy.&rdquo;</p><p>Other franchisees complain that 7-Eleven goes as far as to remotely control the temperature in their stores, even the volume on their televisions.</p><p>Many of 7-Eleven&rsquo;s rules do help protect the brand. And the company has reasons to make franchisees purchase supplies from an approved vendor. For one, 7-Eleven can use the collective buying power to keep costs down, a company official said.</p><p>Something 7-Eleven does not control are employment decisions, including the amount Syed pays his workers. Syed said one of his half-dozen employees, the manager, makes $10.50 an hour. He said the rest earn less &mdash; in a state where the minimum is $8.25.</p><div class="image-insert-image "><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/banner-edited.jpg" title="Syed, the 7-Eleven franchisee in Chicago, calls himself a 'front man' for the Dallas-based corporation. (WBEZ/Shannon Heffernan)" /></div><p>Syed said he can hardly blame employees who are upset about the pay, but he insisted he is not getting rich either. Last year, his 23rd at the store, Syed took home $53,866, he said. That was one of his best years, he added.</p><p>To Syed, the whole franchise model feels like a setup. &ldquo;We are as much of a victim in it as the workers are,&rdquo; he said. &ldquo;We are nothing more than a glorified manager.&rdquo;</p><p>7-Eleven officials declined to get specific regarding the company&rsquo;s agreements with its approximately 6,200 franchises. But Jay Mitchell, a franchise-sales manager at the Dallas headquarters, said 7-Eleven was not going to take responsibility for wages or work conditions.</p><p>Franchisees are &ldquo;going to be independent operators so they are going to be responsible for employing people and determining what they pay those people as well,&rdquo; Mitchell said. &ldquo;While we will provide them guidance, it is completely up to [the franchisees] how they pay their employees.&rdquo;</p><p>Questioned about such employment policies, 7-Eleven spokeswoman Margaret Chabris said the company provides franchisees &ldquo;very comprehensive&rdquo; training and said the franchise agreement requires them to follow the law.</p><p>But Syed said the rest of the agreement makes it too hard for him to cut costs, leaving him little room to pay his employees more. &ldquo;That worker also thinks &mdash; and I know it for a fact &mdash; that I am just greedy and I want to keep all the money in my pocket instead of giving him fair wages,&rdquo; he said.</p><p>It might have been harder for Syed to run a convenience store without the 7-Eleven brand, said LaFontaine, the economist. &ldquo;Independent businesses or franchises fail all the time. That is just a reality of these kinds of small businesses.&rdquo;</p><p>Syed, who publishes a <a href="http://7-elevenfoac.com/data/newsletter/Final_FOAC_December_2012_Newsletter.pdf">newsletter</a> for Chicago-area 7-Eleven owners,&nbsp;says state and federal lawmakers should do more to protect franchises from the companies that own their brand.</p><p>To date, just 17 states have any laws governing franchisor-franchisee relations, according to Dean Heyl, who directs state government affairs for the <a href="http://www.franchise.org/">International Franchise Association</a>.</p><p>Those states include Illinois, which enacted its&nbsp;<a href="http://www.ilga.gov/legislation/ilcs/ilcs3.asp?ActID=2381&amp;ChapterID=67">Franchise Disclosure Act</a>&nbsp;in 1987. That law regulates how franchisors treat prospective franchisees and requires franchisors to have &ldquo;good cause&rdquo; for terminating a franchise.</p><p>Last week, Maine&rsquo;s state Senate voted down a bill that would have, among other things, required franchisors to provide a franchisee a 60-day notice to resolve a problem before termination. The bill also would have allowed franchisees to leave their business to a spouse, partner or heir.</p><p>Heyl said such legislation, if enacted, would &ldquo;hurt franchisees who are playing by the rules.&rdquo;</p><p><strong>Franchising</strong>&rsquo;<strong>s New Frontier</strong></p><p>As franchising has spread, some industries have pushed the model to the extreme. In commercial-cleaning franchising, the customers that need the service usually come through the franchisor. They also make their payments to the franchisor. The franchisee gets just a portion of the payments in periodic checks from the franchisor &mdash; after deductions for insurance, royalties, management and so on.</p><p>In Chicago, the commercial-cleaning franchisees include hundreds of Mexican immigrants. One of them is a woman we will call Gloria Pérez. We agreed not to use her real name because she fears retribution from her franchisor. Pérez entered the commercial-cleaning business four years ago.</p><p>Back then, she and her husband were both unemployed, they had three kids at home and a mortgage, and they were burning through their savings. Pérez saw a newspaper ad placed by CleanNet of Illinois, part of<a href="http://www.cleannetusa.com/"> CleanNet USA</a>, based in McLean, Virginia.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/Franchise%203_sh%20%28CM%20credit%29.JPG" style="margin: 4px 0px 0px 0px; float: right; height: 233px; width: 350px;" title="A CleanNet janitor works after hours in a Chicago-area car dealership. Treated like a franchisee, she says her pay amounts to less than Illinois’s minimum wage. (WBEZ/Chip Mitchell)" />The ad said she could have her &ldquo;own business.&rdquo; Pérez, interviewed by WBEZ in Spanish, said it seemed like &ldquo;a good opportunity because we did not have any other work.&rdquo;</p><p>Pérez went in for an appointment. CleanNet gave her more than 150 pages of legal disclosures &mdash; all in English, she said. She did not understand much except some numbers on a chart the company gave her. &ldquo;It said I could make $6,000 a month if I bought a franchise for $21,000,&rdquo; she said.</p><p>After a discount, Pérez said, she managed to put in $19,000. Since then, she said, she has never come close to earning the monthly $6,000. &ldquo;Every month they take out 20 percent of what I earn&rdquo; and CleanNet does not give her enough customers within range of her home, Pérez said.</p><p>&ldquo;It&rsquo;s a scam,&rdquo; said Chicago attorney Christopher Williams, who filed a class-action lawsuit against the company in March on behalf of janitors such as Pérez. &ldquo;CleanNet is trying to say, &lsquo;We have no unemployment obligation to them. We have no workers-comp obligations to them. We do not pay payroll taxes. We are not their employer. And these are people who need public assistance because they&rsquo;re making so little money. They can&rsquo;t afford health care. If they get injured on the job, they have no workers compensation insurance.&rdquo;</p><p>If a customer falls behind on its payments, CleanNet warns it could deduct that money from paychecks too.</p><p>Another way CleanNet makes money off its janitors is by loaning them money when they cannot afford the franchise fee &mdash; the upfront payment from the workers. Paying off that loan means yet more paycheck deductions.</p><p>&ldquo;All they&rsquo;re left with after that agreement is debt,&rdquo; Williams said.</p><p>The suit against CleanNet, filed in federal court, claims hundreds of the company&rsquo;s Illinois janitors are not franchisees but employees. It accuses the company of violating state and federal laws regulating wages and work hours.</p><p>CleanNet officials did not respond to our requests for comment about the suit. When janitors in Massachusetts filed a similar claim against the company, CleanNet denied any liability or wrongdoing. It did settle with those janitors last November, agreeing to pay out $7.5 million.</p><p>In Illinois, CleanNet is among at least eight commercial-cleaning firms registered to offer franchises, according to the state attorney general&rsquo;s office. The biggest is Jani-King International, based in Addison, Texas.</p><p>Jani-King says it pioneered franchising in the commercial cleaning industry. Asked whether ducking wage-and-hour laws was a big factor in deciding to sell franchises to janitors instead of employing them, the company emailed a statement that did not directly answer the question.</p><p>&ldquo;Franchise owners, like all business owners, have control over their day-to-day operations as well as their profitability,&rdquo; the Jani-King statement said. &ldquo;They can solicit and bid their own business, and they can accept or decline the right to service accounts offered by Jani-King. They can hire employees to clean accounts, or they can clean themselves. They buy all of their own equipment and supplies. The franchise owners receive all revenue generated by their business (less Jani-King&rsquo;s fees).&rdquo;</p><p>But Weil, the Boston University business economist, said the franchise model enables the cleaning companies to shortchange the janitors. &ldquo;If you start doing the math, you realize that people are being paid way below the minimum wage or being denied overtime payment and are really being subjected to inappropriate expenses by another company for, essentially, being an employee of that company,&rdquo; he said.</p><p>In the cleaning industry, it is not just the &ldquo;franchisees&rdquo; who are vulnerable to wage-and-hour violations. Those workers often bring other people to help them with jobs. Pérez gets part-time help from her husband, a son and a neighborhood friend. &ldquo;I can&rsquo;t afford to pay them minimum wage,&rdquo; she said.</p><p>Court rulings in Massachusetts have upended franchising by janitorial companies. &ldquo;Several have closed down or stopped operating the way they were operating,&rdquo; said attorney Shannon Liss-Riordan, who filed the key suits. Now the companies are either treating their janitors like employees or &ldquo;not charging workers upfront for a job,&rdquo; she said.</p><p>&ldquo;My hope is that some of the rulings that we&rsquo;ve gotten [in Massachusetts] will spread,&rdquo; Liss-Riordan said.</p><p>That prospect worries Heyl, the <a href="http://www.franchise.org/">International Franchise Association</a> lobbyist. If lawsuits drive franchised cleaning companies out of business, there will be less competition and increased prices, he warned.</p><p>Heyl also sees a threat to franchising in all industries. &ldquo;We&rsquo;re just coming out of a recession, and banks are very skittish and, if they start looking at a franchise system and open up the [newspaper] and say, &lsquo;Look, some of these franchisees are employees,&rsquo; and there&rsquo;s litigation to follow, there&rsquo;s numerous negative economic impacts.&rdquo;</p><p><em>Follow <a href="http://www.wbez.org/users/cmitchell-0">Chip Mitchell</a> at <a href="https://twitter.com/ChipMitchell1">@ChipMitchell1</a>.&nbsp;Follow <a href="http://www.wbez.org/users/shannon-0">Shannon Heffernan</a> at <a href="https://twitter.com/shannon_h">@shannon_h</a>.&nbsp;</em><em>This report, edited by <a href="http://www.wbez.org/users/djohn">Derek John</a>, is part of WBEZ</em>&rsquo;<em>s&nbsp;</em>&ldquo;<em>Front and Center</em>&rdquo;<em>&nbsp;series, funded by the Joyce Foundation,&nbsp;</em>&ldquo;<em>Improving the quality of life in the Great Lakes region and across the country.</em>&rdquo;</p></p> Mon, 07 Apr 2014 05:01:00 -0500 http://www.wbez.org/news/bigger-burgers-and-fries-franchising-blamed-low-wages-109978