Wednesday, September 29, 2021

Congratulations! We Passed AB 701: The Warehouse Workers Protection Act


Yesterday, we had the honor of joining Governor Newsom, Assemblywoman Lorena Gonzalez, Senator Maria Elena Durazo, and leaders from all across our state in celebrating the signing of California’s nation-leading worker protection laws, including our policy, AB 701.

AB 701, the Warehouse Workers Protection Act, is the first of its kind and an initial step in addressing the reality of algorithmic work in our country. It will protect the over 250,000 frontline warehouse workers in California by requiring employers to disclose quotas while prohibiting them from penalizing workers for rest periods, bathroom breaks, and time complying with health and safety laws.

Just as important as the policy, is the reason we took on this fight. The Los Angeles Labor Movement, and our partners across the Greater Los Angeles Area, had a front-row seat to the growing warehouse industry and the unchecked influence that corporate giants, such as Walmart and Amazon, have on our communities.

Los Angeles is uniquely positioned in the global supply chain and integral to the movement of goods in the United States. Our ports are the busiest in the country with over 40% of all containers in the US coming through our shores. Our robust freeway and rail systems create the ideal infrastructure for the movement of these goods, goods that touch every single state in the US. The sheer size of the population of Los Angeles creates one of the largest markets in the country, incentivizing retail companies to create distribution centers and resulting in the Greater Los Angeles Area having the most warehouses in the country. Combined with our ever-growing dependence on e-commerce, especially during the pandemic, we are left with an ever-expanding workforce composed predominantly of workers of color.  

Over the last few years, we have heard from countless workers who told stories of dangerous working conditions and inhumane quotas resulting in debilitating injuries. Young workers, many of them heads of their households, were forced to twist, bend, and eventually break their bodies to meet the rising demand. It was clear to us that something had to be done and that Los Angeles was destined to take on the warehousing industry head-on.

We would like to thank Gov. Newsom for signing the Warehouse Workers Protection Act and standing with warehouse workers, and Assemblymember Lorena Gonzalez for championing the bill. Her valiant efforts and steadfast determination made this historic policy a reality. Thank you to our partners, such as the Teamsters, the Warehouse Workers Resource Center, and LAANE, for helping us pass such an innovative policy that will protect workers into the future.  

This is a victory for every worker who spoke up, engaged their representative, or joined one of our actions. We are proud to say that California stands firmly in its values and will continue to say, “Work shouldn’t hurt!”

In Solidarity,

Ron Herrera

President, Los Angeles County Federation of Labor, AFL-CIO

Friday, September 3, 2021




EXCLUSIVE FedEx faces labor union challenge over billionaire CEO's pay

3 minute read

Fedex CEO Fred Smith is pictured at a business roundtable meeting of company leaders and U.S. Republican Presidential candidate Mitt Romney in Washington, June 13, 2012. REUTERS/Jason Reed

Sept 3 (Reuters) - FedEx Corp (FDX.N) shareholders should reject founder and CEO Fred Smith's $54 million pay package because the logistics company gave him stock options after scrapping a cash bonus in the wake of the COVID-19 pandemic, only to reinstate it later, the Teamsters labor union said on Friday.

Smith, whose net worth is pegged by Forbes at $5.8 billion, was given a special option award "for motivation and retention purposes" in June 2020 after FedEx canceled a $3.4 million cash bonus for him, citing uncertainty around the COVID-19 pandemic.

Those options were worth $6.4 million as of the end of May, the close of FedEx's fiscal year, more than doubling in value since Smith received them. As more people shipped and received items during the pandemic and FedEx's business rebounded, the Memphis, Tennessee-based company reinstated Smith's $3.4 million cash bonus in December, but also allowed him to keep the special stock options.

This amounted to "double-dipping" that undercuts the pay-for-performance structure of Smith's compensation, the International Brotherhood of Teamsters, which is bargaining on behalf of FedEx employees at a freight facility and is an investor in FedEx through pension and benefit funds, argued in a letter to shareholders on Friday, which was seen by Reuters.

"Having founded the company, been chief executive since 1998 and holding an 8% equity stake, surely CEO Smith has the appropriate incentives to drive shareholder value," the Teamsters general secretary-treasurer, Ken Hall, wrote in the letter.

The union is urging shareholders to vote against the company's executive pay plan at the company's annual meeting on Sept. 27. As with most companies, the vote at FedEx is non-binding.

FedEx declined to comment beyond what it has disclosed on executive pay in securities filings. In its informational disclosure to investors, FedEx said a significant portion of executive compensation is "at risk" and dependent on the company hitting performance goals and share price targets.

FedEx Chief Operating Officer Rajesh Subramaniam, the company's highest paid executive after Smith, also had his $2 million cash bonus reinstated after he received a similar special option award and stock grant worth approximately $6 million at the end of May.

Many U.S. companies tweaked the pay of executives during the pandemic, easing performance targets and even giving them pay rises. Investors then voted down a record number of CEO pay packages at their annual shareholder meetings earlier this year. L2N2NL2O2

Although most shareholder votes on pay are non-binding, some companies have tweaked executive pay when faced with investor opposition. For example, in 2018 Walt Disney Co (DIS.N) renegotiated the compensation of its chief executive at the time, Bob Iger, to toughen performance targets after shareholders voted down his pay.

The Teamsters acknowledged in the letter that Smith's options had yet to vest and that there was still uncertainty over the value of that grant. Smith also accepted a 91% cut in his annual salary during some of the last fiscal year. His salary was $966,125.

Reporting by Jessica DiNapoli in New York Editing by Greg Roumeliotis and Leslie Adler

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