On Wage Theft and Federal Mediation: This case is an example of what workers face in this nation today and why we should be demanding tremendous improvements in workers’ rights. Not the insidious further weakening and elimination of workers’ rights, that is well underway. It is an example that is happening to all too many workers, but we don’t hear about it because most of them have no advocate. In fact, if this group of workers hadn’t been members of a union and had a labor agreement in force, they too would have been the silently dispossessed.
A few years ago, Corporation X signed a binding labor agreement. Corporation X is owned by a single individual and pays its employees at the very low end of the wage scale. The Company is a classic “bottom feeder”.
CORPORATION X ran into some stiffer competition in its business. Instead of discussing its business stresses with its worker representatives, it decided to break its contractual obligation to wage increases to its employees. When you don’t pay what you’ve committed to, it’s wage theft.
The Union promptly filed a grievance, which ultimately ended up in Arbitration. It took six months to get the case to an Arbitrator, who ruled in favor of the workers. Federal Labor Law precedent (the Steelworkers trilogy) established that labor arbitration was final and binding. But CORPORATION X felt it was above the law. It promptly filed a suit in Federal Court, alleging the Arbitrator had exceeded his authority. It took a year and nine months until a Federal Judge ruled in favor of the workers, again. However, the Federal Courts are horrendously backlogged and the actual determination of backpay could have taken years to reach. The Court offered, and CORPORATION X and the Union agreed to try to use the Federal Mediation and Conciliation Service (FMCS) to come to a settlement. The Federal Mediation Service provides cost-free skilled mediators, who work with both sides of a litigation in an effort to reach a “voluntary” settlement. In this case, the Judge’s affirmation of workers’ rights spurred CORPORATION X to finally come to the table.
The Mediation process was protracted and a settlement had to be reached regarding the wage non-payments. The legal process for distributing these kinds of settlements is also time consuming. EIGHT YEARS after their wages were stolen from them, workers received their last backpay check. As workers’ rights stand today, this is a huge victory. But this is not really justice. Had they not had a union and a union contract, it is doubtful that they would have been able to afford the legal talent or had the legal basis necessary to prevail at all. This should not be acceptable.
On March 14, 2025, the current Administration effectively shut down the FMCS by cutting its staff from 220 to a dozen staff. By FMCS estimates, its $55m budget saves the American economy over $500 million every year. In FY 2023, the Federal Mediation and Conciliation Service (FMCS) handled 2,467 collective bargaining cases, conducted 1,566 training and intervention programs, and mediated 1,265 high-impact grievance mediations, along with 1,100 Alternative Dispute Resolution cases. As the above example shows, the FMCS speeds justice for working people that would be further delayed by Court backlogs. Yet the destruction of this worker ally and Court effectiveness tool, was but a footnote in the media circus. A media that prefers to focus on the daily “red meat” offered up as a distraction by the current Administration.
The FMCS has been quietly providing a foundation for workers rights since 1947. Most workers, in fact most Americans, don’t even know it exists. As a result, we don’t know that another foundation of workers’ rights has been destroyed. Without the FMCS, those CORPORATION X workers would most likely still be in the litigation process. Considering that the current Administration is filling the federal bench with corporate lawyers and legal incompetents, these workers today, may never have even gotten a positive ruling from the Court. Millions of dollars that would have stayed in the pocket of an unscrupulous business outlaw. To be clear. That’s the end game of those in control now.
This nation needs to wake up to what’s really happening. Workers need to understand they are under a sustained assault on everything that gives us a shot at a decent paycheck, a safe and decent quality of work life, a chance at retirement security and justice under the law. This includes FMCS, the National Labor Relations Board, OSHA, and funding reductions for a host of worker protection efforts. We are going in the wrong direction. We aren’t understanding the significance of what’s happening. We need a forceful movement to massively enhance workers rights in our nation. But we need to awaken to the fact that we are under assault, before we can form our counter-attack.
