Just another day in the life of the Corporate States of America: United Airlines reports it’s outsourcing 630 gate agent jobs at 12 airports to companies paying near-poverty level wages. Employees who have been with the company for years, earning middle-class wages of $50,000 a year, will be replaced by people paid between $9.50 and $12 per hour. United says it must do this to cut costs and raise its profits relative to other airlines. But United CEO Jeff Smisek gave himself [through his compensation package] $8.1 million this year. If he cut his [compensation package] just $2 million (in ...line with the CEO of the more successful Southwest Airlines, whos [compensation package] is $4 million), United would save about as much as it will by cutting the pay of those 630 employees. The problem in America isn’t that typical workers are paid more than they’re “worth” in the market. It’s that they have no bargaining power, while too many CEOs and other top executives have the power to pay themselves almost whatever they want. How do redress this power imbalance? Some call for stronger unions and greater shareholder say over CEO pay, but Im increasingly of the view we have to change the organization of the corporation so that it has to respond to all stakeholders -- not just its shareholders but also its workers and affected communities. Whats your view? - Robert Reich Note: words in [ ] inserted by me to reflect a more accurate reflection of monetary compensation and source of compensation.
Posted on: Thu, 24 Jul 2014 15:43:35 +0000
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