By Mark Carey
Stay put, don’t move, head down, get back into the office and be seen, don’t rock the boat- just do anything to maintain your job. That’s what the current news vibe is in the national press (Read two articles from WSJ Here and Here). This sounds like a complete 180-degree shift from just a year or two ago. Previously, employers were competing for employees and employees were job hopping for more pay and opportunities. We collectively witnessed the rise of true “Employee Power” in the job market. Employees were emboldened with a new sense of leverage against their employers and the power to force their employers to make compensation concessions, work remotely and gain other benefits previously unheard of. No, I am not referring to the unionization activity at any local Starbucks! I am referring to the much larger national employee population as unions only comprise 2% of all employees.
A One-Off Event Unforeseen in a Generation
The next big recession never happened, aka the quiet landing. Unemployment is still below average as of July 2024. According to economists interviewed for the above WSJ news stories mentioned, the rise of Employee Power was a “one off event” unforeseen in a generation and was never anticipated to have any lasting impact. That was the part of the WSJ story that caused me to question, why did employees lose their leverage on employers and lose momentum?
Why Employee Power Evaporated
I have a simple but long-winded answer, one that I have been collecting in my head as I muscle through severance negotiations for employees, federal court mediations and litigate DEI reverse discrimination cases for the past three to four years now.
A socio-political movement arose in the form of one pandemic, the arrival of political and social unrest, followed by an unprecedented monetary policy that financially infused all employees and their employers. A stock market that blossomed to the surprise of many, bolstering the 401k pension accounts of today’s era for the average employee. These events caused employees to question “their purpose” in the system and the motives of their employers, both good and bad. Younger employees led the charge to question the old school concept of working and started quiet quitting; then everyone started quiet quitting.
Employees Mattered for a Second or Two
Yes, Employees Mattered for a time, albeit a short one. I was awestruck by the potential for a new movement, unrelated to unionism. At-will employees thumbed their noses at employers en masse with a degree of confidence unseen in a generation. There was an immediate bond between all employees, and they unconsciously pushed their agenda on employers with a startling speed. Employers were truly caught off guard and rebalancing on their heels.
The “powers that be” (Biden Administration) added steam to the engine in the form of outlawing forced arbitration in sexual harassment cases after the #metoo event began to fizzle and initiated a rule banning noncompete agreements nationwide for all employees, effective September 4, 2024 unless conservatives (aka Employers) stop them in the Eastern District of Texas. There is currently a showdown between federal district courts (Texas [Trump Appointee] and Pennsylvania [Biden Appointee]) on whether to enjoin or not to enjoin the FTC new rule; litigation that was well anticipated and should be a good show to watch from the sidelines here. I am writing a separate article on this topic and will post soon so you are informed about what happens on September 4, 2024. The FTC rule is a big deal for employees and enhances Employee Power.
Employers freaked out about social unrest and lied to employees and customers in the form of “DEI marketing initiatives,” because that’s what they were and nothing more. Today, DEI is mostly disbanded after the U.S. Supreme Court gave a “nod and wink” to a zero tolerance regarding race quotas in the employment sector and ending affirmative action in public education. Move over DEI, MEI (Merit, Excellence and Intelligence) is now taking over!
But what is the reason for the current sudden evaporation of Employee Power that once was? Is there some internal intracompany propaganda shared amongst employers to collective chill Employee Power for the common good of companies and their shareholders? Could SHRM be behind this? I can only imagine the quickening of this anti-employee movement in the private equity space; private equity companies are detached about employee relations in general. Is the loss of Employee Power related to corporate profits? Yes, but there is more to it.
No one, no newspaper, no politician or management executive is explaining why employees have now lost their “Employee Power” and I am sure many employees would like to know why.
Lost Leverage
In my opinion the answer lies in the principles of negotiation, specifically “employee leverage”. Employees have lost their leverage and employers are refusing to bargain about wages, remote working and hiring has stagnated. When you are negotiating employment related issues, leverage is key to both sides. Leverage can come in a variety of ways, like employee retention through wage concessions during the mass job migration or loud quitting. Leverage can take the form of social justice issues like DEI and can include an FTC rule banning noncompete agreements. This list is endless and falls into what I have coined the phrase “Employnomics”®.
Employee Power has diminished because employers jumped at the first sign of the waning national economic employment data as the above WSJ articles indicate (a return to pre-2019 employment numbers) and put the brakes on wage increases, promotions, hiring and began a mass lay off of overstuffed companies, particularly at the management level. Employers are tightly connected and successful in deleveraging employees, laying them off in many cases as far as my office is currently experiencing it. Employees nationwide cannot coalesce to turn the momentum back into their corner.
Employers are well equipped to message among themselves via large K-Street lobby groups to form coalitions against employees because it benefits them economically. You will not read about this effort; it is entirely subversive. In contrast employees nationwide have no coalition lobby groups to garner consensus of the 133 million full time employees nationwide. The best employees can muster in the form of a mechanism of shared information is through social media and viral TikTok videos of employees getting shamefully terminated in real time.
To Spark An Employee Movement Again
I hope for a mass movement amongst employees where they collectively move with anonymity to push for more changes at work. The tools of change are present via the technology in our phones. I was always impressed by the mass protests in Hong Kong before China neutered the nationalistic movement. Protestors used social media in ways that concealed their identities and caused flash mobs. Protestors used thousands of umbrellas to conceal their identities from the cameras of big brother. If that happened here and employees did not fear their exposure to their employers and amassed together, real change would take place. But to be successful, employees must believe in real change impacting their income and overall wellbeing. It must be populist in nature and viral via social media. Employee Power or leverage would be their sheer numbers. This is our past national history after all, and the tactic was successful leading to the passage of the 1964 Civil Rights Act. We just need a spark!
If you would like more information about this topic or would like to speak to an employment attorney about your concerns, please contact Carey & Associates, P.C. at info@capclaw.com.