USA: What Do You Mean 'Us,' Boss?

Not long ago, before the accounting scandals at Enron, WorldCom and other companies, workers often saw themselves as management's best buddies. Gone was the old, us-against-them mentality in which workers viewed C.E.O.'s as robber barons intent on squeezing them for every last dollar.

In its place was a new world in which workers, with their stock options and 401(k) plans loaded with company stock, saw themselves as allied with management, not opposed to it. Pointing to the dot-com phenomenon, management theorists talked of a New Economy paradigm in which workers would link arms with executives because they were just as eager as their bosses to maximize company profits and stock prices.

The notion of worker exploitation was largely forgotten, at least among white-collar and high-technology employees, because it seemed so Old Economy. Corporate executives fostered an egalitarian atmosphere by using the same cafeterias and parking lots as their subordinates. They embraced an inclusive vocabulary in which workers were partners, associates, even fellow entrepreneurs, and to make workers identify with them, managers rewarded their new partners with stock options, bonuses and discount stock purchase plans.

"In the 90's, half of American households became investors, so the line between being an employee and an investor began to blur," former Labor Secretary Robert B. Reich said. "People were happy because it looked as if a rapidly rising tide was lifting all boats." Workers hardly seemed to worry about the need for workplace protections. With the economy and Wall Street booming, it seemed silly to fret about layoffs. Workers were busy boasting about, not worrying about, the size of their retirement nest eggs.

To this new species of investor-worker, unions seemed irrelevant. Unions made little headway as they sought to lure workers by promising the basic protections coveted in decades past, like health coverage and defined-benefit pensions. Union membership remained flat even as the 1990's boom created more than 15 million jobs. For many workers, the collective approach seemed anachronistic because they were confident that management would protect them or they could protect themselves.

This logic seemed unassailable during the boom. But the paradigm began to crack with the high-tech bust and resulting layoffs, and crumbled with the recession and the Enron-led wave of scandals. At Enron, 4,200 workers were laid off; at WorldCom, 17,000.

Cara Alcantar, who accumulated 1,600 stock options in her four years at WorldCom, said she was nave to identify with WorldCom's chief executive. "I felt on the same side as Bernie Ebbers, on the cutting edge of technology," she said. "I worked extremely hard, and I couldn't imagine layoffs would ever happen to me.'

But on July 3, she was laid off. Now her stock options are worthless, WorldCom says it cannot pay her severance benefits, and the half of her retirement savings that were in WorldCom stock are virtually worthless. "Not only were they not looking out for our interests," Ms. Alcantar said, "they were so greedy they made sure the money went into their pockets."

Before, she said, joining a union had never crossed her mind, but now she says she wishes WorldCom were unionized. With a union, she says, she might have had a defined-benefit pension that, unlike her vaporized 401(k) plan, would have guaranteed her benefits even after the stock market plunged. Labor leaders say that if Enron or WorldCom were unionized, unions would have won better pensions and severance benefits for the workers and, through their prying, might have forced the companies to be more honest about their books.

"We're seeing a real waking up across the nation because millions of workers are seeing that their economic futures are far less secure than they had been led to believe," said Harley Shaiken, a specialist in labor issues at the University of California at Berkeley.

A survey released last week by Peter D. Hart Associates found that 66 percent of workers said they trusted their employers just some or not much at all. Such numbers, labor experts say, suggest that the nation may have reached a watershed in which workers conclude that they need collective protections to safeguard them from predatory executives and economic downturns.

It is unclear whether a deus ex machina will materialize to rescue the beleaguered workers. The most likely candidates are Washington, which seems uninterested, and organized labor, which is weak.

Since the Enron scandal, President Bush and Congress have done little to protect workers even as they have rushed to protect investors. That is a far cry from 1963, when the Studebaker automobile company went under and more than 4,000 workers lost their pensions. In response, Congress, with a Republican senator, Jacob K. Javits, taking the lead, passed legislation that created strict pension protections.

The post-Enron Congress has shunned even modest protections like rules to require companies to make promised severance payments or to let workers elect representatives to the board of their 401(k) plans.

The Hart survey showed that workers are warming to unions, with 50 percent of nonunion workers saying they wanted to join a union, the highest level in two decades.

It was labor's clout in Congress and collective bargaining that created the nation's system of worker protections, including the 40-hour week, pensions, health coverage and job safety rules. But unions are weak, representing less than 10 percent of the private-sector work force, down from 35 percent in the 1950's. Unions have been notably unsuccessful in wooing workers from New Economy industries, like software.

The A.F.L.-C.I.O.'s president, John J. Sweeney, said he saw a pendulum swing in favor of collective protections. "One Enron worker told me, 'We trusted our employer, and liked our job, but when they threw us on on the street, we lost all trust,' " Mr. Sweeney said. "A lot of workers are saying to themselves, 'The same thing can happen to me.' "

AMP Section Name:Corruption
  • 185 Corruption

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