ISS backs Teamsters union over motion 22 at National Express AGM 5 May 2015

Check out  Tom at "Labour & Capital" about some rare and sensible support about encouraging a company to do the right thing for workers, customers (school children in this case) and shareholders.

"Big news tonight (29.4.15) - the FT has reported that the major proxy voting adviser ISS has recommended that shareholders vote FOR Resolution 22 at the National Express AGM next week. PIRC has also recommended a vote in favour.

Resolution 22 calls on the board to commission an independent review of practice in Durham School Services, its US business. This follows repeated complaints from employees about management interference with workplace rights.

To my knowledge, there have been six shareholder resolutions at UK companies in the past ten years that focused on labour rights in one way or another. I don't think ISS has previously recommended a vote for any of them, so this marks a significant shift.

Many large shareholders may share the ISS view that the review proposed in the resolution is not an onerous demand. They may also feel that the board has allowed this issue to drag on for long enough, and action needs to be taken to address it and then move on.

Anyway, it set things up nicely for next Wednesday's AGM."

"Broken Commitments, Vulnerable Workers" - Union busting by National Express continues

On Tuesday morning I attended  another presentation by US transport union, the Teamsters, to pension funds on the anti-union practises by a National Express owned US company called Durham which runs schools buses.

The Chair of the Local Authority Pension Fund Forum (LAPFF), Cllr Kieran Quinn, opened the meeting and made it clear that while he has a union background, as an investor he has concerns about the financial prospects of a company, that appears not to treat its workforce properly nor provide a safe environment for school children. He has had a number of meetings in the past with National Express where he has been told that the unions have exaggerated the problem. However, when he has asked for proof of this they have never produced this information.  

Teamsters spokesperson, Louis Malizia, was even more blunt. The "poisonous" and "unsustainable"  anti-worker and unsafe business practises will put the company at risk. He described the union busting and black-listing activities condoned by National Express. How union activists are victimised for reporting safety issues and the company continues to ignore decisions in favour of the union by the US courts. The company is now facing a backlash over civil rights and is losing contracts.

The final two speakers were two British Members of Parliament, Ian Lavery, MP, and Jim Sheridan, MP, who had both gone over to the US on a fact finding visit. During this visit they spoke at community meetings, met school bus drivers and were interviewed by US press and television stations. They were also thrown out of a local bus depot run by Durham when they tried to visit.

Jim Sheridan, MP, asked why doesn't National Express operate in the same way in the US as in the UK where they have usually good relations with the unions? Why are they treating children's safety differently? Why are they putting profits above safety? This is not some sort of "Communist plot" but about safety. No-one wants "revolution" they want a "resolution". Other bus companies in the US recognise trade unions, run safe services and make money without exploiting people.

Ian Lavery, MP, spoke about the unacceptable and unsafe US school bus services that would just not be tolerated in the UK. The bus drivers are poorly paid but do a very responsible job. He is a former Pension trustee and understands the need to make money to pay for pensions but there has to be a social conscience. Ian introduced a report that he and Jim wrote about their visit that they are just about to publish called "Broken Commitments, Vulnerable Workers".

In the Q&A I made the point that not exploiting people is not just about having a social conscience it is also a good investment choice. Research shows that long term investors such as pension funds get better returns from investing in companies that have good governance and do not for example treat their workers badly. Also, why doesn't National Express engage with its shareholders such as LAPFF? What else are they hiding?

"You Cannot Pick & Mix Which Human Rights to Respect" National Express LAPFF14

The President of the USA Teamsters Union, James Hoffa, sent a video message to the LAPFF conference to thank them for our support in their campaign to stop the North American arm of British company National Express's union busting.

Teamster Louis Malizia then explained to the conference more about the low pay & exploitation by National Express of school bus drivers as part of an "International Activism" debate.

He pointed out the reputational risk to the company from such behaviour and the considerable USA litigation risks from commonplace breaches of Labour law and health & safety legislation.

In the Q&A I made a contribution that there are Ten United Nations Universal Principles of Human Rights. Responsible investors have to respect all Human Rights and this includes Principle 3 regarding trade unions - "Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining".

My point is that you cannot "pick and mix" which particular Human Rights you want to uphold. You have to uphold all of them equally. I hope that National Express and other rogue employers such as the Board of UK Catalysis Housing Association, will understand that if they do not uphold all human rights - then they run the obvious risk that they will be accused of not respecting human rights.

National Express - Union busters and Blacklisters?

On 14 May it is the Annual General Meeting of British PLC National Express.

US transport trade union, the Teamsters, are calling for share owners to vote for Resolution 22 which calls for "improved oversight and reporting of human capital policies and practices". 

This relates to an ongoing dispute with the US School bus business owned by National Express called Durham School Services. 

While in the UK National Express has on the whole a positive relationship with British trade unions,  in the US it has allowed local managers to be trade union busters and blacklisters. This has a reputational risk to the brand and value of National Express. Especially when trade union members have been victimised for exposing health and safety concerns. 

In the UK there has been a campaign to "Blacklist the Blacklisters"  and to boycott companies in the UK who blacklisted workers for their trade union activism. 

I note in the US that National Express has been accused of "disparate treatment, discipline and discharge of employees engaged in union organizing; alleged illegal surveillance of workers engaged in union activity; and allegedly threatening workers with reduction in benefits, working conditions and the loss of employment for supporting unionization".

I think this is also Blacklisting and National Express runs the risk that they will be added to British list to be boycotted by responsible public and local authorities.

Check out this post I did last year on the risk to our pension investments from investing in National Express. Didn't the huge losses we took from investing in BP teach us anything? 

Picture above is of US School bus driver, Diane Bence, explaining to a meeting last month of Pension trustees and journalists, how awful it is to be employed by a bullying, disrespectful employer who takes risks with children's safety. 

On the left was Louis Malizia from the Teamsters who pointed out that if National Express wanted to expand in the US then they will have to compete for contracts in areas which have strong trade union membership. If they are seen as "anti-trade union" then it will make it much harder for them to win contracts from local School boards.  By being so anti-union they are cutting their nose to spite their face.

This meeting was chaired by Cllr Kieran Quinn (middle) who chairs the Greater Manchester Pension Fund and the Local Authority Pension Fund Forum. He pointed out that he had asked National Express to publish their safety data if they have nothing to hide? But they keep ignoring his questions. 

I said at this meeting that this failure indicates a wider governance concern about the Board of National Express. Surely after the BP Gulf disaster investors need to wake up to the risk from investing in such companies?

UPDATE: sign the ShareAction petition here

National Express & the pension fund risk of it killing American children?

This morning I went to a breakfast seminar in London run by the North American transport trade union the Teamsters. This was before the start of the annual Pension Governance conference run by PIRC

The collection and return home of school children by the iconic yellow buses is a huge business in the USA.  There are 500,000 such buses transporting 24 million students per day.

What the Teamsters are concerned about is the USA arm of the British listed transport Company National Express (Durham School Services).

Which is accused of not only treating its school bus drivers very poorly as employees but also consistently breaks health and safety rules for its staff and student passengers. Who often have to endure overcrowded, badly maintained and potentially unsafe buses.

The Teamsters had brought two of their actual yellow school bus drivers to the UK to speak to us about the awful, bullying, nasty and unsafe work practices they have to endure. They told us first hand of their unacceptable experiences while working for National Express in the United States.

Not only were they treated with contempt and disrespect by their management, it is also clear that the safety of drivers and the children is at risk due to overcrowding, defective and poorly maintained equipment, worn tyres and drivers forced to work despite being ill.

The National Express model is to win school bus contracts by the lowest price tender and then make profits by cutting wages and maintenance to the bone and beyond.

This is a disaster waiting to happen. Apart from the absolute morale argument that we do not want   companies we invest in on behalf of our pension scheme members to act in such a way, nor do we want them to face the risk of legal or even criminal action.  There is also ongoing financial reputational risk to the company for being such a poor and irresponsible employer.

The USA has a reputation as a litigious Country. If there was to be a mass tragedy on a yellow school bus which had been previously reported to be unsafe or if the driver was sick but had been forced to work to save his job you will expect at the least a massive law suit.

The experience of the disaster in the Gulf with BP tells us that safety should be a key issue for UK pension trustees. As asset owners it is in our own long term interests to contact our fund managers and make sure that they investigate these complaints.  Then they need to take action against National Express to make it act in a responsible and safe way.

An Offer You Cannot Refuse - Support the Teamster School Bus drivers

Bit last minute, but UNISON Transport Executive agrees to support the UNISON Capital Stewardship Forum efforts to ask our funds to vote in favour of a motion sponsored by UNITE (TGWU) and US trade union funds on Thursday 12 July 2007.

On Thursday there is the First Group plc annual shareholder conference in Aberdeen. There is a resolution at this conference moved by socially responsible investment funds Domini Social Investments and the Calvert Group, together with 142 Unite (TGWU) members at First Group and 2 other trade union pension funds. They filed the resolution in light of ongoing labour relations concerns, particularly at First Student, Inc., the company’s U.S. subsidiary. At last year’s Annual General Meeting, First Group admitted to anti-union acts. The Board then urged a vote against the shareholder proposal stating that the company was committed to “stamping out anti-union behaviour in the U.S.” and enforcing its own policy of neutrality toward unions.

Despite this commitment, the company has failed to protect workers from intimidation and harassment by U.S. manager’s intent on thwarting workers’ efforts to join a union, as documented in a recent report by three labour rights experts.

Support for the human rights resolution at First Group, plc is critical to protect the interests of investors as First Group expands operations throughout North America and takes on greater operational and financial risk.

Many LGPS funds will invest in First Group. Please let your money managers know that you will be carefully monitoring their vote on Resolution 15 at First Group. The proponents believe that supporting this proposal will send a clear message to management that reducing labour risks and grievances is vital to First Group’s long-term success and sustainability. They urge investors to vote for Resolution 15.

If you can, please write to your fund managers (via your investment committee Chair?) asking them to support Resolution 15 at this AGM. If it is too late then make sure that during the next investment panel meeting you will be questioning the fund managers on how and why they voted on this issue.