It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way (K.Marx, Letter to F.Engels on the Indian Mutiny)
Saturday, January 22, 2022
$350 Billion in Pandemic Aid to Build … Golf Courses? Michael Rainey Fri, January 21, 2022
Congress has provided state and local governments with about $350 billion to help them navigate the coronavirus crisis, but according to The Washington Post’s Tony Romm, the money is sometimes being used in surprising and perhaps questionable ways.
A wealthy town in coastal Florida, for example, is spending $2 million in federal aid to help build a golf course – in an area that already has more than 150 of them.
In other examples cited by Romm, North Dakota is using $150 million in federal pandemic aid to help build a gas pipeline, Alabama is spending $400 million to rebuild a prison, and Indiana will put $3 million toward the expansion of the Fort Wayne International Airport.
Do we have a problem? At first glance, the use of federal relief funds for things like golf courses seems deeply problematic. In general, the money provided by Congress was intended to be used for important initiatives related to the pandemic, such as vaccinations, the purchase of medical equipment, and the support of local school budgets, and a golf course is a long way from a hospital or fire station.
But Congress put few restrictions on the use of the funds, opting to allow state and local officials to spend the money as they see fit. And some of the funds were meant to be used to help prop up local economies, which in sunny Florida might include the construction of yet another golf course.
“What’s a good and bad use of money? It’s not really clear,” Marc Goldwein of the Committee for a Responsible Federal Budget told Romm.
Defending the fiscal firehose: White House economic adviser Gene Sperling, who is overseeing the enactment of the $1.9 trillion American Rescue Plan, said the federal aid has played a crucial role in softening the blow of the pandemic. It has given “state and localities the fiscal fire power and flexibility to deal both with immediate crisis as well as continuing disruptions and lingering impacts that could hamper a full, durable and equitable recovery,” Sperling said.
“These funds were meant to ensure that unlike the post-Great Recession recovery — where Congress later refused to add more state and local resources — we would see state and local governments adding to growth and jobs, instead of being a major source of austerity, job loss and barrier to stronger growth,” Sperling added.
VIOLATION OF THE FIRST AMENDMENT ‘Punched in the gut’: Jewish couple was denied adoption due to religion, lawsuit says
Vandana Ravikumar Thu, January 20, 2022
A Jewish couple is suing the Tennessee Department of Children’s Services, saying a state-sponsored adoption agency declined to help them because of their religion.
At the beginning of 2021, Elizabeth and Gabriel Rutan-Ram were making plans to adopt a child from Florida, according to a news release from Americans United for Separation of Church and State, the nonprofit organization that filed the lawsuit on their behalf. Before they could do so, they had to complete state-mandated foster-parent training and receive a home-study certification.
The child they were hoping to adopt had a disability, and the couple wanted to provide him a “loving and nurturing home” in Knox County, the lawsuit said.
The two of them turned to the only agency near them that would help out with an out-of-state adoption. But on the day they were set to begin their foster-parent training, they were told by the agency, Holston United Methodist Home for Children, that it only provided help to prospective families that “share our [Christian] belief system,” the lawsuit said.
As a result, the lawsuit said, the couple was left unable to foster or adopt the child, as no other agencies in the Knox County area could provide the services necessary for out-of-state adoptions.
“I felt like I’d been punched in the gut,” Liz Rutan-Ram told Americans United for Separation of Church and State. “It was the first time I felt discriminated against because I am Jewish. It was very shocking. And it was very hurtful that the agency seemed to think that a child would be better off in state custody than with a loving family like us.”
The couple, along with “six other Tennessee taxpayers,” sued the government agency, saying that state-funded child placing agencies and services should not be able to discriminate against prospective parents or families on the basis of religion. The lawsuit also urges the department to cut ties with Holston for as long as the agency continues to deny services on that basis.
The Department of Children’s Services did not immediately respond to a request for comment from McClatchy News on Thursday, Jan. 20.
Holston United Methodist Home for Children responded to the lawsuit in an emailed statement to McClatchy News. In the statement, Brad Williams, a top leader with the agency, said everything Holston does “is guided by our religious views.”
“We seek to be a force for good, living out the words of Christ to care for children and ‘the least of these,’ and it is vital that Holston Home, as a religious organization, remains free to continue placing at-risk children in loving, Christian families, according to our deeply held beliefs,” Williams said. “We view the caregivers we partner with as extensions of our ministry team serving children.”
Williams also said the agency would help people who were refused service to find other agencies that could help them, and that “finding other agencies is not hard to do.”
“Vulnerable children should not lose access to Christian families who choose to become foster or adoptive parents,” Williams said. “Holston Home places children with families that agree with our statement of faith, and forcing Holston Home to violate our beliefs and place children in homes that do not share our faith is wrong and contrary to a free society.”
Four of the plaintiffs joining the Rutan-Rams are faith leaders from elsewhere in the state — one is an interfaith pastor, one a Disciples of Christ minister, one a Christian minister and one a Unitarian Universalist minister. The other two are a retired psychologist who has prior experience working with foster and adoptive children and the treasurer of the organization’s Tennessee chapter, the release said.
The lawsuit accuses the state of Tennessee of allowing child-placing agencies to discriminate based on religion and said the agency never told the Rutan-Rams they didn’t serve Jewish people until the day they were supposed to start their training. It also says that allowing child-placing agencies that receive state funding to refuse services on the basis of religion violates Tennessee’s constitution, alleging that the Department of Children’s Services is violating the law.
The lawsuit pushes the department to stop providing funding to Holston as long as the agency continues to “discriminate, in services or programs funded by the Department, based on the religious beliefs of prospective or current foster parents.” The plaintiffs are also seeking to recoup attorney’s fees and expenses.
The couple is fostering and hopes to adopt a teenage girl from another agency. They also hope to adopt another child in the future, the lawsuit said. The lawsuit is the state’s first to challenge a law that allows adoption agencies to deny services to families if their moral or religious beliefs are at odds with one another, according to The Knox News. That measure was signed into law about two years ago, the outlet reported.
Jewish couple challenges Tennessee law after Christian agency’s policy prevented adoption
Kerry Breen Fri, January 21, 2022
A couple in Knoxville, Tennessee filed a lawsuit against the Tennessee Department of Children’s Services this week alleging that they were denied services by a state-funded foster care agency because they are Jewish.
Elizabeth and Gabriel Rutan-Ram told TODAY that they first connected with the Holston United Methodist Home for Children in January of 2021, when they were hoping to adopt a child from Florida. Elizabeth Rutan-Ram said that state required the couple to have specific training — including Tennessee-mandated foster parent training and a home-study certification — and after reaching out to multiple agencies, the Holston United Methodist Home for Children was the only agency she could find that offered that training for out-of-state adoptions.
Elizabeth told TODAY that she asked if her and Gabriel's faith would be a problem for the organization early in the process.
"I asked early on if it would be an issue and they said they didn't think so, but that they would get back to me, and in the meantime we kept working on everything," Elizabeth said. "We had signed up for the class. The class was supposed to start that day. I had a check in my hand that I was going to drive out to them ... And I got an email that very clearly said they could not work with us because we didn't match up with their values." 'Committed to Christian biblical principles'
The email that Elizabeth referenced was submitted in the couple's lawsuit. TODAY was able to review the document. While the Holston United Methodist Home for Children did offer to connect the Rutan-Rams with another agency, it also said that "as a Christian organization," the agency's executive team had "made the decision several years ago to only provide adoption services to prospective adoptive families that share our belief system in order to avoid conflicts or delays with future service delivery."
In an email to TODAY, Brad Williams, the president and CEO of the agency, confirmed that the organization had rejected the couple due to their religious beliefs.
“Since 1895, Holston United Methodist Home for Children has been committed to Christian biblical principles in our calling to provide hope and healing for a brighter future by sharing the love of Jesus with children and families struggling with life’s challenges," said Williams, in part. "Everything Holston Home does is guided by our religious views. We seek to be a force for good, living out the words of Christ to care for children and ‘the least of these,’ and it is vital that Holston Home, as a religious organization, remains free to continue placing at-risk children in loving, Christian families, according to our deeply held beliefs. ... Vulnerable children should not lose access to Christian families who choose to become foster or adoptive parents. Holston Home places children with families that agree with our statement of faith, and forcing Holston Home to violate our beliefs and place children in homes that do not share our faith is wrong and contrary to a free society.”
Tennessee House Bill 836
Gabriel Rutan-Ram said that he was shocked to have such a response from an agency that receives state funding.
A recently passed Tennessee law, House Bill 836, "prohibits, to the extent allowed by federal law, a private licensed child-placing agency from being required to ... participate in any child placement for foster care or adoption that would violate the agency's written religious or moral convictions."
"We were completely unaware of that bill," Gabriel said. "I was like, 'Something seems a little off about this,' and then I started looking into it a little bit, and then the other shoe dropped when I found out about it. I was like, 'Oh, OK, this is incredibly unfortunate.'"
The law, which passed in early 2020, is similar to bills in ten other states. In Alabama and Michigan, the law does not include taxpayer-funded organizations, but in Kansas, Tennessee, Mississippi, North Dakota, Oklahoma, South Carolina, South Dakota, Texas and Virginia, agencies that receive state funding can discriminate based on religious belief.
Suing the Tennessee Department of Children's Services
Now, the Rutan-Rams are suing the Tennessee Department of Children's Services, with the assistance of Americans United for the Separation of Church and State, a civil rights organization. Alex J. Luchenitser, associate vice president and associate legal director at Americans United, said that they are seeking a declaratory judgement, which is a legal declaration that the law violates the Tennessee constitution. Luchenitser said that the ultimate goal of the judgement is to prevent taxpayer-funded adoption and foster care agencies from discriminating against prospective parents due to religious beliefs.
"The ultimate goal of this lawsuit is to prevent this type of discrimination ever happening to Elizabeth and Gabe or to anyone else again," said Luchenitser.
The Tennessee Department of Children's Services declined to comment, telling TODAY that they could not discuss pending litigation.
The Holston United Methodist Home for Children does receive money annually from the state, according to Luchenitser, who reviewed the agency’s financial reports. The agency did not respond to a request for comment on the amount of state funding.
'It was heartbreaking'
The Rutan-Rams said they were devastated to hear that they would not be able to proceed with the adoption of the child in Florida. Elizabeth said she felt "awful" and heartbroken after receiving the email from the Holston United Methodist Home for Children.
"We had already worked so hard to get to that point and I didn't really know where it would go from there," Elizabeth said. "I was disappointed in myself for being so upset. I thought I was prepared for something like that, and then I wasn't, so it was very emotional, and I felt like we'd already invested so much time and so much into it, just emotionally, that it was heartbreaking."
Gabriel said that the couple had already converted their guest room into a nursery, and made other preparations like getting a car that would fit a carseat, when they got the news.
"Suddenly, all the wind was just taken out of the sails. And kind of just left this big empty feeling inside," Gabriel recalled. Rachel Laser, the president and CEO of Americans United, said that the organization has handled several similar cases, including that of a Catholic woman in South Carolina who was turned away from a government-funded foster care agency operated by evangelical Protestants. "Unfortunately, this sort of heartbreaking and unconstitutional activity is not unique to Gabe and Liz," Laser said. "Unfortunately, there are a lot of unconstitutional laws that pass in state legislatures and even in Congress. And it’s up to brave citizens like Gabe and Liz to challenge them, and stand up for their own rights and the rights of other Americans."
117,000 children awaiting adoption
Daniele Gerard, a senior staff attorney for Children's Rights, a social services organization, said that laws like House Bill 836 make it harder for children to find stable homes. "On any given day in the United States, there are about 400,000 kids in foster care and about 117,000 of them waiting to be adopted ... What (this law) does is this reduces the safe, loving, stable families," Gerard said. "The decisions about whether or not to train and license foster families should be done with the best interests of the child in mind, not the religious objections of adults."
"The biggest barrier to placing children with families is a lack of qualified foster or adoptive parents, and you don't want to further shrink the pool based on anything other than a merit-based reason," Gerard added.
The Rutan-Rams said that although they could not adopt the child in Florida that they had wanted to adopt, they are still pursuing adoption. The process for in-state foster-to-adopt is different, so they don’t have to go through the agency that rejected them. They are currently fostering a child who they hope to adopt.
“We’re still looking to add to our family,” Gabriel said.
GREEN CAPITALI$M Blackstone Makes ESG Splash with Green-Energy Lending Strategy
David Brooke Fri, January 21, 2022
(Bloomberg) -- Blackstone Inc. has launched a new renewable-energy lending strategy as part of the private equity firm’s commitment to invest $100 billion in green projects over the next decade.
The firm has established the Sustainable Resources Credit Platform to focus on lending to companies that are expanding solar usage to the residential sector, providing renewable electricity generation and storage services, as well as other businesses aiding decarbonization, according to a statement Friday.
Blackstone will target investments across investment grade and non-investment grade debt as well as preferred and convertible securities.
The move is part of Blackstone’s push into further funding transition to renewable energy in the U.S. Across all of Blackstone’s platforms, the firm aims to put $100 billion over the next 10 years into projects and companies aiding the green transition. The firm said it has committed $15 billion since 2019 in areas that are aiding the broader energy transition.
Private credit has lagged the financing boom in all things environmental, social, and governance seen in other corners of debt markets. In October, a loan by Barings to Northstar Recycling Co. to fund its acquisition by private equity firm Ridgemont Equity Partners was seen as one of the first sustainability-linked financings in the U.S. direct lending space.
Robert Horn will work as global head of the new Blackstone venture and Simon Hayden will lead activities in Europe, the statement says. Hayden joins the firm from EIG Global Energy Partners. Jean Rogers, recently appointed as Blackstone’s global head of ESG, and Rita Mangalick, head of ESG at Blackstone Credit, will advise on investments and due diligence.
“We believe large scale and flexible capital are essential to funding decarbonization,” said Horn.
How much money #MeToo CEOs should get ZERO, ZILCH, NADA, NOTHING
Two stories caught my eye this week, the first being the University of Michigan firing its president, the second being Microsoft (MSFT) buying Activision Blizzard (ATVI). The common denominator is reckless behavior by a chief executive.
Questions: How much (if any) money should these men be paid going forward, and should any previous payments be clawed back?
The University of Michigan’s Board of Regents canned president Mark Schlissel after he was found to have had an inappropriate sexual relationship with a subordinate, to whom he sent dozens of emails from his university account, which the board publicly posted.
Another irony, according to The Detroit News: Schlissel’s agreement “was originally scheduled to end in June 2024, but the timeline was moved up to 2023. The contract ... could have cost the university as much as $10 million over the next decade and set a new bar for payouts to an outgoing public university president...”
As for Microsoft buying Activision Blizzard, sure MSFT coveted the business, but it also found a willing seller ready to deal. (Microsoft is paying $69 billion or $95 per share for the video game maker behind "Call of Duty." The stock had been trading as high as $104 less than a year ago.) That discount is partly due to the massive quagmire of sexual harassment claims and alleged workplace violations that took place under CEO Bobby Kotick’s watch.
Bobby Kotick, Chief Executive Officer of Activision Blizzard, speaks at the Reuters Global Media Summit in New York November 30, 2010. REUTERS/Brendan McDermid (UNITED STATES - Tags: BUSINESS MEDIA)
It should be noted that allegations extend to Kotick himself. Specifically, Kotick has been accused of being abusive, turning a blind eye to allegations, and dragging his feet in terms of addressing issues at the company. Enter Microsoft.
Now MSFT faces a Kotick conundrum. Initially Microsoft and ATVI made statements to the effect that Kotick was going to be staying on. Then the Wall Street Journal reported that Kotick is expected to leave once the deal closes. So that means Kotick, like Schlissel at Michigan, will be out.
Both men will lose their salaries going forward, but could get some other payouts. And what about the money that was paid to them prior, specifically during the time that these transgressions occurred? Are they entitled (ahem) to keep?
In Schlissel’s case, a Detroit News story suggests that he won’t get much of that $10 million. But Schlissel is still a tenured faculty and the story notes: “It’s likely that the university and Schlissel will negotiate a confidential settlement for him to leave the university rather than go through trying to strip him of tenure, a process that could take years and end up in court...” But what about the emails the university posted that go back to 2019? Should the university seek to recoup anything from the past two years?
In this Jan. 30 2017, file photo, University of Michigan President Mark Schlissel speaks during a ceremony at the university, in Ann Arbor, Mich. Schlissel has been removed as president of the University of Michigan due to the alleged "inappropriate relationship with a University employee," the school said Saturday, Jan. 15, 2022, on its website. (AP Photo/Carlos Osorio)
After all the hurt that has been put on women at Activision Blizzard, and the discomfort imposed upon the other 9,000-plus employees, never mind on the shareholders, this guy gets half a billion dollars?
“Microsoft should probably be considering whether Mr. Kotick is worth his price tag,” says Jennifer Drobac, professor at the Indiana University McKinney School of Law. “If, following their due diligence and their investigation, they demonstrate that he failed to steer Activision in a lawful manner or in one that would at least comply with Activision’s stated company policies, then yes, either they should claw back the money or they should have a termination clause.”
But wait, you can’t just claw back Schlissel’s salary or take away Kotick’s stock, can you? Actually you can.
The template here is what the board of McDonald’s (MCD) did in the case of its then CEO, Steve Easterbrook. In November 2019 the McDonald’s board terminated Easterbrook for having an inappropriate relationship with an employee. He was fired without cause, which allowed him to receive 26 weeks of severance and benefits.
It turned out the CEO lied. The board was livid and in August 2020 sued Easterbrook. The Wall Street Journal reported: “Easterbrook allegedly engaged in three additional relationships with employees that were sexual in nature ... Investigators found that Easterbrook destroyed evidence about the sexual relationships and lied about his behavior ... McDonald’s found dozens of sexually explicit photographs and videos of women including the employees that had been sent from Mr. Easterbrook’s corporate email account to a personal Hotmail account ... Easterbrook had deleted the photos from his company-issued phone, and they weren’t discovered during the corporate investigation that triggered his firing.” Last month, Easterbrook agreed to return $105 million. Much of the clawback was in stock that was returned to the company, but actual cash was wired back too.
“The board and the board chairman deserve a lot of credit,” says an informed source. “A hell of a lot of boards would not have done anything. They would have made the decision, ‘Let this go away.’”
I asked my source about the implications of the McDonald’s case: “For other boards, if they're facing these kinds of allegations, maybe they won't be so tempted to just dismiss someone,” he said.
“Does cleaning house mean you get rid of someone who’s problematic but don't hold them accountable by following up on allegations and clawing back pay?” asks Jill Fisch, a professor of business law at the University of Pennsylvania Carey Law School.
Good question.
I know you might be thinking that Easterbrook’s transgressions were worse than Schlissel’s and Kotick’s. Maybe that’s the case. But why should these be binary decisions? If someone is 100% bad, claw back 100%; if they’re 40% bad, claw back 40%. That’s what lawyers are for.
I wonder what the Michigan and Microsoft boards think about that.
This article was featured in a Saturday edition of the Morning Brief on January 22, 2022.
Can Microsoft acquisition cure Activision’s toxic workplace?
Microsoft, which is reviewing its own sexual-harassment policies, could be taking on an even tougher challenge
Microsoft’s proposed acquisition of Activision Blizzard is raising further concerns about the videogame company’s workplace culture. Last July, Activision employees walked out to denounce the company’s response to a California lawsuit over sexual harassment and discrimination charges. AFP VIA GETTY IMAGES
Besides concerns about antitrust scrutiny and a record $68.7 billion price tag, Microsoft Corp.’s planned acquisition of Activision Blizzard Inc. also raises a key question: How will it deal with the videogame company’s notorious workplace culture?
While the videogame industry has long suffered from a culture that “denigrates women,” according to Ann Olivarius, a lawyer who has specialized in women’s rights, she sees Activision ATVI, -0.50% as one of the worst examples of toxic workplaces.
Olivarius said the gaming industry allows for “a culture of violence,” mentioning Gamergate, in which female gamers, developers and journalists were targeted for online and offline harassment, including rape and death threats in 2014. She said that culture will be hard to change, as the industry attracts people who want to play games that contain violence. And though Microsoft MSFT, -1.85% makes the Xbox console and has been steeped in videogames for decades, Olivarius said “they don’t have the culture of violence that Activision has.”
In the past few years, Activision has been targeted for investigation by the Securities Exchange Commission and the Equal Employment Opportunity Commission, and is facing a lawsuit from the California Department of Fair Employment and Housing that alleges gender discrimination against and “constant” sexual harassment of women, retaliation against women for complaining, and includes a mention of a female employee’s suicide during a business trip with her male supervisor. Since the California lawsuit filed in July, dozens of employees have left or been disciplined, the company has confirmed.
The investigations have also uncovered documents that show Activision Chief Executive Bobby Kotick knew about years of allegations of sexual misconduct but did not disclose everything to the company’s board. And the Wall Street Journal reported that Kotick himself has been accused of and settled allegations of sexual harassment.
If the acquisition clears antitrust hurdles and is approved, experts see either a big plus for Activision — publisher of games such as “Call of Duty” — in the form of cleaning up its culture, or a bust for Microsoft if that cleanup fails. Kotick acknowledged in an interview with VentureBeat that the drag on Activision’s stock from the fallout over the sexual harassment scandals was a factor in his company’s decision to agree to a sale to Microsoft.
Kathryn Rudie Harrigan, a professor at Columbia Business School who teaches strategic management courses, said the deal could be good for Activision and could, along with the investigations and other actions, be a step toward improving conditions for its female employees.
“It’s all going to come out into the limelight,” she said. “How backward-thinking Activision Blizzard has been.”
Microsoft itself has dealt with similar accusations, though it appears not to be to the same degree. Still, it announced last week that it has hired a law firm to review sexual-harassment and gender-discrimination policies after accusations of sexual harassment and gender discrimination in 2019, including against co-founder Bill Gates. Its review of its own policies was sparked by a shareholder resolution submitted by Arjuna Capital that was supported by 78% of voting Microsoft investors.
Natasha Lamb, managing partner at Arjuna Capital, said Microsoft agreeing to review its policies puts the software giant in a better position to turn around and say it wants to buy Santa Monica, Calif.-based Activision.
“Absent that commitment, they’d be in hot water from their shareholders,” Lamb said, noting that she could understand the financial case for Microsoft buying Activision. But “from a cultural standpoint, it doesn’t seem like a good match.”
Some Microsoft employees agree. They expressed their concerns about introducing an “awful” and “dangerous” culture on an internal message board this week, according to Business Insider.
When reached for comment Thursday, an Activision spokesman referred MarketWatch to Kotick’s letter to employees this week. Kotick said the company is doing work “to set a new standard for a welcoming and inclusive workplace culture,” and that Microsoft will support that “journey.” The company spokesman also pointed to announcements Activision has made in the past several months, including instituting a “zero-tolerance” harassment policy.
Microsoft has not returned a request for comment.
A group of Activision Blizzard workers is unionizing
Kris Holt ·Contributing Writer Fri, January 21, 2022
Call of Duty: Warzone quality assurance workers at Activision Blizzard studio Raven Software have announced plans to unionize with the Communication Workers of America (CWA). They have asked the company to voluntarily recognize their group, which is called the Game Workers Alliance. The 34-person unit had the support of 78 percent of eligible workers, according to Polygon.
“We ask that Activision Blizzard management respect Raven QA workers by voluntarily recognizing CWA’s representation without hesitation,” CWA secretary-treasurer Sara Steffens said in a statement. “A collective bargaining agreement will give Raven QA employees a voice at work, improving the games they produce and making the company stronger. Voluntary recognition is the rational way forward.”
Workers have given Activision Blizzard until January 25th to respond to their request, according to The Washington Post. If the company fails to do so, the group will file for a union election through the National Labor Relations Board and, because the workers have a supermajority of votes, they'd be able to formalize the union without voluntary recognition from Activision Blizzard. Should the group approve the union in an election, the company would need to bargain with workers in good faith.
Sixty Raven workers went on strike in early December after Activision Blizzard laid off 12 QA contractors, despite a request from Raven leadership to keep them employed. The workers demanded the company convert all Raven QA contractors into full-time employees. So far, Activision Blizzard has reportedly been playing hardball and declining to meet with with the striking workers. Warzone players have been grousing about the game's bugs, which QA workers are tasked with finding and addressing.
"Activision Blizzard is carefully reviewing the request for voluntary recognition from the CWA, which seeks to organize around three dozen of the company’s nearly 10,000 employees," the company told Polygon. "While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union." It added that it has raised minimum pay for Raven employees by 41 percent over the last few years, extended paid time off and converted over 60 percent of the studio's contractors into employees.
The CWA claims Activision Blizzard has "used surveillance and intimidation tactics, including hiring notorious union busters, to silence workers.” Last July, the company hired WilmerHale, a law firm with a history of cracking down on unionization efforts, to review its HR policies.
The Game Workers Alliance said its principles include solidarity, equity, diversity, transparency and sustainability. "Shortened development timelines sacrifice project quality and damage the mental and physical health of our team," it wrote on Twitter. "'Crunch' is not healthy for any product, worker, or company."
Earlier this week, Microsoft announced an agreement to buy Activision Blizzard for $68.7 billion, the biggest deal in video game history. If shareholders and regulators approve the acquisition, which could have enormous ramifications for the industry, the merger should close by June 2023.
In an interview with the Post on Thursday, Microsoft Gaming CEO Phil Spencer noted that he didn't have much experience with unions personally after working at Microsoft for over three decades. “So I’m not going to try to come across as an expert on this, but I’ll say we’ll be having conversations about what empowers them to do their best work, which as you can imagine in a creative industry, is the most important thing for us," he said.
On Wednesday, Activision Blizzard said in a Securities and Exchange Commission filing regarding the planned merger that, "To the knowledge of the company, there are no pending activities or proceedings of any labor union, trade union, works council or any similar labor organization to organize any employees of the company or any of its subsidiaries with regard to their employment with the company or any of its subsidiaries." The week that Raven workers went on strike, Activision Blizzard sent its employees a letter imploring them “to consider the consequences” of signing union cards.
As Bloomberg's Jason Schreier noted, the Game Workers Alliance is the first union within a AAA gaming company in North America. Last month, workers at Vodeo Games formed the first video game union in the US. Management at the indie studio voluntarily recognized Vodeo Workers United. Swedish publisher Paradox Interactive signed a collective bargaining agreement with unions in 2020, while Japanese–Korean publisher Nexon recognized a workers' union in 2018.
Activision Employee Group Forms Union, a First in Video Games Jason Schreier Fri, January 21, 2022
(Bloomberg) -- Microsoft Corp.’s planned acquisition of Activision Blizzard Inc. will come with an unexpected and perhaps unwelcome addition: a small group of unionized workers.
About three dozen people who work for an Activision-owned studio agreed to form the Game Workers Alliance Union, representatives for the group said Friday. They asked Activision to voluntarily recognize their union status. It would be the first union at a publicly traded video game publisher.
The group is composed of 34 quality assurance testers at Activision’s Raven Software, a team responsible for ensuring new content for Call of Duty games runs smoothly and without errors. It’s part of the Communications Workers of America, the largest union in the media industry.
A spokesman for Activision said the company is reviewing the request for recognition. “While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union,” the spokesman said in an emailed statement.
For years, people from across the video game industry have proposed organizing as a solution to unhealthy work environments. Burnout is a prevalent issue in gaming, brought on by a culture of overwork, sexism and little job security. Employers have not embraced workers’ flirtations with unionizing, but last month, employees of a small independent studio called Vodeo Games became the first to organize in North America.
Activision has been mired in scandal since California sued the company last summer for claims of sexual harassment and discrimination. Workers at the company began handing out union cards last month, triggering a warning from management that employees should “take time to consider the consequences of your signature on the binding legal document presented to you.”
Workers at Activision’s Raven Software went on strikes starting Dec. 6 in protest of the company’s intent to dismiss a dozen contract testers. Quality assurance testers are generally paid the least of any game developers and are sometimes treated as disposable. At Raven, testers are frequently asked to work overtime and have talked of going nights and weekends for months straight.
The Activision spokesman said the company has over the past couple of years raised minimum compensation for Raven testers by 41%, extended paid time off and expanded medical benefits access to workers and their spouses.
Microsoft said this week that it will acquire Activision for $68.7 billion. Unionization at big tech companies like Microsoft is rare. When a 38-person group of Microsoft bug testers organized in 2014, the company eventually dismissed them.
Management at Activision hasn’t acknowledged the Raven strike or responded to specific requests from the workers, representatives for the Game Workers Alliance Union said.
“It’s extremely important that workers have a real seat at the table to positively shape the company going forward,” Brent Reel, quality assurance lead at Raven, said in a statement.
Raven Software testers at Activision Blizzard form the first union at a major US gaming company
Amanda Silberling Fri, January 21, 2022
Today, Raven Software's quality assurance (QA) department -- which mostly works on "Call of Duty" as part of Activision Blizzard -- became the first union to form at a major U.S. gaming company. With help from the Communications Workers of America (CWA), Raven Software testers launched the Game Workers Alliance, which plans to focus on "improving the conditions of workers in the video game industry by making it a more sustainable, equitable place where transparency is paramount," even beyond its own company. The 34-worker unit is asking management to recognize their union during a time already marked by change: on Tuesday, Microsoft acquired Activision Blizzard for $68.7 billion in one of the priciest tech acquisitions of all time.
But on the heels of that historic acquisition, Activision Blizzard has been embroiled in controversy amid ongoing SEC investigations and sexual harassment scandals. Internally, employees started laying a grassroots foundation for worker solidarity through groups like the ABK Workers Alliance. When Raven Software laid off 12 contractors in early December, the team at the Wisconsin-based studio staged a walkout, which has continued for five weeks and counting.
Raven Software QA tester Onah Rongstad told TechCrunch that this incident sparked discussions about unionizing.
"On December 3, about a third of my department was informed that their contracts were going to be terminated early. And this was coming off of a five-week stretch of overtime, consistent work," she said. "We realized in that moment that our day-to-day work and our crucial role in the games industry as QA was not being taken into consideration. And at that time, we decided as Raven QA to start a strike to demonstrate that we are not just disposable parts of the industry, and during that time, it became very apparent that we had majority support within our department for a union."
The ABK Workers Alliance used its sizable social media following to crowdfund over $370,000 to assist with wages during the strike. The CWA said that this strike was the third work stoppage at Activision Blizzard after the company was sued in July 2021 over sexual harassment and misconduct claims. Still, about 20 members of the department remain on strike, Rongstad told TechCrunch.
"We are not sure how long [the strike] will continue, because we have not had direct communication with leadership about our demand that the 12 individuals who were let go be reinstated, which is unfortunate," said Rongstad, who has been with Raven Software since September 2020. "We are hoping to be able to go through with our unionization and get voluntary recognition so that we can prevent something like this from happening in the future."
Rongstad added that the news of Microsoft's planned acquisition does not change the union's plans to seek recognition.
"At the end of the day, we want to be able to work with leadership to create the most positive and beneficial work environment for all of the workers at ABK, and we are happy to work with leadership, whether that is the current leadership or Microsoft leadership in the future," they told TechCrunch.
This level of organizing among workers has little precedent in gaming, despite the industry being notorious for over-working employees or deploying mass layoffs due to closing studios. But only a month ago did the first voluntarily recognized gaming union form in North America at the small indie studio Vodeo Games, which produces "Beast Breaker." Vodeo's union also works with the CWA.
In an emailed statement to TechCrunch, Activision Blizzard responded to the Game Workers Alliance's announcement:
Activision Blizzard is carefully reviewing the request for voluntary recognition from the CWA, which seeks to organize around three dozen of the company’s nearly 10,000 employees. While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union.
Across Activision Blizzard, we remain focused on listening closely to our employees and providing the improved pay, benefits and professional opportunities needed to attract and retain the world’s best talent. Over the past couple of years, this has included raising minimum compensation for Raven QA employees by 41%, extending paid time off, expanding access to medical benefits for employees and significant others, and transitioning more than 60% of temporary Raven QA staff into full-time employees.
It's yet to be seen whether or not Activision Blizzard will voluntarily recognize the Game Workers Alliance. If Activision Blizzard chooses to recognize the union, then they don't need to have a union election and can begin collective bargaining. If the company opts not to recognize them, then the union can conduct an election through the National Labor Relations Board.
"We do have supermajority, and that's why we were able to ask for voluntary recognition. We're confident that if it went to a vote, we would win," said Rongstad. "We are hoping that they will voluntarily recognize the union and just show their support for workers rights."
The Game Workers Alliance is giving Activision Blizzard until January 25 to respond to their request for voluntary recognition. Read their letter below:
Workers at Activision Blizzard-owned game studio Raven Software vote to unionize
Jaimie Ding Fri, January 21, 2022 Workers at Raven Software, maker of "Call of Duty: Modern Warfare 3" and other video games, have voted to unionize. (Associated Press)
After weeks of striking, quality assurance workers at Activision Blizzard-owned game studio Raven Software have voted to form a new union, adding a wrinkle to Microsoft's $69-billion acquisition of the video game giant.
Workers at the Wisconsin-based studio that leads development of the popular game “Call of Duty” are launching the Game Workers Alliance with Communications Workers of America. The quality assurance unit consists of 34 workers, 27 of whom voted to publicly support the union.
“In the video game industry, specifically Raven QA, people are passionate about their jobs and the content they are creating,” Becka Aigner, a Raven QA functional tester, said in a press release. “We want to make sure that the passion from these workers is accurately reflected in our workplace and the content we make.”
More than 60 workers walked off the job at Raven Software and across the 10,000-employee company headquartered in Santa Monica in early December to protest the dismissal of several members of the quality assurance department at the end of their contracts. The strike has been running for five weeks.
Jessica Gonzalez, a former Activision employee and organizer with worker group A Better ABK, called the news a “huge step” for labor organizing in the games industry.
“The first-ever blockbuster studio to unionize, it’s a big deal,” Gonzalez said.
Worker unrest has been stirring at Activision Blizzard for months. California’s Department of Fair Employment and Housing filed a lawsuit against the firm last summer, alleging that senior leaders allowed sexual harassment and pay discrimination to continue unchecked throughout the company for years.
In the wake of the lawsuit, workers at the company formed A Better ABK to press for better conditions and worker representation at Activision Blizzard and its King unit, maker of popular mobile games such as "Candy Crush."
A Wall Street Journal investigation in November showed that Activision Blizzard Chief Executive Bobby Kotick knew about sexual harassment allegations for years. Nearly a fifth of the firm’s staffers signed a petition and a walkout was organized to call for Kotick’s resignation.
Workers across the video game industry have increasingly been pushing back against work conditions that include temporary contracts with minimal job security and brutal weeks-long pushes to meet game deadlines. In December, about a dozen workers at the independent game developer Vodeo Games formed the first video game studio union in North America.
Friday’s news comes on the heels of Tuesday's announcement that Microsoft would be purchasing Activision Blizzard for $68.7 billion, the largest acquisition in the software company’s history. Some employees expressed unhappiness that the deal could represent a soft exit for Kotick, who stands to walk away with hundreds of millions of dollars.
Microsoft, like most of the tech industry, is not unionized, though temporary employees at the contractor Lionbridge Technologies signed a union contract with the company in 2016. Some Microsoft workers in South Korea and Britain are also part of unions.
Microsoft Gaming Chief Executive Phil Spencer told the Washington Post on Thursday that he doesn't "have a lot of personal experience with unions."
"I’ve been at Microsoft for 33 years," Spencer said. "So I’m not going to try to come across as an expert on this, but I’ll say we’ll be having conversations about what empowers them to do their best work, which as you can imagine in a creative industry, is the most important thing for us.”
The newly formed Game Workers Alliance requested voluntary recognition from Activision Blizzard but will move forward with a balloted election through the National Labor Relations Board if they do not receive a response by Tuesday.
“A collective bargaining agreement will give Raven QA employees a voice at work, improving the games they produce and making the company stronger," CWA Secretary-Treasurer Sara Steffens said in the press release. "Voluntary recognition is the rational way forward.”
The Game Workers Alliance also accused the company of "surveillance and intimidation tactics," including hiring union busters to silence workers.
An Activision Blizzard spokesperson said the company is “carefully reviewing” the request for voluntary recognition from CWA.
“While we believe that a direct relationship between the company and its team members delivers the strongest workforce opportunities, we deeply respect the rights of all employees under the law to make their own decisions about whether or not to join a union,” the spokesperson said.
The company said it has raised minimum compensation for Raven QA employees by 41%, extended paid time off, expanded access to medical benefits and transitioned more than 60% of temporary QA staff into full-time employees.
