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(NEW YORK) — Workers at a Wells Fargo branch in New Mexico voted to form a union late Wednesday, becoming the first employees at a U.S. megabank to unionize.

Employees at an Albuquerque location favored unionization by a margin of 5-3, establishing a small outpost for organized labor at a company that operates more than 4,000 branches and employs over 225,000 workers in the U.S.

The union breakthrough arrives as Wells Fargo faces a wider labor campaign. Two branches, one in Daytona Beach, Florida, and another in Atwater, California, have filed petitions for union representation that could trigger balloting, according to information from the National Labor Relations Board shared with ABC News.

In response to ABC News’ request for comment, a Wells Fargo spokesperson said the company opposes unionization but acknowledged that the decision lies with employees.

“We respect our employees’ rights to vote for union representation,” the spokesperson said. “At the same time, we continue to believe our employees are best served by working directly with the company and its leadership.”

The spokesperson pointed to a five-employee branch in Bethel, Alaska, which withdrew a petition for unionization ahead of a vote scheduled for Thursday.

“We are pleased with this development and look forward to continuing to directly engage with our employees,” the spokesperson said.

The Communication Workers of America, the union that’s organizing Wells Fargo employees, did not immediately respond to ABC News’ request for comment.

Seven worker complaints over alleged illegal anti-union activity carried out by Wells Fargo remain under review at the NLRB, the government agency said in a statement to ABC News.

The charges cover a range of claims alleging illegal retaliation, discipline and alteration of the terms of employment, the NLRB said. The complaints span five Wells Fargo facilities in Texas, Iowa, Arizona and California.

At a store in Salt Lake City, Utah, Wells Fargo settled over a union-related worker complaint, agreeing to not engage in coercive statements, surveillance or interrogation, the NLRB said.

In a statement last month about two of the worker complaints, the Communication Workers of America criticized Wells Fargo for the alleged conduct.

“We are organizing a union to build a better Wells Fargo for workers and customers, yet the bank continues to try to resist change,” the CWA said.

“Rather than join us in our efforts to address the toxic culture that has led to scandal after scandal and cost the bank billions of dollars in fines, Wells Fargo has chosen to break the law by attempting to silence us,” the union added.

When asked about worker complaints of illegal anti-union conduct during a Senate hearing earlier this month, Wells Fargo CEO Charles Scharf reaffirmed the company’s opposition to unionization and defended its freedom to discuss the subject with workers.

“We believe it’s best that we have a direct relationship with those employees, and we do intend to exercise our right to speak with them to make sure they make an informed decision,” Scharf said.

The union drive at Wells Fargo comes amid an uptick in labor campaigns this year, including efforts involving employees at some of the nation’s largest companies, such as Starbucks and Amazon.

Workers filed nearly 2,600 petitions for union representation in 2023, marking an increase of 3% from the previous fiscal year, the NLRB said in October.

Charges filed by workers over illegal anti-union activity rose 10% in 2023 compared to the same period last year, the NLRB added.

The nascent unionization at Wells Fargo aligns with a surge in organizing across the labor movement, Harry Katz, a professor of collective bargaining at Cornell University, told ABC News.

“It’s further evidence of the growing interest in unionization, even among workers that haven’t traditionally been organized in the U.S.,” Katz said.

Katz cautioned, however, that the workers could face difficulty reaching an agreement with Wells Fargo on new terms for the workplace. All of the thousands of Starbucks workers across more than 300 unionized stores, for instance, remain without a single union contract.

“Even if you unionize, it doesn’t mean you have bargaining power,” Katz said. “But this is still noteworthy.”

 

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(NEW YORK) — Breakfast foods maker General Mills, the brand behind familiar cereals like Cheerios, Lucky Charms and Wheaties, may not be a consumer favorite anymore as the company experiences slowing sales and increasing price hikes.

In the company’s latest quarterly financial report, General Mills’ CEO Jeff Harmening blamed the drop on “stronger-than-anticipated value-seeking behaviors,” meaning that people are finding cheaper alternatives to high-priced cereals.

The pandemic turned around what had until then been a steady slide in cereal sales, as everyone ate breakfast at home. During 2020, General Mills reported a 5% boost in sales, but sales in 2021 fell 8.7% and nearly a further 4% last year.

General Mills also raised its prices in order to offset pandemic-related supply chain issues and inflation.

Now that Americans are once again out and about, and as a result making breakfast choices outside the cereal aisle, they’re less inclined to pay premium prices for their usual cereal. Instead, sales of cheaper generic store brands spiked 20%.

General Mills has now forecast that the company’s sales may not be able to return to its usual volume until next summer, at the soonest.

On top of tepid consumer demand for the brand-name cereals, shoppers are becoming increasingly aware of how much bang they are actually getting for their buck.

“Many brands are shrinking the size or weight of their products and charging the same price,” smart shopping expert Trae Bodge told ABC News’ Good Morning America.

She encouraged shoppers to always check and compare unit prices when selecting items off the shelf at a grocery store.

“‘Shrinkflation’ is a term used to describe implicitly increasing the price of an item by slightly decreasing the amount or quantity in a package,” Steve Reed, an economist at the Bureau of Labor Statistics, previously told ABC News.

While the Bureau of Labor Statistics (BLS) doesn’t have any evidence on why this occurs, or insight into seller strategies, Reed said, “the conventional explanation would be that consumers may not notice small decreases in size or quantity, or react less negatively to them compared to an explicitly higher price.”

The BLS does attempt to compute for shrinkflation, however, in its Consumer Price Index, which measures what consumers pay for everyday goods and services and is often used as an inflation barometer, according to Reed.

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(NEW YORK) — Drugstore chain Rite Aid has accepted a ban of its use of facial recognition software for five years due to false accusations stemming from the technology that disproportionately affected people of color, the Federal Trade Commission said.

The retailer failed to impose reasonable precautions in its deployment of facial recognition, resulting in thousands of false-positive matches with customers accused of shoplifting and other inappropriate behavior, a legal complaint from the FTC said.

Acting on false-positive alerts, employees followed consumers around its stores, searched them, accused them of wrongdoing in front of friends and family, and called the police to remove them, the complaint said.

The company also chose not to inform customers of its use of facial recognition and discouraged employees from doing so, the FTC said.

“Rite Aid’s reckless use of facial surveillance systems left its customers facing humiliation and other harms, and its order violations put consumers’ sensitive information at risk,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement.

“Today’s groundbreaking order makes clear that the Commission will be vigilant in protecting the public from unfair biometric surveillance and unfair data security practices,” Levine added.

In a statement, the company said it was “pleased to reach an agreement” with the FTC. However, Rite Aid added: “We fundamentally disagree with the facial recognition allegations in the agency’s complaint.”

“Rite Aid’s mission has always been and will continue to be to safely and conveniently serve the communities in which we operate,” the company said.

In all, Rite Aid collected tens of thousands of images of individuals, many of which were low-quality, the complaint said, noting that the activity took place between 2012 to 2020.

Mistakes made by the company’s technology included false matches with an image collected thousands of miles away, as well as an incorrect positive result flagged at dozens of stores nationwide, the complaint added.

Rite Aid violated the terms of a 2010 agreement reached with the FTC after a finding that the company had failed to protect sensitive financial and medical information, the agency said.

The FTC issued a warning earlier this year that the company would be closely monitoring issues around the collection of data tied to individuals’ physical characteristics, the agency said.

In addition to complying with the five-year ban, Rite Aid said it will impose safeguards for future use of its surveillance systems.

Those safety measures include deleting photos previously collected by its facial recognition software, informing customers when their physical characteristics are entered into a store database and providing notice to customers about use of the technology at a given location.

 

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(NEW YORK) — The famously “closed on Sundays” chicken sandwich fast-food chain could soon be required to fire up the fryers and serve hungry travelers in some locations.

The New York State Assembly has put forth a new bill, known as the Rest Stop Restaurant Act, that would require food and beverage companies contracted to provide services along the Thruway and at the Port Authority in New York and New Jersey to stay open seven days a week.

Applegreen, an Irish convenience store chain with a portfolio of companies including Chick-fil-A, took over the leases of all Thruway Authority service areas in 2021. To date, Chick-fil-A has opened at seven Thruway service areas. The fast-food chain currently operates 2,988 restaurants across 48 states.

“While there is nothing objectionable about a fast food restaurant closing on a particular day of the week, service areas dedicated to travelers is an inappropriate location for such a restaurant,” the bill states, in part. “Publicly owned service areas should use their space to maximally benefit the public. Allowing for retail space to go unused one seventh of the week or more is a disservice and unnecessary inconvenience to travelers who rely on these service areas.”

The only exception from the seven-day-a-week operations mandate in the new legislation is for “temporary concessions such as farmers markets or local vendors.”

One of the bill’s sponsors, Assemblyman Tony Simone, spoke to ABC News Albany affiliate WTEN-TV about the importance of ensuring that New York State’s transportation facilities offer reliable food services.

“You know, we get hungry when we’re traveling. We may not like our brother-in-law or sister-in-law’s cooking and wanna get a snack on Christmas Eve,” Simone said. “To find one of the restaurants closed on the thruway is just not in the public good.”

WTEN also reports that a Thruway official who also spoke with them said that, regarding the bill, “all 27 service areas that were a part of the $450 million project were built with no toll or tax dollars and that Chick-fil-A already signed a 33-year contract with the Thruway.”

Simone clarified that “the Thruways are meant to serve New York travelers first,” adding that he thinks it’s “ridiculous” that a food provider would be “able to close on Sunday – one of the busiest travel days of the week.”

Simone and the other bill sponsors are currently seeking co-sponsors to help pass the legislation during the current assembly session in Albany.

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(NEW YORK) — Approximately 26,550 pounds of frozen TGI Fridays boneless chicken bites products have been recalled due to possible contamination with “clear, hard plastic,” the U.S. Department of Agriculture’s Food Safety and Inspection Service announced.

“The problem was discovered when the firm notified FSIS that it had received consumer complaints reporting that clear, hard plastic was found under the breading of the boneless chicken bites,” according to the recall announced Friday.

Simmons Prepared Foods issued the recall on its 15-ounce cartons of Honey BBQ flavor chicken bites that were produced on Oct. 3 by the Arkansas-based food manufacturer.

The recalled products bear the lot code KL3K03 and have a Best By date of Dec. 26, 2024, located on the side of the carton. The items also have an establishment number “P-20287” inside the USDA mark of inspection.

There have been no reports of injury or illness due to consumption of the chicken bites.

Those concerned about illness or an injury are encouraged to contact a health care provider.

“FSIS is concerned that some product may be in consumers’ freezers. Consumers who have purchased these products are urged not to consume them. These products should be thrown away or returned to the place of purchase,” the agency said in the recall notice.

Click here to see the full product label images and details.

Simmons Prepared Foods did not immediately respond to ABC News’ request for comment.

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(NEW YORK) — When the Federal Reserve recently signaled interest rate cuts next year, the stock market soared to record highs and analysts voiced sunny hopes of a “soft landing.”

Arriving less than a year before the presidential contest, the announcement raised a separate consideration: What the rate cuts could mean for President Joe Biden’s reelection bid.

Analysts who spoke to ABC News said research shows that a strong economy benefits an incumbent presidential candidate, since voters factor their financial well being into an assessment of the leader’s job performance.

But the implications of interest rate cuts are more complicated, the analysts added.

“A good economy benefits an incumbent,” Ray Fair, a professor at Yale University who oversees a model that forecasts elections based on economic conditions, told ABC News. “A bad economy goes the other way.”

“How the economy does depends in part on what the Fed does, but it depends on other things, too,” Fair added.

He declined to comment on how this dynamic could be applied to the current presidential race.

In theory, lower interest rates make borrowing less expensive for businesses and consumers, propelling companies to invest in new projects and everyday people to stretch for bigger purchases. That all should help propel economic growth and buoy consumer optimism.

In turn, a major economic surge could benefit Biden, dispelling concern about a recession and improving the livelihoods of everyday people, some analysts said.

However, the benefits of forthcoming rate cuts could prove more limited, since rate moves take hold after a period of delay that can last months, some analysts said. Further, economic growth may not yield sufficient improvement in people’s direct experience, leaving sentiment about the economy unchanged, they added.

The Biden campaign did not immediately respond to a request for comment.

By some key measures, the U.S. economy demonstrates good health: The unemployment rate hovers near a 50-year low, economic growth surged in a recent three-month period and inflation stands well below a peak last year.

Still, many voters find fault in Biden’s stewardship of the economy. Nearly two-thirds of Americans disapprove of Biden’s handling of the economy, an ABC News/Ipsos poll found in August.

The economy, therefore, poses a challenge for Biden, some analysts said, noting that the policy plans at the Fed could alleviate some of the difficulty.

Even before the Fed institutes a potential rate cut, the announcement of its plans alone has delivered economic benefits, Joseph Gagnon, fellow at the nonprofit Peterson Institute and a former senior economist at the Federal Reserve, told ABC News.

The central bank’s policy shift in recent days reduced yields on the all-important 10-year treasury bond. Lower bond yields make borrowing less costly for consumers on items big and small.

Last week, for instance, mortgage rates fell below 7% for the first time since August, Freddie Mac said in a statement.

“Bond yields fell and that actually does stimulate the economy,” Gagnon said.

The central bank’s pivot to rate cuts could also do away with a potential political liability for Biden: rate increases.

“That’s the absence of a negative political headwind for the Biden administration,” Steve Boms, founder and president of Washington, D.C.-based consulting firm Allon Advocacy, told ABC News.

The most recent Democratic presidential candidate who failed to win reelection, Jimmy Carter, lost his bid amid a historic series of rate hikes at the Fed.

Still, some analysts warned that potential rate cuts could have minimal impact on Biden’s reelection hopes, since voters already disapprove of his handling of the economy and potential improvement could prove too little or too late to change that sentiment.

The challenge stems in part from the conundrum surrounding Biden, in which strong economic measures have not translated into approval of his job, Boms said.

“One of the primary motivations, typically, of the Fed reducing rates is to bolster employment and reduce unemployment,” Boms added. “But in the current situation we’re already at historically low unemployment levels.”

Moreover, the economic benefits brought by rate cuts often arrive months after the Fed imposes the policy, Gagnon said. If the Fed begins to cut rates midway through next year, he added, the economic improvement may not manifest itself ahead of election day.

“The window is closing,” Gagnon said.

When asked about next year’s election at a press conference in Washington, D.C. on Wednesday, Fed Chair Jerome Powell said, “We don’t think about politics.”

“We’ll do the things that we think are right for the economy at what we think is the right time,” Powell added.

However, the Fed’s fight against inflation carries significant implications for the presidential election, Fair wrote in an article in February.

Over the coming months, Fair said, “the media will be dominated by stories about political candidates, debates, poll results, [and] campaign spending issues.”

He added: “But behind the scenes is what really matters, namely how successful will the Fed be?”

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(NEW YORK) — Nikola founder Trevor Milton was sentenced to four years in prison Monday due to fraudulent claims about his electric vehicle company.

In court Monday, Milton portrayed himself as a generous and honest yet unsophisticated businessman who grew up milking cows, lacked a college degree and did not mean to defraud investors in his electric truck company.

“My intent was not to harm others,” Milton told Judge Edgardo Ramos. “Let me have probation.”

Ramos did not comply with Milton’s request, sentencing him to four years in prison, a $1 million fine, forfeiture of a ranch Milton purchased with ill-gotten gains and restitution to victims.

Milton was convicted of wire fraud and securities fraud after prosecutors said he embellished the success of his company and deceived retail investors, who they said lost more than $660 million combined.

One model of the Nikola electric pickup truck called the Badger, lacked certain parts, such as airbags and an operable HVAC, and many of the interior lights were not operable and were merely backlit, prosecutors said.

Prosecutors described Milton’s business practices as a “sustained scheme to take advantage of individual, non-professional investors” in order to inflate Nikola’s stock price and enrich himself.

“Milton over and over again exaggerated or outright lied about Nikola’s success in a way that misled investors about the risks and likely returns of their investments,” prosecutors said.

The defense claimed investors lost no money from Nikola and asked for a sentence for Milton that did not include prison time.

In July 2021, Milton was the at the center of a nearly 50-page indictment, in which prosecutors accused Milton of preying on vulnerable retail investors who had turned to trading after losing income due to the pandemic. In some cases, these victims lost their retirement savings, authorities said, as they outlined his web of false promises related to an electric truck that was never operable.

This is a developing story. Please check back for updates.

 

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(NEW YORK) — Apple will halt sales of new models of its smartwatch due to a patent dispute, the company announced on Monday.

The move, which affects Apple Watch Series 9 and Apple Watch Ultra 2, centers on the devices’ blood-oxygen sensor.

In October, a federal trade agency found that Apple violated the patent of California-based medical technology company Masimo. The ruling set off a 60-day review period for the Biden administration, which ends on Dec. 25.

Apple has decided to preemptively stop sales of the smartwatches, the company said.

“Apple’s teams work tirelessly to create products and services that empower users with industry-leading health, wellness, and safety features,” according to the company’s statement. “Apple strongly disagrees with the order and is pursuing a range of legal and technical options to ensure that Apple Watch is available to customers.”

On Dec. 21, the company will halt sales of new smartwatch models online. Retail stores will also stop selling the smartwatches on Dec. 24. Sales of the smartwatches will continue outside of the U.S., Apple noted.

Separately, Apple has accused Massimo of stealing patented features from Apple for its smartwatch.

Masimo did not immediately respond to a request for comment.

Released in September, the Apple Watch Series 9 ranges in price from $399 to $749.

On its website, Apple calls the device’s blood-oxygen sensor a “breathtaking innovation.”

 

 

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(WASHINGTON) — Southwest Airlines has been handed a record $140 million fine for its operational meltdown during the 2022 holiday travel season, the U.S. Department of Transportation said Monday.

The civil penalty leveled against the airline is about 30 times larger than any previous fine against an airline, DOT officials said in a press release.

The DOT said it will also require Southwest to start issuing a $75 flight credit to any passenger whose arrival is delayed more than 3 hours when it’s the airline’s fault, including mechanical issues.

“Today’s action sets a new precedent and sends a clear message: if airlines fail their passengers, we will use the full extent of our authority to hold them accountable,” Transportation Secretary Pete Buttigieg said in a statement.

The $140 million fine adds to the about $600 million in refunds and reimbursements that had previously been agreed to over the meltdown, the DOT said. Officials said they will use the majority of the fine to compensate customers affected by future Southwest flight cancellations and other delays.

As a massive winter storm battered the United States during the 2022 holiday season, the airline cancelled more than 16,900 flights, stranding more than 2 million passengers, the DOT said.

Southwest said it had “learned from the event” and made new investments to improve customer service and “our resiliency.”

“We’re pleased to have reached this consumer-friendly settlement, which includes a new, industry-leading policy to compensate Customers during significant delays and cancellations,” the airline said in a press release.

Transportation officials said their investigation of the dayslong incident included “examining tens of thousands of pages documents, conducting several multi-day, in- person audits and site visits at Southwest’s headquarters, reviewing thousands of consumer complaints, and consulting with various third parties, such as airports.”

That investigation found that the airline had violated consumer protection laws on providing customer service, prompt flight-status notifications and prompt refunds, DOT officials said Monday.

DOT officials said they ordered Southwest to reserve $90 million in vouchers to cover the $75 flight credits the airline will be required to pay when flights are more than 3 hours late.

“Taking care of passengers is not just the right thing to do — it’s required, and this penalty should put all airlines on notice to take every step possible to ensure that a meltdown like this never happens again,” Buttigieg said in a statement.

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(NEW YORK) — The Quaker Oats Company has recalled dozens of granola products due to the risk of potential salmonella contamination.

The recall impacts more than 40 granola bar and granola cereal products, according to an announcement posted on the U.S. Food and Drug Administration’s website on Friday.

Quaker said the listed products “have the potential to be contaminated with salmonella.” No further details were provided on the potential contamination.

“To date, Quaker has received no confirmed reports of illness related to the products covered by this recall. Quaker has informed the FDA of our actions,” the company said.

The products are sold throughout the United States, as well as in Puerto Rico, Guam and Saipan.

No other Quaker products are impacted, the company said.

See the full list of recalled items here.

Salmonella is a bacteria that can make people sick, and most types cause an illness called salmonellosis, according to the Centers for Disease Control and Prevention.

Most people with salmonella infection experience symptoms such as diarrhea, fever and stomach cramps, which may occur hours to days after infection, the CDC states, though some do not develop symptoms for several weeks. In rare cases the infection can be fatal.

Infants, those ages 65 and older and people with weakened immune systems are more likely to develop severe infections, according to the CDC.

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