Prospects for Labor Law Reform: A Labor Perspective
By JONATHAN HIATT

In the year 2000, Human Rights Watch—an organization highly respected for reports that document human-rights abuses in developing countries—decided to embark on an investigation of worker-rights abuses here at home. This investigation was undertaken in part because the United States is among only a handful of countries that have not ratified ILO Conventions 87 or 98, the international conventions on freedom of association (i.e. union organizing) and collective bargaining. (Other non-ratifiers include Burma, China, Iran, and North Korea.)

Human Rights Watch was also motivated by the U.S. labor movement’s growing complaint that the treatment of American workers seeking to exercise their organizing and bargaining rights in the United States had become a human-rights crisis—and by the response of U.S. employers, which has usually been that most workers who do not have union representation simply do not want it.Human Rights Watch proceeded to conduct a comprehensive investigation, including many field studies, interviews, surveys, and research inquiries. Among its final conclusions was the following: “[W]orkers' freedom of association is under sustained attack in the United States, and the government is often failing its responsibility under international human rights standards to deter such attacks and protect workers' rights.... a culture of near-impunity has taken shape in much of U.S. labor law and practice.” 1 Acknowledging the state of U.S. labor law as a contributing factor to a human rights crisis, the U.S. House of Representatives found: “The ineffectiveness of the NLRA [the National Labor Relations Act] has put workers' fundamental freedoms at risk. These developments have spurred a human rights crisis with real economic consequences for America's middle class.”  2

I began with this flashback because I believe the Employee Free Choice Act is front and center today (indeed, it has a much better chance of passing than any of us would have thought even a couple of years ago) largely because of a growing recognition that the current obstacles to collective bargaining involve a two-dimensional crisis of human rights and economic wellbeing. Moreover, this twofold crisis profoundly affects U.S. workers and American society as a whole. There is much at stake, including our hopes of preserving and reinvigorating the nation’s middle class.

Labor’s Role in U.S. Economic Revitalization

America can’t be a successful low-wage consumer society. The administration of George W. Bush tried to make up for stagnant wages with consumer debt, a choice that has proven disastrous. That our country needs to channel more money to America’s workers and less to Wall Street speculators and CEOs is a proposition no longer marginalized as pro-union propaganda. Rather, it has become a mainstream element of the formula for our nation’s economic recovery.

Today, there is growing recognition that the nation’s agenda for economic revitalization and renewed prosperity must include restoring workers’ freedom to form unions. In exercising that freedom, workers should not have to declare war on their employers, and they should not have to confront a war declared on them. This freedom is essential if workers are to negotiate a fair share of the wealth they create.

The importance of unions is even recognized by some of the nation’s leading economists, including Nobel Prize winners. In a statement published recently in The Washington Post, over 30 prominent economists noted that throughout the most recent economic expansion (from the year 2000 to 2007) the income of the median working-age household fell by $2,000, and virtually all of the benefits of that period’s growth went to a tiny minority of wealthy Americans. According to the economists, a major reason for the shift from the more broadly shared prosperity of past decades to the rapidly growing inequality of recent times is the erosion of workers’ ability to form unions and bargain collectively. 3

Economic inequality has increased dramatically in recent years. In the 1970s, the ratio of CEO pay to rank-and-file worker pay was roughly 42 to 1. By 2006, the ratio had obscenely increased ten-fold. Well-known examples abound: James Skinner, CEO of McDonalds, earned $12.3 million last year, roughly 600 times the average of McDonalds 600,000 workers; and Lee Scott, Wal-Mart’s CEO, earned $31 million, which is about $16,000 per hour, or only slightly less than the average Wal-Mart employee makes in a year. 4

Even President Bush’s Council of Economic Advisers published a report finding that over the past 35 years workers productivity has risen by 75 percent, while inflation-adjusted wages are lower than they were in 1973. 5

Meanwhile, numerous studies have documented that there is a connection between times of U.S. economic (and financial) stability and periods when collective bargaining contributed to rising wages.

An Unfair Process

Today, the National Labor Relations Board (NLRB) process for achieving union recognition is not a fair test of workers’ desire for collective bargaining. How can it be a fair test when worker organizers are fired in 1 of every 4 campaigns? Or when employers threaten or predict that formation of a union will mean that the plant will close in over 50 percent of campaigns? Or when workers are forced, as a condition of keeping their job, to attend one-on-one meetings or captive audience meetings with their supervisors in 80 percent or more of union campaigns, where they are forced to listen to only one side of the story? Or when employers have, over the past several years, violated the organizing and/or bargaining rights of their workers in 25,000 to 30,000 cases per year? 6

Some employer representatives grow weary of the union refrain that this type of election process cannot be fair, especially when an employer has exclusive economic control over the voters and the premises where the campaigning and voting take place.

Some would also prefer ignore the U.S. Census Bureau’s own statistics showing that union membership has been the route out of poverty and into the middle class for workers that do have unions. The wage premium for workers in unionized jobs is 28 percent when their pay is measured against employees in comparable non-union positions. It is even higher for females (34 percent), African-Americans (29 percent), and Latinos (59 percent). 7 Similarly, the union premium for other economic benefits is significant: 80 percent of unionized employers make some payment toward healthcare coverage for their employees, compared to 49 percent of non-union employers; 68 percent of union employers provide some amount of guaranteed pension benefits, compared to 14 percent of non-union employers. 8

To explain why union density and collective bargaining coverage has declined in the United States, employer representatives often point to various reasons unrelated to employer interference. These include the impact of globalization, the effects of new technology, and the belief that unions are unable or unwilling to address workers’ concerns.

But this ignores the fundamental fact that, according to all reputable survey evidence, a growing number of American workers who do not have a union would like to have one. The most recent surveys show that number to be roughly 60 million workers, compared to the 15.4 million workers who have a union today. And if in conducting these surveys it is posited that getting a union would not require a major confrontation with their employer, then the number of workers who say they would like to have a union goes even higher. 9

An Uneven Playing Field

The decline in unionization has made it more difficult for employers who would prefer to stay on the sidelines and not oppose their workers’ desire for collective bargaining. Today, however, employers fear that not opposing collective bargaining will put them at a competitive disadvantage. Nevertheless, some responsible and profitable major corporations treat majority sign-up for union recognition as a standard practice and an important element of a successful high-road business plan. The result for companies like AT&T and Kaiser Permanente, for example, has been workplaces with better labor-management relations, less tension, greater respect for employees, and increased employee morale.

In contrast, many other employers remain intent on making it as hard as possible for workers who want collective bargaining to achieve their goal. Some are quite open about that aim, and oppose labor law reform of any kind. The terms are too good right now, and they have no interest in legislative change.

There are some employer representatives who at least privately acknowledge that the status quo is unacceptable on the grounds of human rights, economics, or both. Yet even this group often behaves publicly as if the Employee Free Choice Act (EFCA) would bring about an end to civilization as we know it. My question to such representatives is simple: If not EFCA, then what?

Management representatives who acknowledge the problems with our existing system often suggest that we would not need the EFCA’s majority sign-up provision “if we encouraged more employers to voluntarily recognize their workers’ union,” and that we would not need the bill’s first-contract arbitration provision “if we had better trained mediators.” These suggestions are not constructive: the labor movement and its supporters have spent decades encouraging employers to voluntarily recognized their workers’ desire to form a union; and the dispute-resolution community is not the problem.

Coercion by Unions?

Some employment-relations scholars and practitioners acknowledge that the current system is in need of serious reform, yet they question the propriety of EFCA’s majority sign-up provision largely on the grounds that this process will open workers to coercion by unions.

This argument ignores the fact that majority sign-up is not new or untested. It has been legal since the NLRA was enacted in 1935, and millions of workers have formed unions by signing union authorization cards under a majority sign-up procedure. And over these many decades, the record shows minimal union coercion in connection with the procedure.

A study by the HR Policy Association, a pro-business organization opposed to the EFCA, identified just 113 cases since the inception of the NLRA as involving fraud and coercion in connection with the collection of authorization cards.10 A review of each of these cases, however, indicates that only 42 involved misconduct relating to the signing of cards. That’s less than one case every two years. 11

Contrast this tiny number to the number of illegal firings and other employer violations against workers’ federally protected rights, according to the NLRB’s annual reports: 29,559 in 2007 alone. 12

This should come as no surprise, as it is employers that hold power over workers—the power to hire and fire, and to determine wages and promotions. That’s the power that can lead to coercion. So it is little surprise that the ratio of violations of workers’ rights by employers to the violations of coercion by unions under the existing system is roughly 60,000 to 1.

Contrary to the inaccurate critiques spread by some EFCA opponents, the proposed legislation would not require workers concerned about union coercion to make use of its majority sign-up provisions. Under EFCA, workers would still have the right to avail themselves of the NLRB election process, just as it exists today. The difference is that instead of employers deciding whether workers must go through the NLRB process or achieve recognition on the basis of majority sign-up, which is the case today, workers would choose the process.

Unions as Part of the Solution

The U.S. House of Representatives passed the EFCA by a significant margin two years ago. Today, the Senate is ready to do the same. The nation also has a president who strongly supports the Employee Free Choice Act and who, I believe, will work hard to see it enacted. Indeed, I give President Barack Obama final words in this essay:

I believe we need to reverse many of the policies toward organized labor we’ve seen these last eight years, policies with which I have sharply disagreed. I do not view the labor movement as part of the problem; to me, and to my administration, labor unions are a part of the solution. We need to level the playing field for workers and the unions that represent their interests. Because we know that you cannot have a strong middle class without a strong labor movement. 13

Notes

1. Human Rights Watch, Unfair Advantage: Workers’ Freedom of Association in the United States under International Human Rights Standards, 12, 14 (2000), http://www.hrw.org/sites/default/files/reports/uslbr008.pdf.
2.  H.R. Rep. No. 110-23 (2007).
3. Economic Policy Institute, “Labor Law Reform Key to Economic Recovery.” February 25, 2009. http://www.epi.org.
4. McDonald’s Corporation 2008 Proxy Statement, http://www.sec.gov/Archives/edgar/data/63908/000119312508077858/ddef14a.htm; Wal-Mart Stores, Inc., 2008 Proxy Statement, http://www.sec.gov/Archives/edgar/data/104169/000119312508086949/ddef14a.htm#tx91664_26. 5. Economic Report of the President, Together with the Annual Report of the Council of Economic Advisors, 282, 284 (February 2008), http://www.gpoaccess.gov/eop/2008/2008_erp.pdf.
6. John Schmitt & Ben Zipperer, Dropping the Ax: Illegal Firings During Union Organizing Campaigns, 1951-2007, (March, 2009), http://www.cepr.net/documents/publications/dropping-the-ax-2009-03.pdf; Kate Bronfenbrenner, Uneasy Terrain-The Impact of Capital Mobility on Workers, Wages, and Union Organizing, 18, 73 (2000), http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1002&context=reports; Seventy-Second Annual Report of the National Labor Relations Board, Table 4 (2007), http://www.nlrb.gov/nlrb/shared_files/brochures/Annual%20Reports/Entire2007Annual.pdf; Seventy-First Annual Report of the National Labor Relations Board, Table 4 (2006), http://www.nlrb.gov/nlrb/shared_files/brochures/Annual%20Reports/Entire2006Annual.pdf; Seventieth Annual Report of the National Labor Relations Board, Table 4 (2005), http://www.nlrb.gov/nlrb/shared_files/brochures/Annual%20Reports/Entire2005Annual.pdf; and Sixty-Ninth Annual Report of the National Labor Relations Board, Table 4 (2004), http://www.nlrb.gov/nlrb/shared_files/brochures/Annual%20Reports/2004%20WholeAnnualReduced.pdf.
7. AFL-CIO Issue Brief, The Silent War: The Assault on Workers’ Freedom to Choose a Union and Bargain Collectively in the United States, 13 (2005), http://www.aflcio.org/joinaunion/how/upload/vatw_issuebrief.pdf.
8. Bureau of Labor Statistics, 2006 Employment Benefits Survey, http://data.bls.gov/PDQ/servlet/SurveyOutputServlet;jsessionid=f03045af62dfW$3F$08$.
9. AFL-CIO, With Grim Expectations for Next Generation’s Financial Future, Public Sees Unions as Key to Improving Economic Opportunity, http://www.aflcio.org/joinaunion/voiceatwork/efca/upload/EFCA_Polling_Summary.pdf.
10. Testimony of Nancy Schiffer, AFL-CIO Associate General Counsel, before the Subcommittee on Health, Employment, Labor, and Pensions, Committee on Education and Labor, U.S. House of Representatives, Strengthening America's Middle Class Through the Employee Free Choice Act, February 8, 2007, http://edworkforce.house.gov/testimony/020807NancySchiffertestimony.pdf.
11. Id.
12. Seventy-Second Annual Report of the National Labor Relations Board, Table 4 (2007), http://www.nlrb.gov/nlrb/shared_files/brochures/Annual%20Reports/Entire2007Annual.pdf.
13. Remarks of President Obama announcing creation of the Task Force on Middle-Class Working Families, the White House, Washington, DC, January 30, 2009. http://www.cwa1180.org/politics/todaywhitehouse.shtml.

Jonathan Hiatt is general counsel of the AFL-CIO.

Labor and Employment Relations Association
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