IS THERE A UNION IN YOUR FUTURE?
CONGRESS INTRODUCES EMPLOYEE FREE CHOICE ACT
Yesterday, both houses of the United States Congress introduced identical versions of the Employee Free Choice Act (EFCA) legislation (S. 560 and H.R. 1409). This legislation is
designed to make it dramatically easier for a union to organize your
employees.
Notably,
in the last Congress, then-Senator Obama was a co-sponsor of an
identical bill. That proposed legislation ultimately died in the
Senate on June 26, 2007 when Democrats failed to garner enough votes to
end a Republican filibuster.
With
big labor a huge financial supporter of President Obama's election
campaign, labor leaders were aggressively pushing for reintroduction of
the same bill once they gained larger majorities in both the House and
the Senate as well as an ally in the White House. That day has finally come.
EFCA will make sweeping changes to the rules on how unions organize. Here's a rundown of the three key provisions:
1. "Card-Check" Labor Certification.
Currently, employees wishing to unionize can petition the National Labor Relations Board to hold a secret ballot election
at their workplace if just 30% of employees in an appropriate unit sign
pledge cards or a petition. An "appropriate unit" may range from
the employees in one small department to all employees in the
company. Supervisors cannot participate.
EFCA
would virtually eliminate the secret ballot election that has been used
successfully for over 70 years in favor of a much more public procedure
known as "card check."
Under a card check, instead of holding an election, a company's
employees can become unionized if just 50% + 1 of the employees in an
appropriate unit sign union pledge cards.
EFCA would require the NLRB
to craft "guidelines and procedures" to be followed, including "model"
pledge card language and procedures "to establish the validity" of
signed pledge cards.
Under
EFCA, instead of all employees participating in a secret ballot
election, a full 49% of employees may never have the chance to weigh in
on the issue. Though the bill is dubbed the Employee Free Choice
Act, in fact, the law may result in many employees being subject to
union representation, even though they never had any choice in the
matter whatsoever.
2. COMPULSORY ARBITRATION TO SETWORKING CONDITIONS.
The new compulsory arbitration provision could be the most pernicious aspect of the proposed legislation because it will disturb the process of collective bargaining
as we know it. Under existing law, the union and the company
bargain over wages, benefits, hours, and other working conditions
through the give-and-take of collective bargaining. Both sides
have the ability to use a variety of negotiation tactics, including the
threat or actual exercise of economic "weapons" such as strikes or
lockouts, to persuade the other to agree. Ultimately, the contract is a
product of mutual agreement.
Under
EFCA, if no deal is reached within as few as 130 days of the union's
certification, a federally-appointed arbitration board or panel (which
likely knows nothing about how to run your business) will be selected
to literally write the terms and conditions of the contract that the
parties could not agree upon.
The
arbitration board's decision will be binding on the parties for at
least two years. The arbitrator will have the power to decide how
much of a wage increase you will pay, what hours your business will be
operated, what type of insurance you will provide your employees, how
much paid time off you will give your employees, and the like.
3. HUGE EMPLOYER PENALTIES.
The proposed legislation adds three new penalties for federal labor law
violations. This will up the ante considerably for even the most minor
labor law missteps during a union organizing campaign and bargaining
for the first contract. They include:
(1) Fines of up to $20,000 for each unfair labor practice committed by an employer. The current law has no such fines. (Notably, these penalties do not apply to violations committed by the union);
(2)
Triple back pay for employees who are found to have been suspended or
terminated because they are either for or against union organizing
(this is a whopping 300% increase in the current penalty); and
(3)
Mandatory federal court injunctions against employers alleged to have
committed unfair labor practice charges during an organizing campaign.
Washington insiders are uncertain about the specific timing for EFCA's consideration by the Senate or House of Representatives.
Just yesterday, the Senate Health, Education, Labor and Pensions
(HELP) Committee conducted a hearing dubbed "Rebuilding Economic
Security: Empowering Workers to Restore the Middle Class."
Most
Senate Democrats are expected to vote the party line. However, a
few Democrats from right-to-work states have indicated they may not
support the bill.
In
order to achieve a 60-vote filibuster-proof majority, nearly all Senate
Democrats and some moderate Republicans would need to support the
bill. Most likely, some type of compromise on the terms of EFCA
would need to occur in order for the bill to make it the White House.
For the new President, passage of EFCA legislation is a major priority of his administration. President Obama
made his stand on the EFCA legislation perfectly clear in a videotaped
speech presented to labor officials meeting for the AFL-CIO's Executive
Council. President Obama stated: "[t]o me, and to my administration, labor unions
are a big part of the solution. We need to level the playing
field for workers and for unions that represent their interests -
because we cannot have a strong middle class without a strong labor
movement ... And as we confront [economic] crisis and work to ... pass
[EFCA], I want you to know that you will always have a seat at the
table."
Employers
need to ready themselves for the impact of this potential new law.
BRG&S has developed a management education and awareness program to
guide companies through the possible changes which EFCA may bring and
strategies they may employ to educate the workforce about their rights.
Since
no one knows when EFCA will pass, we are recommending that companies
become acquainted with their options now. If you would like more
information about strategies your company may employ, please contact
partners Ken Ballard, Matt Wakefield, Rich Rosenberg or John Golper.
For more information, call us today at (818) 508-3700,
or visit us on the web, at www.brgslaw.com.
Sincerely,
Richard S. Rosenberg
Partner
BRG&S, LLP
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