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. RosenbergPartnerBRG&S, LLP |
