by Jennifer Woofter, President of SSC
There has been a lot of talk about the Employee Free Choice Act (EFCA), a piece of legislation that would make it easier for workers to form a union in their workplace. In a nutshell, passage of EFCA would allow employees to start a union through a “majority sign-up”, speed up contract negotiations by introducing a mediation and arbitration process, and increase penalties against employers who violate labor laws. EFCA recently passed in the House of Representatives, but remains up for debate in the Senate. In the meantime, it seems like everyone has an opinion.
As a small business owner focusing on sustainability and social responsibility issues, I have one too. At a time when foreclosure rates are staggeringly high, even as CEOs receive millions in salary, bonuses, stock options, and other perks, it’s hard to believe that giving more power to the worker is a bad idea. On the other hand, as a CEO myself (albeit one that didn’t get a swanky package to our local country club or use of a company jet) I’m not exactly a patsy for the labor movement either. It’s exactly my middle-of-the-road stance that made me consider the Employee Free Choice Act so carefully.
The decline in unions over the last three decades can be linked to lower wages, fewer health benefits, and perhaps even the current economic crisis. For pro-union groups, EFCA is a panacea to cure all that is wrong with the corporate system. As freechoiceact.org puts it, EFCA “can restore the balance, giving more workers a chance to form unions and get better health care, job security and benefits—and an opportunity to pursue their dreams.” Push through EFCA, these groups promise, and we’ll see a stronger middle class, more income equality between the “average worker” and her CEO, and greater fairness in the workplace.
Anti-union groups have a starkly different message, and oppose the legislation for three key reasons. The first claim is that EFCA actually takes away workers’ rights by replacing secret ballot voting with publicly signed “check card” campaigns. (What they fail to mention, incidentally, is that workers actually get to choose whether to forego an election in favor of the more expedient majority authorization process. For this reason, I tend to cast aside this protest as a canard by anti-union groups trying to cast themselves as protecting worker rights.)
The second complaint centers on the idea of mandatory arbitration. EFCA provides that either employers or employees may request mediation, and eventually seek binding arbitration if no agreement on a first contract has been reached after 90 days of bargaining. Opponents of EFCA claim that mandatory binding arbitration provides motivation for either a union or employer to engage in bad faith bargaining until the end of the negotiating period. This is a reasonable point to make, and worth considering. At the same time, it’s worth asking if binding mandatory arbitration is a better alternative that then current system, where employers can delay negotiating almost indefinitely, hiring consultants (often the lawyers who write anti-EFCA editorials) that teach them how to stall and prolong the bargaining process. Even when found guilty of bad faith bargaining, the penalty for these companies is usually to “resume bargaining”. For a company that is successfully stalling the union efforts, this penalty does not even equate to a slap on the wrist. Suddenly, a faster contract process—even at the risk of binding arbitration—doesn’t seem so bad.
The final point that anti-union groups make is that EFCA mandates tougher penalties for employers who are found to violate labor laws, but leaves the penalties for violations by union organizers untouched. In my book, this is the strongest criticism of the Employee Free Choice Act. Unions clearly aren’t perfect, and there have been instances of intimidation and coercion tactics from organizers that rival the worst of the “one-on-one informational meetings” held so often by employers facing a union drive. But in an era when 82% of employers faced with organizing campaigns hire exorbitantly paid union-busting consultants and when only 38% of new unions are able to finalize a contract with management within a year of their certification—well, my sympathies have to remain with the worker.
The blatant anti-union rhetoric is at an all-time high, and not just by the usual “bad guys” of steel mills and coal mines. Don’t believe me? You can listen yourself to a recorded telephone conference call from October 17, hosted by Bank of America and led by Home Depot co-founder Bernie Marcus. In the hour-long phone call, obtained by the Huffington Post, Mr. Marcus raged against EFCA, saying that its passage would turn America “into France”. He called for companies to send millions of dollars to anti-EFCA congressional candidates and stated that CEOs at companies not getting involved in opposing EFCA “should be shot”. Not to put too fine a point on it, he claimed these CEOS should be “thrown out of their goddamn jobs.”
Now, I’m not upset with Mr. Marcus, whose claim that he could have been on a “350 foot boat out in the Mediterranean” instead of on that expletive-laced phone call says a lot about his ability to separate his personal life from the economy, which he frames as “a disaster, a total absolute disaster”. What irritates me is that the call was hosted by Bank of America, who just three days earlier had received $25 billion in federal bailout funds. At least one other bailout recipient, AIG, also had a representative present on the call.
The fact that companies like Bank of America and AIG are participating in calls like this one—which can hardly be described as a thoughtful look at the issue—tells me that anti-labor sentiment is present throughout big business. To be fair, neither company has formally come out against EFCA, and Bank of America at least discussed the pros and cons of EFCA in a research document released two weeks after that call. But for me, it’s about the attitude.
It’s not just the traditional blue collar industries that feel it’s necessary to demonize unions and limit worker rights—it’s managers at your bank down the street. Given the fact that companies receiving billions in bailout money are simultaneously soliciting ideas on how to best funnel money to organizations and candidates opposing EFCA—well, that tells me the system of oversight and accountability is broken.
Unions aren’t perfect, but they offer a voice to employees who have too often been left out of the conversation. At the end of the day, I support EFCA because I believe every employee—from the CEO to the janitor—has a stake in the success of our companies. When we all get a place at the table, we have the best chance of creating a marketplace that succeeds. If you disagree, and think that our current system is working, I’d be happy to hear your thoughts. You can reach me on my yacht off the coast of France.
Jennifer Woofter is the president of Strategic Sustainability Consulting, a firm that helps organizations address their social and environmental impacts. She does not own a yacht.