What follows is a summary/synthesis of empirical studies that reveal rampant employer violations of labor law intended to allow employees to make a free and uncoerced choice about whether to join or support a union. Also included is a description of the multi-million dollar union-busting industry. The diary concludes with an outline of the Employee Free Choice Act as a fix for the broken NLRB election/certification process.
Inadequate enforcement of U.S. labor law is a principle reason why workers in the United States may no longer effectively exercise their fundamental right of self-organization for mutual aid and protection. The NLRB certification process not only fails to effectuate the major policy goal of the NLRA in that it fails to promote collective bargaining, but it fails to guarantee internationally recognized fundamental human rights.
In the year 2000, Human Rights Watch, a non-profit international rights monitoring group, published a report that concluded:
"[L]egal obstacles tilt the playing field so steeply against freedom of association that the United States is in violation of international human rights standards for workers."
More about the broken process and how we will fix it...
INTRODUCTION
This diary will present empirical data framed by anecdotal information to lend perspective on how the NLRB certification process fails to advance the purposes of the NLRA while simultaneously encouraging high transactions costs and wasteful strategic behavior by employers and unions. From a labor policy perspective, the NLRB certification process fails to advance the goals of the NLRA. From an economic perspective, it encourages economic waste. This diary will conclude with an analysis of the changes proposed in the Employee Free Choice Act (EFCA) - a legislative proposal designed to reform the NLRB certification process. Proposals for reform included in the EFCA have the potential to promote cooperative collective bargaining, discourage wasteful strategic behavior and lower transaction costs and hostility now associated with the NLRB certification process.
The federal statutes that serve as the framework for private sector labor management relations in the United State are riddled with loopholes that facilitate illegal employer resistance tactics and permit an unregulated and highly effective union avoidance industry. The process by which workers organize in order to demand recognition and collective bargaining from an employer unwilling to voluntarily recognize majority support for a union is referred to as the National Labor Relations Board (NLRB) certification process. This process no longer functions.
Intro to the NLRB Certification Process
"Management can do so much within the confines of the law to combat unionism that they need not and should not break the law." – Arthur Mendelson, renowned union-buster.
What follows is a brief overview of the NLRB process for determining union representation in a workplace. A private sector employer may voluntarily recognize a union following a demonstration that the union enjoys the support of a majority of eligible workers in the workplace. This may be accomplished through a variety of means, including presentation of signed authorization cards or a petition. However, the employer is not required by law to recognize the union until that union is certified by the NLRB. The NLRB certifies a union despite employer resistance if the union wins majority support in a secret ballot election supervised by the NLRB. In order to begin the process that leads to an NLRB election, the union must file for an election by demonstrating through signed authorization cards or petitions that the union has the support of at least 30% of the employees in a workplace.
After this initial step is accomplished, the NLRB sets a date for a workplace election and begins the process of deciding which employees are eligible to vote. The process used to determine which employees are members of the bargaining unit and therefore eligible to vote in the election presents the first real opportunity for employer litigation and delay. Once an election date has been set, the employer and union typically begin the inevitable electioneering. The NLRB attempts to hold a workplace election with 42 days of the union filing for an election. The union will use organizers and pro-union employees to convince workers to vote for the union, while the employer will use anti-union employees and managers to encourage workers to vote against the union. The employer campaign is far more often than not orchestrated by a professional anti-union consultant. The employer may communicate his views on unionization directly to employees in the workplace during work hours. Union organizers are effectively and legally banned from the workplace and pro-union employees are often prohibited from discussing non-work related topics during work hours, including unionization. Union organizers typically visit employees at their homes whenever possible or solicit employee attendance at after-hours union meetings away from the worksite. The effect of a recent NLRB decision permitting employers to prohibit employee interaction outside the workplace during non-work hours remains to be seen, but could further reduce the ability of workers to learn of the potential benefits of unionization. (Guardsmark, LLC, 344 NLRB No. 97 (2005) (NLRB finds that a rule prohibiting employee fraternization after working hours and away from the worksite does not infringe on employee rights under the NLRA.))
On the day of the election, employees cast a ballot for or against the union. The election occurs in the workplace during work hours. The NLRB official conducting the election counts the votes and determines the outcome based on a simple majority. If more votes are cast for the union than against the union, the union is considered certified. Certification may be delayed, however, if the employer decides to challenge the results of the election. While the results of the election are litigated before the NLRB and in federal court, the workplace operates as if the union lost the election.
This basic description of the NLRB election process reveals ample opportunities for the employer and union to engage in strategies designed to win employee votes. By default, the workplace remains union-free prior to certification of the election results. Therefore, the employer hoping to resist employee organization efforts has the incentive to engage in strategies designed to delay the process. Employer coercion and intimidation strategies are legally prohibited by the NLRA, but ineffective remedies fail to deter such behavior. Employer opportunities for delay through legal and administrative challenges are an integral part of the NLRB certification process and employers who take advantage of such opportunities frustrate the will of employees who vote to organize but do not violate the law.
EMPLOYER RESISTANCE STRATEGIES
A legal framework designed to allow for an orderly process for determining union representation and facilitating productive collective bargaining will necessarily include mechanisms to control management behavior to the extent that employees are protected from retaliation before and during the election and that they remain free to choose for or against representation. The NLRA deems illegal any employer action that interferes with or coerces employees in the exercise of their labor rights. However, a persistent and systemic failure to adequately enforce these provisions of the NLRA has undermined the Act’s effectiveness.
The inability of the NLRB representation process to protect employee free choice can be inferred from the fact that anti-union consultants advertise money-back guarantees for employers who hire their firms to manage union avoidance campaigns. Empirical evidence establishing wide-spread and routine employer violation of the NLRA lends strong evidentiary support to this inference. Chronic delay in the administration of the Act as well as ineffective penalties and remedies fail to deter employers from using illegal union resistance tactics. Empirical data suggest that illegal employer resistance tactics are ubiquitous and effective. The following review of empirical data collected from several studies of organizing drives will illustrate that the NLRB representation process fails to deter employer suppression of labor rights.
Strategies used by anti-union consultants to assist employers who seek to resist union organizing drives are implemented using tactics that can be classified into two major categories: "Tactics of Intimidation" and "Tactics of Delay".
TACTICS OF INTIMIDATION
"Underlying all this employer opposition to workers’ organizing is the raw power of the employment relationship – the power to assign work, to pay a wage, to impose discipline, and ultimately to dismiss the worker. Workers hear employers’ views with this power in mind." – Human Rights Watch
The NLRA broadly prohibits employers from intimidating, coercing or retaliating against employees for exercising the right to form unions. Case law interpreting the NLRA outlines the types of employer and union behavior that are legally prohibited as interfering with the employee’s right to make a free choice regarding union representation. Employer or union may file an unfair labor practice charge (ULP) with the NLRB if one party believes the other has violated the NLRA as interpreted through Board and federal court decisions. Employers, especially those counseled by anti-union consultants, have become very adept at using methods to apply subtle pressure on employees to vote against the union. While technically legal, such tactics have the same coercive effect that underlies the NLRA definition of unfair labor practice. Legal or illegal, employer resistance tactics have a demonstrably negative effect on worker’s willingness to support an effort to organize his or her workplace. The probability of the average workers voting union is reduced by more than 15 percent in an election in which the employer has threatened or taken action against pro-union employees. (Dickens, William. The Effect of Company Campaigns on Certification Elections: Law and Reality Once Again. (Industrial Labor Relations Review, 36:4, 402-414. 1983))
Bronfenbrenner Study
One of the foremost empirical studies of employer resistance strategies conducted on a national scale was published in September, 2000 by Dr. Kate Bronfenbrenner, Director of Labor Education Research at Cornell University’s School of Industrial and Labor Relations. (Bronfenbrenner, Kate. Uneasy Terrain: The Impact of Capital Mobility on Workers, Wages, and Union Organizing. (Cornell, 2000).) Bronfenbrenner analyzed employer behavior during 407 organizing campaigns occurring in 1998 and 1999. During these two years unions participated in more than 6200 NLRB elections (3229 in 1998 and 2976 in 1999.) (BNA Plus. 2000. "NLRB Representation and Decertification Election Statistics: Year End Report, May 2000." Washington, DC: Bureau of National Affairs.) More than 450,000 workers were involved in these elections. The union win rate for all NLRB certification elections was 51.2% in 1998 and 51.3% in 1999. Data collected by Bronfenbrenner and others reveal a correlation between the union win rate percentage and employer use of illegal resistance tactics. For instance, unions won only 38% of elections where the employer illegally threatened to move or close the worksite. The study established that the more employer resistance tactics employed during an organizing campaign leading up to an NLRB certification election, the lower the union win rate.
Bronfenbrenner’s 2000 study focused primarily on one particularly effective employer resistance tactic – the threat to close or move the worksite. Consistent with findings in a similar study conducted in 1993-1995, Bronfenbrenner’s 2000 study revealed that in 51% of the elections analyzed employers threatened to close or move the worksite if the union was to win the certification election. Employer threats to close or move the workplace are more effective in certain industries than in others and consequently are more prevalent during campaigns in certain industries. For instance, at worksites in the textile manufacturing industry employers threatened to close or move the worksite in 100% of representation elections. By comparison, employers threatened to close or move the worksite in 25% of campaigns seeking to organize employees in the entertainment industry and 31% of campaigns in the healthcare industry. Outsourcing trends make the threat to move or close the plant far more credible and consequently more effectively threatening in some industries compared to others. For instance, union win rates in campaigns where the employer threatened to move or close the facility in the health care and entertainment industries averaged close to 60%, while average win rates in campaigns with threats in the manufacturing sector was 28%.
In 79% of the election campaigns where threats to move or close were made, the threats were delivered verbally in a subtle or veiled manner. Fifty-one percent of campaigns where threats were made involved specific and unambiguous verbal threats. In 11% of campaigns where threats to move or close were made, the threats were specific unambiguous and written. Anti-union consultants are well practiced in the art of delivering threats in a manner that effectively intimidates workers while avoiding the remote possibility of NLRB intervention. Ambiguous threats usually consisted of the employer offering examples of union facilities that had closed down or moved overseas. Sometimes, the employer recruits suppliers or customers to deliver the message to employees that those businesses will cease dealing with the employer if the workforce were to organize.
Proving employer illegality in the form of threats to close or move a worksite usually requires documentation of a clear unambiguous threat. Even apparently unambiguous employer threats sometimes fail to meet the threshold required to establish illegality. For example, at an Illinois auto parts factory a supervisor told workers involved in an organizing drive, "I hope you guys are ready to pack up and move to Mexico." In this instance, the NLRB found that the statement constituted an illegal threat to close the worksite. The Seventh Circuit Court of Appeals overturned the NLRB, holding that the statement was "a joke, not a threat." Hunter-Douglas, Inc. v. NLRB, 804 F2d. 808 (7th Cir. 1986) The law essentially recognizes truth as a defense when it comes to employer speech during an organizing campaign. Many employers accused of making threats to move or close a worksite in response to an organizing campaign claim they were not making a threat, but rather a prediction based on solid economic data. Where half of all organizing campaigns involve a threat to move or close the worksite, the employer actually followed through in only 3% of the campaigns in which the employer threatened to move or close the worksite following union certification. Clearly, the majority of these threats are designed solely to intimidate workers and have no basis in reality.
In her sampling of union certification campaigns, Bronfenbrenner found high rates of illegal employer behavior that did not involve threats to move or close the worksite. One in four employers in Dr. Bronfenbrenner’s sample discharged workers for union activity. In a little over half of campaigns where undocumented workers were members of the bargaining unit, employers threatened to refer undocumented workers to immigration authorities. One half of employers made illegal promises to change or improve employee terms and conditions of employment. One in five employers gave illegal previously unscheduled wage increases while a similar number made some kind of illegal unilateral change in benefits or working conditions. One in ten employers promoted a pro-union employee to supervisor status, thereby removing that person’s eligibility to vote in the certification election and reducing further their ability to make public statements in support of the union without fear of discipline. Two out of three employers held mandatory and intensive one-on-one supervisor to employee meetings at least weekly, designed to persuade the employee to vote against the union. Nine out of ten employers held mandatory mass meetings where workers are subjected to one-sided anti-union messages and can be legally fired or disciplined or non-attendance, asking questions or speaking to coworkers. One in three employers gave bribes or special favors to employees who openly opposed the union or in some other fashion assisted the anti-union ‘vote no’ committee. One in ten employers used electronic surveillance to monitor the activity of union supporters.
The legal threshold for finding that any particular employer resistance tactic violated the NLRA is relatively high. Unions filed unfair labor practice charges against only 35% of employers who threatened to close or move the worksite. Unions filed charges with the NLRB for other types of illegal employer behavior in only one third of all the elections reviewed in the study. The high burden of proof necessary to establish employer illegality is not the only deterrent against unions filing unfair labor practice charges. Ineffective remedies that fail to correct the damage caused to the organizing campaign cause unions to vigorously pursue unfair labor practice charges against only the most egregious employer violations. For instance, the NLRB reinstated illegally discharged workers prior to the certification election in only 12% of the campaigns studied by Bronfenbrenner where the employer illegally discharged workers. A ‘re-run’ election was ordered by the NLRB in only 6% of elections where the union lost. This number is staggeringly low considering the prevalence of illegal employer resistance tactics during organizing campaigns.
The NLRB has discretion to refrain from filing a complaint when presented with an unfair labor practice charge. According to Bronfenbrenner’s study, in 1998 and 1999 only 63% of unfair labor practice charges filed by unions resulted in an NLRB complaint. Unions withdrew charges before an election in 15% of campaigns were unfair labor practice charges were filed. Charges were settled before the NLRB filed a complaint in 7% of campaigns where charges were filed. Most notably, the percentage of ULP charges that resulted in a favorable final determination for the union was only 19%. Increasingly long delays in the resolution of unfair labor practice charges and the ineffective penalties provided for their remedy have resulted in unions that are increasingly less inclined to waste resources pursuing official redress of employer illegalities.
Bronfenbrenner’s study established a correlation between the number of legal and illegal employer resistance tactics used during a campaign and the likelihood of a union victory in the certification election. Sixty-two percent of employers ran anti-union campaigns using five or more tactics and 20% of employers ran very aggressive anti-union campaigns using more than ten tactics. In only 3% of the campaigns studied by Bronfenbrenner did the employer not utilize any resistance tactics, all of which resulted in the union winning the certification election.
Chicago Study
In 2005, Chirag Mehta and Nik Theodore of the Center for Urban Economic Development at the University of Chicago published their study of 62 organizing campaigns launched in the Chicago area in the year 2002. The results of their findings based on a relatively small sample in a particular geographical area corroborate the findings of Bronfenbrenner’s much larger nation-wide study. The Chicago study documented widespread employer use of illegal resistance tactics that ultimately affected the outcomes of NLRB certification elections. (Mehta, Chirag and Theodore, Nik, Undermining the Right to Organize: Employer Behavior During Union Representation Campaigns. (University of Illinois at Chicago: 2005))
The Chicago study tracked employer use of both legal and illegal union resistance tactics. In 61 of the 62 campaigns surveyed, employers used some kind of anti-union resistance tactic. The study revealed a notable correlation between employer use of resistance tactics and union win rates. Unions were successful in 73% of the certification elections following campaigns where the employer used five or fewer resistance tactics. Unions were successful in 56% of certification elections where the employer used between six and ten resistance tactics. The union win rate dropped to 17% where the employer used more than ten such tactics.
Employers illegally promised to improve wages if employees refrained from supporting the union in 59% of the campaigns studied by Mehta and Theodore. In approximately half of the campaigns, the employer offered bribes or special favors to employees who publically voiced opposition to the union. Approximately half of employers threatened to close down or relocate the worksite if the union were to win the certification campaign. One in three employers fired workers for union activity. A total of 67 pro-union employees were dismissed during the course of the 62 campaigns included in the study. These figures are fairly consistent with the findings of Bronfenbrenner’s nation-wide survey.
The Chicago study revealed what is perhaps the clearest demonstration of the effectiveness of employer resistance strategies in coercing employees to oppose unionization. As noted earlier, the NLRB certification process begins where the union demonstrates at least 30% support to the NLRB using signed authorization cards or a petition. For strategic reasons, including a desire to gauge employee support before investing resources into the organizing campaign, unions usually collect authorization cards from a much larger percentage of employees. For 91% of the organizing campaigns included in the Chicago study, unions demonstrated the support of at least 50% of workers when filing for an election with the NLRB. In several cases, the union demonstrated more than 80% support. The union lost the certification election in half of the campaigns where it began the process with a demonstration of at least 50% support. These statistics demonstrate that support for the union was eroded between the time the union filed the petition and the time the election was held – invariably the result of effective and often illegal employer intimidation.
TACTICS OF DELAY
By insisting on an NLRB election to determine majority status, even when presented with authorization cards signed by a vast majority of the workforce, the employer buys time during which to conduct a counter-organizing campaign. This time allows the employer to use economic coercion and a position of power in the workplace to pressure workers into rejecting unionization. Many employers, counseled by professional union-busters, take every opportunity to enter into time consuming litigation that further delays the election. Strategies of delay are often implemented very soon after the union files a petition for an election. If the union wins the certification election, the employer may always challenge the results before the NLRB. If the NLRB sides with the union, the employer is entitled to an appeal in federal court.
Employers know that the NLRB process for reviewing unfair labor practices is time consuming, almost never results in a pre-election remedy and will sometimes help to postpone the election. Where the organizing campaign requires a buildup of momentum, the employer resistance campaign depends on making the process as slow and arduous as possible. The anxiety and conflict inevitable during the pre-election campaign period always works to the anti-union employer’s advantage.
Strategies of delay are usually implemented from the moment the union files the petition for an NLRB election. Depending on characteristics of the workplace and individual employee job descriptions, some employees are eligible while others or not. For instance, employees who may be characterized under very loose rules as either independent contractors or supervisors are excluded from the bargaining unit and are not permitted to vote in the election. The process used to determine which employees are included in the bargaining unit not only invites litigation and delay, but also presents the first opportunity for employers to target suspected union supporters for exclusion from the election. A recent landmark NLRB decision casts doubt on the bargaining unit eligibility of millions of employees and will almost certainly increase the amount of litigation surrounding bargaining unit definition. (Oakwood Healthcare, Inc., 348 NLRB No. 37 (2006))
When a union files an unfair labor practice charge to protest an illegal employer resistance tactic, the NLRB will usually postpone the election date in order to investigate and resolve the charge. Unions are hesitant to take steps that will prolong the amount of time that pro-union employees will be subject to the ‘gauntlet’ of employer resistance tactics. According the NLRB’s own publications, the Board’s goal for the length of time it takes to decide whether an unfair labor practice charge has merit is seven to twelve weeks. If the charge is found to have merit and a settlement cannot be reached by the union and management, the Board attempts to open hearings on the case 120 days after the charge was found to have merit. A small minority of ULP charges are prosecuted by the NLRB General Counsel and cases that go to the full Board for a decision typically take more than a year to process. The median age of an unfair labor practice case awaiting a decision by the Board in September of 2005 was 1,232 days from the time the charge was filed. (NLRB, Seventieth Annual Report of the National Labor Relations Board (NLRB, 2005) Even after a decision, Board orders are not self enforcing and can be ignored by an employer until the union wins enforcement in federal court.
An unfair labor practice charge against an employer’s illegal behavior during an organizing campaign will almost never reach resolution before the end of an organizing campaign unless the union is willing to postpone the election. This is primarily due to the NLRB’s reluctance to utilize authority granted under the NLRA to petition the federal courts for injunctions to stop employer interference. Despite the prevalence of illegal employer tactics, a mere nine so-called 10(j) injunctions were sought by the Board in 2005. Of those nine petitions for injunction, federal courts only granted four. The Board simply refuses to use its power to petition federal courts for orders restraining illegal employer resistance tactics.
The conclusion of the Board’s certification process does not end the employer opportunity to delay unionization. Employers may refuse to negotiate in good faith with the elected and certified representative of his or her employees. The only remedy available to force an employer to bargain with the employer is an NLRB bargaining order. The NLRB order is only enforceable in federal court. Employers fail to agree to a first contract within two years of certification with 45% of newly certified and recognized unions. (Federal Mediation and Conciliation Service, 2004 Annual Report, Table B, p.19 (FMCS, 2004)). Fred Feinstein, former General Counsel of the NLRB, wrote,
"By merely exercising available rights of appeal, the finality of a union election can readily be delayed for more than two years and often much longer." (Feinstein, Fred. Afterward. Some of Them Are Brave: The Unfulfilled Promise of American Labor Law, by Mary Beth Maxwell and Bruce Nissen. (Washington, DC: American Rights at Work, 2003)
The empirical data collected in the Bronfenbrenner and Chicago studies illuminate the wide-spread use of illegal employer resistance tactics during organizing campaigns. The inability and political unwillingness of the NLRB and federal judiciary to protect employees seeking unionization from employer intimidation and delaying strategies is the most obvious reason for the steady decline of union representation rates in the private sector. Review of the data reveals that United States labor policy has failed to promote collective bargaining and industrial peace. Moreover, U.S. labor policy is also a failure from an economic efficiency perspective.
Employer strategic behavior designed to resist unionization increases the transaction costs associated with collective bargaining. Many of the strategies employers use to resist union organizing drives are costly in terms of lost production time and exposure to legal liability. For instance, mandatory mass meetings of employees are conducted on the clock and result in multiple hours of lost production time. When management is more focused on union avoidance than monitoring workplace efficiency a drop in productivity often results. Employer unfair labor practices provide unions the opportunity to strike and picket prior to recognition, which drastically interferes with production. Employees who are illegally fired for union-support are sometimes awarded backpay. In the year 2005, the NLRB awarded $83.8 million in backpay awards. While backpay awards are usually assessed far too late to make an impact during the organizing campaign, they can eventually amount to a costly business expense. By far, the largest expense bourn by most employers who actively resist an organizing drive are the fees associated with hiring an anti-union consulting firm, also known as "professional union-busters."
UNION AVOIDANCE INDUSTRY
Anti union consultants and law firms help employers circumvent the intent of federal labor law by advising them on the effective use of standardized tactics of intimidation and delay. The vast sums of money employers spend on anti-union consulting services represent the highest single transaction cost associated with the NLRB certification process. Union avoidance is a multi-million dollar per year industry. One study calculated that employers spent approximately $200 million in the year 1990 in direct payments to defeat organizing drives. (Lawler, J, Unionization and Deunionization (University of South Carolina Press, 1990) The same study quantified the amount of time management is directed by consultants to fight union organizing efforts and concluded that union-avoidance costs totaled well over $1 billion each year. In 1997, AFL-CIO Director of Organizing Richard Besinger estimated that employers spent between $2,000 and $4,000 per vote to defeat unions in the NLRB certification process. (Levine, D. Interview with Richard Besinger, Disgruntled Magazine. (1997) Union avoidance lawyers and consultants are becoming rich by simultaneously undermining employee free choice and capitalizing on employer fear of unionization.
Union consultants are hired by employers in a vast majority of union organizing campaigns. Anti-union consultants were hired by 82% of all employers in Mehta and Theodore’s Chicago study. Three out of four employers in Bronfenbrenner’s nation-wide study hired a consultant to help resist the union organizing campaign. The American labor movement’s recent recommitment to aggressively organize new workers in the private sector has increased demand for anti-union consulting services. The vice president of one prominent anti-union consulting firm was quoted saying, "There’s more opportunity to sell our services." This same vice-president disclosed to a newspaper reporter that his firm was working with twelve employers at the time and typically works with over one-hundred employers each year. (Maher, Kris. Union’s New Foe: Consultants. Wall Street Journal. August 15, 2005.) He also claimed to have helped 90% of his clients to defeat union organizing drives. The web-site of his consulting firm, Labor Relations Institute, Inc., advertises a package deal with a money back guarantee. Another consultant, president of Sullivan & Associates, Inc., was interviewed by the same reporter and was quoted as saying, "We’re not union busters." Despite his objection to that particular label, he went on to boast that his firm was successful in defeating the union organizing drive in 215 out of 218 cases.
In his book, "Confessions of a Union Buster", former anti-union consultant Marty J. Levitt readily admits to using tactics of intimidation and delay to defeat union organizing drives. (Levitt, Marty with T. Conrow. Confessions of a Union Buster (New York, Crown Publishers, 1993.) Levitt confesses that emotional and psychological pain stemming from his realization of the harm he had done to so many people nearly ruined his life and inspired him to write a tell-all account his union-busting career. Levitt recounts advising employers to fire pro-union employees and foment racial animosity to divide the workforce. He regularly incorporated other tactics of intimidation and delay into his highly successful consulting practice. The majority of anti-union consultants deny any knowledge of or responsibility for labor law violations that occur so regularly during organizing campaigns. Jackson-Lewis, one of the largest law firms specializing in union avoidance practice, was recently sued by a client for legal malpractice. (EnerSys Delaware Inc. v. Jackson Lewis LLP, Civil Action No. 2004-CP-23-2685 (South Carolina, 13th Circuit) April 23, 2004) The client, EnerSys, claims Jackson Lewis counseled the company to fire seven pro-union employees, fire supervisors unwilling to intimidate or coerce employees, threaten to close a South Carolina factory, refuse to bargain with the union and illegally support a decertification campaign. EnerSys agreed to a $7.75 million settlement with the union and employees following multiple unfair labor practice charges and lawsuits. Fred Feinstein, former General Counsel of the NLRB commented, "What makes this case so unusual is the public exposure by an employer of the strategies often used to crush unions or prevent their formation."
Experienced union consultants frequently review the docket book at NLRB regional offices, and often become aware that a union has filed a petition for recognition even before the employer receives notification from the NLRB. The consultant contacts the employer, informs him or her of the organizing effort, and attempts to convince the employer that his ongoing access to the same variety of ‘insider information’ will help that employer defeat the organizing drive. According to reformed union-buster Marty Levitt, the panicked employer is almost always willing to pay a high price for the consultant’s services and eagerly turns over complete control of the workplace. The consultant’s first task is to command the loyalty of front-line management and supervisors by convincing them that the union organizing drive is an indication of their failure and the NLRB certification election is a referendum on their job performance. This tactic inevitably works to pressure supervisors to carry out the unsavory tactics of intimidation and delay necessary to defeat the union organizing campaign.
Using supervisors as ‘foot soldiers’ to deal directly with employees during the anti-union campaign is not only effective, but it also protects the consultant from having to report his union-busting activities to the government. The 1959 federal Labor Management Reporting and Disclosure Act (LMRDA) is intended to require anti-union consultants to disclose their activities to the Department of Labor. The consultant will invariably use the employer’s managers and supervisors to implement the anti-union campaign, thereby avoiding direct contact with employees. Using supervisors to implement resistance tactics is strategically preferable because their position of power in the workplace is inherently intimidating and coercive. However, consultants use supervisors rather than contacting employees directly primarily to avoid the disclosure requirements of the LMRDA by taking advantage of a loophole. An ‘advice exemption’ carved out of the LMRDA allows union-consultants to direct and execute counter-organizing campaigns without having to disclose their activities to employees targeted by their campaigns, the government and the public. The ‘advice exemption’ is yet another example of a scurrilous statutory interpretation of labor law that serves to undermine the Congressional purpose of legislation designed to protect workers’ rights.
LABOR LAW REFORM - UNIONS ABANDON THE NLRB PROCESS AND FIGHT FOR EMPLOYEE FREE CHOICE ACT
A functional legal framework will discourage management interference with employees’ collective decision whether to organize. An efficient legal framework will minimize transaction costs and strategic behavior associated with the establishment of the collective bargaining relationship. Recent proposals for labor law reform seek a functional and efficient alternative to the broken NLRB certification process.
Unions Are Abandoning the NLRB Process and Seeking Voluntary Recognition
Unions are choosing to opt out of the NLRB certification process. The American labor movement is organizing new workers at an increasingly rapid rate while simultaneously fewer unions regularly file election petitions with the NLRB. More workers are gaining collective bargaining rights in spite of and outside of the legal structure that was designed to accomplish that end. Unions are organizing many new workers through the voluntary recognition process. Employers opt-out of the employer friendly NLRB certification process for a variety of reasons. Sometimes, employers agree to voluntary recognition procedures with unions out of a desire to avoid hostile conflict and preserve labor peace. In other instances, employers cooperate with unions in order to have help achieving a mutually beneficial political goal. Employers with an organized group of employees at one worksite are more likely to sign a voluntary recognition agreement with the same union seeking to organize a new worksite.
Often, employers are unwilling to give up the advantages of the NLRB certification process by agreeing to voluntary recognition. Many unions run so-called ‘comprehensive’ or ‘community’ campaigns in order to pressure employers into recognizing the union on the basis of signed authorization cards – without an NLRB certification election. Without a statutory framework that requires employers to recognize majority support for unionization, unions are sometimes dependant on tactics that pressure employers into agreeing to voluntary recognition of the union based on card-check. Many of these tactics increase hostility between employer and employees and also require unproductive expenditure of resources that from an economic standpoint are considered transaction costs. Effective labor law reform will reduce or eliminate the transaction costs associated with both employer resistance strategies and union comprehensive campaigns. Reduction in transaction costs and the promotion of collective bargaining can both be accomplished through statutory reforms that require employers to recognize majority support on the basis of signed authorization cards.
Without a statutory requirement that employers recognize majority support on the basis of signed authorization cards, unions use comprehensive campaigns to pressure employers into signing voluntary recognition agreements. Voluntary recognition agreements are binding promises to recognize the union when presented with a majority of authorization cards. Often, voluntary recognition agreements are coupled with neutrality agreements, which essentially entail a promise from the employer not to engage in overt union resistance tactics. Empirical data concerning the prevalence of comprehensive campaigns and the costs associated with their execution are not currently available. However, brief discussion of two recently executed comprehensive union campaigns will provide some insight into the high degree of conflict and inevitable loss of productivity associated with their implementation.
University of Miami Janitors
In Miami, Florida, the Service Employees’ International Union set out to organize university janitors who were paid little over five dollars per hour without health benefits. In addition to organizing the janitors themselves, the union organized students, clergy, and concerned members of the Miami community. Catholic clergy held mass in support of janitors and an Episcopal church donated office space to the union. Students occupied university buildings and sympathetic faculty moved classes off campus. Janitors went on unfair labor practice strike to protest the illegal discharge of several pro-union workers. Janitors and allies blocked traffic on major roadways. A janitor hunger strike garnered nation-wide publicity. The Miami Herald and other media ran articles critical of University President Donna Shalala, who refused to intervene in what she described as a labor dispute between the janitors who cleaned university buildings and the employer, a contractor in Massachusetts. The pressure and disruption caused by SEIU’s comprehensive campaign eventually forced a reluctant Shalala to demand that the Massachusetts contractor agree to voluntary recognition on the basis of signed authorization cards. At the end of this painful and disruptive process, over seventy percent of the UM janitors submitted signed authorization cards in support of unionization and their union was recognized.
Janitors in Houston, Texas
In Houston, Texas, the Service Employees’ International Union ran a similar campaign to organize janitors employed by several companies that provided janitorial services to urban office buildings. Janitors went on a month-long unfair labor practice strike that garnered local and national media coverage. The contractors eventually bowed to community pressure and agreed to voluntary card-check recognition after police on horseback were videotaped riding through a peaceful crowd of picketing strikers comprised of women and men of all ages. Houston janitors won recognition for their union and began bargaining a first contract before their broken bones and bruises were fully healed.
During comprehensive campaigns, inconvenience and disruption affecting third parties to the labor dispute put pressure on the primary employer and this is often a primary factor in compelling the employer to agree to voluntary card check recognition. A reporter accurately described this phenomenon as it played out in Houston:
Throughout the strike, the SEIU applied more pressure to the owners of the buildings cleaned by the Houston janitors than to the cleaning contractors that employ them. Building owners ultimately have to absorb the cost of higher wages and benefits for janitors, and the union accused this oil-enriched business community of hoarding energy profits while keeping janitors in poverty.
Amendments to the NLRA that prohibit so-called ‘secondary boycotts’ were designed to promote industrial peace and eliminate an effective organizing tool for unions by making it illegal for unions to apply pressure to any party other than the employer with whom the union engaged in a primary labor dispute. While unions are in some respects disadvantaged by an inefficient and broken NLRB certification process, the alternative comprehensive campaign provides opportunities to apply pressure to parties other than the employer that would not be possible in an NLRB process. Nevertheless, the resources unions are forced to spend on comprehensive campaigns is better spent providing good representation or organizing new workers. In order to promote industrial peace, the NLRB certification process must be reformed to provide real opportunity for collective bargaining under a well-regulated process that minimizes transaction costs, hostile strategic behavior, loss of production time and widespread economic disruption to whole communities.
THE EMPLOYEE FREE CHOICE ACT (EFCA)
Effective labor law reform will not require replacing the NLRA, but should restore the spirit of the Act by modifying the legal framework in a manner that will advance its two-part purpose: promotion of collective bargaining and industrial peace. At a minimum, effective reform must include provisions to deter illegal employer intimidation and tactics of delay that essentially constitute bad faith bargaining. A legal framework that reduces opportunities for employer resistance will simultaneously eliminate the need for unions to resort to disruptive tactics associated with comprehensive campaigns in order to win recognition. Labor law reform that will encourage collective bargaining and reduce the inefficiencies associated with the NLRB certification process must eliminate or reduce the high cost to employees, employers and third parties associated with strategic behavior and hostile conflict that inevitably accompany employee efforts to demonstrate majority support.
The Employee Free Choice Act, which will be at at the top of the new Democratic Congress’ legislative agenda, is designed to restore the ability of employees to make a free and uncoerced choice regarding unionization while reducing the negative economic effects associated with the conflict ridden NLRB certification process. The EFCA includes three major legislative proposals that would promote cooperative collective bargaining, discourage wasteful strategic behavior and lower transaction costs now associated with the NLRB certification process.
First and foremost, the EFCA would institute mandatory card check for determining majority support for union representation. The process by which employers would gauge majority support after implementation of EFCA will be quick, simple and efficient. Disputes over composition of the bargaining unit would be settled by binding arbitration. If the majority of employees in a bargaining unit sign union authorization cards, the union could petition the NLRB for recognition. The employer would have the choice to voluntarily recognize the union, but their failure to do so would no longer automatically trigger the NLRB certification process. Instead, the NLRB would investigate the authorization cards and any other evidence of majority support accompanying the petition for recognition. The NLRB would certify the union upon its determination that the union has demonstrated majority support through valid signed authorization cards. This approach would eliminate the costly conflict ridden pre-election campaigning period during which workers now face coercion and intimidation and employers are encouraged to spend vast sums on union avoidance consultants.
Second, the EFCA would establish effective penalties and remedies for employer coercion and intimidation. Weak remedies provided for by the current framework include meaningless ‘cease and desist’ orders and relatively light backpay awards that employers absorb as a cost of doing business. The Act would provide for significant monetary penalties for employers who commit unfair labor practices that interfere with employee rights. An employer who discharges an employee in retaliation for union support would pay triple backpay. Fines of up to $20,000 could be assessed against an employer who makes plant closing threats, conducts illegal surveillance, makes unilateral changes or offers bribes. Under the current legal framework, only the NLRB is empowered to petition federal courts for injunctions to prevent multiple unfair labor practices during an organizing drive. The EFCA would permit employees to petition federal courts directly for an injunction to prevent employers from committing multiple labor law violations and would require the NLRB to petition for a 10(j) injunction where the Board has reason to believe an employer illegally discharged or discriminated against a pro-union employee.
Finally, the EFCA would include provisions designed to counteract employer tactics of delay, including deliberate refusal to bargain and frivolous litigation. After a ninety day period following certification or voluntary recognition of the union, the employer or union would be able to request mediation from the Federal Mediation and Conciliation Service (FMCS). If the FMCS mediation did not produce an agreement after thirty days, employer or management would be entitled to demand binding arbitration. No longer would employers be able to engage in surface bargaining or refuse to bargain with the goal of prolonging an agreement until frustrated employees seek decertification. Mediation and binding arbitration provisions would eliminate most opportunities for wasteful strategic behavior by either party. These provisions would preclude strategic behavior in the post certification period in the same way that meaningful penalties and mandatory card check would prevent strategic behavior in the pre-certification period.
Anti-union employer groups have already begun a campaign to defeat the reforms called for in the Employee Free Choice Act. The Right to Work Foundation has taken a lead role in litigation before the current employer-friendly NLRB designed to undermine voluntary recognition and outlaw neutrality agreements. In agreeing to hear a case sponsored by the Right to Work Foundation a Republican-appointed majority on the Board stated: "We believe that the increased usage of recognition agreements, the varying contexts in which a recognition agreement can be reached, the superiority of Board supervised secret ballot elections, and the importance of Section 7 rights of employees, are all factors which warrant a critical look at the issues raised." (Dana Corp. and Metaldyne Corp., 341 NLRB No. 150 (June 7, 2004))
On the legislative front, the Right to Work foundation is leading a coalition of anti-union lobbyists and business interests in opposition to the EFCA. They argue that secret ballot elections are a necessary ingredient to a fair determination of employee choice and that card check campaigns leave employees more vulnerable to coercion. Empirical evidence suggests the opposite. A survey commissioned by the organization American Rights at Work and conducted by the Eagleton Research Center at Rutgers University contacted over four hundred employees selected randomly from worksites where union organizing campaigns used authorization cards and/or the NLRB certification process. Of all workers surveyed, including workers from worksites where card check and the NLRB certification process were used, four times as many workers (22%) reported that management tried to coerce them as opposed to the union (6%). Forty-six percent of workers involved with NLRB certification elections complained of management coercion compared to only 23% in campaigns using authorization cards and voluntary recognition. Only 4% of workers who signed a union authorization card reported that the presence of the union organizer made them feel pressured to sign the card. Finally, workers in campaigns using authorization cards and voluntary recognition were nearly twice as likely as workers involved in an NLRB certification election to report that management left the decision to form a union up to the workers – 62% compared to 33%. Empirical studies have established that voluntary recognition based on signed authorization cards is a better process for protecting employee free choice than the NLRB certification election.
CONCLUSION
If the labor policy of the United States remains the promotion of collective bargaining and industrial peace, the Employee Free Choice Act is a reasonable and uncomplicated solution to the decline in collective bargaining and corresponding rise in labor-management confrontation. The Employee Free Choice Act is good policy. The reforms proposed in the Employee Free Choice Act would promote a more fair and efficient process of determining employee choice regarding unionization and would restore meaning to the preamble of the National Labor Relations Act.
The Employee Free Choice Act makes good economic sense. It would eliminate the need for wasteful spending on anti-union consulting firms. The Employee Free Choice Act would reduce the need for unproductive and often hostile strategic behavior on the part of unions and employers during NLRB certification campaigns. Finally, and perhaps most importantly, the Employee Free Choice Act would reduce the length and intensity of organizing drives and first contract fights so that management and labor would be able to begin a cooperative relationship with the goal of maximizing productivity for mutual benefit.