The debate over the Employee Free Choice Act

BY NATALIE MARSH AND KEVIN CHEN

As the nation continues to wade through its worst recession since the 1930s, interest groups and policymakers are gearing up to fight over the Employee Free Choice Act (EFCA), a bill that seeks to significantly reshape federal labor law. While history tells us that periods of economic hardship have helped bring about powerful labor reform and assert workers’ rights, EFCA’s passage is anything but certain. With powerful rhetoric —and plenty of money — coming from the left and the right, the Act is soon becoming one of the most divisive and hotly contested pieces of legislation this year.

Introduced in the House of Representatives in 2007 by Congressman George Miller (D-CA), the act offers three important changes to the National Labor Relations Act. First, it would allow unions to form immediately if a majority of employees sign union cards. Under current law, the card-signing process is followed by a secret ballot election that then determines if a union is legally recognized. Second, if an employer and a union negotiating over a labor contract cannot reach an agreement within 90 days, the bill would require the dispute to be solved through binding arbitration. Finally, the bill calls for stricter fines and penalties for employers that violate labor law.

The act passed the House in 2007, carried largely by Democratic votes, but is currently stalled on the Senate floor where Democrats still lack the 60 votes needed to close debate and vote for the bill’s passage. Democrats came close to ending debate in late March, but were surprised by Senator Arlen Specter’s (R-PA) sudden decision to switch sides on the issue.

"The problems of the recession make this a particularly bad time to enact Employees Free Choice legislation," Specter said during a floor speech on March 24 explaining his decision. "Employers understandably complain that adding a burden would result in further job losses."

Since Specter’s defection, supporters and opponents of EFCA have each begun massive campaigns in hopes of influencing the bill’s final outcome.

Proponents of EFCA, which include all major unions and most Democrats in Congress, argue that it will finally level the playing field between employer and employee in an era where wages have stagnated and union membership has declined. In particular, they argue that the card signing, or "card check," provision, will help workers unionize without facing threats from their employers. While the idea of union elections sounds fair, pro-union groups say that in reality they allow employers to coerce employees out of unionizing. According to the AFL-CIO, "78 percent of companies require supervisors to deliver anti-union messages to the workers whose jobs and pay they control" and "corporations routinely intimidate, harass, coerce and fire people who try to organize unions." A report by the Center for Economic and Policy Research found that in 30 percent of union elections, at least one worker was fired for supporting unionization.

By allowing employees the option of forming a legal union by obtaining a majority of signed cards, EFCA would hopefully eliminate these employer practices that unfairly discourage workers from unionizing.

"Allowing workers to unionize as they have a right to do under the law is a key point and purpose of [EFCA]," former labor secretary Robert Reich said on a press call with the Center for American progress in February.

In addition, Reich countered Specter’s argument that enacting this legislation would further harm the American economy.

"Unions matter," Reich added. "Workers in unions earn 30 percent higher wages and are more likely to receive benefits. Workers want to be in unions…if [workers] have higher wages and higher benefits, they would have the purchasing power they need to buy the goods and services that this economy produces — and that would strengthen the economy overall."

Pro-labor groups have spent millions in lobbying and advertisements in their campaign to pass EFCA. According to OpenSecrets.org, organized labor spent $80 million in the 2008 election cycle with this goal in mind.

But supporters of EFCA are equally matched by their opposition, many of whom claim that the act actually works against the interests of both employees and employers. In a report originally released in April 2007, the Heritage Foundation concluded that the legislation would actually "take away workers’ rights." The card check, it argues, "strips workers of both their fundamental right to vote and their privacy. Both the union and the employer would know exactly which workers want to join the union, leaving workers vulnerable to threats and intimidation."

The report also found problems with the other two key provisions of the bill: the arbitration provision allows untrained bureaucrats to determine proper wages and the higher penalties for employers are unfair because the penalties for union misconduct would not also be increased.

Opponents of EFCA include many prominent Republicans, the U.S. Chamber of Commerce, and other business groups. Many feel that the bill is really a ploy to benefit the big unions and their bosses. The changes, they argue, would let workers hear "only one side of the story" and bring more cash into the pockets of union bosses. Former Massachusetts Governor Mitt Romney is among those against the bill for this reason.

"This is not just a matter of ‘oh, let’s help the working folks,’ " Romney said in a conference call with the Workforce Fairness Institute on April 13. "That’s not what this is. This is a matter of: ‘let’s get the money for the unions.’…This is about money and about politics and it is sacrificing the rights and freedoms of the American worker to be able to get big bucks for the unions bosses."

One critic, University of Chicago law professor Richard Epstein, went so far as to call the EFCA "unconstitutional." In an op-ed piece published in the Wall Street Journal in December, he argued that the card check provision "denies all speech rights to the unions’ adversaries," (First Amendment) while its arbitration provision violates an employer’s right to refuse to negotiate with unions (Epstein found this to be a violation of the Takings Clause of the Fifth Amendment).

Like its pro-labor counterparts, the anti-EFCA coalition has also spent a great deal of time, energy, and money to defeat this legislation. In April, the Chamber of Commerce spent $1 million on a national television spot that highlighted the act’s damaging effects on businesses of all sizes. Moreover they have publicized plenty of research, like the Heritage Foundation report, that asserts EFCA does much more harm than good.

One coalition of large corporations including Starbucks, Costco Wholesale Corp. and Whole Foods Market, opposes the EFCA but offers an alternative proposal that is sort of a compromise between the two groups. Their plan would eliminate the card check and mandatory arbitration, but enact the harsher employer penalties mentioned in the act. But unfortunately, labor groups say this plan accomplishes nothing by abandoning two key provisions of EFCA and pro-business groups argue that the plan penalizes employers without recognizing union abuses.

It seems that the future of EFCA will be yet another difficult task for the Obama Administration, but securing its passage may be just out of the President’s range. Though President Obama co-sponsored the bill when he was in the Senate and has since expressed his interest in its passage, he can hardly risk throwing all his weigh behind such a contentious bill at a time when he needs as much cooperation as possible in Congress. The future of this bill — and perhaps next decade of labor-business relations — looks like it will be decided in a very close fight indeed.

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