Financial Week, November 9, 2008, Sunday

Financial Week

November 9, 2008, Sunday

Financial Week

Unions: It's time to cash check
After spending $400 million on the election, Big Labor wants easier organizing laws

By Neil Roland

As the labor movement seeks to cash in on its huge contribution to Barack Obama's presidential campaign, business groups are trying to play out the clock on legislation to ease union organizing—even citing the credit crisis as a reason to put any new organizing laws on hold.

A bill pushed by labor would give unions rather than companies the choice of having workers vote to organize by signing cards rather than using secret ballots. Opponents worry that union strong-arming could intimidate workers who don't want to openly vote against an organizing effort. But proponents cite studies they say support unions' contention that employers have been using their own strong-arm tactics to deter workers from organizing.

The legislation passed the House last year but stalled in the Senate after a Republican filibuster. It has gained new momentum after labor spent $400 million on the election and assigned 250,000 volunteers who helped drive states such as Ohio, Indiana and Pennsylvania into Mr. Obama's column.

After the election, the U.S. Chamber of Commerce and the National Association of Manufacturers came out with guns blazing.

In a 14-page letter to the president-elect, the manufacturers' group said the Employee Free Choice Act is “anti-worker.” The bill “interferes with the democratic process and would have a negative impact on the rights of manufacturing workers,” the letter said.

Not to be outdone, the Chamber held a press conference last week at which its president, Thomas Donohue, said the bill would increase employers' costs and should take a back seat to legislative efforts to stimulate the economy. “We should wait until after we get economic stabilization and get more people back to work,” Mr. Donohue said.

He warned that the Chamber was not open to compromise and would mobilize its grass roots and use advertising to oppose the bill. The Chamber has already spent “in the single-digit million-dollar range” on advertising against the bill this year, spokesman Justin Hakes said.

Andy Stern, president of the Service Employees International Union, said his group and the umbrella AFL-CIO want the bill passed as soon as possible. “We have the greatest inequality in the history of our country, the middle class is shrinking, and there's not a minute to wait,” he said.

Current law lets companies decide whether unions should be allowed to organize workers through a secret ballot or by getting a majority to sign cards. Labor favors card-signing because it can be done off-site without an employer's knowledge.

Senate Republicans might successfully filibuster the bill again if it is introduced, said one political scientist.

“The public is wary of where unions are these days, so that Republicans can safely filibuster on this without seeming too obstructionist,” said Bruce Cain, director of the University of California's Washington center.

Both labor and business should be open to compromise if it looks as if the bill can't get through Congress, said Thomas Kochan, a management professor at the Massachusetts Institute of Technology.

“An impasse would perpetuate the terrible adversarial environment, and you wouldn't be able to drive improvements in worker innovation and productivity,” he said.

Some academic studies have found that employers use a variety of tactics to intimidate workers who want to organize.

One out of every 17 eligible voters in National Labor Relations Board elections is fired, suspended, demoted or otherwise economically punished for supporting unionization, according to a two-year study by Oregon University political science professor Gordon Lafer.

“The system is profoundly broken, profoundly undemocratic and, I would say, profoundly un-American,” Mr. Lafer told a congressional committee last year.

Some employers use one-on-one meetings to tell workers to vote against the union, he said. Others delay union elections for months, bar unions from access to employee lists and plaster workplaces with anti-union posters while prohibiting unions from posting.

Cornell University labor professor Kate Bronfenbrenner said employer intimidation is getting worse because globalization enables managers to use the threat of outsourcing, and improved technology allows electronic surveillance.

Chamber of Commerce lawyer Charles Cohen has countered that unions typically win 60% of all elections involving new organizing, the same rate as 40 years ago. FW

Write to Neil Roland at nroland@financialweek.com. Or write to the editors at fw_editor@financialweek.com.