Employee Free Choice Act: From Beltway to Main Street
If you have a real thing for wonky Beltway policy debates, then you know about the Employee Free Choice Act, a bill hailed by the left as an essential step to rolling back poverty and decried by the right as an affront to healthy capitalism. The bill passed in the House but stalled in the Senate last summer, but now people outside Washington are going to hear more about this issue as states are going to consider passing their own version. The Small Business & Entrepreneurship Council recently announced that any state that enacts something like the Free Choice Act will get negative points in the SBE Council's yearly index of how healthy the climate in certain states is for small businesses and entrepreneurs to thrive.
The Employee Free Choice Act would allow employees to vote on whether or not to unionize with an open system of signing cards, as opposed to the secret-ballot process that is the status quo. It sounds arcane, but the basic debate when it comes to small business is this: Is a process that would effectively increase union members a good thing? The SBE Council gives some reasons to think not:
Card-check, which eviscerates the current right employees have to cast a private vote regarding whether they want union representation or not, enables abusive organizing tactics. This mandated approach to union organizing—where everyone in the workplace would know how each individual feels about union representation—will only serve to establish an environment that is ripe for harassment and underhanded tactics. This unfair, turn-key approach to forced unionization will be especially burdensome and costly for small businesses.... The 'card-check' bill would boost the level of unionization, increase costs, and restrain productivity. That, of course, means that businesses become less competitive. Of course, in the long run, both business owners and employees would suffer.
A problem with considering just how much something like the Employee Free Choice Act affects small business is that the subject of union membership in small businesses seems like a critically understudied issue. I gave the Bureau of Labor Statistics a call, and it said it doesn't collect any data on whether or not union members work for small businesses, and if they don't do it, probably no one else does, either. If we can't know that, it seems equally hard to predict just what would change if card-check was allowed.
Maybe the only answer is to see what the actual people on the ground think. Any small-business people out there, what are your thoughts on unionization? Do the proposals in this bill worry you?
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Reader Comments
YES!
These proposals scare me soooo bad!
Small Business and Federal Labor Law
Mom and Pop shops don't have enough employees to organize a union.
Our big box competitors like Wal-Mart do, but routinely violate labor laws because there are no financial penalties. The Employee Free Choice Act adds penalties to flatten the playing field for those companies that follow the law, or are exempted from it from lack of employees or insufficient interstate trade ($500k). According to the National Federation of Small Business the typical small business has less than 3 employees and less than $500K gross.
Secret Ballot elections aren't very secret in small companies where employees all know each other. In a large national corporation where employees are anonymous maybe they make sense. But that isn't a small business, is it?
Has the Small Business & Entrepreneurship Council ever advocated to exempt more small businesses from Federal Labor Laws by inflation adjusting the interstate commerce rate from $500,000 which was set in 1959, or do they only act as a shill for big business and the GOP?
Unions in Small Businesses
The debate about EFCA seems to center around the card-check provision of the law. However, The second component of EFCA is FAR more dangerous to America's employers and workers: That is the binding arbitration provision that mandates if a company and a union cannot reach a contract within 120 days after the union is certified that a government-imposed arbitrator (not market conditions or economic weapons) will determine what the contract between the employer and the union shall be. And workers will not be able to vote on that, nor will they be allowed to strike. This, in itself, runs counter to America's free-market economy and will be the ultimate job killer. Large companies can outsource, small businesses will just close.
With reference to statstics, nearly all businesses in the private sector with two or more employees can fall victim to unions. Although the stats on whether the business is small or not are unobtainable, another way you can get a sense of the size of the company is the the National Labor Relations Board election statistics. The NLRB does keep track of bargaining unit size.
Also, an area that people don't seem to understand is just how easy it is to get union authorization cards signed. Even today, under current law, union organizers are legally allowed to make workers promises (that they have not power to guarantee) in order to lure workers into signing a card, or voting to unionize. If the worker falls for it and the union later breaks its promise or fails to deliver, there is nothing the worker can do.
At least in today's climate, the employer can at least try to counteract the kool-aid workers are subjected to when signing cards by educating workers prior to a secret-ballot election.
The hallucinogenically-named Employee Free Choice Act is poisonous for small and large business...and their workers.
If you want more information on EFCA, you can check out http://www.EmployerReport.com
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