Time for a Raise

Time for a Raise

June 22, 2009
Originally published in The American Spectator

Are Democrats in Congress really not supporting a Republican bill to allow union workers to earn more money? That was not a misprint: Republicans in Congress are fighting to give union workers raises while Democrats are sitting on their hands.

In America if someone works hard most of the time they get ahead and are rewarded for their effort. Unfortunately this is not the case in many union workplaces. Federal law bars millions of union workers from receiving wage increases every year and the Republicans in Congress are trying to do something about it. Earlier in June Rep. Tom McClintock (R-CA) and Sen. David Vitter (R-LA) introduced the Rewarding Achievement and Incentivizing Successful Employees Act, or RAISE Act, to allow union workers to earn raises based on merit. As of this writing not a single Democratic senator or congressman has co-sponsored the bill, which is surprising since according to the nonpartisan Opensecrets.org organized labor has contributed over $670 million to Democrats since 1990 and only about $51 million to Republicans.

Currently, a union worker’s wages are dictated by collective bargaining agreements made between a union and an employer. The collective bargaining agreements not only create a floor for worker’s wages but they also establish a ceiling. The vast majority of these agreements grant pay increases on seniority but not merit, in other words, no matter how hard an employee works the only way they can see an increase in their salary is by longevity.

The National Labor Relations Board, the federal agency which oversees union bargaining, and the courts have held that employers with collective bargaining agreements can only deal with a union and not with an individual employee. This means in most cases an employer cannot reward a union employee for being more productive without violating the National Labor Relations Act (NLRA.) 

The RAISE Act would amend the NLRA to allow employers to pay productive workers more than the base amount set in the union’s collective bargaining agreement. James Sherk, a fellow in Labor Policy at the Heritage Foundation, asserts that if the RAISE Act becomes law, union worker’s earnings could rise by between $2,600 and $4,300 per year. Compared to the recent Obama temporary tax cuts, the RAISE Act could allow union members to earn almost eleven times as much this year as they will be receiving from the latest short-term tax decrease.

Why are Democrats not rallying behind a bill that could help so many of their largest supporters? It may be because much of labor contributions come from political action committees and other entities bundling cash and not directly from individuals. The RAISE Act is focused on the individual not a large organization. It allows an individual to achieve and be rewarded by his own hard work and not be lumped into a larger group which may not value or recognize his individual skill or effort. Currently, contributions from big labor focus on the large scale union and not the worker. The way many politicians receive cash from big labor may force them to put the desires and needs of the union ahead of the individual worker. The RAISE Act puts the priority on the worker not the union, which may be why many of big labor’s top contribution recipients have not supported it.

The wage ceiling fails to incentivize workers and harms companies. A manager or employer is prohibited from rewarding union members who are more productive and work harder than minimally required. Workers currently lose opportunities to be compensated for their extra efforts, which may result in a lack of motivation that is needed to make a company successful. Removing the wage ceiling mandated by the NLRA and collective bargaining agreements will allow both the worker and the employer to see greater income and proponents of the bill argue, will significantly help the economy at large.