In City Journal, Claire Berlinski looks at the effects of the so-called Employee Free Choice Act (EFCA) by looking at a precedent of EFCA in reverse, in Great Britain early the Margaret Thatcher’s government.
Thatcher put reform of the trade union law at the top of her agenda. Among the key provisions of Britain’s 1980 Employment Act was a change in the way government would recognize unions. At the time, workers voted to join unions—or not—in public, by voice vote. Dissenters suffered harassment and physical intimidation. Henceforth, Thatcher decided, new union membership agreements would require approval by means of a secret ballot in order to protect rank-and-file workers from bullying by union organizers. If allowed to vote secretly, she believed, ordinary workers would not vote for policies against their long-term interests—such as pay raises so incommensurate with production as to render British businesses uncompetitive, or strikes so prolonged as to make even the Soviets unwilling to buy British goods.
Thatcher was right. As soon as the secret ballots were introduced, many workers began defying the trade union leadership and rejecting the unions’ ruinous policies. When she had taken power, Britain was the second-poorest nation in Europe. Her reforms led to the longest sustained period of British economic expansion of the postwar era. In the past decade, as a direct consequence of her augmentation of labor-market flexibility—in layman’s terms, her smashing of the trade unions—the Organisation for Economic Co-operation and Development has ranked Britain at the top in both output and inflation stabilization.
With unified Democratic control of government looming, America may be set to go back to the economic insanity Britain left behind. But that’s not all.
As if eradicating secret ballots weren’t bad enough, the EFCA contains a still more ominous provision: it vastly increases the role of government in settling labor disputes. The act stipulates that, if an employer and a union cannot agree on an initial contract within 90 days, either party may ask the Federal Mediation and Conciliation Service to intercede in the negotiations. If no deal is reached after 30 days of federal mediation, the feds will assign an arbitrator to work out an agreement. The arbitrator’s decision will be final and binding for two years. Workers will not get the chance to ratify the agreement, by secret ballot or otherwise.
In effect, the federal government will gain the power to dictate the terms of a contract and to set wages, benefits, hours, and work rules. Because negotiations for new contracts almost always take more than 120 days, this provision will ensure a significant expansion of government into the private sector. It’s absurd to imagine that even the most well-meaning government arbitrator would be sufficiently familiar with the day-to-day operations of a company, or the industry in which it operates, to make contract decisions as wisely as the company’s owners and employees would.