How to end the ‘free rider’ problem with union representation 

Congressman Rick Allen (R-GA) has re-introduced the Employee Rights Act, legislation that would codify several individual workers’ rights, such as guaranteeing the right to secret ballots during union elections. The legislation is a good idea that the Competitive Enterprise Institute has supported in the past. This latest version improves on the effort by making things fairer for unions as well. Specifically, it relieves them of the responsibility to represent the workers who dissent. 

It’s an olive branch to unions that addresses one of their main complaints regarding this type of pro-worker legislation: That the proposals would create a “free rider” problem where workers get the benefits of union membership without having to contribute anything to the union. 

Currently, 26 states have “right-to-work” laws which state that workers cannot be coerced into joining or otherwise financially supporting a union if they want to keep their jobs. In other non-right-to-work states, the union’s contract with management typically includes so-called “security clauses” that require workers to contribute or be fired. 

Unions argue that since the National Labor Relations Act (NLRA) requires them to be the exclusive representative for all workers during contract negotiations, even those who haven’t officially joined, it’s only fair that those workers be required to contribute to the union. Otherwise, the argument goes, those workers are free riding on the backs of the workers that support collective bargaining. 

This “exclusive representation” requirement means that workers invoking right-to-work laws can still find themselves under the thumb of a union. Any demand workers have regarding management, such as asking for a raise or an adjustment to their work schedule, must be dealt with through the union. If those workers aren’t dues-paying members, well, the union isn’t likely to jump to it when they need assistance. So, even in right-to-work states, workers may be obliged to join a union they disagree with just to get things done. 

The Employee Rights Act, among other provisions, addresses this issue in two ways. It guarantees the right of workers to directly negotiate with management. It further ensures that in cases where workers opt out of union membership, the union isn’t obligated to work on their behalf.  

In short, the legislation eliminates exclusive representation entirely. Unions become like any other membership-based organization: the benefits of joining–collective bargaining for wages, the ability to pursue grievances against management, and so on–become exclusive to members. Workers can opt out, but they’re on their own if they do. 

It’s a fair compromise that empowers workers by giving them more choices. They can still join in collective bargaining with their fellow workers if they want or go it on their own if they think they can do better. It may prove to be beneficial to unions as well. It will prod them to become more customer-oriented towards their members, rather than taking them for granted. A union won’t have the drain of providing for non-members. Unions that can prove they’re doing well by their members will have a solid recruitment message.