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OpenMarket: Private Unions

  • Federal Labor Agencies Attack Workers and the Economy

    August 27, 2015 1:10 PM

    Today, CEI released a report on the Obama administration’s effort to pay back its union allies by way of federal labor agencies.

    The National Labor Relations Board and Department of Labor are using their regulatory and adjudicatory powers to prop up labor unions that are experiencing a decades-long decline in membership. Not only do the agency actions serve as political payback to a special interest group, the rules and decisions severely disrupt the workplace and how companies do business. Further, the actions stand in stark contrast to the NLRB and DOL’s missions to protect worker rights, not benefit special interest groups like Big Labor.

    And this regulatory barrage could not have come at a worse time. Currently, 6.5 million workers are seeking full-time employment, but federal regulations have subjected them to part-time work. In addition, labor participation rate is at a 38-year low of 62.6 percent. Worse, federal agencies upsetting common business practices via regulation is a surefire way to keep the below-average employment numbers where they are.

    The report focuses on three significant actions coming out of the DOL and NLRB: DOL’s proposed overtime rule change, NLRB ambush election rule, and the upcoming NLRB joint employer decision.

  • NLRB Denies Petition to Form College Athlete Union, for Now

    August 18, 2015 12:37 PM

    The National Labor Relations Board (NLRB) yesterday denied a petition by Northwestern University football players to form a union. While this is a rare show of restraint by a labor board that, under the Obama administration, has often acted like a pro-union advocate, the ruling is on such narrow grounds that it’s difficult to draw any broader conclusions from it.

    A ruling in favor of the Northwestern union petitioners would have affected all private schools in the National Collegiate Athletic Association’s (NCAA) top division, a mere 17 schools of 125. That raises the question: Would the Board have ruled differently if its decision were to apply across the board, or at least to the overwhelming majority of athletic programs?

    For more on the NLRB decision, see here.

  • The NLRB Declines Jurisdiction in College Athlete Unionization Case

    August 18, 2015 12:36 PM

    The National Labor Relations Board has declined the opportunity to rule on whether or not college athletes are employees and can therefore be unionized. The petition was brought by the College Athletes Players Association which desired election as the union for Northwestern University college athletes.

    CEI submitted an amicus brief in the case. In the brief, we pointed out the likely true motivation behind the push to unionize student athletes, and the problems it would cause for those students:

    [T]he United Steelworkers union is driving this whole initiative. The Steelworkers, one of the largest industrial unions in North America, are underwriting and financing the effort and have been trying to unionize students for a decade. The goal? Access to some of the millions of dollars associated with college sports. And Stanford, with its long and storied athletic history, is a prime target for the Steelworkers, with nearly 10 local union chapters in the area.

  • The Administration Is about to Upend American Business Practices

    August 13, 2015 7:45 AM

    It is probably the biggest change in American employment law since the National Labor Relations Act and its reform in the 1930s and ‘40s, but it could happen without the general public realizing it. The National Labor Relations Board (NLRB, a product of that 1930s legislation) is expected to rule any day now in a case that will affect thousands of businesses. Firms are bracing themselves for the fall-out.

    The case in point relates to Browning-Ferris Industries (BFI), which owns a recycling plant that hires employees from a staffing agency. The local Teamsters Union petitioned the NLRB to designate BFI as a “joint employer” of the workers alongside the staffing agency. Designation as a joint employer would mean that BFI would be liable for the employees’ working conditions alongside the staffing agency. That means they could be sued over contractual matters and working conditions.

    If the NLRB rules in favor of the Teamsters, it would have far-ranging effects for companies of all shapes and sizes. The start-up that employs a receptionist from a staffing agency would find it now “jointly employed” that receptionist. Your office that has cleaning staff come in from a different firm at night could easily find it jointly employing those cleaners.

    The whole American business model of contracting out non-essential services would be overturned overnight. Firms that have spent decades flattening their structures would be forced to vertically integrate. One employment owner told The Hill, “Every company will have to reexamine their business relationships… I’d rather be responsible for my own company than someone else’s.”

  • CEI Joins Coalition to Support Right-to-Work Protections in Missouri

    July 29, 2015 3:15 PM

    No individual should be forced to financially support an organization with which they disagree or risk penalty. However, in Missouri and 24 other states, private-sector employers and unions may agree to a contract provision known as a union security clause, which compels workers to pay union dues or lose their job.

    Currently, Missouri is considering becoming a right-to-work state, which would allow workers to opt-out of paying dues to a union they may not support without risk of termination.

    While worker freedom is the most important aspect of right-to-work protections, other benefits arise from such laws. In a recent study conducted by the Competitive Enterprise Institute, “Interstate Analysis of Right to Work Laws,” found that real personal income, over the duration the study analyzed (1977-2012), grew by 123 percent in the United States, but right-to-work states saw faster growth rate of 165 percent whereas non-right-to-work states only saw below average growth of 99 percent.

    With respect to Missouri, the study’s economic analysis showed that the Show Me State's estimated per capita income loss associated with not having a right-to-work law was $3,040.

    The Competitive Enterprise Institute along with 54 other organizations signed on to a coalition letter showing our support for right-to-work protections in Missouri.

  • Congress Gives Up Fight against NLRB Ambush Election Rule

    May 8, 2015 10:55 AM

    The Competitive Enterprise Institute planned on scoring the Senate’s veto override vote on S.J. Res. 8, a Congressional Review Act Resolution of Disapproval to void the National Labor Relations Board’s “ambush election” rule. Unfortunately, the Senate voted 96-3 to table the measure in order to focus on other business.

    While it was unlikely that Senate Republicans could have mustered the 67 votes needed to override President Obama’s veto, GOP members should have demanded a vote to put senators on the record on whether they support the special interests of labor unions or worker rights.

    The NLRB’s ambush election rule threatens workers’ freedom of association and privacy, while hampering employers’ abilities to educate employees on the impact of unionization in the workplace.

    Further, the ambush election rule is a regulatory solution in search of a problem that doesn’t exist. Labor unions already win 65.2 percent (FY 2013) of all union elections held. Labor unions win an even higher percentage of elections when employees have less time to educate themselves on unionization, and the main component of the rule is to drastically shorten the time period for union organizing elections, possibly to as little as 11 days after a union files a petition.

  • Theatrical Union Ignores Membership Vote to End Volunteering Exemption

    April 23, 2015 1:33 PM

    If a vote goes against you, ignore it.

    That is what a theatrical union did this week, when it announced it would ditch a longstanding plan that allowed actors to volunteer at small theaters.

    Actors’ Equity Association, which represents 50,000 actors and stage managers, recently held a non-binding referendum on whether to abandon a minimum wage exemption for theaters with less than 100 seats. Members voted against ending the exemption, known as the 99 Seat Theater Plan, by about a two-to-one margin. Granted, the referendum was non-binding, but it does show a union’s leadership going blatantly against the wishes of an overwhelming majority of its membership. 

    Some actors working in small theaters had asked for greater pay, reports Southern California Public Radio (SCPR), but Actors’ Equity’s proposed solution is about as heavy-handed a way to address the issue as could be. “I believe that there is an inequality inside L.A. theater and I think it should be fixed,” actor Ramon De Ocampo told SCPR. “But I don’t think it should be fixed with a sledgehammer. We need to scalpel it away to get that payment.”

    The sledgehammer metaphor is especially apt considering that many actors approach performing in small theaters as a job, but as a means to gain experience and sharpen their skills. As The New York Times reports:

    [H]undreds of union actors working in this city’s distinctive and thriving small theater scene are barely paid for their work. And, in an unusual twist to America’s economic fairness debates, many of them say they are O.K. with that.

    “None of us is here to make money,” Lynn Odell said recently as she rehearsed a science-fiction comedy at Theater of Note, a 42-seat theater that operates in a former auto-glass repair shop in Hollywood. “We are here for the experience.”

    The willingness of Los Angeles actors to perform for a pittance, hoping to hone their craft and, maybe, to catch the eye of an agent or manager, is now at the heart of an extraordinary rift in the union representing theater actors, and has opened a new front in the nation’s battle over the minimum wage.

    Ironically, a prominent defender the 99 Seat Theater Plan is Tim Robbins, an avowedly liberal Hollywood actor who happens to run a small theater.  

  • The $7 Billion Slowdown

    February 12, 2015 11:12 AM

    The ongoing logjam at ports on the West Coast could cost American retailers around $7 billion this year, according to the consultancy Kurt Salmon. That’s a lot of money, and huge disruption to the nation’s economy. Of course, it’s impossible to prevent disruptions, including large ones, from ever happening. The problem is that this one was not only easily foreseen, but preventable.

    The recent shutdown, and continuing backlog, has followed a similar pattern as past West Coast port shutdowns. That’s because labor at the ports functions as a cartel that can disrupt commercial shipping easily.

    Shippers must negotiate with the union as a group, through a trade group called the Pacific Maritime Association (PMA). The union, International Longshore and Warehouse Union (ILWU), represents dockworkers at ports all down the West Coast. (Unionized port workers on the East and Gulf coasts are represented by the International Longshoremen’s Association.)

    Like railroads and airlines, maritime shipping is a network industry vital to commerce. However, while labor relations at railroads and airlines are covered under the Railway Labor Act (RLA), which was designed to avoid major disruptions to commerce, ports are covered by the National Labor Relations Act (NLRA), which enables disruptions that the RLA doesn’t allow.

    “Railroad crews cannot decide to stop working on the tracks, and airline crews cannot withhold fuel from planes,” explains Diana Furchtgott-Roth of the Manhattan Institute. “But [port] workers can simply not show up for shifts in Los Angeles and Oakland in order to hold out for higher wages.”

    A clear solution would be for Congress to shift jurisdiction of ports from the NLRA to the RLA, much as it extended the RLA’s jurisdiction to airlines in 1936, 10 years after the original Act’s 1926 passage.

    American Action Forum President Douglas Holtz-Eakin explains:

    A cornerstone of the RLA is that its purpose, as stated in the statute, is to “avoid any interruption of commerce” while providing for “the prompt and orderly settlement of all disputes” that arise in labor matters. Labor contracts under the RLA do not expire. Instead, they become “amendable” and remain in force until a new agreement is reached.

    If negotiations are not productive, then federal mediation is required before either unions or employers can engage in “self help” like slowdowns, strikes or lockouts. The National Mediation Board, which oversees the process, says that 99% of all of its mediation cases since 1980 have been handled without interruption.

  • Congress Takes First Shot at NLRB Ambush Election Rule

    February 10, 2015 9:56 AM

    Congress established the National Labor Relations Board as a body made up of neutral arbiters to represent the public in labor disputes. Under the Obama administration, the Board has strayed from its required impartiality to issue rules and decisions that outright favor labor unions over workers and employers.

    An example of the Board unfairly administering national labor policy to advance the interests of labor unions is the implementation of its “ambush election” rule. 

    Specifically, the amendments to union election procedures significantly favor unions by limiting debate and time workers have to learn about the pros and cons of union representation. It does so by shortening the time frame between the filing of a petition and the date on which the election is conducted to as little as 11 days from a median of 38 days.

    Another component of the rule, which inappropriately benefits special interests and jeopardizes worker privacy, compels employers to hand over employees’ private information—cell phone, email address, and work schedule—to union organizers. 

    As I note in the Competitive Enterprise Institute’s agenda for Congress, “Government should not have the power to force employers to disclose workers’ contact information to a special-interest group for any cause. That [ambush election] rule would almost certainly expose workers—who would not have the choice of opting out of union organizers’ obtaining their information—to harassment, intimidation, and much higher risk of identity theft.”

  • NLRB Advances against McDonald’s

    December 23, 2014 12:21 PM

    By issuing complaints against McDonald’s on December 19, 2014, the National Labor Relations Board gave unions a boost and further riled business groups. On July 29, 2014, the National Labor Relations Board’s (NLRB’s) Office of the General Counsel had set the labor and employment world on fire by authorizing these complaints, which needed Friday’s Board approval to move forward.

    In essence, the Board itself has now preliminarily determined that the franchisor McDonald’s is a joint employer with McDonald’s franchisees and thus is liable for the actions of the franchisees, beyond just the opinion of the NLRB General Counsel.

    In a press call, the International Franchise Association joined the U.S. Chamber of Commerce, National Restaurant Association, and National Retail Federation to address last Friday’s issuance of complaints against McDonald’s.                      

    Robert Cresanti, Executive Vice President of Government Relations and Public Policy for the International Franchise Association explained that holding franchisors liable for the actions of their franchisees, as the NLRB General Counsel has proposed in an amicus brief, would move the franchise system toward large, corporate-owned outlets and away from independently owned operations.

    On the call, Cresanti pointed out two important, real-world impacts such a decision would entail: 1) Minorities would be disproportionately disadvantaged as minority ownership is notably higher among franchise businesses than non-franchise businesses, and 2) Job growth would be constrained as business resources are sapped and franchise expansion curtailed.

    Glenn Spencer, Vice President of the Workforce Freedom Initiative at the U.S. Chamber of Commerce, discussed how the direction of the NLRB leaves businesses with an uncertain standard for compliance.

    Angelo Amador, Vice President & Regulatory Counsel with National Restaurant Association, noted the breadth of the issue goes far beyond McDonald’s and even far beyond restaurants.

    David French, Senior Vice President of Government Relations for the National Retail Federation talked of the retail industry’s concern about the NLRB’s action today.

    Indeed, the NLRB General Counsel’s brief in the BFI case speaks directly to franchising, staffing/temp agencies, and contracting/subcontracting. All of these industries must be concerned with the NLRB’s march against McDonald’s.

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