A welcome examination appears in today’s Wall Street Journal of the legal and constitutional considerations involved in the Employee Free Choice Act. Richard Epstein, a professor of law at the University of Chicago, addresses the issues in the op-ed, “The Employee Free Choice Act Is Unconstitutional.”
Epstein’s critique of the card check provisions as abridging free speech rights is intriguing and of particular importance to small businesses. A card check campaign can be conducted clandestinely — think of how you could organize a shop of 20 people over a weekend just by going door to door — depriving an employer of his rights to make the case against unionization.
But Epstein’s analysis is even more persuasive when applied to the binding arbitration provisions. Under the Employee Free Choice Act, both employer and the newly recognized union would have to agree on a first contract within 120 days. If not, then a government arbitrator — an arbitration panel — imposes a two-year contract on both parties. Epstein:
The government-chosen panel could well impose terms that might cripple the firm competitively. Consider that the takings clause surely prevents the government from forcing any person to buy real estate for twice its market value from a seller. That same principle applies to this labor law: No government should be able to force a firm to hire labor at $50 per hour when the company is not willing to pay half that much.
Worse, the EFCA also permits the government arbitrator to strip the employer of all its standard management prerogatives on everything from subcontracting out to promotion policy. By flatly denying the employer any option to walk away, mandatory arbitration under the EFCA runs smack into the takings clause.
Arguments in the 2007 Congressional debate against the Employee Free Choice Act focused primarily on the card check provisions and their destruction of secret-ballot elections in the workplace. The anti-democratic nature of those provisions gave — and still gives — opponents a powerful political weapon, a campaign issue. People want to vote in private, period.
But as time passes, the forced arbitration provisions are coming to the fore. Employers recognize that an imposed contract eliminates the ability to operate a business the way they see fit, and a flawed contract could put them out of business, period. That practical threat, now combined with Epstein’s legal analysis, reveals the Employee Free Choice Act to be a serious, even existential threat to American businesses and a competitive economy. And it means the bill is not one that can be compromised, but only killed.
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