Card Check: Binding Arbitration, the Worker’s Enemy

By March 18, 2009Labor Unions

If organized labor’s advocates of the Employee Free Choice Act are so intent on promoting worker “choice,” why are they so eager to surrender it through binding arbitration?

The Employee Free Choice Act ( S. 560 and H.R. 1409)  requires mediation after 90 days of a union’s recognition if a first contract has not been reached. Then, absent an agreement, binding arbitration is required 30 days later.  From the bill’s text:

(3) If after the expiration of the 30-day period beginning on the date on which the request for mediation is made under paragraph (2), or such additional period as the parties may agree upon, the [Federal Mediation and Conciliation Service] is not able to bring the parties to agreement by conciliation, the Service shall refer the dispute to an arbitration board established in accordance with such regulations as may be prescribed by the Service. The arbitration panel shall render a decision settling the dispute and such decision shall be binding upon the parties for a period of 2 years, unless amended during such period by written consent of the parties.’.

While the secret-ballot destroying “card check” is the most prominent and noxious provision of the Employee Free Choice Act, the binding arbitration language also alarms employers. The requirement undermines the basis for good-faith negotiating and give unions an incentive to make unreasonable demands, hoping the arbitrator splits things down the middle. The resulting government-mandated wages and benefits and work rules (it’s not a contract) could represent the difference between profitability and bankruptcy — especially for smaller companies in competitive industries.

Now flip this argument around. Why would a company’s employees want to surrender their ability to bargain collectively with their employer? Let’s say organizers for Amalgamated Workers Y successfully sign up 51 percent of Company Z’s employees, and the union and company are working in good faith to reach a first contract but it’s just taking a long time. Tough luck. After 120 days, the employees have an arbitrator’s decision imposed on them, terms that last for two years.

Workers get no vote on a contract. Where’s the “employee free choice?”

Or, assume union negotiators interested in the union’s priorities — not the interests of the employees — drag talks out as a matter of strategy. The federal arbitrator imposes terms requiring higher salaries and benefits, which the company cannot afford EXCEPT by laying off 20 percent of its workforce. The way unions work, younger, more recent hires would get the shaft.

“Sure, I signed up for a union because the organizers told me I’d get a big raise and more health care. All I got was fired.”

Where’s the “employee free choice?”

(We started thinking about this issue today after reading a letter in the Washington Post [“A Choice for Metro’s Workers“] from a union official representing Metro employees. He makes a big point of how it’s the employees, not the union, that decides whether to approve or disapprove contracts: “First, members of Local 2 of the Office and Professional Employees International Union decide what contract offers they will accept, not ‘union leaders.'” Fair enough. But if contract votes are such a matter of principle, it’s hard to explain big labor’s eagerness to surrender the votes through the Employee Free Choice Act’s binding arbitration.)

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