Card Check: Arbitration, Distinctions

By May 19, 2009Labor Unions

James Sherk at the Heritage Foundation responds to an attack from Media Matters for America against a Heritage video that explains why the Employee Free Choice Act’s binding arbitration provisions  are so bad. The post, “Fact Check: Media Matters Wrong on Card Check Facts,” notes several misrepresentations from Media Matters (yeah, bit surprise). More importantly, Sherk provides a good primer on the distinctions between public sector arbitration and EFCA’s imposed government arbitration. To wit:

Most public sector arbitration decisions decide disputes in renewing an existing contract – not in writing a new contract from scratch. Both parties have already settled fundamental issues such as the sort of seniority or promotion system that will be used, the job classifications for employees work, and the benefit types employees earn. The main issue in dispute is how much workers will earn, not how the department will be (re)structured. The arbitrators also have clear standards and guidelines they must use to make their decision.

This hardly work flawlessly. In many cases arbitrators make bad rulings that cities cannot afford. One arbitrator’s ruling nearly bankrupted Detroit in the late 1970s, forcing the city to lay off one fifth of the police force and igniting a crime spree. In other cases taxpayers must simply pay out because the government never goes bankrupt – it just raises taxes to cover higher costs.

EFCA, however, has none of the limited safeguards contained in public sector arbitration. Read the bill. It only applies to new contracts, before any issues like promotion procedures and work duties have been settled. The government arbitrator would impose those, without the benefit of a previous contract to look back on. And unlike public sector arbitration there are no standards for the arbitrator to use. None at all.

The upshot is that union negotiators would make extreme demands, hoping the government-mandated arbitrator splits the difference. Binding arbitration works against good-faith negotiating.

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