Compromising Positions

Sensing the swell of public opinion against the elimination of the secret ballot from union representation elections, the proponents of the Employee Free Choice Act (EFCA) are suddenly in a mood to compromise. If the rumors from Capitol Hill are true, however, the only things that will be compromised if the revamped legislation goes forward will be the interests of U.S. businesses and their employees.

Readers of the Informed Employer will recall that labor unions spent approximately $450 million in the 2008 presidential election with the express purpose of ensuring passage of the EFCA, which prominent labor leaders described as their "number one priority" for the incoming administration. In its original form, the EFCA would radically alter existing labor law in three primary ways:

· Eliminating the rights of employees to vote by secret ballot in union representation elections and, instead, forcing employees to become union members by "card checks;"

· Allowing the federal government to set the terms of an employer's initial collective bargaining agreements by forcing the employer to submit to federal mediation and then binding arbitration if agreement is not reached within 90 days of the union's selection; and

· Dramatically increasing the penalties for employer violations of the National Labor Relations Act to include triple back pay awards, plus fines of up to $20,000 per violation.

Proponents of the EFCA had reason for confidence about the EFCA's passage based on the statement from then-Senator Obama before taking office that, "we will pass the Employee Free Choice Act. It's not a matter of if, it's a matter of when." However, employer opposition to the EFCA has proved fierce and seems to have persuaded moderates in both parties that the costs to small and medium-sized businesses would be considerable. In addition, the National Labor Relations Board (NLRB) election results for calendar year 2008 showed that unions won 66.8 percent of all representation elections conducted that year – the highest union win rate in 55 years – which significantly weakened the union argument that the NLRB's election process was tilted against unions.

As a result of these unexpected challenges, support for the EFCA has softened, leading to reports that several key senators are negotiating a potential EFCA compromise that would retain secret ballot elections, but drastically reduce the period of time between the date the employer is put on notice of the election request and the date of the election to 5-10 days (as compared to the present 42-45 days). Given that unions often conduct covert campaigns to pressure employees to sign authorization cards for many months before ever requesting an election, this compressed time period for employers to respond hardly seems a fair "compromise" for employers.

Even worse, as the tradeoff for retaining secret ballot elections, employers would be required to give up control of their property by allowing unions access to company facilities to engage in organizing activities and foregoing employer rights to hold certain employee informational meetings near the time of an election. Moreover, it is uncertain whether this compromise will do anything to water down the other radical provisions contained in the EFCA, including the specter of having the federal government set initial contract terms or impose drastic penalties for technical violations of the law.

Although the Senate negotiations over the EFCA are in a state of flux, employers should bear two things in mind. First, even though employers appear to have been successful in beating back the challenge to the secret ballot, this victory is far less than half the battle. If the remaining provisions of the EFCA compromise are put into place, the cost to American workplaces could be devastating to small and mid-size businesses. Accordingly, employers and their advocacy groups need to keep the pressure on Congress to defeat the EFCA in its entirety.

Second, even if the present compromise discussions fail, it is increasingly likely that Congress will intervene to shorten the standard election period in the near future given the enormous energy being expended by unions (not to mention campaign contributions). If that happens, employers will have much less time to react to union organizing drives than at present.

Informed employers will take this possibility into account and begin training their supervisors now on the signs of organizing activity and how to communicate to their employees the advantages of remaining union-free. The Labor and Employment Practice Group at Ice Miller LLP stands ready to assist in these efforts.

This publication is intended for general information purposes only and does not and is not intended to constitute legal advice.  The reader must consult with legal counsel to determine how laws or decisions discussed herein apply to the reader's specific circumstances.