EMPLOYEE FREE CHOICE ACT INTRODUCED IN 111th CONGRESS
On March 10, 2009, the Democratic Leadership introduced
into both the Senate and the House the Employee Free Choice
Act (EFCA). The proposed legislation contains the same provisions
as the 2007 version of the EFCA.
Summary of the EFCA
The proposed EFCA amends the National Labor Relations Act
to substitute a “card check” for the secret
ballot election as the method to determine whether a union
should be certified as the employees’ bargaining agent.
Second, the proposed EFCA requires that after 120 days of
collective bargaining/mediation over an initial contract,
unresolved issues be submitted for final and binding resolution
to a government sponsored arbitration panel. The arbitration
panel’s award would determine the terms and conditions
of employment for a two year period. Third, the proposed
EFCA imposes significantly higher financial penalties against
employers for committing unfair labor practices, e.g. fines
as high as $20,000 for each unfair labor practice and backpay
damages of lost pay plus double the amount in liquidated
damages.
Impact of the EFCA in its Current
Form
If the EFCA becomes law, the most significant effect on
employers will be increasingly successful union organizing
campaigns. Labor unions will be able to forego the election
process in favor of a stealth campaign with the card check
system. This will likely delay management’s perception
of the union campaign, causing it to lose critical time
in informing employees of the company’s position,
the risks of unionization, and the benefits of remaining
union free. Moreover, under the card check system, instead
of a secret ballot system in which each employee can freely
vote his or her conscience, unions can more easily exert
pressure on employees to simply sign the card favoring the
union. Unlike the current secret ballot election process
that takes a “snap shot” of employee sentiment
on a given day, the card check process is cumulative over
time. Will there be a process for employees to “revoke”
their authorization if there is a change of mind? The current
version of EFCA is silent.
With the mandatory arbitration provisions, management will
have lost critical leverage in negotiating an initial contract
with the newly-formed union. Usually an employer negotiating
a first contract can withhold provisions such as union shop
and dues check off, and later trade them off for a reasonable
economic package and strong management rights provisions
in the collective bargaining agreement. With EFCA, the union
will have no incentive to accept what management offers
and can instead hold out for the mandatory arbitration process,
trusting that the arbitration panel will simply “split
the difference” between the employer’s offer
and the union’s demands. Arms length collective bargaining
over the terms of an initial labor agreement will become
a thing of the past.
Clearly the EFCA would do far more than eliminate secret
ballot elections. In requiring first labor contract disputes
to be submitted to binding arbitration, unions will be able
to promise employees whom they are trying to convince to
sign union cards that the law guarantees that the union
will secure for them a labor contract. Under the current
law, the union would have to acknowledge that the parties
are required to engage in good faith collective bargaining,
but that good faith bargaining does not require that the
employer and the union must reach an agreement.
Opposition to the EFCA
Opponents of the EFCA in the Senate have promised to filibuster
against the legislation, and the critical issue is whether
Senate supporters of the bill have 60 votes to invoke cloture,
which would permit a vote on the merits of the legislation.
The Wall Street Journal reports that some Democratic Senators
are considering ways to oppose the legislation in its current
form. The U.S. Chamber of Commerce has announced its all-out
opposition to the EFCA, and is urging employers and employer
associations to contact their Congressional representatives
to voice their concerns. Shawe & Rosenthal has been
working closely with the Maryland Chamber of Commerce in
stressing to members of the Maryland Congressional Delegation
the business community’s opposition to the legislation.
March 10, 2009
Shawe
Rosenthal, LLP provides this publication for informational
purposes, and it should not be construed or relied upon
as legal advice. You should contact your Shawe Rosenthal,
LLP lawyer to discuss any questions that you may have concerning
your own situation.
|
