A misguided law enables the president’s union pandering
The National Labor Relations Board has become a partisan issue of late. After trying—and failing—to destroy secret-ballot union elections via “card check” legislation, President Obama turned away from the democratic process, and toward the NLRB, as a venue for advancing Big Labor’s interests.
To date, Obama has placed three people on the NLRB. During a congressional recess, he installed Craig Becker, who’d served as a top lawyer for two of the nation’s largest unions (the Service Employees International Union and the AFL-CIO), as a member of the board. He selected Mark G. Pearce—who had worked in “union side labor and employment law,” as his official NLRB bio puts it—as another. And Obama chose Lafe Solomon, a career NLRB lawyer, as the board’s general counsel.
Solomon promptly filed a complaint against Boeing, claiming the company had illegally discriminated against a unionized, strike-happy plant in Washington State when it chose to expand production in South Carolina, a right-to-work state, instead. And the board is trying to change the rules governing union elections so that companies have less time to mount anti-union campaigns.
These moves go beyond anything the NLRB has done in the past. But the current behavior of the National Labor Relations Board is only the outermost layer of the true problem: the National Labor Relations Act. In addition to creating a labor system that hurts non-union workers, forcing contracts upon unwilling participants, and engendering corruption, the 1935 legislation violates the Constitution, gives the NLRB the power to function as all three branches of government at once, and allows each president to stock the board with flagrantly biased nominees. President Obama may have abused the NLRA more than his predecessors did, but the NLRA is built for abuse. It should be repealed, or at least reformed.
The NLRA is also known as the Wagner Act, after Sen. Robert F. Wagner of New York, its sponsor. Before its enactment, private-sector employers had basically complete freedom in how they dealt with unionizing employees. They could, for example, simply fire workers who tried to unionize. Only 13 percent of the non-farm work force was unionized, but strikes were disruptive, and they were growing more frequent.
The stated justification for the NLRA was that strikes had enhindered the free flow of commerce, and that strengthening | unions and giving them a federally protected right to strike
would somehow fix that. In reality, of course. Congress supported the law as a way of tipping the power balance toward unions and away from management. The NLRA was just one of many New Deal laws that accomplished this.
Some of these laws addressed real problems—until the Norris-La^Guardia Act, for instance, courts often issued injunctions to end strikes, essentially forcing people to work. The NLRA, however, was a mistake from top to bottom.
As it was originally enacted, the NLRA defined several “unfair labor practices” for businesses, but none for unions. (In 1947, the Taft-Hartley Act added some for unions.) Short of closing a plant entirely, management could no longer discourage workers—using such tools as hiring, firing, discipline, and promotion—from participating in union activities. The only significant exception, confirmed in a 1938 Supreme Court case, was that an employer could hire replacement workers during a strike, and was under no obligation to fire the replacements to make room for returning strikers. The strikers were still considered company employees, however, and had to be reinstated when positions opened up.
Further, the act set up the system through which unions are recognized: First, they have to get 30 percent of workers in the “bargaining unit” (typically, the workers at a given plant) to sign cards. Then, the NLRB supervises a secret-ballot election, and if the union wins, it has the right to represent the workers. (Alternatively, the union can get signed cards from 50 percent of workers and avoid an election, but only if the company voluntarily recognizes the union.) The company is required to negotiate in good faith with its union on a contract; if negotiations falter, the union may strike.
The logic here is simple and straightforward: We want workers to be paid more and treated better: therefore, we’ll arm workers with the weapons they need lo gain concessions from employers. Unfortunately, it wasn’t until the 1950s that Milton Friedman proved the economic fallacy of this plan. Yes, unions often manage to get higher pay and better working conditions for their members. But in response, unionized businesses hire fewer workers. The workers who aren’t hired by union companies go to non-union companies—where their competition drives down wages—or remain unemployed. In other words, in the private sector at least, the gains of unionized workers aren’t gains for the working class as a whole; they’re gains by some workers at the expense of others. (In the public sector, which is not covered by the NLRA. higher wages simply come from taxpayers.)
And economics aside, the NLRA system involves a tremendous amount of coercion. Companies have to negotiate with unions with the threat of a federally protected strike in the background whenever their employees vote to make them. Businesses may not fire workers for union activities, including striking, regardless of what the relevant contracts say. And while (he current case against Boeing involves a fresh issue— whether companies may factor in local labor laws and past strikes when deciding where to build new capacity—the NLRA has long been interpreted to mean that a business may not shut down a unionized plant and reopen it somewhere else (a “runaway shop”) in response to strikes or union demands. If a union loses an election, the NLRB may decide the employer
engaged in “unfair labor practices” and force the company to bargain with the union anyway.
It’s not just employers over whom the law grants unions immense power. When a union wins an election, workers who voted against it are forced to accept the union as their “monopoly bargaining” agent, and are forbidden to negotiate their own contracts with the business. Depending on state law and the specific contract, anti-union workers may also have to join the union or pay dues. Right-to-work laws help in this regard, but they do not solve the problem of coercion—and the NLRA banned even these laws until the passage of the Taft-Hartley Act. In a right-to-work state, workers at union shops don’t have to pay dues or join the union, but they’re still bound by the union contract even if they do not wish to be. Seen differently, they get to free-ride on union negotiating efforts without paying their fair share.
Most of the NLRA’s effects were completely foreseeable. Union membership exploded- almost tripling in the ten years following its passage. And the law failed to accomplish its supposed goal of curtailing strikes: Work stoppages continued to rise through 1937, fell off as the economy improved, and then soared, reaching their all-time high in 1943.
What many did not foresee was the spread of corruption through organized labor. This is a complex story—read Robert Fitch’s Solidarity/or Sale for an excellent summary by a pro-union, leftist writer—but the bottom line is that it’s called “monopoly” bargaining for a reason. When a union doesn’t face competition and is entitled to dues from thousands of workers, it constitutes a massive opportunity for organized crime. To this day, if you read through the FBI indictments following a mob bust, you’ll find allegations of labor racketeering.
read more at national review