Aren’t We Supposed to Have One National Labor Policy?

Andrew Strom

Andrew Strom is an Associate General Counsel of Service Employees International Union, Local 32BJ in New York, NY.

The United States Constitution provides that the “Laws of the United States… shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby.” What this is supposed to mean is that when Congress enacts a law, it is binding on all fifty states. When it comes to labor relations in the private sector, Congress long ago enacted the National Labor Relations Act (NLRA), which declares “the policy of the United States to … encourage[e] the practice and procedure of collective bargaining.” So, why was it okay for six Southern Governors to issue a statement threatening auto workers that unionizing would put their jobs in jeopardy – the kind of statement that would clearly be illegal if made directly by an employer?

For years, states across the South have been trying to lure businesses to locate there by referring to themselves by the misleading term “right-to-work” states. These so-called “right-to-work” laws, which now exist in twenty-six states, prohibit unions and employers from entering into agreements that require workers represented by unions from paying fair share fees to cover the cost of representation. The laws by themselves do not make it harder to organize, and the workers in these states enjoy the same federally protected right to organize and bargain collectively as workers in other states. Nevertheless, Southern politicians have long pointed to these laws as a signal that unions are not welcome in their State. When she was governor of South Carolina, Nikki Haley declared, “We discourage any companies that have unions from wanting to come to South Carolina because we don’t want to taint the water.” Georgia’s economic development website sells the State to businesses by proclaiming that if businesses relocate there “you’ll also be doing business in an employment-at-will and right-to-work state with low unionization.” One policy analyst at a right-wing think tank has candidly explained that businesses are drawn to states with these laws because they “tend to lower union presence,” and “this is positive because higher levels of unionization drive up costs.” Lamar Alexander, a former Governor of Tennessee once asserted “if we don’t have right to work laws, those [manufacturing] jobs are going to be in Mexico.”

Curiously, the provision in the NLRA that has been relied upon to authorize these laws is actually quite narrow. In 1947, as part of the Taft-Hartley Act, a Republican Congress added Section 14(b) to the NLRA, creating an exception to our uniform federal labor policy. That provision states that nothing in the NLRA “shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.” The NLRB and the courts have disregarded the plain text of this provision to hold that States may not only prohibit agreements that require membership in a union, but they may further prohibit agreements that require the payment of any representation fee to a union. In a 1963 case, Retail Clerks Int’l. Assn, Local 1625 v. Schermerhorn, the Supreme Court addressed a situation where a collective bargaining agreement provided that employees who did not wish to join the union would be required to pay a service fee to the union that was the exact same amount as union dues. The Court held that the agreement was the “practical equivalent” of an agreement requiring membership in the union because it imposed the only membership obligation enforceable under the Act – the obligation to pay dues.

In 1980, the NLRB addressed the question left open by Schermerhorn, and held that Section 14(b) authorizes states to prohibit agreements that require the payment of any representation fee whatsoever to a union. A divided D.C. Circuit panel affirmed the Board’s decision over a strong dissent from Judge Abner Mikva. As Judge Mikva wrote, “[p]lain meaning has its limitations, but it must count for something….  There is no suggestion whatsoever in the legislative history that a worker who pays a fee for services rendered by the union thereby becomes a ‘member’ of the union. In any other context, such a proposition would be facially absurd.”

As a result of this misinterpretation of Section 14(b), unions in the South have long faced a serious free rider problem. And these “right-to-shirk” laws are part of a vicious cycle. The laws were passed in the first instance because unions were weak in these states. But, the existence of these laws has likely discouraged unions from committing resources to try to organize more workers in these states. And, the limited presence of union members has emboldened politicians to engage in harsh anti-union rhetoric that likely further discourages unionization. To return to the statement by the six Republican governors opposing the UAW’s organizing, even though telling workers “unionization would certainly put our states’ jobs in jeopardy” certainly looks like a threat, the NLRB lacks authority to regulate the speech of government officials, so unless the governors were acting as the agents of the auto makers, the NLRB would not have occasion to decide whether the statement should be viewed as a prediction rather than a threat.

Congress enacted the NLRA based on its finding that in the absence of collective bargaining the inequality of bargaining power between employers and workers “depress[es] wage rates and the purchasing power of wage earners.” Yet, Southern states often seek to attract business by bragging about how low unionization rates in their states have depressed wages. For instance, Oklahoma’s economic development website features a chart showing how average wages in Oklahoma are lower than the national average for twelve different occupational categories. We tend to take these kinds of appeals for granted, but it should be shocking to see a state be so open about undermining federal policy.

If the current Supreme Court had the opportunity to rule on the meaning of Section 14(b), it would be interesting to see how all of the self-proclaimed textualists on the Court would justify a ruling that an agreement requiring the payment of any fee to a union is the same as an agreement requiring membership in that union. Yet, I’m confident that six Justices would find a way to reach that result. If the United States truly were committed to “encouraging the practice and procedure of collective bargaining,” I have a long list of suggestions to further that goal, starting with passage of the PRO Act, but at a minimum, we should stop letting individual states directly undermine that policy.

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