WSJ Columnist Jenkins Gets Works-Council Law Wrong

Benjamin Sachs

Benjamin Sachs is the Kestnbaum Professor of Labor and Industry at Harvard Law School and a leading expert in the field of labor law and labor relations. He is also faculty director of the Center for Labor and a Just Economy. Professor Sachs teaches courses in labor law, employment law, and law and social change, and his writing focuses on union organizing and unions in American politics. Prior to joining the Harvard faculty in 2008, Professor Sachs was the Joseph Goldstein Fellow at Yale Law School.  From 2002-2006, he served as Assistant General Counsel of the Service Employees International Union (SEIU) in Washington, D.C.  Professor Sachs graduated from Yale Law School in 1998, and served as a judicial law clerk to the Honorable Stephen Reinhardt of the United States Court of Appeals for the Ninth Circuit. His writing has appeared in the Harvard Law Review, the Yale Law Journal, the Columbia Law Review, the New York Times and elsewhere.  Professor Sachs received the Yale Law School teaching award in 2007 and in 2013 received the Sacks-Freund Award for Teaching Excellence at Harvard Law School.  He can be reached at [email protected].

In yesterday’s Wall Street Journal, Holman Jenkins weighs in on the VW-UAW discussions about a German-style works council at VW’s plant in Chattanooga, TN.  Although the automaker and the union have concluded that such a council would be legal in the U.S. only in an already-unionized workplace, Jenkins asserts that this conclusion is simply a “handy interpretation” and one that is “extremely questionable.”  Why?  Because, writes Jenkins, “[f]reedom of contract exists in America.”  And, as to federal labor law’s ban on employer interference with labor organizations, Jenkins says only that “the law can’t stop employees of a company from consulting with employees of a company about company matters.”

This is, to put it politely, a thin legal analysis.  It is true that, in general, we have freedom of contract in America.  But, whatever you think about its merits, the National Labor Relations Act makes a range of of workplace contracts illegal.  Perhaps the most obvious example is that in a unionized workplace an employer is prohibited from bargaining individual employment contracts with employees covered by a collective bargaining agreement.  More particularly relevant here, section 8(a)(2) of the Act makes it illegal for employers to establish, in non-union workplaces, a wide range of labor-management committees.  Over the last few decades, the NLRB has read 8(a)(2) as banning committees that: are established by management, involve employee participation, and deal with management on issues concerning wages, hours, or working conditions.  The leading case on the subject is Electromation.

A works council that followed the German model would meet this definition easily and would be prohibited if established by management in a nonunion workplace.  If, as Jenkins suggests, VW just “set up” such a council, there’s really no doubt that the employer would violate federal labor law.

Whether or not the law ought to prohibit works councils in non-union settings is a different question, and probably one worth debating at another time.  But that the law currently does prohibit management from establishing works councils in non-union settings is clear.

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