HR 800: Employee Free Choice or Costly Changes on the Horizon?

HR 800, the Employee Free Choice Act of 2007, is a controversial bill that, if enacted, would fundamentally change labor relations law and procedure in the United States. The bill gained momentum soon after the Democratic Party took control of Congress. It has resulted in vitriolic debate between Republicans and Democrats and between organized labor and business groups.

On March 1, 2007, the House passed the bill, which was introduced by Congressman George Miller (D-CA), by a roll call vote of 241 to 185. The bill was supported by 99 percent of Democrats and opposed by 94 percent of Republicans. Senator Edward Kennedy (D-MA) introduced the bill in the Senate on March 29, 2007. It has been referred to the Committee on Health, Education, Labor, and Pensions and will be voted on in the Senate soon. Although President Bush has vowed to veto the bill, it is unclear at this point whether there would be enough support for the bill to override a veto.

HR 800 would change current labor law in three fundamental ways. These changes are summarized below.

Card Checks Instead of Secret Ballot Elections
Currently, the National Labor Relations Act (NLRA) provides that if a union wishes to represent a group of employees and the employer does not voluntarily recognize the union, the union must file with the National Labor Relations Board (NLRB) a petition for an election that is supported by at least 30 percent of the employees in the proposed bargaining unit. The NLRB then conducts a secret ballot election to determine whether a majority of those voting wish to be represented by the union.

Federally supervised secret ballot elections were originally put in place over 50 years ago to protect workers from intimidation or coercion by employers, unions or coworkers. However, under the Employee Free Choice Act, unions would be able to represent employees if, after a petition is filed, the NLRB determines that a majority of employees signed a card stating their intention to join the union. Card-signing is a process overseen by union members, not by government officials.

The relevant language in the bill states as follows:

If the Board finds that a majority of the employees in a unit appropriate for bargaining has signed valid authorizations designating the individual or labor organization specified in the petition as their bargaining representative and that no other individual or labor organization is currently certified or recognized as the exclusive representative of any of the employees in the unit, the Board shall not direct an election but shall certify the individual or labor organization as the representative [of the employees] .

The bill would authorize the NLRB to develop model language to be used on authorization cards and standards to determine whether such cards are valid.

Unions support this legislation because organizing by card check is easier, cheaper and faster than an NLRB election. Thos who oppose the bill argue that, in doing away with the ability to vote privately, Congress will eliminate important safeguards for all workers.

Limitations on Negotiations for an Initial Collective Bargaining Agreement

The bill also would require the parties to commence negotiations for an initial collective bargaining agreement within 10 days of a request for bargaining and would set a 90-day time limit for reaching an initial collective bargaining agreement (or a longer period if agreed to by both parties). The NLRA currently sets no time limit on reaching an initial agreement. It simply requires the parties to bargain in good faith to attempt to negotiate a contract.

Negotiations for an initial collective bargaining agreement typically are long and difficult. The parties must reach agreement on a variety of economic and non-economic items. By placing an arbitrary time limit on negotiations, the bill could alter the delicate natural balance of factors the marketplace imposes on union and employers in collective bargaining negotiations.

The bill further provides that if an agreement is not reached within the 90-day period, or such longer period upon which the parties agree, the matter must be referred to the Federal Mediation and Conciliation Service (FMCS) to see if their differences can be resolved through nonbinding mediation during a 30-day period or such longer period to which the parties agree.

An Arbitration Board Can Impose a Collective Bargaining Agreement upon the Parties

If the dispute is not resolved through mediation, the Employee Free Choice Act would direct the FMCS to refer the parties to binding arbitration before an arbitration board. The decision of the board would be final and binding on both parties for two years, unless both parties agree in writing to amend the agreement.

Currently, unless the parties agree otherwise, federal mediators and arbitrators have no authority to impose contract terms on employers and unions.

Other Changes: Strengthening Enforcement
In addition to these three major changes, the bill proposes to strengthen enforcement of the NLRA by prioritizing for investigation by the NLRB any charges that employers engaged in unlawful restraint or coercion or discrimination based on union activity during an organizing campaign or prior to the negotiation of the first collective bargaining agreement. If violations are found, the bill would impose liquidated damages in the amount of two-times back pay and civil penalties of up to $20,000 per violation.

Outlook

At this point, it is too early to tell whether the bill will pass the Senate, or, if it does pass the Senate and is vetoed by President Bush, whether the veto will be overridden. Nevertheless, even if the bill does not become law during the 2007 Congress, if the Democrats obtain a greater majority in Congress, and/or they gain control of the White House, you can expect future efforts to enact this legislation or something very close to it.

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