Saturday, May 7, 2011

Right-to-Work Laws: Who Benefits?

Who really benefits most from state right-to-work laws in America, workers or employers?  This post outlines the history of labor law in the 20th century and explores data that demonstrates that standards of living are lower in states with right-to-work laws.  Additionally, various social issues are explored comparing right-to-work states with states that support unions.

But first a little amuse bouche, or perhaps more appropriately, an amuse douche.

This is in no way intended to be a thorough overview of US labor law, but rather an outline of some key elements which influence state Right-to-Work laws.  For a comprehensive review of the history of the labor movement in the US including a thorough review of the legal framework for organized labor, I strongly recommend There is Power in a Union by Philip Dray.

The National Labor Relations Act
The most significant law enacted which was favorable to organized labor was the 1935 Wagner Act also known as The National Labor Relations Act (29 U.S.C. § 151–169) (NLRA).  The NLRA limits the the ways in which employers are permitted to treat workers in the private sector who organize labor unions, practice collective bargaining, and take part in strikes and other forms of organized activities in support of their demands. The NLRA does not apply to workers who are covered by the Railway Labor Act, agricultural workers, domestic servants, supervisors, or government workers at any level.

The law was written in the context of the Interstate Commerce Clause of the US Constitution.

[The Congress shall have Power] "To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes"
The significance of the clause was re-iterated in the Supreme Court's opinion in Gonzales v. Raich, 545 U.S. 1 (2005):
The Commerce Clause emerged as the Framers' response to the central problem giving rise to the Constitution itself: the absence of any federal commerce power under the Articles of Confederation. For the first century of our history, the primary use of the Clause was to preclude the kind of discriminatory state legislation that had once been permissible. Then, in response to rapid industrial development and an increasingly interdependent national economy, Congress “ushered in a new era of federal regulation under the commerce power,” beginning with the enactment of the Interstate Commerce Act in 1887 and the Sherman Antitrust Act in 1890. (emphasis added)
Therefore the commerce clause was seen as the best way to achieve labor parity with capital.
At the time, there was discussion that a moral approach to labor rights might be more suitable, relying on the 1th Amendment.
Section 1. Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.
Section 2. Congress shall have power to enforce this article by appropriate legislation.
In his Yale Law Review paper Contract, Race, and Freedom of Labor in the Constitutional Law of “Involuntary Servitude,"(pdf) Professor James Gray Pope lays out an argument that, although it has not yet been adjudicated by the Supreme Court, the 13th Amendment provides a sound moral foundation for labor organizing and perhaps a stronger one than the commerce clause.
The Supreme Court has yet to adopt and apply a standard for assessing labor rights claims under the Involuntary Servitude Clause. This Article suggests that one may be found in the leading decision of Pollock v. Williams (1944), which contains the Court’s most thorough discussion of the interpretive issues. Under Pollock, a claimed right should be protected if it is necessary to provide workers with the “power below” and employers the “incentive above” to prevent “a harsh overlordship or unwholesome conditions of work.” Although this is not the only conceivable standard, it does fit well with the text, history, and case law of the Amendment. The absence of any racial element, which might appear dishonest in light of the fact that most of the leading cases involved workers of color, nevertheless corresponds to the Amendment’s original meaning and appears to have important advantages from a doctrinal point of view. The Article discusses the legal and philosophical justifications of various labor rights in relation to the Pollock standard, including the right to quit, the right to change employers, the right to name the wages for which one is willing to work, and the right to strike. (emphasis added)
However it was framed, the NLRA was intended to move labor closer to the table in industrial relations.

The NLRA provides extensive protections for workers seeking to organize.  The law states:
The inequality of bargaining power between employees who do not possess full freedom of association or actual liberty of contract, and employers who are organized in the corporate or other forms of ownership association substantially burdens and affects the flow of commerce, and tends to aggravate recurrent business depressions, by depressing wage rates and the purchasing power of wage earners in industry and by preventing the stabilization of competitive wage rates and working conditions within and between industries.

Experience has proved that protection by law of the right of employees to organize and bargain collectively safeguards commerce from injury, impairment, or interruption, and promotes the flow of commerce by removing certain recognized sources of industrial strife and unrest, by encouraging practices fundamental to the friendly adjustment of industrial disputes arising out of differences as to wages, hours, or other working conditions, and by restoring equality of bargaining power between employers and employees.


It is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization, and designation of representatives of their own choosing, for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.
The mechanism to implement these actions is the National Labor Relations Board (NLRB).  From the Act:
The Board is empowered, as hereinafter provided, to prevent any person from engaging in any unfair labor practice (listed in section 158 of this title) affecting commerce. 
Note the constant reference to free-flow of commerce in the context of labor organizing.  As I read it, it strikes me as somewhat disjointed.  It seems that labor organizing is subordinate to the interest of Capital to conduct commerce across state lines.  I agree with Professor Pope that a stronger foundation would have been the moral foundation of the 13th amendment.

So what became of tthe act?  It was implemented successfully to allow workers to band together to form unions and negotiate with employers for better wages, better hours, better working conditions, increased workplace safety and additional benefits.  So how did we end up with regressive right-to-work laws in 22 states?   Let me introduce you to the Taft-Hartley Act, the Act that gutted the intent of the NLRA.

The Labor-Management Relations Act - Taft-Hartley
The Labor–Management Relations Act (Pub.L. 80-101, 61 Stat. 136, enacted June 23, 1947, informally the Taft–Hartley Act) was designed to impose restrictions on labor union rights that were granted in the NLRA.  Sponsered by Senator Robert Taft and Representative Fred A. Hartley, Jr. initially vetoed by President Harry S. Truman's veto on June 23, 1947, the veto was overridden and the law enacted.  Labor leaders labeled it the "slave-labor bill" and President Truman though it a "dangerous intrusion on free speech," that was in "conflict with important principles of our democratic society," The principal author of the Taft–Hartley Act was J. Mack Swigert of the Cincinnati law firm Taft, Stettinius & Hollister.

The LMRA amended the 1935 NLRA and changed that act in the following ways:
  • Closed Shops: LMRA prohibited closed shops where employers were contractually required to hire only union members. The act allowed Union Shops to stand.  Union Shops require new hires to join the union in a specified period of time if it's part of the collective bargaining agreement.
  • Union Security Clauses: Permits individual states to outlaw union security clauses (such as the union shop) entirely by passing right-to-work laws. A right-to-work law prevents unions from negotiating contracts or legally binding documents requiring companies to fire workers who refuse to join the union. All of the states in the Deep South and a number of Republican states in the Midwest, Plains, and Rocky Mountains regions have right-to-work laws (with five states – Arizona, Arkansas, Florida, Mississippi and Oklahoma – enshrining right-to-work laws in their states' constitutions).
  • Strikes: Requires a 60 day notification period and binding arbitration.  The President was vested with the powers to break any strike contrary to the national interest.  Despite his veto of the legislation, Harry Truman used the act 12 times during his Presidency.
  • Treatment of Supervisors: Supervisors were prohibited from joining the union.
  • Right of Employer to Oppose Unions: Employers have a right to oppose unions, so long as they did not threaten employees with reprisals or promise benefits to refrain from forming or supporting them. Employers were granted the right to file a petition requesting that the NLRB determine if a union represents a majority of its employees, and allow employees to petition either to decertify their union, or to invalidate the union security provisions of any existing collective bargaining agreement.
  • NLRB: The LMRA required the NLRB to pursue violations rather than allowing it to assess the veracity of the claims. It also allowed employers to see redress against unions through the NLRB for secondary effects like boycotts.
The aggregate effect of these provisions was to tip the balance of the scales back in favor of employers over employees as it was prior to 1935.  Alexander Cockburn summed up the problems with Taft-Hartley in a 2004 piece for Counterpunch.
Taft-Hartley still said strikes were legal, up to a point. It just made it far harder to win them. It declared the closed shop illegal and permitted the union shop only after a vote of a majority of the employees. It forbade jurisdictional strikes and secondary boycotts. Other aspects of the legislation included the right of employers to be exempted from bargaining with unions unless they wished to.

The act forbade unions from contributing to political campaigns and required union leaders to affirm they were not supporters of the Communist Party. This section of the act was upheld by the Supreme Court on 8th May, 1950.

The Taft-Hartley Act also gave the United States Attorney General the power to impose an 80 day injunction when a threatened or actual strike that he/she believed "imperiled the national health or safety".
In effect, it eviscerated the power of the NLRA in favor of big companies at the expense of working people.

Right-to-Work Laws
Right-to-Work States in Turquoise (from Wikipedia)
Taft-Hartley introduced the nation to the Right-to-Work (RTW) laws.  Currently 22 states have RTW laws on the books.
  • Alabama
  • Arizona
  • Arkansas
  • Florida
  • Georgia
  • Idaho
  • Iowa
  • Kansas
  • Louisiana
  • Mississippi
  • Nebraska
  • Nevada
  • North Carolina
  • North Dakota
  • Oklahoma
  • South Carolina
  • South Dakota
  • Tennessee
  • Texas
  • Utah
  • Virginia
  • Wyoming
(NOTE: States in italics have RTW laws written into their state constitutions)

How, then, to evaluate the impact of these RTW laws on the people of these states?  Implemented to provide more "freedom" for workers, did it really play out that way?  Let's examine some core social and economic measures comparing states with RTW laws and states which protect worker's rights to unionize.  The question is not whether companies can generate more profits in RTW states, but rather to compare the quality of life for residents of RTW and non-RTW states.

Based on data from 2005, it's clear that RTW states suck up more Federal Benefits and workers get paid less.  Across a wide range of measures, citizens in RTW states fare worse than their brothers and sisters in pro-union states.  The average wage in RTW states is $7,166 lower and the RTW states receive $0.18 more return on every tax dollar than union states.  The redistribution of wealth from union to non-union states is undeniable.  Workers and citizens in RTW states have lower levels of academic achievement (averaging 3.2% worse in RTW states), lower heath measures (higher obesity in RTW states, for instance) and higher incidents of STDs and teen pregnancy (13 more per 1000).  While the issue of unionism is only an indirect contributor to these measures, household income and access to quality public education is critical, and unionism is tied directly to wages.  With lower wages, RTW states lack the resources that pro-union states have to ensure a better life for their citizens.

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