The Employee Free Choice Act (EFCA) is a controversial bill. Although the bill was passed in the U.S. House of Representatives in 2007 by a pretty wide margin, the bill was stalled by the Senate in 2007, and then reintroduced in March 2009. However, many observers expect the EFCA to pass this time, especially in light of comments reflecting President Obama’s commitment to its passage.
What Does the EFCA Entail?
The EFCA would amend the National Labor Relations Act, which is the primary law that governs issues relating to labor relations, unions and collective bargaining.
The EFCA would make some key changes in the rules of:
- How unions are formed;
- How they come to represent employees;
- The way the first contract between unions and employers is negotiated; and also
- How employees’ rights under the National Labor Relations Act are enforced.
How Do Things Work Currently?
Under the current labor laws, if a group of employees (which is usually called a “Bargaining Unit” and typically includes employees who all do the same job or similar jobs) want to be represented by a union, they go through a “card-check process” and subsequent “secret ballot election.”
Such elections are overseen by the National Labor Relations Board, which is considered a “neutral party.” Elections happen once there is a “showing of interest,” meaning a union authorization card is signed by at least 30 percent of the employees in that bargaining unit. Unions typically attempt to get more than 50 percent of the employees to sign a card showing interest in a union, to better the chance of winning when the vote does go to secret ballot.
The EFCA would allow unions to actually bypass the secret ballot elections altogether by simply proving that a majority of employees in the work unit have signed union authorization cards.
The lack of a secret ballot election is one of the reasons the bill is so controversial.
In fact, in a Wall Street Journal article from Aug. 8, 2008, George McGovern, a former Democratic senator, presidential candidate and self-proclaimed friend of labor unions, said:
“The key provision of [the] Employee Free Choice Act is a change in the mechanism by which unions are formed and recognized. Instead of a private election with a secret ballot overseen by an impartial federal board, union organizers would simply need to gather signatures from more than 50 percent of the employees in a workplace or bargaining unit, a system known as "card-check." There are many documented cases where workers have been pressured, harassed, tricked and intimidated into signing cards that have led to mandatory payment of dues.
Under [the] EFCA, workers could lose the freedom to express their will in private, the right to make a decision without anyone peering over their shoulder [and be] free from fear of reprisal. There's no question that unions have done much good for this country. Their tenacious efforts have benefited millions of workers and helped build a strong middle class. They gave workers a new voice and pushed for laws that protect individuals from unfair treatment. They have been a friend to the Democratic Party, and so I oppose this legislation respectfully and with care.”
Additional Points Regarding the Employee Free Choice Act
- Following recognition of a bargaining representative, collective bargaining would have to begin within 10 days.
- If a collective bargaining agreement isn’t reached in 90 days, either party may request mediation by the Federal Mediation and Conciliation Service (FMCS).
- If parties do not reach an agreement within 30 days of FMCS’s involvement, the EFCA requires that binding arbitration occur and imposes a 2-year collective bargaining agreement upon the parties. (What this basically means is someone outside the union and outside the company comes in, listens to both sides and determines what their collective bargaining agreement is going to be. No changes can be made for 2 years without both parties agreeing, and both parties have to live with what the arbitrator decides.)
Pros and Cons of This Bill
One of the arguments against the card authorization process in particular is that it eliminates the ability for the employer and the union to engage in a campaign after the election is announced, but before it occurs, which is currently a requirement of the National Labor Relations Act.
Under the EFCA, an employer may not even be aware that a union organizational campaign is underway and therefore would not have the opportunity to tell employees its views on the issue. Pro-EFCA advocates argue that the campaign process allows employers to intimidate employees and use other tactics to defeat the union.
Those who oppose the bill argue that the EFCA imposes unreasonable time limits on contract negotiations, which is a process that usually takes far longer than 120 days. Also, the National Labor Relations Act currently utilizes the concept of freedom to negotiate and freedom to walk away from an unsatisfactory negotiation, which would no longer be allowed under the EFCA.
Proponents of the bill argue that, under current law, employers often delay or stall bargaining, which renders the process ineffective or unfair.
One final argument against this provision has to do with unfair labor practices (ULPs). The EFCA would increase the penalties for employers engaging in certain acts which are considered ULPs. Specifically, an employer can be charged with a ULP, fined up to $20,000 per violation and ordered to reinstate an employee and provide triple back-pay.
The EFCA does not impose similar penalties against unions that are found to have engaged in unfair labor practices.
Why Your Company Needs This Information
There’s a lot of complacency from employees who hear about this new bill and think, “This has nothing to do with me; I don’t have or want a union,” and also for employers who think, “We’re a union-free shop or in a ‘non-unionized industry,’ so this doesn’t apply to us.”
Recent commentary from a number of law firms cautions that taking this approach could be “sticking your head in the sand.” If this act passes, industries that haven’t been the target of union organizing activities in the past may be in the future because the act would make union organizing much easier.
So, employees and employers really do need to educate themselves on the legislation and about union representation so they can make informed decisions about the impact the bill may have if it were to become a law.
The EFCA would affect labor relations for all private-sector workforces, not just those who are unionized or those who have been subject to a union organizational campaign in the past. Under the EFCA, unions are expected to expand their organizing attempts into industries not currently being represented, such as healthcare, hospitality, retail and financial services.
And in the current economic climate, some employees may feel like they need somebody to represent them in their relations with their employer.
Get Informed As Soon As Possible
I encourage employers to educate themselves on both sides of the argument—those for the EFCA and those opposing it.
Employers should also consider the potential implications for their industry and their company if this bill does pass.
Here are some helpful resources for employers to review: