So, EFCA… What is That, Exactly?

You can’t get away from it.  The thing is everywhere.

The internet has ads for it.  And against it.  At the party your wife dragged you to, they were talking about it.  At your office yesterday, too.   The news can’t get enough of it, be it Fox, Air America or NPR.  It’s on people’s bumpers, for crying out loud.  

Maybe you’ve gone along with these people, not wanting to be the one to admit you don’t really get it, or maybe you ‘ve never heard of it.  But the fact remains, everyone – everyone – is talking about the Employee Free Choice Act, and you have no idea what they’re saying. 

Hi.  This post is for you.

Introduced in both houses, for the second time (it first hit the House in 2007), EFCA is the proposed legislation that blew the doors open on NLRA reform.   Called “Card Check”  by its detractors, the bill would drastically change national labor law and policy, resulting in easier unionization of workplaces, more strength for union activities, and higher penalties for employer violations.  Needless to say, the business community is less than pleased. 

You may have heard that the Free Choice Act might not pass – that’s true.  Some key former supporters have jumped ship recently, leading to questions about the bill’s viability in this year’s Congress.  But the cat’s out of the bag on reforming the national labor laws, and if   when something happens, it will be because of the conversation started over EFCA.

So what’s the big deal?  Here’s what the bill would do:

1. Replace the current rules for voting for or against a union. 

Currently, a union has to get a majority of workers to sign cards indicating they want to hold a union election, present the cards to the NLRB, then let the NLRB oversee a secret ballot election.  The unions say this takes too long, and gives the employer a chance to hire a union-busting consultant or lawyer (or both), retaliate and threaten pro-union supporters, force employees to attend anti-union meetings, and otherwise clog worker’s attention with reasons they should vote “no”.  Then, they say, a lot of employers find ways to just plain cheat. 

The Free Choice Act would do away with everything except that very first part, where a majority of workers signed cards saying they wanted the vote.  After EFCA, those cards would be their votes, and a majority of cards would mean the union won.  This is where the bulk of the EFCA debate focuses its attention – the business community says giving up “secret ballot” elections is unamerican.  The unions say there were never fair elections to begin with.  But that’s mostly just rhetoric.  Here’s the real debate:

From the business perspective, this has “fraud bait” written all over it.  Without NLRB oversight, the potential for cheating by a union looking for new meat would be huge (think: writing in cards, changing votes, padding, etc.).  Trying to keep things fair would prove impossible.

Unions say that EFCA just levels the playing field, since right now they don’t get to talk to the employees before an election, and the employer can say whatever it wants.  To the unions, the employers just don’t want to lose the time they have to hold their indoctrination sessions, and the card check procedure would make it more likely that a worker’s vote wouldn’t be influenced by employer bias.

2. Force Arbitration for First Contracts

If a union wins a vote, of course, the next thing they have to do is start negotiating their first Collective Bargaining Agreement, or CBA.  Right now, while employers have to negotiate in “good faith,”  they don’t have to agree to any specific demand made by the union.  They can always say “no” - it’s called bargaining to an impasse - and the union’s recourse is to do things like go on strike or file a claim with the NLRB.  It’s just understood that first contracts are going to take longer than other contracts, many many months longer, in a lot of cases.

Under EFCA, after two months of bargaining, either side will have a right to submit the negotiations to binding arbitration.  An arbitrator will hear both sides and then work out the contract’s provisions as they see fit.  Those contract terms will then be binding on the employer and the union for two years. 

So, if an employer really feels strongly enough to fight a union demand tooth-and-nail, it’s not only going to have to bargain hard with the union, it’s going to have to convice an arbitrator that whatever the union wants is bad for the company and the workers.  Former Republican Speaker of the House Newt Gingrich recently calls the arbitration changes in EFCA the ”real threat” of the bill.  

3. Raise the Penalties for Employer Labor Law Violations

This doesn’t get nearly as much attention as the two other changes, but to me, the penalty increases are EFCA’s sleeping giant. 

Right now, when an employer violates an employee’s rights under the NLRA, most of the remedies are focused on getting the employer to do something: sitting down at the bargaining table or restoring an employee’s status.  The Board does have some power to act to ensure future violations won’t happen, by posting signs regarding the employees’ rights, for example.   As far as money goes, the Board can order an employer to pay an aggrieved employee front and back pay in some cases, or pay litigation costs if the employer’s actions warrant it.  But the focus is on restoration of relations, not punishment.

Under EFCA, the concept of “remedy” in the labor law will drastically change.  Instead of just being about restoring an employee, financial damages will move into the “make-sure-this-doesn’t-happen-again” column.  If the Board finds that an employer infringed on a worker’s rights during an organizing campaign, the worker will be entitled to treble damages – three times the back pay he’s owed.   The NLRB will also have to seek an injunction to stop an employer’s actions if it has reason to believe the employer is violating the Act, and can assign fines of up to $20,000 for other employer violations, like threatening to close a plant or lay off workers when they seek unionization.  

When the penalty issue comes up in EFCA debates (which is not as often as it should), employers are quick to point out that there are no comparable penalties for union-side violations of the NLRA.  In their defense, unions cite statistics showing that the overwhelming majority of NLRB cases are employer violations.  Employers say that’s only because workers don’t generally go after unions, but unions will always go after employers. 

I’ll go into more detail on the penalty provision of EFCA in another post, but suffice it to say punishment-style penalties for employers will likely change the nature of the NLRB, from facilitator to enforcer.  Depending on which side of the labor debate you’re on, that is either exciting or very, very scary. 

What Does All This Mean?

The one thing both sides of this debate can agree on is that the Employee Free Choice Act (if it ever gets passed) will drastically alter the landscape of the American workforce.  With card-check elections, employers will have to either accept unionized workers, or work constantly to maintain an anti-union mentality in their employees. 

Plus, service and tech industries that have never thought about national labor law may find themselves with 90 days to negotiate a first contract before going to arbitration, and fear of stiff penalties for violations of the Act. 

Unions see EFCA as levelling the playing field, and there’s no doubt that they have had a difficult time organizing for decades.  As for the business community, even the employers who think they’ve had it relatively easy see EFCA as a drastic move to unionize workers, partially by stripping important safeguards against union misconduct. 

Support for the Free Choice Act is diminishing on the Hill, and the debate now seems to be whether a compromise will take some of the teeth out of one of the three provisions or if the democrats will table EFCA until they can get the votes needed to pass it as-is. 

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That’s it.  Now you’re all caught up.  If you have strong feelings about this significant law, feel free to leave them in the comments.  Otherwise, go hang out at the water cooler and wait for a chance to look smart.

EFCA Update: Senator Blanche Lincoln Announces Opposition While Senator Mark Warner Announces Support for Cloture

In yet another blow signaling a need for a compromise of the Employee Free Choice Act, Senator Blanche Lincoln (D-Ark.) announced this past Monday that she will not support the union-backed legislation–at least not in its current form.

Meanwhile, Senator Mark Warner (D-Vir.) seems to be wavering.  Warner announced that he backs a vote for cloture, but he said he will evaluate his stance on the measure after EFCA has reached the floor.

Workplace Prof Blog recently reported on a story floating around about the compromise operations that have already begun in an effort to get EFCA passed through Congress.