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'Free choice' versus binding arbitration

Peter Kirsanow, a Cleveland attorney and member of the U.S. Commission on Civil Rights, has turned his attention recently to the Employee Free Choice Act, the legislation that would allow labor organizers to dragoon employees into a union bargaining unit via public collection of signature cards, eliminating a secret-ballot election supervised by the National Labor Relations Board.

In several posts at National Review's The Corner (one previously noted by Walter), Kirsanow focuses on the binding arbitration provisions of the law, which until recently have received much less scrutiny then the "card check" provisions. In short, if a new bargaining unit and employer cannot reach a first contract after 120 days, a federal arbitrator will impose contract terms on them for two years. Sometimes you can't even agree on the size of the negotiating table in that period of time, Kirsanow notes from his own experience. And is it really a contract?

Under EFCA, the terms set by the arbitrator will be the furthest thing from a "contract." It won't be an agreement between management and labor. Rather, wages, hours and terms and conditions of employment will be dictated by a government appointed arbitrator. The mandate will be binding on the parties for two years. Neither the company nor the employees can reject it...

Currently, if employees don't like the tentative agreement negotiated between union leaders and management the employees can vote it down and instruct their leaders to go back to the bargaining table to get a better deal. Not so under EFCA. If the employees don't like the arbitrator's decree of a 2% wage increase, they're stuck. Similarly, if the company can't afford the arbitrator's command to pyramid overtime, the company's stuck. The consequences aren't difficult to imagine.

Right. Imagine being in an industry where five or six businesses are engaged in fierce price competition, and where labor decides to organize you first. An arbitrator's terms could kill your operation altogether.

Kirsanow's posts, which also include some illuminating comparisons to Canadian employment law:

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.