With President-Elect Barack Obama set to take the oath of office on January 20, 2009, employers must implement plans now in anticipation of the likely passage of legislation that will make unionizing employees much easier. Employers should expect that Congress will address some form of the Employee Free Choice Act (EFCA) and the Re-Empowerment of Skilled and Professional Employees and Construction Tradeworkers Act (RESPECT Act) early in 2009. The EFCA and the RESPECT Act were both introduced in Congress in 2007. The House of Representatives passed the EFCA, and Obama and Vice-President-Elect Joseph Biden co-sponsored the U.S. Senate versions of both pieces of legislation.

The EFCA

In its present form, the EFCA would amend the National Labor Relations Act (NLRA) and result in three substantial labor law changes. First, the EFCA would make it significantly easier for a union to organize employees and require an employer to recognize and bargain with that union. Under current federal labor laws that govern private employers, following the filing of an election petition, which requires signed authorization cards from a minimum of 30% of the employees in the proposed bargaining unit, a secret ballot election is held by the National Labor Relations Board. A majority vote of those who cast ballots in the election is required for a union to be recognized as the exclusive representative of that group of employees. Under the EFCA, a union would become the exclusive bargaining representative as long as it could convince a majority of employees – that is 50% +1 of the employees in the sought-after bargaining unit - to sign union authorization cards. This change would strongly favor unions, because it would eliminate the secret ballot election process and the pre-election opportunity for employers to campaign against the union’s effort to organize the employees. Moreover, employees who did not sign cards, and employees who signed authorization cards without knowing the significance of their action, would not have the opportunity to vote against union representation.

Second, the EFCA would require that if the employer and the union are bargaining for their first contract and do not reach agreement within 90 days, either party could refer the matter to mediation. If mediation did not result in a collective bargaining agreement within 30 days, the matter would be referred to binding arbitration. The results of arbitration would be binding on both parties for two years. This process would significantly alter the collective bargaining process (which currently requires good faith negotiations, but does not require either party to make a concession). This process would also reduce an employer’s bargaining power (currently, employees have the right to strike if an agreement cannot be reached). Under the EFCA, a union could simply inflate its initial demands so that a negotiated agreement is not reached, resulting in mandatory arbitration and the terms and conditions of the employees’ employment being set by an arbitrator for up to two years.

Third, the EFCA would increase the penalties against employers for a violation of the NLRA during the time period when employees are seeking representation by a union or during the period after a union has been recognized as the exclusive representative until the first contract is entered into between the employer and the union. The increased penalties include: a civil penalty of up to $20,000 per violation, back pay plus two times that amount as liquidated damages, and stronger injunctive relief. As a result of the increased penalties, unions and employees would likely file more unfair labor practice charges, which will result in added costs for employers.

In order to prepare for EFCA legislation, employers should take the following actions:

  • have legal counsel review, at a minimum, your company’s solicitation/distribution, facility access, bulletin board, confidentiality and wage policies
  • train all members of management in the signs of union organizing, the legal effect of union authorization cards, the EFCA, the company’s philosophy about unions, and how to respond to employee inquiries about unions or pro-union statements
  • develop a plan to educate employees about the legal significance of union authorization cards and the company’s philosophy about unions
  • establish and place into practice a high level of conduct for members of management and employee-employer relations – timely address personnel issues, visit work units on off shifts, timely complete evaluations, ask about and listen to employees’ concerns, reward hardworking employees

The RESPECT Act

The RESPECT Act would increase the number of employees who would have the right to form or be organized by a union by redefining the definition of “supervisor” under the National Labor Relations Act. Under present law, supervisors are not “employees” under the Act. Currently, “front line” or “working supervisors” – including “charge nurses” in health care – are individuals who act as supervisors by assigning tasks and have responsibility to direct the work of others, but who may not serve in that supervisor role exclusively. Under current law, such individuals can be supervisors who are exempt from union organizing and bargaining unit membership. The RESPECT Act would revise the definition of supervisor to remove the terms “assign” and “responsibility to direct” from the list of supervisor criteria, and require that individuals spend a majority of their working time performing supervisory functions.1 As a result of these changes, many “working supervisors” and other first-line members of management would no longer qualify as a “supervisor.” This narrowing of the definition of supervisor would result in many individuals being eligible to become bargaining unit members along with the same employees they are charged with supervising. Employers need to consider how passage of the RESPECT Act would impact front line or working supervisors and the operational changes the employers must implement to strengthen the argument that its supervising employees meet the statutory definition of supervisor. Along with the new year comes the expectation of strong support for labor law legislation by both the White House and Congress, so there is little doubt that some form of the EFCA and the RESPECT Act will be strongly considered as early legislation in President-Elect Obama’s first term. Employers must begin to prepare now for the anticipated changes.