The Employee Free Choice Act of 2009 (EFCA) was introduced on March 10 in both the House of Representatives and the Senate. The 2009 version of EFCA is identical to last year’s bill, which passed the House by a wide margin but ultimately failed in the Senate when its supporters were unable to invoke cloture on a potential filibuster motion. Had it passed Congress, President Bush indicated that he would veto the 2008 measure.  

In contrast, both during the 2008 Presidential campaign and more recently in public statements to union leaders, President Obama has expressed strong support for EFCA and promised to work with its supporters to enact the legislation. In introducing the bill in the House as Chairman of the Education and Labor Committee, Rep. George Miller, D-California., stated that “Americans’ wages have been stagnating or falling for the past decade. … If we want a fair and sustainable recovery from this economic crisis, we must give workers the ability to stand up for themselves and once again share in the prosperity they help to create.”  

A bruising political conflict over EFCA is expected. While the bill is expected to receive overwhelming support in the House, EFCA’s opponents (including the U.S. Chamber of Commerce and a number of employer-oriented advocacy groups) are concentrating most of their efforts on the Senate, where its passage is uncertain. At least 60 Senate votes are needed to overcome an expected Republican-led filibuster, and it is unclear whether Republican and Democratic Senators who have expressed concern about EFCA, such as Senators Lincoln (D-Arkansas), Pryor (D-Arkansas), Nelson (D-Nebraska), Landrieu (D-Louisiana), Specter (R-Pennsylvania), Snowe (R-Maine), and Collins (R-Maine) will be willing to allow the bill to be voted upon in its current form (even if they do not ultimately support it), or will seek to broker compromise legislation in a manner similar to their role in modifying the White House’s stimulus package. The timing of any votes also presently is uncertain because although EFCA has been introduced—in a maneuver understood to be symbolic of its importance to labor—its actual presentation for key votes is likely to be delayed until certain economy-related legislation is first addressed and, as Democrats hope, an additional favorable vote (Franken, D-Minnesota) becomes available.  

There are three key components to EFCA that will negatively impact employers to a significant extent.  

(1) Union Recognition Process

Under EFCA, the secret ballot election process will be effectively replaced by “card check” recognition. That is, if a union obtains the signatures on authorization cards from 50% plus one of employees in an appropriate bargaining unit, and turns such cards over to the NLRB, the union will be certified as the majority representative of such employees.

(2) Binding Third Party Interest Arbitration Will be Imposed Upon Any Employer Not Reaching Agreement on a First Union Contract Within 120 Days of the Beginning of the Bargaining Process.

Currently, if a union is certified, an employer still has some control over its business operations through the collective bargaining process. This is because, in collective bargaining, an employer by law may always refuse to agree to unreasonable, costly, or unproductive union bargaining proposals. If the employer and the union disagree over one or more contract terms, the union’s principal recourse is to strike and/or picket the employer, and the employer may, in turn, continue to operate using supervisors, managers, or replacement workers, or even lockout. Under EFCA, an employer’s right to say “no” to union wage, benefit, or working condition demands is removed. Instead, a “neutral” arbitration panel is appointed by the Federal Mediation and Conciliation Service to decide the terms of all disputed items of the parties’ first contract if such a contract is not reached within 120 days after the beginning of the bargaining process.  

(3) Increased Penalties Against Employers for Unfair Labor Practice Violations

Under the National Labor Relations Act, employers are now prohibited from threatening to discharge or discharging employees for engaging in protected union activities, or from interfering with, restraining, or coercing employees in the exercise of their rights under the National Labor Relations Act. The current remedy for such a violation is that any discharged employee would be reinstated and receive full back-pay for the period of time he/she may have been terminated, with interest. In addition, injunctions against alleged employer illegal activity are rarely sought or granted. Under EFCA, any employee found to be unlawfully terminated while employees of the employer are actively seeking representation, or after recognition is granted until a first contract is entered into, would receive full back-pay plus two (2) times that amount as liquidated damages. In addition, any employer found to have willfully or repeatedly committed unfair labor practices during a union organizing campaign or during the period before a first contract is entered into would be subject to a civil penalty not to exceed $20,000 for each violation. Finally, injunctive relief would be readily available where unfair labor practices were alleged to occur during a union organizing campaign or after recognition is granted but before a first contract is entered into between the employer and the union.