Executive Summary

Many changes in union laws are affecting companies this year. These changes will help unions win elections against companies. Any company with just two employees may have a union. With foreign-owned subsidiaries remaining the target of the Auto Workers' Union, companies in the U.S. and overseas are rightfully concerned. The National Labor Relations Board ("Labor Board") is prosecuting Boeing for operating an assembly line in South Carolina. In the meantime, the United States Department of Labor is proposing regulations to require consultants and attorneys to reveal certain types of advice they give to companies. Most recently, the Labor Board has proposed regulations that will force companies to give information to employees about unions and to shorten the time for a union election. Therefore, all manufacturing, warehousing and service companies must be aware of these changes and take immediate action to ensure that their companies remain union-free.

When employees ask a union to represent them, the employees and union keep their actions secret. The union – not the company – visits the employees at their homes or in bars, talks with them and gives them information which may or may not be true. Companies usually do not talk with employees about unions, because the companies do not want to give the employees information about unions and the employees' right to support a union. The first time many companies discover that a union is trying to represent its employees is when a union asks the Labor Board to conduct an election.

Currently, the Labor Board will investigate the union's request and hold a hearing. After the hearing, the Labor Board will determine whether there should be an election and which employees should vote. The company may have as many as six weeks to educate its employees about one of the most important decisions of their working lives. After a union wins, the employees must pay dues to the union, follow internal union rules, and only the union represents the employees for their wages and working conditions. In addition, to end union representation, the employees, company and union must comply with complicated procedures.

However, important changes are coming. On June 21, 2011, the Labor Board issued "proposed regulations," to which companies, unions, lawyers, business groups and members of the public have 60 days to submit comments and suggested changes. The Labor Board will then issue "final regulations," which will have the force of law and will change the way the Labor Board, unions and companies must operate.

These final regulations will shorten the time for an election. As mentioned, most companies do not begin to educate their employees until after the union files a request for an election. These new regulations may shorten the period before an election to just three weeks. During that time, the company must hire a lawyer, collect information about the union, and develop and implement a strategy to convince its employees to vote against the union and in favor of the company. Three weeks is not enough time to inform employees about the union and about the immediate and long-lasting implications, if the employees vote in favor of the union.

Specifically, the Labor Board proposes the following changes to the current procedures:

Click here to see table

What do these changes mean to your company? When a union wants to represent your employees, it may have already been talking with them for months. The union has made many promises, including a wage increase of $1.00/hour or more, increased vacation leave and more benefits. The union also promises protection to the employees, telling them that the company may terminate them only "for cause" or by seniority ("last hired, first fired"). Thus, a union may jeopardize the company's flexibility to operate its business.

With these proposed regulations, the Labor Board will rush to have a hearing and an election. The company will have less opportunity to ask the Labor Board to dismiss the request for an election or to determine who should vote. The company will also have less time to educate its employees. The employees will have more opportunity to believe the union's promises. The employees' vote will be hurried and they will not vote with enough knowledge about unions and the impact of their vote in favor of the union.

Therefore, companies must take important actions now to remain union-free. These actions include:

  1. An audit to determine if employees will vote for a union;
  2. Written policies to tell employees that the company believes a union is not necessary;
  3. Written policies and procedures to restrict the rights of unions and employees to support unions;
  4. An analysis to determine if the company's wages and benefits are appropriate to fight a union organizing effort;
  5. The development of "employee relations" to create and maintain an "issue-free workplace;"
  6. Structural changes to the supervisory hierarchy, departments and shifts to weaken a union's attempts to represent the employees; and
  7. Training supervisors who are the "first-line defense" for the company.

Waiting until the union contacts a company is too late. Usually, a union will contact a company when it is supported by at least 75 percent of the employees, although the union needs support from only 30 percent of the employees to ask the Labor Board for an election. Acting now will reduce the risk that your company will become the next target for a union.