Union Busting is Big Business

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John Schmitt and Ben Zipperer
Topeka Capital Journal, July 6, 2007
Northwest Arkansas Times, July 10, 2007
AlterNet, July 20, 2007
AFL-CIO Milwaukee Labor Press, July 26, 2007

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As the percentage of American workers in unions continues its long and severe decline, the Senate just voted to kill the Employee Free Choice Act. What prompted the now-dormant bill, and what is causing the weakening of the labor movement, is not a decreased need for unions. According to polls, about half of non-supervisory workers want to join one, but employers are increasingly breaking the law to prevent their workplaces from being unionized.

Fifty years ago, more than 30 percent of private-sector workers were organized. That share today is 8 percent. Globalization and the new, technology-driven economy have contributed to this decline, but advanced economies in Europe survive these same developments with union coverage rates as high as 80 percent. Much of the falloff is actually the result of illegal, anti-union actions by employers. Our recent analysis of cases brought before the National Labor Relations Board (NLRB), which oversees union-management relations in most of the private sector, shows that employers illegally fire as many as 1 in 5 union organizers.

Actions by the world's largest employer are a case in point. When butchers at Wal-Mart's Jacksonville, Texas, store joined the United Food and Commercial Workers International Union, Wal-Mart permanently closed its meat-cutting departments, switched to pre-packaged meat, and fired four of the union supporters.

Just picking on Wal-Mart is unfair, as much of the business community also despises unions. Unions fight for increased wages and benefits and for redistributing earnings from employers to workers. Corporate managers, on the other hand try to maximize profits for shareholders and compensation packages for those at the top. Compelled by the threat of lower profits, many employers will do whatever it takes to avoid a union workplace.

Not infrequently, this means breaking the law. The National Labor Relations Act (NRLB) makes it illegal to intimidate or fire workers for union activity. Yet, according to our study of data from the NLRB, there has been a steep rise in illegal firings of pro-union workers in the last few years. Currently, 1 in 53 is dumped during an election campaign. And employers generally fire the workers who are leading the union organizing drives. If 10 percent of union supporters are actually organizers in their workplace, NLRB data show that about 1 in 5 is fired illegally for their activism.

Interestingly, union membership has actually increased in the public sector. Whereas the private sector — the bulk of the U.S. economy — has seen unionization fall by three-quarters over the last 50 years, public-sector union membership has tripled over the same period to about 36 percent. Persistent, illegal activity by employers in the private sector explains this disparity. Illegal firings exist in the public sector too, of course, but they are less prevalent. Additional civil service protections ensure that firings are more onerous to the government than they are to a business. Besides, we should expect less union busting in the public sector: There is no profit motive there.

President Dwight D. Eisenhower once lambasted union busters, proclaiming, "Only a fool would try to deprive working men and women of the right to join the union of their choice." The fools today are actually quite rational, practicing the cool calculus of costs and benefits.

In a worst-case scenario, the cost of firing a union supporter isn't that much. It includes legal proceedings and remuneration to the discharged employee. At a maximum, discharged employees will receive missed earnings minus any income they have earned in the meantime. The total award usually amounts to less than $4,000, a small price to pay to avoid sharing profits with employees through a union-negotiated contract.

In its vote, the Senate eliminated the opportunity to increase fines and make other changes to labor law that reduce the incentives for illegal employer aggression. But without those reforms, crime really does pay.

John Schmitt is a senior research associate and Ben Zipperer was a research assistant at the Center for Economic and Policy Research in Washington, DC.