Employee Free Choice Act (EFCA) Update: Methinks Thou Dost Protest

February 19, 2009

Last November, when Barack Obama was elected President and Democrats took control of Congress, passage of the Employee Free Choice Act (“EFCA”) seemed all but a done deal. Labor even boasted that EFCA would be part of the new president’s 100-day agenda. But then came the economic crisis, TARP, the auto industry bail out, and the loss of nearly 600,000 jobs in January 2009 alone.

Key Proposed Provisions

EFCA has three basic components.

1. First, as written, EFCA would require employers to recognize a union if the union obtained signed authorization cards from a majority of workers in the proposed bargaining unit.

This provision, often referred to as “card check,” has received most of the media attention because many see this aspect of the bill as the most controversial. Recently, pro-business blogs have noted the increase in letters to the editor challenging claims that EFCA does away with secret ballot elections. While it is technically correct that elections may still be possible under EFCA, the language of the bill only authorizes an election if organizers stop gathering cards before getting half of the employees’ signatures. This means a secret ballot election will only be held if the union, not the employees, is willing to call for an election. Since EFCA was introduced to avoid secret ballot elections (which unions have been losing in ever increasing numbers), it is highly unlikely unions will make such a request of the Board.

2. Second, EFCA would mandate mediation and binding arbitration on first contracts when the union and employer cannot agree to the terms of a collective bargaining agreement within certain limited deadlines. Although not receiving as much press, this aspect of the bill is as dangerous to business as the card check provision.

3. Third, EFCA, if passed, would increase penalties for unfair labor practices.

Administration Squeamishness

Although Senator Obama co-sponsored the Senate bill in April 2005, less than a week before his inauguration, he seemed to pull back slightly from his support of EFCA in its current form. In a January 15, 2009 interview with The Washington Post, then President-Elect Obama, while restating his support for the basic principle of making it “easier and fairer” for workers to join unions, acknowledged his willingness to consider “some modifications and tweaks to the general concept of EFCA.” He offered to listen to both labor and the business community to “see if there are ways that we can bring those parties together and restore some balance.” Most notably, he recognized that while the country is “losing half a million jobs a month,” his focus must be first on key economic priority items.
Since becoming President, Obama has restated his support for EFCA, but continues to encourage the two sides to reach a compromise, noting that business has legitimate concerns about the bill. As reported by The Philadelphia Inquirer in a February 12, 2009 article, President Obama said “he would not urge a delay in consideration of [EFCA] legislation,” but there are no indications he is pushing it to the front of his agenda either.

Interestingly, in a January 29, 2009 interview with CNBC, Vice President Joe Biden said he thought the administration would move “prudently,” with an understanding that there is “only so much on the plate these first couple months” and that there will need to be compromise. When pressed as to whether that meant EFCA would be pushed to 2010 or beyond, Biden emphatically denied a significant delay, saying he expected it could move forward this year, “hopefully with some bipartisan support.”

Labor Infighting

The most interesting news, however, may be indications there are rifts within labor itself regarding how, when and in what form to push EFCA. Amidst the economic crisis and the auto industry’s pitch for a financial bail out, there were signs the AFL-CIO may be willing to compromise on EFCA in an attempt to save its members’ manufacturing jobs and the payment of their dues. This could mean omission of the card check procedure in exchange for shorter election periods, card check with a “super majority,” access to employees in the work place, or merely an agreement to take EFCA off the legislative front burner for now. Change to Win, on the other hand (with SEIU as its largest and most influential member), represents employees who hold mostly low-paying service industry jobs. Consequently, Change to Win is not likely to shift its focus from EFCA and its organizing potential, which was the basis for SEIU’s departure from the AFL-CIO in the first place.

Now there are reports that the “civil war” brewing between rival factions within UNITE-HERE may threaten that union’s support for EFCA. Greg Sargent, of the blog WhoRunsGov, and Ben Smith at Politico, both reported that members of HERE locals (including locals in Las Vegas and New York) are distributing flyers asking members not to support UNITE’s EFCA campaign. According to HERE supporters quoted on Politico, the fliers are “an attempt to forestall a sneak attack from the UNITE side,” which is led by union co-president Bruce Raynor, who favors dissolving the merged union.

HERE accuses UNITE of inserting an anti-UNITE-HERE message in its internal EFCA communications. UNITE has denied this allegation, but Raynor’s comments in his February 9, 2009 Huffington Post article entitled, “The UNITE HERE Merger – A Missed Opportunity,” belies that claim. As it turns out, Raynor and UNITE-HERE co-president, John Wilhem, differ drastically in their view of EFCA and organizing strategies. Raynor is not shy about chiding Wilhem for his position, memorialized in a September 2008 memo to the Director of the Change to Win Strategic Organizing Center. In that memo, Wilhem takes issue with Change to Win’s strategy of centering a proposed massive campaign on EFCA. As Wilhem says, even if passed, EFCA will be tied up for a long time while new Board members are appointed and regulations and procedures for EFCA are developed. While Wilhem believes the legislation is “desirable,” he does not think it is a “magic wand.” Raynor takes great issue with this comment, and these divergent views of EFCA may be one reason the merged union is coming apart.

Where Are We Now

So where does that leave EFCA? There were rumors EFCA was going to be re-introduced in the House during the second week of February, but that did not occur. As Mark Toth, Chief Legal Officer for Manpower North America, noted on his “Employment Blawg” recently, President Obama’s and Vice President Biden’s comments, taken together, seem to indicate that EFCA will be more or less “on hold” until the Fall and “some experts feel that the President’s three recent pro-labor executive orders were expressly designed to pacify the unions until then.” These observations on timing were echoed by House Majority Leader Steny Hoyer (D-MD), who stated that House action on EFCA is unlikely until the spring. Senate Majority Leader Harry Reid (D-NV) has said the Senate probably will not take up EFCA until the summer. Both indicated, as have the President and Vice President, that compromise is likely.

In the months since the election and amidst increasing panic from business, opposition to the legislation has gotten louder and stronger. While the current economic situation has negatively affected business, it has made the anti-EFCA message more palatable to a larger segment of the public. In a media climate that has not been kind to unions recently, they are, under their breath, also conceding that compromise may be necessary.

As Bill Barry, Director of Labor Studies at Baltimore County Community College, put it: “[a] basic question in calculating the chances for EFCA are the amount of IOU’s that the incoming Obama administration owes to union officials.” Barry points out that although the labor movement takes a great deal of credit for the Democrats’ victory, union votes in the election actually declined for the third consecutive election. His December 2008 article appearing on Gangbox on January 12, 2009, cites to a survey conducted by Peter D. Hart Research Associates, Inc. The survey reported that 67 percent of union members voted for Obama, about the same percentage voting Democratic as in 2004 and 2000. Barry opines: “Among Obama’s many political skills is an unbelievable ability to count hard numbers, so he may well figure that his debts to the unions are less than AFL officers claim.”

Finally, even if EFCA passes in its current form, implementation may be delayed, as it is likely EFCA will face constitutional challenges.

For further information or assistance in preparing for EFCA or for help with union avoidance generally, please contact any member of the McGuireWoods Labor & Employment or Employee Benefits teams.