The Employee Free Choice Act: What’s it really mean?
November 26, 2008 by Jim GiulianoPosted in: Employment law, Management, Money, Special Report, policies
You’re a small company so you probably don’t need to prepare for the possibility of dealing with the Employee Free Choice Act, right? Well …
First, let’s talk about what would happen to businesses of any size if the EFCA became law (full-disclosure warning – it’s long, complicated and not pretty):
- A union would have the right to be recognized as the exclusive bargaining representative of your employees if a majority of those employees sign authorization cards.
- If a majority of employees sign cards, an employer must begin bargaining within 10 days after the union is certified.
- If the union and the employer cannot agree upon the terms of a first collective-bargaining contract within 90 days, a federal mediator steps in.
- If, after 30 days of mediation, the union and employer still have not agreed on a contract, a federal arbitrator would be empowered to determine the terms of the agreement, and your employees would lose their current right to ratify the terms of the agreement.
- If an employer is found to have unlawfully terminated pro-union employees, the law would provide for liquidated damages of three times back pay. In addition, you’d be hit with a $20,000 penalty per occurrence if the National Labor Relations Board or a court finds against you.
Now, let’s talk about how HR should prepare for the passage of the EFCA:
- HR and management should get educated on the EFCA rules, the logistics of any card-signing campaign, and any unresolved employee issues that may make the company vulnerable to unionization.
- Supervisors should understand their role in any union card-signing campaign, and what they can and cannot say to employees regarding union organizing and union representation.
- HR, as part of new-hire orientation, may want to underscore the benefits the company already offers without unionization.
- Further, some advise employers to refrain from mentioning unions for fear of making employees more aware. However, most companies have found that dealing with the issue head-on by informing employees about the drawbacks of unionization has been the more effective approach.
Where it stands now
Anyone who tries to predict the future of the EFCA may as well pretend to use a crystal ball; no one’s sure where the proposal is going and when it will be considered. Most are betting that the EFCA will become law in some form.
Right now, there’s more than one version of the act floating around Capitol Hill. Here’s the Senate version.
Tags: EFCA, Employee Free Choice Act, HR, National Labor Relations Board, union
December 1st, 2008 at 10:34 am
I have been on both sides with a large company & union representation. You will find that in most cases, there is no need for a union if the company is fair & takes care of their employees. The Company’s policies can be the cause for union activity. Be up front & treat people like you would prefer to be treated.
December 1st, 2008 at 10:41 am
Your article does not specify what size business the EFCA will affect. Your lead in says “You’re a small company so you probably don’t need to?” So will it affect me or not ?
December 1st, 2008 at 12:35 pm
Mike – only if your employees want to go with a union. That is a wide range of companies. Typically, it affects manufacturing companies.
December 1st, 2008 at 1:58 pm
This law is nothing more than another way for gaining political control over business and a move toward socialism……why would any employer – especially a small one (11 employees or less?) want to have a union dictate how they would do business?
You can expect the Acorn-Like Community Intervention Tactics used against banks and bank managers at their homes to influence (read intimidate) workers.
The effort seems to be underway against one of the largest non-union employers – WalMart. Watch for large crowds of people with no connection to unions or companies (or even your city) massed outside your business when shift change occurs and watch employees sign these cards for fear of their lives. You can pooh-pooh it all you like but when it happens then what?
The term “scab” starts to ring a bell except that the new call will become “capitalist pig”!
The new attorney general candidate is not going make any waves to prosecute any overt union shenanigans either judging by his lackluster milquetoast legal performance. Obama wants unions to use as a tool for control of business everywhere and Eric Holder is a do anything for the boss guy(like pardoning the murdering FALN Terrorists in 1999).
Employers will become powerless to manage their own companies….which is the whole point of this legislation. At some point the HR Manager will simply be working for the government not the employer.
December 1st, 2008 at 2:15 pm
This is going to change the face of all of the foreign car companies who come to the U.S. and then prevent employees from organizing. It’s going to make them play on a level playing field finally! Will be great for competition as well, since there won’t be a ’south’ region that can get away with not playing by the same rules.
Plus, Walmarts won’t be able to skirt around the issue of fair wages. Good for them. I hope they get this in the works as soon as the year starts. Will keep foreign-owned companies from advantaging themselves in our country.
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December 1st, 2008 at 2:26 pm
Marcus, what are you talking about? It sounds like a knee-jerk reaction to unions. I guess you don’t realize it, but everything you said applies to those companies that don’t believe in treating their employees with respect and fairness. If it wasn’t for companies with attitudes like yours, we wouldn’t have unions. So, if you don’t like unions, treat your employees right.
I’m not big on unions either, but I understand their purpose, and why they exist. The little guy HAS to have a voice, and sometimes unions are the only way to give him a voice.
Judith said it best, “..there is no need for a union if the company is fair & takes care of their employees.”
December 1st, 2008 at 2:37 pm
This is the most fundamental change in the Labor Relations landscape since Taft-Hartley in 1949. HR Managers must become vigilant in a way they have never faced since the forming of the NLRB. Unfortunately, in recent years most HR folks have steered away from Labor Relations in the belief that it was no longer an essential part of their function. That is about to change and change dramatically.
December 1st, 2008 at 3:15 pm
If this law is enacted, look for the prices at Wal-Mart to rise as well as the cost of foreign cars whose companies have plants in the US. Also look for US companies to move even more of their manufacturing operations overseas, because they have to compete globally and if their personnel costs increase because of union demands, then they have no choice. They are responsible to their shareholders, not the employees. One basic point that is often missed is that the jobs belong to the employer, not the employees. Unions have contributed significantly to the demise of American industry by inflating the cost of goods produced and this new legislation will only speed the day when the government controls production.
December 1st, 2008 at 4:03 pm
Tom is correct.
Everyone needs to keep in mind that unions are in business for ONE reason: TO MAKE MONEY.
They thrive on perpetuating the myth that the “little guy” doesn’t have a voice. Marcus is not
knee-jerking; he’s stating the truth (unfortunately).
December 1st, 2008 at 4:16 pm
all fine and dandy and i understand but i envision some drastic changes to non-solicitation policies within companies. as most of our Companies allow for mom/dad selling candy for their kids; allow for United Way campaigns: allow for various solicitations of its employees for a variety of causes, etc. we will all need to put an end to any and all solicitation?
December 1st, 2008 at 4:47 pm
Richard, The EFCA as currently proposed (HR 800) has nothing to do with solicitation, it only deals with union organizing activities. Whoever is the owner of a compant can establish any policy they desire dealing with solicitation.
December 2nd, 2008 at 11:33 am
Wow, in the midst of some of the worst economic conditions since the great depression (which was also exacerbated by gov’t interference), American’s true colors shine through: “what’s in it for me”.
While unions may well have had a purpose at one time, they have become both an integral cog in the broken machine that is Washington, and a liability to our country’s sucess in terms of global competitiveness with other economies and political systems.
We will not see positive change in our country as long as the political caste can buy votes, like those of the elderly or union groups, by pushing thru legislation providing those groups additional protections, powers, or financial considerations. The EFCA is payback, nothing more, for political support provided by union groups: “help us gain power and we’ll help you gain power.” There is no overwhelming societal need or even demand for EFCA; and in terms of employee relations the market already decides that effectively. Unemployment over the last couple of decades has, on average, been low enough you are forced as an employer to offer competitive wage and benefit packages to retain quality employees. Treat them poorly, as suggested occurs by some of your posters, and you lose the best and brightest to your competition, and leave yourself the dregs, with the obvious impacts on your business’ survival. Call it enlightened self-interest; and it begs the question why would any group, given the example provided by government or unions, choose to equally reward and protect those barely doing the job with those excelling at the same job? You end up with exactly what we’ve seen in those same union and government shops–a culture of mediocrity. History clearly points out the results for societies that buy compliance with bread and circuses; the same road we seem to be traveling now.
December 2nd, 2008 at 12:07 pm
EFCA, which is far more likely to become law under the coming Democrat majority Congress, will notably change the manner of unionization. It is designed less to ensure the rights of worker’s free choice than to eliminate natural obstacles to unions. The legislation will replace secret ballots with signature cards, without clarity of intent of such, prevent employer knowledge of activity and opportunity to rebutt union claims, and force concessions by mandating contracts.
If the legislation would permit desolving a union by the same proposed means, it would be less alarming. The secret ballot process is a clear process void of misunderstanding on whatis being chosen. Signature cards could and would likely mistaken by workers for less than what they will come to represent under this proposed legislation; a vote for unionization signed under potential duress of union activists.
Penalties for termination of “pro-union activists” are yet unclear in final application since no announcement or formal process will be required to advise employers of union activity. Therefore, any termination could become litigation whether the employer was aware of the individuals standing or not.
I see many problems, and ultimately greater worker dissatisfaction with unions than present.
This proposed legislation is directly in response to less interest or need for union assistance in the workplace. Most employers readily value their workforce and provide benefits commensurate to the market they represent.
Unions are not charitable organizations, they are businesses. Their leadership is kin to corporate executives, and be assured they like their “fat salaries” and such as well.
No good will come of this legislation, except to perhaps show forth more clearly the true intentions of those behind it.
I am most concerned for our loyal employees, who look to us, their employer, for prudent leadership, sound institutions and employment durability, as once this becomes law, we will be disengaged from the preocess and powerless to act in their best interests. Forced to either agree to imprudent contracts or surrender to unarbitrated terms dictated by outsiders likely lacking knowledge necessary to survive in the industry.
I do not strictly oppose unions. However, I do vehemently oppose this legislation because it is not in the interest of furthering employee will or free choice as depicted in name, but orchestrated to empower failing unions with monopolistic conditions unchecked in their tactics.
Under present law, employers cannot take adverse action against organizers or “pro-union” employees, but that’s not enough…
Under present law, employees have “free choice” of unionization if enough workers desire it as revealed in secret ballot, but that’s not enough… Note: Unions allege employer interference based on lower votes than ‘voiced’ intentions. I would suggest the data indicates the pressure to vocally consent in spite of one’s true feelings. The proposed law removes the “secret” ballot, and thereby prevents a vote without potential duress.
Under the present law, contracts are not manadatory, but must be negotiated by both parties without a requirement for consession by either party. The legislation would require a contract regardless of the terms sought by the union or employer. Either party could introduce “hardball” propositions forcing unwise consent to terms or third party designed contracts unchangeable for two years.
Industry after industry has fell prey to relentless pursuit of imprudent union contracts. As American workers have grown aware of the downside of such, unions have suffered a notable downturn in new members. This legislation is designed to reverse that trend, whether good for the American worker or not. Union leaders are fighting to hold more market share, which just happens to be the American workforce.
December 2nd, 2008 at 3:20 pm
Jenna must be the local union representative or just doesn’t understand business very well. The foreign car companies who pay very good wages in the areas where they are located will just move on to Mexico if they get pushed too hard by the unions. It won’t be good for anybody. The unions have nearly broken the US auto manufacturers, and now they’re trying to save themselves and ruin the business for everyone else. There’s a reason Texas has produced more than half the new jobs in country over the last couple of years. There’s a reason the South in general hasn’t suffered the business slowdowns that the the northeastern states have suffered. It’s called “right to work”. Socialism hasn’t worked anywhere in the world, but the unions keep on trying. But who are they going to work for when the last manufacturer has left the country.
December 3rd, 2008 at 2:18 pm
My company makes automotive care products and has been hit very hard by the economic turn down. A union organizer came to our company and secretly solicited members in our parking lot and handed out pamphlets making all kinds of promises. This is what they do. Make promises they cant deliver on. They don’t offer ANYTHING! They can just negotiate for a better deal. They don’t provide any benefits to anyone. Our company offers 100% paid medical benefits, paid holidays, life insurance, matched 401K program and good wages. At least we had the opportunity to educate our employees how good they have things. If this law passes, we won’t have the cooling off period to rebutt all the UNION LIES told to our employees.
I WANT CONGRESS TO VOTE IN FAVOR OF SUPPORTING THE AUTO INDUSTRY STIMULUS PACKAGE. However, I am torn because this will keep the Union shops going. its the Unions that have brought down our auto industry and the democrats have supported their every move. Democrats accept Union money and make it easier for Big Labor to crush the competitiveness of business in America. It ok for Honda to set up in Ohio with no Union and tax advantages that make them more competitive than our own US auto makers. VW, a German auto company subsidized by the German gov’t will setup in Chatanooga, TN, again with tax advantages and is not saddled with the burden of healthcare because they have gov’t run healthcare. Nissan is in TN with same advantage. Toyota is in KY and 13 other locations in America without ANY Union to bog them down. EVERY FOREIGN MANUFACTURER IS HERE IN THE US WITHOUT UNIONS TO DESTROY THEIR COMPETITIVENESS. CHINA IS COMING NEXT. They pay good wages and benefits and unions cannot offer them anything but misery. It was OK for Foreigners to ship jobs overseas to US because we welcomed them and gave them tax advantages. BUT DEMOCRATS ARE AGAINST SHIPPING JOBS OVERSEAS BECAUSE YOU NEED TO SAVE UAW JOBS. REMEMBER THAT DEMOCRATS HAVE PERPETUATED THE UNION WORKSHOPS. Foreign Auto won’t have the UAW to worry about because the US taxpayer would have already bailed the UAW out. I HATE Big Labor and what it has done to the American work ethic.
Congress is talking tough with the auto industry and the unions but the Unions are the reason the auto industry is in the state it’s in. This ridiculous law will make it even easier for the Unions to covertly overtake a viable business and run it into the ground. Congress realizes this and yet they are still trying to push this thru. Call your congressman to shut this down.
December 5th, 2008 at 9:01 am
Gary is right on. Jenna either just doesn’t get it – or she’s a plant.
The thing that strikes (pardon the wordplay) me most is the name “Employee FREE CHOICE Act.” Secret ballot IS FREE CHOICE. Holding a card in front of someone to sign while a couple of muscled buddies stand next to your car, or talk about how good-looking your daughter or wife are and wouldn’t it be a shame if anything happened to them takes the FREE out of Choice.
But then again, Organizers would NEVER use intimitidation! Would they?
December 19th, 2008 at 12:35 pm
I am fortunate to work for men who have tried to develop the kind of company that they would want to work for. I can’t imagine our employees, most of whom feel it’s the best job they’ve ever had, wanting to join a union. Some employees aren’t happy with some benefits, but the total benefits package is good.
I know people bash Walmart a lot for the low wages, but they do offer some good benefits. My husband was just off work sick for two weeks, and it was all paid. That’s on top of two weeks paid vacation and some personal and bereivement days he gets every year. Walmart also contributes to a 401K for all employees wether the employee participates or not. Most companies only match for participating employees. The 10% discount on general merchandise and produce helps too – they extended the discount to cover all purchases over the holidays. I’m not saying they’re the greatest employer in the world, but theyr’e not as bad as they have been made out to be in the press; not when you look at the total package and not just the wages.
I do fear the day when we no longer have private business in this country. It just keeps getting harder and harder. And while the Big 3 made a lot of their own mistakes, the unions had their share of dragging them down with unrealistic expectations.
March 2nd, 2009 at 2:50 pm
Every time i come here I am not dissapointed, nice post
March 2nd, 2009 at 4:50 pm
This proposed legislation HR 800 and S 1041 is the most profound change to the labor relations landscape in the United States since the passage of Taft-Hartley Ammendment to the NLRA in 1949. It is NOT about fairness or anything like it. It is NOT about how well or poorly an employer treats his or her employees. It IS ALL about how the declining union membership (8.2% in 2007 according to BLS) can be revived through secret organizing tactics that employers will have a difficult time combating. It will effect ALL types of workers with the exception of public sector employees.
March 23rd, 2009 at 12:54 pm
The point is not whether you are pro or anti union. The point is that the new law would let unions scare and coerce employees into signing union cards using threats and other coercive tactics but would forbid the employer from even breathing a word against the union. Another “freedom” that should more rightly be called the forced unionization law.