On March 9, 2015, Wisconsin Gov. Scott Walker signed into law a measure that prohibited unions from requiring non-union members for whom they bargained to pay agency fees, striking another blow against organized labor four years after the state effectively ended collective bargaining for public-sector employees. The new law, effective immediately, made Wisconsin the 25th right-to-work state and the first to do so since Michigan and Indiana enacted similar laws that were intended to hobble the ability of employees to bargain collectively for wages and for better working conditions.
Mark Mix, president of the National Right to Work Committee, claimed the action then put pressure on other Midwest states to follow suit. "Every worker deserves freedom of choice when it comes to union membership and dues payment, and if states like Michigan and Wisconsin can pass Right to Work then Illinois, Minnesota, Missouri and Ohio can too," Mix stated.
Mix's professed concern for the freedom of workers is little less than disingenuous propaganda since the economic evidence and historical record show that "right-to-work laws" have significantly weakened unions, and that the decline of a viable labor movement is inextricably linked to rising economic inequality among Americans. As employers inevitably engage in a collective "race to the bottom" the ability of employees to negotiate and demand higher wages and better conditions for work declines.
As of 2018, twenty-four states had agency fee requirements for public employees. While 28 states have so-called right-to-work laws that prohibit mandatory agency fees, Wisconsin and Michigan had exceptions for police officers and firefighters that permit agency fees covering those workers. In those right-to-work states, unions still represented workers but membership rates were significantly lower. Agency fees, paid by public-sector workers who decline to formally join their unions, provided millions of dollars annually to unions. The loss of that revenue further weakens the power of unions to create better working conditions and to improve the standard of living for employees.
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The unremitting war against unions and the right of employees to bargain collectively for better compensation and working conditions has remained under attack by a well-funded and orchestrated cabal of right-wing pro-business groups since the end of the New Deal. In 1977, the U.S. Supreme Court decided Abood v. Detroit Board of Education. In a unanimous decision, the Court affirmed that the union shop, legal in the private sector, was also legal in the public sector. The Court held that non-members may be assessed agency fees to recover the costs of "collective bargaining, contract administration, and grievance adjustment purposes" while insisting that objectors to union membership or policy may not have their dues used for other ideological or political purposes.
In the 2018 term of the U.S. Supreme Court that decision was contested anew. In Janus v. American Federation of State, County and Municipal Employees, the Supreme Court agreed to consider - for the second time in two years -a suit brought by anti-union groups. The nominal plaintiff, a disgruntled social worker in Illinois, challenged the legality of fees that workers who are not members of unions representing teachers, police, firefighters and certain other government employees must pay to help cover the costs of collective bargaining with state and local governments. Janus' lawsuit was funded by The National Right to Work Foundation which is part of a right -wing network funded by corporate billionaires and ideological opponents of unions.
In Abood as well as in Janus, the plaintiffs argued that requiring them to pay agency fees to unions whose views they may not share, violated their rights to free speech and free association under the First Amendment to the U.S. Constitution. Ironically, two prominent conservative law professors, Eugene Volokh and William Baude, had previously debunked that argument as nonsensical. In an amicus brief that they submitted on behalf of the AFSCME, they argued that even Abood was wrongly decided: "Where Abood truly went wrong... was not in how it applied the new First Amendment objection it recognized. Rather, Abood erred by recognizing that objection in the first place. Compelled subsidies of others' speech happen all the time, and are not generally viewed as burdening any First Amendment interest. The government collects and spends tax dollars, doles out grants and subsidies to private organizations that engage in speech, and even requires private parties to pay other private parties for speech-related services--like, for example, legal representation. To be certain, these compelled subsidies are subject to other constitutional restrictions. For example, the government cannot compel payments that violate the First Amendment's Religion Clauses or the Equal Protection Clause. But a compelled subsidy does not itself burden a free-standing First Amendment interest in freedom of speech or association."
For their part, the unions contended that mandatory agency fees were needed in order to eliminate the problem of what they call "free riders" - non-members who enjoy the benefits of union representation i.e. - such as increased compensation and better working conditions obtained in through collective bargaining - while simultaneously refusing to pay for the costs of that representation. In addition, depriving unions of agency fees could thwart their ability to spend money in political races. Historically, because of the long-standing antipathy of the GOP to unions, unions have endorsed and supported Democratic candidates.
In 2016, the Supreme Court considered a similar case, and after hearing arguments appeared poised to overturn a 1977 Supreme Court precedent, but the death of conservative Justice Antonin Scalia the following month left the court with an even split of conservatives and liberals, and its 4-4 ruling in March 2016 did not resolve the legal question. Republican President Donald Trump's appointment of Justice Neil Gorsuch in 2017 restored the Supreme Court's 5-4 conservative majority. In the spring of 2018, after the appointment of Neil Gorsuch, by a vote of five to four, the Supreme Court's reactionary majority sided with the plaintiff and, in reversing the Abood decision, held that even the collection of agency fees by public sector unions violated the First Amendment rights of employees who opposed unions.
"This case is about power," American Federation of Teachers President Randi Weingarten said. "The funders of this case want a new Gilded Age, this time on steroids," Weingarten added, referring to a period in the late 19th century known for its concentration of wealth among industrialists.
The union membership rate among public-sector workers was nearly 35 percent in 2017, more than five times higher than the unionization rate for workers in the private sector, U.S. Bureau of Labor Statistics figures show. Taking away mandatory agency fees could have profound implications for public-sector union coffers. Unions in New York state, for example,
would lose an estimated $110 million per year without mandatory fees from non-members, according to the business-backed Empire Center for Public Policy. The loss of this revenue to unions would be especially damaging since unions have historically been the agents that have promoted a higher standard of living, income equality, job security, and equal treatment of all employees in the workplace.
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The private sector analogue to Janus v. AFSCME is Epic Systems v. John Lewis, a series of cases that U.S. Supreme Court also decided in its 2018 term. The employees in the Epic cases complained that their employers underpaid them in violation of the wage and hour provisions of the Fair Labor Standards Act of 1938, and that, under §7 of the National Labor Relations Act, they were entitled to engage in concerted action - such as class action arbitrations - to vindicate their rights.
Supported by the U.S. Chamber of Commerce and a virtual smörgåsbord of right-wing funded institutions and "public interest" groups with deliberately deceptive names such as the Equal Employment Advisory Council, as well as by the Trump administration, the plaintiffs in Epic argued that the Federal Arbitration Act - that was passed in 1925 - should be construed to ignore and override the statutory provisions of the National Labor Relations Act.
The NLRA, which was passed in1935 during the New Deal, was enacted to counter widespread strikes and labor violence between employees - who were denied the right to organize and to bargain collectively - and business owners. These workers and their families were also often the victims of thugs and special police hired by employers. Many others were required as a condition of their employment to sign "yellow dog" contracts - agreements between workers and employers in which the employees - who lacked equal bargaining power - agreed not to join or support a union.
The NLRA, at 29 U.S.C. §151 -"Findings and declaration of policy" - explicitly states "[I]t is hereby declared to be the policy of the United States to eliminate the causes of certain substantial obstructions of the free flow of commerce ...by encouraging the practice and procedure of collective bargaining..." In response to the plaintiffs' claims, the unions replied, "The right to engage in concerted protected activity is ' a bedrock principle of federal and policy' that has repeatedly been invoked by the Board and the courts over the past eight decades....Just as an employer cannot deprive its workers of that substantive statutory right by insisting that they agree to arbitrate all workplace disputes instead of picketing, striking, or engaging in any other form of legally protected protest activity, neither can it opt out of the core, substantive worker-protected right established by Norris-LaGuardia and the NLRA by requiring workers to prospectively waive their statutory right to improve workplace conditions through collective adjudication."
At issue in Epic was the question of whether employers could, as a condition of employment, require employees to sign arbitration agreements that require them to submit all work-related disputes to individual arbitrations, contrary to §7 of the National Labor Relations Act; irrespective of whether they belonged to unions; and irrespective of whether existing negotiated collective bargain agreements required that work-related disputes be adjudicated between the unions, as the freely -chosen agents of the employees, and the employers through the grievance and collective arbitration process.
In another five-to-four decision, writing on behalf of the Court's reactionary majority, Justice Gorsuch ignored the well-established canons of judicial interpretation, the unambiguous legislative history of both acts , and the plain wording of the Federal Arbitration Act. As Justice Ginsberg noted in her dissent, the Federal Arbitration Act was explicitly passed to provide a forum to resolve disputes among merchants, not disputes involving workers who are explicitly excluded from the act. By contrast, the National Labor Relations Act and its immediate predecessor, the Norris-LaGuardia Act, were passed to guarantee the rights of all employees to organize unions, to bargain collectively to improve wages and working conditions, and to engage in collective actions to achieve those and related ends.
The decision in Epic Systems may very well spell the death of organized labor in the private sector and will harm millions of Americans who work for wages, whether they belong to unions or not since they would now be reduced to the status of indentured servants.
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The labor history of the United States in the nineteenth century and the first three decades of the twentieth century was often violent and bloody. Most state courts treated labor unions and strikes as illegal conspiracies in restraint of trade and labor organizers and striking union members were regularly arrested, imprisoned and often shot by Pinkerton detectives,private militias raised by employers, and National Guard soldiers who were mustered into service by business-friendly governors in many states.
Ever so slowly, the tide began to turn. In the 1930s, as the effects of the Great Depression became more pronounced, industrial unionism, organized under the auspices of the Congress of Industrial Organizations (CIO), emerged. With the enactment of the National Labor Relations Act in 1935, the right of all workers "to organize and bargain collectively through representatives of their own choosing" was pronounced for the first time to be national public policy. Other New Deal legislation included the Walsh-Healey Government Contracts Act, which required the payment of prevailing wages on government contracts in excess of $10,000; the Railroad Retirement Act; and the Fair Labor Standards Act of 1938, which provided for the first time, with certain exceptions, a nationwide minimum wage floor and maximum workweek of 40 hours per week within three years of its enactment date.
Courageous individuals such a Bill Haywood, Mother Jones, Eugene Debbs, John L. Lewis, and Walter and Victor Reuther, among thousands of others, struggled to secure social and economic justice for American workers. Organized labor brought to America the right to grieve mistreatment in the workplace, "just cause" termination standards, the eight hour day, weekends off, overtime and rest break regulations, workers' compensation, unemployment insurance and pensions.
Since the 1940s, the American labor movement has been forced into retreat. After the death of Franklin Roosevelt and the election of a Republican Congress in 1946, right-wing liberalism and laissez-faire economics one again became resurgent. The first great success of New Deal critics was achieved with the enactment of the Taft-Hartley Act in 1947, that was passed over President Truman's veto. The effect of this legislation was to outlaw "closed shops" and to permit individual states to allow "open shops"--i.e. shops in which elected unions could not require all of the employees to belong to the unions, irrespective of whether the non-union employees also received and enjoyed the benefits of collective bargaining.
As a result of that legislation, corporations began an inevitable migration to the South where welcoming state legislatures hastily enacted "right-to-work" laws. The migration of these manufacturing companies away from the unionized urban centers of the Midwest and North left hundreds of mill towns impoverished and desolate, and the union movement, over time, has been effectively eviscerated.
By January, 2018, the number of wage and salary workers belonging to unions stood at 14.8 million in 2017, which was an slight increase of 262,000 from 2016. In 1983, the first year for which comparable union data are available, the union membership rate was 20.1 percent and there were 17.7 million union workers.
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Many non-union employees still do not seem to understand that their ability to influence working conditions and wages, as solitary individuals who lack comparable bargaining power with managers and owners of business, is virtually nil. Apparently, however, the myth of the autonomous, self-made individual who can receive recognition, remuneration and advancement solely by dint of one's own hard work continues to resonate in the workplace to the present, notwithstanding all of the evidence to the contrary.
This myth now resonates at the top level of the federal government as Andrew Puzder, a fast food executive and opponent of minimum wage and other labor laws, was chosen by Donald Trump to become the Secretary of Labor. A fierce critic of government regulation and an Ayn Rand enthusiast, Puzder has expressed a preference for automation in the workplace. As he noted, machines are much easier to deal with than humans: "They're always polite, they always
upsell, they never take a vacation, they never show up late, there's never a slip-and-fall, or an age, sex, or race discrimination case."
Even among the few unionized workers still employed in manufacturing, downward economic pressures have forced many unions to acquiesce to a two-tier pay system imposed by management: younger workers now make substantially less per hour than more senior employees who perform the same work. The effect of this two-tier system denies younger workers upward mobility and divides workers based solely upon dates of hire: "The changing job market is undercutting entry-level wages for those who do not go to college. In the 1960s and 1970s, you saw high school graduates getting good jobs at Ford and AT&T, jobs that in inflation-adjusted terms were paying $20 or $25 in today's wages," said Sheldon Danziger, a professor of public policy at the University of Michigan. "Nowadays most kids with just high school degrees will work in service-sector jobs for $10 or less..."
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The decline of unions explains in large part why wages have remained stagnant for decades. As the power of unions has eroded, companies have gained the upper hand and are able to unilaterally dictate to individual employees the terms and conditions of their employment. A survey conducted by Evan Starr, a management professor at the University of Maryland, found that one in five employees in the U.S. were subject to non-competition agreements in 2014. Matthew Marx, a professor at M.I.T's Sloan School of Management, found that employers typically present workers with non-compete contracts when the employers lacked negotiating leverage. The use of non-competition agreements has been expanded to restrict the ability of even low-wage workers to accept successor employment at "competitors" for higher wages in a wide range of jobs from sales to technical services.
Besides non-competition agreements, many companies have increasingly used their economic clout to impose non-poaching agreements that eliminate or severely restrict the ability of franchisees to hire workers from other locations within the same franchise. The "non-oaching" agreements are widespread among franchises as diverse as Burger King, H.R. Block and Jiffy Lube, among others.
Eric Posner and Alan Krueger have pointed to the existence of non -competition and anti-poaching agreements as evidence of "monopsony power." The term is used by economists to describe the ability of an employer to suppress wages below the efficient or perfectly competitive level of compensation. This is done through the use of non-compete clauses and non- poaching agreements that are aimed at the most vulnerable workers.
As Posner and Krueger note, "The studies show that common features of the labor market give enormous bargaining advantages to employers. Because most people sink roots in their communities, they are reluctant to quit their job and move to a job that is far away. Because workplaces differ in terms of their location and conditions, people have trouble comparing them, which means that one cannot easily 'comparison shop' for jobs. And thanks to a wave of consolidation, industries are increasingly dominated by a small number of huge companies, which means that workers have fewer choices among employers in their area." They conclude that, ''When employers exercise monopsonistic power, wages are suppressed, jobs are left unfilled, and economic growth suffers. Unions used to offset employer monopsony power, but unions now represent only 7 percent of the private sector."
Harold Meyerson has described the correlation between union membership and economic equality in article in the American Prospect in 2012. He observed that "From 1947 through 1972, productivity in the United States rose by 102 percent, and median household income rose by an identical 102 percent. In recent decades, as economists Robert Gordon and Ian Dew-Becker have shown, all productivity gains have accrued to the wealthiest 10%. In 1955, near the apogee of union strength, the wealthiest 10 percent received 33 percent of the nation's income. In 2007, they received 50 percent."
Colin Gordon, a Professor of History at the University of Iowa, has argued that "One hallmark of the first 30 years after World War II was the 'countervailing power' of labor unions (not just at the bargaining table but in local, state, and national politics) and their ability to raise wages and working standards for members and non-members alike. There were stark limits to union power--which was concentrated in some sectors of the economy and in some regions of the country--but the basic logic of the postwar accord was clear: Into the early 1970s, both median compensation and labor productivity roughly doubled. Labor unions both sustained prosperity, and ensured that it was shared."
The pervasiveness of anti-union bias remains so potent in right-to-work states and so ingrained in the false consciousness of its citizens that, as recently as February 2017, Boeing employees in South Carolina voted against their own best interests. The National Labor Relations Board announced that 74 percent of the 2,828 workers cast ballots voted against joining the International Association of Machinists and Aerospace Workers (IAM). In a statement, IAM lead organizer Mike Evans said: "We're disappointed the workers at Boeing South Carolina will not yet have the opportunity to see all the benefits that come with union representation."
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The mythology behind "right-to-work" laws and companion efforts have largely succeeded in gutting this country's labor laws but they have produced results quite different from the economic theory their proponents endorse. As Isaiah Berlin sagely noted, "Freedom for the wolves has often meant death to the sheep." In a world of unrestrained competition, only the few, the wealthier, the more powerful, the more resourceful, the better educated, the more mobile, will be able to maximize their opportunities; everyone else gets left behind or becomes "road kill."
If unregulated market economies are the answer to economic progress, as corporate CEOs and their lobby of sycophants and enablers insist, how then does one explain the implosion of Wall Street and the related financial scandals that destroyed trillions of dollars of wealth possessed by ordinary Americans? Conversely, if government regulation of the economy is the problem, how do we explain the growing economic inequality in the U.S? Why is it that, despite what right-wing libertarians claim is a confiscatory tax code, the wealth of the top 1% continues to grow exponentially?
Massachusetts Senator Elizabeth Warren has been criticized by the Republican noise machine and its right-wing media outlets for stating the obvious: that each of us has depended for our success, to some degree, upon the help, assistance and inspiration that we received from others. Further, she has emphasized the obvious: that public goods - rail, road and airport infrastructure, public education, government support for R&D, public health, food and safety regulation, environmental regulation, civil rights protection, consumer protection, anti-trust regulation, protection of intellectual property - are essential prerequisites for economic success. Consider, for example, the rewards reaped today from the government funding and research to create satellite/GPS technology and the internet.
Market economies are affected by the frailties and foibles of human actors. Many of these actors are motivated by selfish, short-sighted concerns; but the consequences of their actions harm everyone. It is for that reason that regulation in the public interest and investment by the government - as the agent of the people in a democracy - are essential antidotes to the temper the excesses of capitalism and to create the foundations for a truly just society.
The continued clamor to reduce public regulation and investment is a siren call that is orchestrated by corporations and the wealthy elite who want free reign to continue to game the system. Ordinary citizens need to resist that clamor and to understand that their true, long-term interests have little in common with the interests of the top 1%. As Nicholas Kristof reminds us "If you're infatuated with unfettered free markets, just visit Waziristan."