6 Ways a Union-Backed Bill Will Upend the Job Market

COMMENTARY Jobs and Labor

6 Ways a Union-Backed Bill Will Upend the Job Market

Feb 6th, 2020 6 min read
COMMENTARY BY
Rachel Greszler

Research Fellow in Economics, Budget and Entitlements

Rachel researches and analyzes taxes, Social Security, disability insurance, and pensions to promote economic growth.
House Speaker Nancy Pelosi attends a press conference on the Protecting the Right To Organize (PRO) Act on February 5, 2020. Sarah Silbiger / Stringer / Getty Images

Key Takeaways

A bill the House of Representatives is about to pass would upend the U.S. labor market as we know it.

One of the reasons unions are in decline in the U.S. is because they haven’t adapted to the changing labor market and economy. 

The PRO Act would set workers and the economy back by forcing 20th-century structures onto a 21st-century workplace.

Despite its congenial acronym, a bill the House of Representatives is about to pass would upend the U.S. labor market as we know it.

The Protecting the Right to Organize Act—dubbed the PRO Act—comes at a time when the labor market is stronger than it has been in decades. 

Unemployment is at a 50-year low. Wage growth is incredibly strong, with the lowest-wage earners experiencing twice the average gains. The number of discouraged workers plummeted more than 25% over the past year as favorable work opportunities opened up for them. 

The PRO Act threatens all of those gains at the expense of benefiting union bosses who send hundreds of millions of dollars to liberal causes and politicians each year.

Under the PRO Act, workers would lose—not gain—protections and basic democratic rights, along with a chunk of their paychecks. Among its many other troubling provisions, the PRO Act would also put independent workers’ livelihoods on the line, intervene in employers’ business decisions, and overturn 27 sovereignly enacted state right-to-work laws and a Supreme Court decision.

Here are just a few of the PRO Act’s harmful provisions:

1. It violates workers’ privacy. The PRO Act would force employers to provide employees’ private information—without their consent and without even the chance to opt out—including their home address, personal email address, and mobile and home phone numbers to unions. This is more personal information about their workers than employers have to provide to any government entity, including the IRS. There is no basis for granting union bosses greater access to individuals’ personal information than federal, state, or local lawmakers, especially when union organizers have been known to use such information to threaten and intimidate workers at their homes or to sign them up for thousands of dollars of unwanted subscriptions and products. 

2. It strips workers of the right to a secret ballot election. A fundamental component of our democracy is the right to vote in secret and free from fear and intimidation. That’s why many Democrats in Congress insisted on secret ballot union elections as a condition in the United States-Mexico-Canada Agreement. Ironically, those same lawmakers support the PRO Act, which would allow union organizers to bypass secret ballot elections. It instead allows a so-called card check process—which currently only indicates a worker’s willingness to have a secret ballot election—to unionize without an actual vote. That is especially troublesome, given the intimidationmisrepresentation, coercion, threats, and promises unions all too often use to get workers to sign the cards. If enacted, this provision would be equivalent to replacing the current election system in the U.S. (including secret ballots and neutral voting precincts) with a single political party canvassing votes door-to-door without any integrity checks. 

3. It subjects neutral third parties to strikes and boycotts. In an attempt to force other companies to do their bidding, the PRO Act would allow unions to strike, boycott, and otherwise harass neutral third parties that are not involved in labor disputes, but that simply do business with a company involved in a dispute. For example, in a 2014 case, a hotel workers’ union pressured outside companies that had booked events at the hotel with which the union had a dispute to cancel those reservations using tactics—including trespassing, threatening to go to the neutral affiliates’ homes, attending meetings and shouting at customers, and incessantly following and calling neutral parties until they gave into the union’s demands. Such secondary boycotts are entirely unfair to neutral businesses and their employees, who would suffer economic harm and potentially long-term reputational damage through no fault of their own. (That’s why they are illegal.) 

4. It overturns the franchising business model. There are about 750,000 franchise establishments in the United States, representing far more than just fast-food restaurants. All told, franchises are spread across 300 different types of businesses in the U.S.—including car dealerships, gas stations, hotels, and gyms—and employ nearly 8 million workers. The PRO Act would upend that business model by requiring franchisors to become legally liable for workers they do not hire, fire, pay, supervise, schedule, or promote—in short, workers over whom they exercise no direct control. The consequence would be fewer franchises, fewer jobs, lower incomes, fewer goods and services, and higher prices for consumers. 

5. It upends the gig economy, contracting, and independent work. Lots of people like working for themselves. In fact, the Freelancers Union estimates that 1 out of every 3 workers in the U.S. participates in independent work. About 10% of workers perform independent work (contracting, freelancing, consulting) as their primary job, and that’s their choice. According to the Bureau of Labor Statistics, fewer than 1 in 10 independent contractors would prefer a traditional work arrangement. By changing the definition of an employee, the PRO Act would require that almost everyone answer to a boss instead of having the option to work independently—including when, where, and for whom they want. The same legislation is killing jobs left and right in California—and the PRO Act doesn’t include the many exemptions that exist under California’s law.

6. It invalidates 27 states’ right-to-work laws and overturns a Supreme Court decision. Currently, 27 states have laws that allow workers the right to choose whether or not to join a union, and the Supreme Court ruled in Janus v. AFSCME that public employees cannot be forced to pay fees to unions as a condition of their employment. The PRO Act would upend these laws of the land, usurping power from one branch of the federal government to another, as well as restricting state lawmakers from their rights to enact worker freedoms and establish an economic and business climate that they believe is most conducive to growth and opportunity. For workers in unionized workplaces, this could mean the loss of hundreds of dollars in wages each year to pay for a service workers do not want and may actively oppose. Forced union fees are particularly troubling in light of union corruption. Recently, federal prosecutors revealed a United Auto Workers unit “riddled with corruption” as top UAW officials used millions of dollars from workers’ dues for lavish personal expenses. While some workers would lose wages to union fees, others could lose their jobs as unions significantly drive up employers’ costs (and not just their compensation costs). Unions have a credible argument against representing so-called free-riders who do not pay union dues or fees, but the solution is not to force them to pay for representation they do not want, but to end exclusive union representation and instead have workers who do not pay the union obtain their own representation, if they desire it.

One of the reasons unions are in decline in the U.S. is because they haven’t adapted to the changing labor market and economy. 

Many of the benefits of unions in the past—such as securing safe working conditions and fair wages—have become less relevant as both the law and the globally competitive economy have produced the things unions used to achieve. 

Instead of trying to force workers into unions that don’t provide value to them, unions should be responding by providing services that workers want so that they will join voluntarily. 

The Freelancers Union, for example, has done just that by helping freelancers pool together for lower-cost benefits, such as health and disability insurance. And it does it without requiring any dues from members. 

Whereas the PRO Act would set workers and the economy back by forcing 20th-century structures onto a 21st-century workplace, policymakers can help workers adapt to, and benefit from, changes in technology and the nature of work by expanding on the recent pro-growth policies that have generated a strong economy and competitive labor market; allowing the private sector to respond to workers’ demands; allowing options other than traditional employment for individuals to earn a living or to supplement their income; and by making it easier for nontraditional workers to access traditional workplace benefits.

This piece originally appeared in The Daily Signal