Government, Courts, and the World of Work

The U.S. Department of Labor has proposed regulations implementing Executive Order 13496, signed on January 30, 2009, and which applies to all firms under contract with the federal government to provide goods or services in the amount of $100,000 or more. The regulations define the type of notification covered contractors and subcontractors must give employees about their rights to organize a labor union. Among other things, the proposed notification informs employees that they have a right to take actions to improve working conditions without penalty, including the right to strike and picket.

While labor law is exclusively proscribed by the National Labor Relations Act (NLRA), the proposed regulations state that the President’s legal authority is under the federal Procurement Act, which authorizes executive policies that ensure “economical and efficient” procurement and supply.  Every president dating back to the Roosevelt administration has used this authority to pursue executive policies, including encouraging or discouraging union activity, although the U.S. Supreme Court has held that the Procurement Act does not give the president broad discretionary power to set labor policy.  For example, in 1996, the court held that Executive Order No. 12954, which prevented the U.S. government from contracting with employers who hire permanent replacement workers during a strike, violated the NLRA and the Procurement Act, and was unconstitutional.

Specifically, the proposed regulation states, in relevant part, that the U.S. government:

Has a proprietary interest in ensuring that [government] contracts will be performed by contractors whose work will not be interrupted by labor unrest. The attainment of industrial peace is most easily achieved and workers’ productivity is enhanced when workers are well informed of their rights under Federal labor laws, including the [NRLA].

The Office of Federal Contract Compliance Programs (OFCCP) will enforce the Order when finalized, although it is more than likely that a lawsuit will be filed to enjoin enforcement.

The Employee Free Choice Act (EFCA) had 200 sponsors in the U.S. House of Representatives and more than enough votes to pass the measure.

But the chances of getting a filibuster-proof 60 votes in the Senate fell when Republican, now Democratic, Sen. Arlen Specter of Pennsylvania announced he wouldn’t vote for the measure.

Nevertheless, President Obama recently told AFL-CIO leaders in a videotaped address, “We will pass the Employee Free Choice Act, “according to the The Wall Street Journal.

Meanwhile, some businesses have proposed a compromise, including Costco Wholesale Corp., Whole Foods Inc. and Starbucks Corp, employers that would be targets for union organizing if the EFCA gets enacted.

Many observers predicted that the current economic crisis would force Congress to delay action on this bill - but that’s increasingly starting to look like wishful thinking. Union officials have released statements from Nobel-winning economists and other business experts supporting the EFCA, and they’re ready to spend millions of dollars and volunteer hours this spring pressuring Congress to pass the legislation.

In the wake of important labor law reforms, EANJ’s LABOR LAW CERTIFICATE PROGRAM is the first such program in the country to help human resource managers lead their organizations both strategically and legally. Click here for details:

http://www.eanj.org/programs/labor-law-certificate-program

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The Wall Street Journal reports that labor unions will be targeting federal contractors in 2009. According to the people quoted in the resport, unions view federal contractors, including banks, as vulnerable to organizing.

Unions are lobbying to include labor rules in the stimulus package being prepared by Congress, including a requirement that contractors remain neutral during organizing drives.

Meanwhile, in its final days the Bush administration is considering an executive order that ensures federal contractors do not abandon elections in favor of card-check rules.

It is unclear, however, whether any of these actions now being discussed would be legal, considering that the National Labor Relations Act preempts most labor regulations and that the First Amendment protects  both union and employer speech during organizing drives.

In 2002, EANJ surveyed its member-employers on whether they informed employees of the political positions that they were taking and whether they engaged employees in political discussions. Of 157 respondents, one in four (25%) stated that they informed employees of political views and positions.

In 2006, the NJ Legislature enacted, and the Governor signed, the Worker Freedom from Employer Intimidation Act.  As first introduced, the purpose of the bill was to restrict the employer’s right to discuss labor unions, but since this type of speech is protected by the National Labor Relations Act, the bill was revised to cover political, civic and religious issues and opinions.

This week EANJ did a follow up survey. 205 employers responded. Only 7 reported that they engaged employees in political discussions.  While we can only speculate as to whether this dramatic decline in political speech is attributable to the chilling effect of the Act, it is apparent  that the Act is preempted by federal law and violates employers’ First Amendment rights.

The law also harms the public. Of the seven employers noted above, 4 are nonprofit organizations. This makes sense, considering that most nonprofits have a direct stake in who gets elected and what laws get passed. Since most nonprofits are prohibited from lobbying, they often engage in educational programs for employees, clients and other stakeholders. Sadly, in addition to violating employers’ free speech rights,  the Act chills organizational speech that serves the public interest.