In perhaps no U.S. presidential election in recent memory has the outcome been more important to a change in our basic labor law, the National Labor Relations Act (“NLRA” or “Act”). Predictions are that if Sen. Obama is elected President and the Democrats take control of Congress, the crown jewel in labor’s legislative agenda, the Employee Free Choice Act, which passed the House last year but fell short in the Senate,1 could become the law of the land.2

The Employee Free Choice Act (“EFCA”), as passed by the U.S. House of Representatives, has three major features that make sweeping changes in the current provisions of the NLRA. First, the Act will permit unions to obtain certification through a mandatory card check conducted by Regional Offices of the National Labor Relations Board (“NLRB” or “Board”). Second, EFCA will impose first contracts through interest arbitration where the parties are unable to agree on the terms of such agreements. Third, EFCA will amend certain provisions of the Act to permit NLRB Regional Directors, acting at their own discretion, to seek injunctive relief against employers for alleged violations arising out of union organizing campaigns. The Board will be required to assess both back pay and double liquidated damages on employers who discharge employees during an organizing campaign. In addition, the Board will have authority to assess a civil penalty of up to $20,000 per violation of Section 8(a)(1) or (3) of the Act that substantially interferes with the union organizational process during the period of organizing and, after certification or recognition of a union, until a first contract is entered into. Each of these changes and its significance is examined below.

In its current form (H.R. 800), EFCA requires that the Board must certify a union upon finding that a majority of an employer’s employees in a unit appropriate for collective bargaining has signed valid authorizations designating a particular union as their bargaining representative in support of this petition3. The proposed legislation is silent on the question of what constitutes a valid designation, and the Board is specifically directed by statute to develop model union authorization card language and procedures for determining the validity of authorization cards.4 The Act does not, in any of its current forms, specify a timetable for the Board to accomplish this task.

The current version of EFCA also does not indicate how traditional representation issues involving the scope and composition of bargaining units will be determined. Under current NLRB procedures, these issues are determined by means of a representation case hearing that results in a written decision by a Regional Director, which is subject to review by the NLRB. Moreover, the card check provisions in the proposed legislation do not provide for the use of such procedures for employees seeking decertification of a union.

Imposing mandatory card checks on employers represents a sweeping change in the manner in which unions gain bargaining rights under the Act. Under the NLRA, as currently structured and interpreted by the United States Supreme Court, an employer has an absolute right to insist on a Board-conducted secret ballot election, rather than accept the outcome of a card check, unless it has previously agreed to have the question of the union’s majority status tested by means of the latter procedure, or has committed unfair labor practices that impair the election process.5 This is based on the theory that while cards may have validity, a secret ballot election is by far the preferred means for determining the question of whether employees wish to be represented for the purposes of collective bargaining.6  At the current time, most NLRB elections take place pursuant to voluntarily agreed-upon election agreements (approximately 90 percent in the Board’s fiscal year 2006).7

As indicated above, the second major change EFCA invokes is the imposition of a mandatory first collective bargaining agreement on parties who are unable to achieve such agreements through traditional collective bargaining.8 EFCA as proposed requires an employer to commence bargaining within 10 days of a request by a certified or voluntarily recognized union, and to bargain for up to 90 days from that date. If no agreement is reached during the 90-day period, either party may request that the Federal Mediation and Conciliation Service (“FMCS”) mediate the dispute. If mediation fails after 30 days, the FMCS is required to appoint a board of arbitration to resolve the disputed issues between the parties. EFCA does not specify the rules or regulations under which such interest based arbitrations are to be conducted. This change imposes, for the first time, government supervision over not only the process of collective bargaining, but also over the terms of such bargaining. Any contract imposed as a result of interest arbitration will be for a period of two years.

The final provisions of EFCA that have received perhaps the least amount of publicity are the special or extraordinary remedies outlined above.9 This transforms the Act from one that is remedial in nature and simply seeks to preserve and protect the status quo, to one that will impose significant punitive sanctions on employer conduct. The cumulative affect of such provisions is obvious: only those employers with significant resources will consider risking such litigation, particularly where court review is generally time consuming, expensive, and a long time in coming because of the Board’s inherent delays in decision-making.

EFCA is truly revolutionary. No less a liberal Democrat and supporter of organized labor than Sen. George McGovern, a former candidate for the U.S. presidency, has staunchly opposed the notion of imposing collective bargaining relationships except through the process of a secret ballot election. Sen. McGovern described the card check provision of EFCA as “a disturbing and undemocratic overreach not in the interest of either management or labor” . . . that “runs counter to ideals that were once at the core of the labor movement…” and “[i]nstead of providing a voice for the unheard, EFCA risks silencing those who would speak.”10 In short, mandatory card checks are not consistent with the American way of secret ballot elections.

1 The bill that passed the House of Representatives was introduced as H.R. 800. The Senate version was S. 1041.
2 Indeed, a sitting member of the National Labor Relations Board recently stated in an address to the U.S. Chamber of Commerce on “Labor Policy at the Crossroads” that a “perfect storm” exists for changes to U.S. labor law. Board member Wilma Liebman, speaking for herself, said there is “record wage inequality” and the lowest rate of union representation in the private sector coupled with eroding health care and retirement benefits, rising immigration, and millions of citizens
“feel[ing] like they are walking an economic tightrope.” 54 Construction Labor (BNA, October 8, 2008).
3 See Section 2, H.R. 800, 110 Cong. § 2 (1st. Sess. 2007).
4 Id.
5 Linden Lumber Division v. NLRB, 419 U.S. 301, 310 (1974).
6 NLRB v. Gissel Packing Co., 395 U.S. 575, 602 (1969). While the Supreme Court approved the use of authorization cards as a measure of union sentiment for the purpose of imposing a bargaining order as remedy for an employer’s unfair labor practices, that prevent the holding of a fair election, the Court was careful to point out that authorization cards are “admittedly inferior to the election process…” Id. at 603.
7 2006 NLRB Annual Report, at p. 15.
8 See Section 3, H.R. 800, 110 Cong. § 3 (1st Sess. 2007).
9 See Section 4, H.R. 800, 110 Cong. § 4 (1st Sess. 2007).
10 “My Party Should Respect Secret Union Ballots,” George McGovern, The Wall Street Journal (Aug. 8, 2008).