Federal law, the National Labor Relations Act, requires employers to bargain in good faith with union officials toward a collective bargaining agreement, but it does not mandate that the parties must reach an agreement. 

Contracts can take a long time to negotiate because one or both sides are new to the process, have unreasonable demands, and are negotiating complex terms that will affect all future contracts. It’s not uncommon for collective bargaining agreements to address dozens of workplace provisions (well beyond just pay and benefits) and to span hundreds of pages. A Bloomberg Law analysis of first contracts reached between 2004 and 2021 found an average length of 409 days between election certification and contract ratification. 

The Faster Labor Contracts Act would provide a maximum bargaining period of 120 days — 90 days of bargaining followed by 30 days of mediation — before either party could invoke mandatory arbitration. With each side choosing its own arbitrator and, absent agreement on a third neutral arbitrator, the Federal Mediation and Conciliation Service selecting a supposedly “neutral” arbitrator, an unelected federal arbitrator would make the final determination on labor terms.  

It’s understandable that workers who’ve been oversold by union organizers expect big changes and fast results in the form of a first contract. But the 120-day limit is arbitrary and rushed. Fewer than 10% of first contracts were achieved within 120 days, according to the Bloomberg analysis. 

Certain industries, such as healthcare, where lives are literally on the line, can be especially complex and require more time. Since most contracts last three years or longer, failure to take the time to get things right can compromise the quality of products and services and increase the risk of future job losses or outright business failure. 

Causing job losses and business failures is just one way that the Faster Labor Contracts Act could end up hurting the workers it aims to help. 

In addition, there’s no guarantee that it will result in faster contracts because, while the bill limits negotiations, the arbitration timeline is unlimited. Bringing uninformed arbitrators up to speed on everything they need to know about the workplace, the employer’s risks and finances, and workers’ concerns could easily take months, if not a year or longer. Yet decisions made without this crucial information could be disastrous for the business and the union members.

Moreover, a lack of readily available arbitrators at the FMCS could contribute to delays, possibly resulting in slower contracts processed than might have occurred without government intervention.

And arbitration cuts workers from the negotiation and ratification process. Currently, nearly all union constitutions and bylaws require union members’ ratification of collective bargaining agreements before they are signed and enforced. Under the Faster Labor Contracts Act, any negotiations that result in forced arbitration would leave workers without a vote on their binding employment terms. 

RAND PAUL PROPOSES AMENDMENT TO END BIRTHRIGHT CITIZENSHIP FOR ILLEGALS

If passed, the Faster Labor Contracts Act would almost certainly face constitutional challenges because mutual assent is a required element of a legally enforceable contract, and the act could result in labor terms being imposed on either or both parties without their assent. The government imposing terms on private parties could constitute state action, opening the door to free speech and freedom of association challenges to any arbitration-ordered resolution.

History shows that when the government replaces collaboration with compulsion, both workers and employers lose. Instead, policymakers should focus on supporting workers and employers by modernizing labor laws in ways that promote the freedom, dignity, and opportunity that make American work exceptional. 

Rachel Greszler is a senior research fellow at the Plymouth Institute for Free Enterprise at Advancing American Freedom Foundation.