The House subcommittee on Health, Employment, Labor, and Pensions recently held a hearing on modernizing federal labor law. Here’s an easy first step: Close the “worker center” loophole.
Congress passed the National Labor Relations Act in 1935 and the Labor-Management Reporting and Disclosure Act in 1959 to regulate the often-contentious interactions between employers and employees. The laws set ground rules for organizers and employers to ensure that, as heated as a campaign might get, there was some fairness and order in the process. Workers could strike and picket, for instance, but organizers couldn’t go out and take action to intimidate firms that merely did business with a company targeted for unionization. (Speaking of which, it would be nice if angry Twitter mobs followed the same principle.)
As enlightened employers began to appreciate that providing benefits without unionization made more sense than dealing with the demands and confrontations of a union shop, membership in the union workforce has dropped from 35 percent to about 11 percent — including just 6.5 percent in the private sector.
So unions have gotten creative and found ways around federal rules. Unions have increasingly turned to “worker centers” to carry their water. A worker center is not organized as a labor union, but rather under the same 501(c)(3) section of the tax code used by the Red Cross and other charities. But these worker center “charities” operate in much the same way unions do, except that they’re not bound by union rules under the NLRA.
Worker centers are allowed to wage wide intimidation campaigns that target secondary companies — those that do business with a company targeted for organizing. And worker centers don’t have to file with the Department of Labor or make certain financial disclosures, as unions must. Worker centers can also engage in indefinite pickets, while unions are restricted to 30 days unless they file for representation.
The number of worker centers has grown from just five in 1992 to more than 200 today. For an example of how they operate, look at the “Fight for 15” campaign to raise the minimum wage for fast-food workers that launched nationwide boycotts in 2013. The Service Employees International Union has spent an estimated $100 million funding “Fight for 15” or supporting its advocacy.
Similarly, the Restaurant Opportunities Center, which organizes non-fast-food establishments, is a creation of the Hotel Employees and Restaurant Employees International Union and is described by a co-founder as a tool for organizing “the 99 percent of the industry that doesn’t have a union.”
And the Coalition of Immokalee Workers, or CIW, one of the original worker centers, offers an example of how hardball labor tactics spread. CIW’s goal is to get financial “bonuses” paid to its supporters, who are largely tomato pickers based in South Florida. To achieve this, CIW launches aggressive street protests and boycotts along the entire supply chain for tomatoes, targeting tomato exchanges, restaurants, and supermarkets.
Some companies have resisted, including Publix and Wendy’s, given that they have their own supplier code of conduct to ensure workers are treated fairly. These companies question why they should pay people they don’t employ. Additionally, there are serious transparency questions about the program, which is governed by secret agreements. A class-action lawsuit also alleged that money collected for the agricultural workers never got to them over a several-year period.
CIW’s simple message is that you can either pay into the program or suffer nasty attacks. For example, the organization recently accused Wendy’s of being complicit in “sexual violence” in the fields, while providing no credible evidence of this. It’s quite the racket.
When given a choice in an environment regulated under the NLRA, workers have increasingly chosen not to join unions. So unions are looking to turn up the heat on this “silent majority” of employees and create a toxic, intimidating atmosphere.
Worker centers should have to play by the same rules as big unions, but the National Labor Relations Board opined in 2006 that worker centers are only covered if they engage in back-and-forth negotiations.
As the saying goes, if it walks like a duck and quacks like a duck, it’s probably a duck. It’s time for the sharp legal minds in Congress to apply this simple principle to worker centers and restore fairness and order to employee-employer relations.
Richard Berman is the executive director of the Center for Union Facts.
