“Employee Free Choice Act” Would Implement Most Sweeping Labor Law Changes in Decades, Strengthening Unions’ Hand in Both Organizing and Negotiations

March 14, 2007

On March 1, 2007 by a vote of 241 - 185, the House passed the proposed "Employee Free Choice Act" (H.R. 800). H.R. 800 has been put forward by the unions who express frustration with strong management campaigns against unionization and lengthy delays in obtaining first union contracts after union recognition. Under the bill — which is still pending in the Senate — employees would lose the protection of a secret ballot election in which they can freely decide whether they want a union or not. With the current secret ballot election process, neither the union nor the employer knows how any individual employee voted, which frees employees from pressure or coercion.

H.R. 800 would replace the secret ballot election with a union authorization "card check" procedure, under which a union would be able to gain bargaining rights simply by obtaining union authorization cards from a majority of employees. Without a secret ballot booth to exercise their right to vote and decide privately, employees often would feel pressured or coerced into signing authorization cards for a union they did not actually support.

Additionally, without the advance notice necessary for a secret ballot election, a union would often be able to solicit authorization cards without the employer even knowing the union was doing so. As a result, employees would only hear the union’s view on whether unionization would be in their interest. Others, including the employer, would not have an opportunity to present to the employee the negatives to having a union.

The result would be that unions would be able to get recognition rights much more easily through pressuring employees and through a one sided presentation of the issues.

Another important change under H.R. 800 would occur after a union got recognition rights through the new card check procedures, when it began bargaining with the employer regarding the terms for a first contract. Under the present law, those terms are left to the employer and the union to negotiate by free collective bargaining. Under H.R. 800, if the employer and union did not agree on contract terms relatively quickly, the dispute would be decided by an arbitration panel that would set the wages, benefits and other terms and conditions of employment for the next two years. An unknown panel of arbitrators, who do not have to live and survive under the contract, would thus decide what the wages, benefits and other terms would be. That could be disastrous for an employer and employees, threatening the financial health and even the survival of the company, and is fundamentally at odds with the free collective bargaining system that the National Labor Relations Act has established for over 70 years.

H.R. 800 would also change current law by imposing treble damages and other penalties for unfair labor practices on employers. (Similar penalties would not be imposed on union organizers who illegally intimidate workers.)

Gibson, Dunn & Crutcher lawyers are available to assist in addressing questions you may have regarding H.R. 800. Please contact the Gibson Dunn attorney with whom you work, or Scott A. Kruse (213-229-7970, [email protected]) in the Los Angeles office, William J. Kilberg (202-955-8573, [email protected]) in the Washington, D.C. office, or Labor and Employment Practice Group Co-Chairs Deborah J. Clarke (213-229-7903, [email protected]) in Los Angeles or Eugene Scalia (202-955-8206, [email protected]) in Washington, D.C.  

© 2007 Gibson, Dunn & Crutcher LLP

The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.