The Risk of Increased Labor Unions in the Private Sector Workplace: Employee Free Choice Act (EFCA)

MBanes October 30, 2008

A critical analysis of the Employee Free Choice Act (EFCA) was provided to me from the Ford & Harrison LLP. The analysis illustrated that the percentage of American workers who belonged to private sector (non-government) labor unions reached its peak in 1954, when 34.8% of the private sector workforce belonged to a labor union. By 2007, only 7.3% of the private sector workers were union members. The ultimate goal of the EFCA is to make it easier to increase union membership and improve its fading relevance to the American workplace.

The EFCA would essentially eliminate the secret-ballot elections process to determine whether employees wanted to be represented by a union. The secret-ballot elections would be replaced by simply securing majority of employee signatures on authorization cards designating the union as the collective bargaining representative, also called the Card-Check Recognition.

Employers can expect organized labor to intensify its efforts to secure passage of the EFCA, particularly with a Democratic-controlled Congress. The obvious overarching implication of the EFCA is that the law would make it much easier for unions to organize employers.

Human Resources will need to focus extreme attention on traditional labor issues more than ever. In light of the more aggressive labor movement, unprepared employers will find themselves increasingly more vulnerable to union organizing if they fail to take action.

Some Reasons Why Employees Support Unionization 

1. Poor Supervision. Poor supervision can completely undermine employee relations and morale.
2. Poor Organization Structure. Employers should clearly define the chain of command and reporting responsibilities. Supervisors should understand that they are part of the management team and are co-responsible for management decisions rather than blaming upper management for unpopular decisions. Employees who feel they have been treated harshly or unfairly by supervisors may want to “get even” with management by seeking unionization.
3. Failure to Communicate. Improper responses to employee suggestions and ideas can create or add to employee dissatisfaction.
4. Failure of Management to Keep Employees Informed. When appropriate, employees should be informed about how the company is doing, changes in operations, etc.
5. Retention of Poor Employees. Poor employees may be unqualified, marginal, or overqualified and their retention may cause resentment among their co-workers.
6. Job Security. Employees who perceive they lack job security may be more likely to unionize.
7. Failure to Provide Advance Opportunities.
8. Failure to Recognize and Reward Employee Successes and Contributions.

Some Strategic Preventive Measures for Human Resources to Implement 

1. Make Unions Unnecessary. Recognizing individual achievement and merit and responding to employee issues and concerns before employees look outside the company for resolution of their concerns. Conduct a comprehensive Employee Relation Audit by conducting a survey assessment from a third party. The key is to capture the true concerns of employees. Management should then prepare an immediate action plan designed to provide solutions to problems uncovered.
2. Respond to Employee Issues and Concerns. An effective employee relations audit should identify the major issues and concerns particular to the employer’s workforce and proactive measures to deal with those issues.
3. Develop Workplace Leadership. Cultivating leadership requires at least two critical components: leadership training and accountability.
4. Adopt a Union-Free Culture. Clearly state that the company wants to remain union-free, emphasize the employer’s commitment to communication, indicate the company recognizes and rewards individual achievement, and highlight company efforts to promote dignity and respect.
5. Develop Effective Communication Mechanisms. Direct communication to employees, input from employees to management, and cross-communication between management.
6. Adopt Mechanisms to Resolve Employee Disputes
7. Establish a “Don’t Sign the Card” Education Plan. Discuss the disadvantages of unionization and the potential risks associated with signing union authorization cards.

The Human Resources team needs to devote significant attention to traditional labor and employee relations issues. A proactive approach to positive employee relations is essential. Employers must take steps now to help ensure that their workplaces remain union-free.

Posted in Human Resources Analytics