Most of the attention on the misnamed "Employee Free Choice Act" (HR 1409/S 560) has centered on provisions which would effectively strip workers of their right to secret ballot elections in deciding whether to join unions, replacing such elections instead with a "card check" system. But the other feature of EFCA is just as diabolical for business and workers alike.
Under current labor law, unions and employers are obligated to bargain in good faith over labor contracts, engaging in "give and take" that usually results in a reasonable compromise for both workers and management. EFCA's enactment would change this significantly. If management and the newly formed union cannot agree to a first contract within 90 days, either side can demand that the dispute go to a federal arbitrator, who would have the power to impose a contract on both sides, locking in provisions for two years. While many employers shudder at the possibility of the federal government setting the terms of labor contracts, it is important to recognize that binding arbitration would strip workers of valuable rights, too. They would no longer be able to vote on a contract that their union leaders negotiated with management on their behalf.
In its May 29th issue, the Wall Street Journal published a great editorial on the arbitration provisions of EFCA which includes an insightful quote from Paul Kersey, director of labor policy for the Mackinac Center for Public Policy. Mr. Kersey said, "What the bill doesn't explain is what happens when the government imposes a contract that a company can't afford. Ask for a bailout?"