Labor at a Crossroads: In Defense of Members-Only Unionism

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(AP Photo/Times Free Press, Danielle Moore)

This article is published as part of "American Labor at a Crossroads: New Thinking, New Organizing, New Strategies," a conference presented on January 15, co-sponsored by the Albert Shanker Institute, The Sidney Hillman Foundation, and The American Prospect. (View agenda here.) Find our Labor at a Crossroads series here.

Surveys of employee support for unions show a majority want collective representation. Yet, as illustrated by the close vote on union representation at the Volkswagen plant in Chattanooga, Tennessee, union organizing efforts often fail-either before employees have a chance to vote, or at the ballot box, or in subsequent litigation.

For decades, scholars and union-side lawyers explained the gap between employee desire for unionization and declining rates of unionization by arguing that employers are able to coerce, intimidate, or persuade employees to abandon their support for unions. Conversely, employer advocates and their organization, the National Right to Work Committee, insist that employees do not wish to unionize, and that unions do not adequately represent the interests of all employees once they establish a bargaining relationship. One way to test these competing hypotheses is to eliminate the long organizing process and allow only those employees who support a union to bargain collectively, leaving other employees free from union representation.

Allowing members-only unions would protect the rights of those who wish to bargain collectively even if they fail to surmount all the legal hurdles necessary to establish the union as the representative of all employees in the workplace. The decision of the United Auto Workers union to engage in members-only bargaining at the VW plant in Chattanooga is a potentially revolutionary experiment with a new approach to union representation. The 45 percent of the workers there who wish to be represented by a union now have a union, and it is going to negotiate with VW over working conditions. This is a win for VW, a win for the employees who wanted union representation, and perhaps even a win for those employees who didn't. The National Labor Relations Board (NLRB) should allow the experiment to proceed.

Yet members-only bargaining will occur at VW only because VW wants to negotiate with a union representing its employees. At every other workplace, federal law should require employers to bargain with a union that enjoys significant employee support even if the majority did not choose a union. Changing federal labor law to expand legal protection for members-only bargaining would address the argument that unionization based on the majority vote of employees coerces the minority who prefer no union.

The ideal place for this experiment to begin is in the half of American states that have enacted right-to-work laws. Right-to-work laws reject the notion that all employees in a bargaining unit should be required to join, provide financial support to, or be obligated by the contract secured by the union selected by the majority.

There is a tension between the libertarian philosophy underlying state right-to-work regimes and the democratic philosophy underlying the federal rule of exclusive representation

, according to which the union has an obligation to represent equally all employees in the bargaining unit. Federal law requires unions to represent all employees in the unit while state right-to-work laws give workers the right to refuse to contribute to that representation. As such, the current state of affairs in right-to-work states can be analogized to a political world in which anyone whose party lost an election could still go to public schools, drive on public highways, and benefit from public security without having to pay taxes to support those public goods.

The NLRB should relax the requirement of exclusive representation in right-to-work states and allow unions to organize, bargain on behalf of, and represent only those workers who affirmatively choose to become members. Those workers who wish to join a union and bargain collectively in right-to-work states should thus be permitted to construct a bargaining unit that includes only those workers willing to pay for union representation. Such a change in the law would simply take the right-to-work concept to its logically consistent and fair conclusion. It would allow workers who do not want to be union to be genuinely nonunion: They would owe nothing to the union, they would not be covered by the collective bargaining agreement, and they would pursue interactions with the employer without union interference or assistance. Unions, for their part, would no longer be obligated to represent those workers who do not desire such representation and who do not wish to pay for it. And workers who wish to unionize would no longer be required to subsidize representation for their nonmember coworkers.

Although the Board has never held that the National Labor Relations Act (NLRA) requires members-only bargaining, there is significant support for that proposition in the structure of the statute and in the Supreme Court's jurisprudence. Neither the Board nor the courts has decided whether a union should have the right to select members-only bargaining in a right-to-work state that has exercised its authority to prohibit unions from requiring those who benefit from its services under the exclusivity principle to pay their pro rata share of the costs. Whatever the arguments for members-only bargaining in non-right-to-work states, there are substantially stronger arguments for the Board to conclude that the NLRA permits members-only bargaining in right-to-work states.

Nothing in NLRA section 7-which grants employees the rights "to self-organization" and "to bargain collectively through representatives of their own choosing"-limits these rights to workplaces where a majority of employees choose one union. Moreover, nothing in section 9 (which provides a mechanism for choosing a union that enjoys the power of exclusive representation) limits the ability of a group to bargain on a members-only basis.

The law currently allows members-only representation

. In Consolidated Edison Co. v. NLRB, a 1938 decision arising out of a dispute between two unions seeking to represent the same group of employees, the Supreme Court explicitly recognized the right of a union to bargain on behalf of its own members only. The employer in that case had agreed to recognize one of the unions as the representative of its own members and had entered an agreement governing their terms of employment. The Board had held the contract invalid because the union had not been certified under section 9(a) as the exclusive representative. The Court rejected the NLRB's position. Although it did not have occasion to hold that an employer is obligated to bargain on a members-only basis (because no failure to bargain had been alleged, since the employer had agreed to the contract), the Court said that members-only bargaining is necessary to protect the section 7 rights of union members absent a majority union.

The Court explained that the employees' rights to form a union and bargain collectively gave them the right to do so on a members-only basis unless or until a union was certified as the exclusive representative of all the employees under section 9. The Court also explained that members-only bargaining was entirely consistent with the policies of the NLRA:

[I]n the absence of . . . an exclusive agency the employees represented by the Brotherhood, even if they were a minority, clearly had the right to make their own choice. Moreover, the fundamental purpose of the Act is to protect interstate and foreign commerce from interruptions and obstructions caused by industrial strife. This purpose appears to be served by these contracts in an important degree.

The Court later held that members-only agreements are enforceable under another section of the NLRA, which makes collective bargaining agreements enforceable, and again rejected the idea that members-only bargaining is inconsistent with the law and policy of the NLRA.

Although members-only bargaining is permissible under the NLRA if the employer agrees to engage in it, the NLRB has held that it is not required of employers. In Dick's Sporting Goods, a minority of employees formed the Dick's Employee Council and sought recognition from the employer on behalf of its members only. When management declined to recognize or bargain with the Council, the employees filed a failure to bargain charge, but the NLRB General Counsel refused to issue a complaint, stating simply that the law leaving an employer free to refuse to bargain on a members-only basis is "well settled and is not an open issue."

In Charleston Nursing Center, the NLRB held that an employer did not interfere with the employees' rights to engage in collective action when it refused to meet with a group of nurses, but offered to meet with each nurse individually. But no Board decision, in either a group grievance case like Charleston Nursing Center or in a members-only bargaining case like Dick's Sporting Goods, has explained why the regime premised on majority rule and exclusivity is the only basis upon which employers are required to bargain with employees; in all of these cases the Board has simply assumed the rule rather than justified it on the basis of statutory analysis or policy.

Most importantly, the NLRB has never considered whether unions have the right to demand that an employer engage in members-only bargaining in right-to-work states. Whatever the legal and policy arguments in favor of requiring employers to engage in members-only bargaining in every state, the legal and policy arguments in favor of members-only bargaining in right-to-work states are stronger. The principle of exclusivity assumes that because all benefit from collective representation, all must share in the costs in order to avoid free riding. But if right-to-work laws prohibit cost sharing, unions are burdened with the costs of representing employees who do not wish it and will not pay for it. Where employees can opt out of contributing anything to union representation, the union ought to have the option to construct a bargaining unit consisting only of those who will contribute to the union enterprise. This is a good and principled reason to relax the rules of exclusivity in right-to-work states. Allowing members-only bargaining in these settings advances the preferences of workers who wish not to be in the union, the interests of unions that wish not to represent free-riding workers, and the interests of union members in not subsidizing the representation of their objecting coworkers.

If the NLRB recognized that employers are required under federal labor law to bargain with minority unions, it would have to address two other issues. First, union opponents will argue that members-only bargaining is the only permissible form of union representation and the law should abandon the principle of exclusive representation when a majority chooses a union. Given the lack of experience that unions, employers, and workers have with members-only unionism-at least in the modern context-a permissive and experimental approach is appropriate. At this stage, the Board should rule that if unions wish to engage in members-only bargaining, they would be entitled to do so, and the employer would then be obligated to bargain with the union on behalf of its members only. If the employer and the union negotiated an agreement covering only members, any employee who wished to get the benefit of the agreement could, of course, join the union and thereby the bargaining unit. Any employee who did not wish to be covered by the agreement could simply decline to join the union. If, instead, a union insisted on exclusivity, the parties would then simply be in the same position they are in under current law.

The second issue the NLRB would have to address if members-only bargaining became established is whether an employer would illegally discriminate between union members and nonmembers by negotiating different terms with the union than it does with unrepresented employees. The NLRA prohibits discrimination on the basis of union membership only where the discrimination is for the purpose of encouraging or discouraging union membership. It would be permissible for an employer and union to agree to different terms of employment for union members so long as they do not do so for the purpose of encouraging or discouraging union membership. If the employer can get nonunion employees to work for less than the collectively bargained minimum, it would not be discriminating for the purpose of encouraging or discouraging union membership by paying them less, but rather would just be paying what the labor market would allow. If the employer decided to pay nonunion employees more than what the collective bargaining agreement required, because it thought that nonunion workers were more productive, or because its ability to fire them at will meant that their labor costs on average were lower even if their wages were higher, then it would not be discriminating for the purpose of encouraging or discouraging union membership. But if an employer paid nonunion employees more than union members for the purpose of undermining support for the union, it would violate the NLRA.

Of course, paying nonunion workers less than their union counterparts might have the effect of encouraging union membership, just as paying nonunion workers more would have the effect of discouraging union membership. But what the NLRA makes unlawful is not disparate treatment, but disparate treatment for the purpose of encouraging or discouraging membership. If the employer has legitimate business reasons for the differential pay rates, the requisite unlawful intent would be lacking. As a practical matter, it may be difficult for a union to prove the illegal motivation of an employer who paid nonunion employees more than employees covered by a members-only agreement.

The NLRB should adopt a rule requiring an employer that offers better terms to its nonunion employees to prove that it has a legitimate reason for doing so

and is not simply trying to undermine support for the union.

Unions turned away from members-only bargaining a century ago because they recognized that there is strength in numbers: employees generally negotiate more effectively when they can speak with one voice on behalf of everyone. But many workers today do not see the value of collective action; they believe that union representation coerces those who would rather go it alone. The best way to reconcile the libertarian wishes of workers who want no union representation with the democratic wishes of those who do is to allow members-only bargaining.

While a minority union will probably not have the power to persuade a recalcitrant employer to dramatically improve working conditions, it is better than no union at all. At least a minority union will allow some workers the chance to experience the benefits of collective action, and it may persuade others that all workers enjoy higher wages when they stand together. And, in right-to-work states, members-only bargaining will eliminate the unfair situation where workers can get the wage benefits of a union contract without having to share in the financial cost of maintaining the union.

This article draws on two works the author published with co-authors: "Restoring Equity in Right to Work Law," (with Benjamin I. Sachs), 4 U.C. Irvine L. Rev. 857 (2014); and "Imagine a World Where Employers Are Required to Bargain With Minority Unions" (with Xenia Tashlitsky), 27 A.B.A. J. Lab. & Emp. L. 1 (2011).