Democrats Emphasize Need for Stronger Unions to Sustain Growing Middle Class

WASHINGTON – The Committee on Education and the Workforce held a hearing today entitled, “Compulsory Unionization through Grievance Fees: The NLRB’s Assault on Right-to-Work.” At the hearing, Ranking Member Rep. Robert C. “Bobby” Scott highlighted evidence-based research that shows stronger unions are essential to building and sustaining our nation’s middle class. A recent International Labour Organization report found that countries with collective bargaining coverage rates under 15 percent, such as the United States and South Korea, have extremely high levels of wage inequality. By contrast, countries with as much as 95 percent collective bargaining coverage, such as Belgium, Austria and Sweden, have far lower rates of inequality. 

 

“My colleagues across the aisle have been focused on policies that weaken workers’ bargaining power to get a fair share of the wealth they create, but the economic research is clear—stronger unions are better than weaker unions for building and sustaining a middle class,” said Ranking Member Scott (D-VA). “Stronger unions reduce wage inequality and help ensure that the increased wealth generated by growing productivity is fairly shared with the workers. Today’s hearing focused on a narrow issue that involves a pending appeal before the National Labor Relations Board. Rather than rushing to judgment on the nuances of this case, we should allow the NLRB to deliberate and render an opinion on the merits.”

 

While the National Labor Relations Act imposes a “duty of fair representation” that prohibits unions from discriminating on the basis of union membership, the current NLRB’s rules forbid unions from charging a fee for providing grievance representation services to an individual non-member. Right-to-work laws—which have been adopted in 25 states—also shift costs from non-members to members, driving up the costs of union membership for dues-paying members. Right-to-work laws prevent workers from being required to join a union or pay agency fees “as a condition of employment”.  The issue in the case before the NLRB, United Steel, Paper and Forestry  Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union, Local 1192 (Buckeye Florida), only deals with the union charging a non-discriminatory grievance fee if a non-member requested individual assistance with a grievance. Right-to-work laws would remain untouched no matter how the NLRB resolves the legal issues in this case.  

 

Research shows that weakening union representation both weakens the middle class and undermines workers’ bargaining power to get a fair share of the wealth they helped to create.  Beyond the narrow issue of grievance fees, the hearing also explored whether vast majority of workers are better off with stronger or weaker unions.  One of the Democratic witnesses, Professor Robert Bruno, touched on the fundamental equity and fairness issues raised by right-to-work laws, and its impact on workers. 

 

“Economic research is unanimous in concluding that right-to-work laws significantly reduce unionization rates and the relative power of labor unions, thereby reducing the number of workers who will have a health insurance and a retirement plan,” said Robert Bruno, a Professor of Labor and Employment Relations at the University of Illinois in Urbana. “The gradual decline in unionization has been found to be a driving force in the increase in income inequality both in the United States and across the world. By lowering union membership, right-to-work laws contribute to the redistribution of income from workers to employers, from labor to capital, and from middle-class taxpayers to the wealthy.”

 

Elise Gould, Senior Economist at the Economic Policy Institute, also testified at the hearing on the lower wages prevalent in right-to-work states. 

 

“Wages in right-to-work states are 3.1 percent lower than those in non-right-to-work states, after controlling for a full complement of individual demographic and socioeconomic factors as well as state macroeconomic indicators,” said Gould. “This translates into right-to-work status being associated with $1,558 lower annual wages for a typical full-time, full-year worker.”

 

House Republicans used today’s hearing to decry the NLRB’s recent call for amicus briefs on the issue of grievance fees. The hearing represented yet another attack on the deliberative work of the NLRB, under the guise of a fabricated “assault on right-to-work laws” as a way to grab headlines. Despite the misguided title of the hearing, Democrats emphasized that the work of unions is critically important in growing the middle class.