Unions, Business, Democrats, Republicans and Obama

Obama was the beneficiary of strong support by unions. They are now gearing up to be the beneficiaries of passage of one of Obama’s campaign promises: The Employee Free Choice Act (Card Check Law).

Some quick research (Google) gives the mechanics of the law. Workers in a company would be unionized once they got a majority of votes on cards distributed by the organizing union. I gather the process is “Joe, check here for the union.” If Joe checks (or doesn’t check the card) his vote is immediately known. The election becomes a public, one-to-one process, ending only at the point of majority – there’s no cut-off date.

The union and the company then negotiate a contract. If there isn’t an agreement in 90 days, the parties mediate for thirty days. No agreement, and the dispute is decided by binding arbitration.

Details from the AFL-CIO point of view are here. The U.S. Chamber of Commerce viewpoint is found here. Neither viewpoint will solve any of the economic problems we face.

I’ve been an employee and an employer, though I’ve never been in a union.

A couple of anecdotes to illustrate my views:

In my twenties I worked for a large insurance company. It had all of the then current fringe benefits, health and disability insurance, liberal vacations, pension contribution matching, etc. I had gotten quick promotions while doing the same job. Why? The company had an elaborate employee manual. You got raises on a regular basis based on a lock-step system of titles. The only way around the lock-steps was to be promoted. So, since my superiors liked what I was doing, I got “promoted,” got more money and did the same thing.

There was no union, and at one point there was an organizational attempt. The union organizer promoted the union as the way to get what us workers “deserved.” I asked what we deserved above what we were getting and how I would get my “promotions” under an adversarial company/union system. He didn’t have much to say.

More recently, the law firm in which I was a partner, received a complaint based on not paying overtime as required by federal law. All staff were non-exempt employees under the Federal Labor Standards Act. The complaint was based on the staff member not being paid overtime two or three times over a year’s period of time. No mention was made of the fact that the firm didn’t worry about hour and a half lunches, coming in late or leaving early based on need, etc. as long as the work was getting done.

The firm went through the pay records, identified where we had underpaid and wrote a sizable check to settle the case. The firm then republished the work rules, when you had to be there, when you could leave, made clear that lunch was an hour, that personal time would be charged as such, all required by FSLA. The complaining staff member’s fellow staff members ostracized her. Their good thing had been screwed up.

I’m not a fan of “one size fits all” treatment of people. I’ve probably been lucky that I’ve never had a job that pitted me against an unyielding, monolithic, faceless management. Maybe my views would be different if I had.

But note that the insurance company and the law firm that I write about weren’t bad places to work. “Management” and the “workers” accommodated each other. The company and the firm made money and the owners and workers got a pretty fair share.

But, it seems to me that Obama and other Democrats are aligning themselves with unions that are making the same mistakes that the Republican party and American business have been making for some time now, ignoring the reality of a changing world economy.

The car companies are clamoring for a bailout to save themselves from their bad business practices, many related to the stupidity of their adversarial relationships with unions.

A few more trillion in bailouts won’t save an economy that isn’t sustainable. Union election rules that perpetuate an adversarial relationship between management and workers that hasn’t worked for the last thirty years won’t save us either. Governments have the false luxury of not having to pay as they go. Companies and workers have to have something to sell that people want at a price they will pay that results in a surplus – profit. If they don’t follow that model, they are living in a house of cards. Companies and workers are going the way of government, trying their best to return to the good old days when the house of cards looked sturdy.

I hope Obama follows through on his promise for change. Support of the Card Check Law and serial business bailouts isn’t the way to do it.