Eliminating the Secret Ballot

Economic stimulus legislation has garnered most of the attention around Washington, D.C., but it’s not the only high-stakes political game. Consider these two combustible words: “card check”

Officially known as the Employee Free Choice Act (EFCA), this legislation, which would enable workers to organize into a union by signing authorization cards in place of a secret ballot, is sending shivers through the business community. It was approved by the U.S. House of Representatives in 2007 before stalling in the Senate. But the bill’s chances improved substantially, supporters and foes alike agree, with the elections in November, whereby the Democrats gained seats in the Senate and Barack Obama, who included the bill in his presidential campaign platform, was elected president.

However, timing could complicate matters. The Obama administration has to deal with the economic recovery first. In a Jan. 17 interview with The Washington Post, the president-elect said, “If we’re losing half a million jobs a month, then there are no jobs to unionize, so my focus first is on those key economic priority items.”

Given the bill’s potential for divisiveness, it is not likely to be one of the first bills brought to the floor. Neither organized labor, nor Democrats, want to move on the issue until they’re certain they have 60 votes.

But there’s little doubt that the issue, which is strongly supported by Senate Majority Leader Harry Reid (D-Nev.), will be addressed eventually.

At present, forming a union requires a majority of employees to vote in a government-supervised, secret-ballot election. The latest version of the bill would allow unions to form simply by allowing workers to sign cards. The bill would additionally set time lines for first contracts between unions and employees, and raise fines on employers that violate employees’ rights to unionize.

The two provisions in the bill that have raised the ire of industry are the secret-ballot elections and the mandatory arbitration. The business community is in lock step in saying that secret-ballot elections are the only fair way to organize because they give management a chance to make its case before the voting and allow workers to express their preferences privately.

There are some in the business community who feel the government arbitrator measure could be even more damaging to business revenue. Right now, a newly formed union and its employer have about 12 months to reach a contract agreement. If they do not both approve a contract, the employer can walk away from the negotiating table.

But under the proposed legislation, the union and its employer would have no more than 120 days to come to an agreement. If none is reached, a government arbitrator would be appointed to resolve the conflict and draw up a contract.

Many business leaders say the current economic climate makes the bill especially worrisome.

“Passing something like that in this environment could potentially put further strains on an already fragile economy, at least in the way it was originally proposed,” said Robert Niblock, chairman and CEO of Lowe’s. Niblock added that a secret ballot process “is key to what’s made us a great nation and we’d like to see that continue.”

Home Depot CEO Frank Blake said, “We feel very strongly that our associates ought to have the right to a secret ballot.”

That sentiment is shared across the business community. Trade associations such as the National Retail Federation (NRF) have rallied the troops in an attempt to thwart the measure.

The NRF’s position is that the EFCA would remove a fundamental principle of American democracy for retail workers—their right to request a secret ballot election in deciding on union representation. Many business leaders maintain that by replacing the secret ballot with the card check, union organizers can circumvent federally supervised elections altogether, fast-track the process and unionize employees by having them simply sign a card.

“The bill is so one-sided—it’s fatally flawed,” said Rob Green, VP of government affairs for the NRF, who added that the card-check process could remove nearly half of all employees from the organizing process because the union only needs signatures from a simple majority.

“For example,” he said, “if eight employees from a store with a staff of 15 signed union authorization cards, a union would automatically be recognized and the remaining seven employees would be precluded from the process, and their voices would essentially be silenced.”

Whether Congress takes up this bill now or in two years, representatives from both sides are digging in for a pitched battle. The U.S. Chamber of Commerce has budgeted $10 million since the election to see that this bill doesn’t see the light of day.

Meanwhile, the Service Employees International Union (SEIU), the country’s largest labor organization, earmarked $10 million as part of a campaign to urge President Obama and Congress to enact the card-check bill in the 100 days after Inauguration Day. American Rights at Work, a worker-advocacy group, spent $3 million on ads that show workers urging lawmakers to pass the bill in order to improve their economic situation.

Several high-profile leaders in the labor and civil-rights movement said the bill is vital to ending what they call employers’ harassment and intimidation of workers, particularly in the often-hostile management-vs.-union campaigns that typically precede elections under the current process.

The business community is also rallying around working people. They argue that if card check is enacted, it would take privacy, power and voice away from America’s workers, according to the NRF’s position. Not all workers might know about organizing efforts, and many of them might not even get the opportunity to vote since a simple majority would be needed.

As to any compromise, there has been scuttlebutt on Capitol Hill that some labor-friendly Democrats may seek to jettison the secret-ballot provision in order to gain broader support on the measure and ensure its passage.

However, under that scenario, the government arbitrator issue could still be part of the package. For its part, the U.S. Chamber of Commerce is on record as saying that any provision that abolishes secret-ballot elections or mandates binding arbitration processes are non-starters. And influential business leaders also appear stalwart in their opposition.

During a presentation at National Retail Federation’s annual conference in New York City this past January, Lee Scott, in his final public remarks before stepping down as CEO of Wal-Mart Stores, said, “I don’t think you can amend this bill. It is fundamentally so flawed.”