[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



 
 FREEDOM IN THE WORKPLACE--AN EXAMINATION OF A NATIONAL RIGHT TO WORK 
                                  LAW


=======================================================================


                                HEARING

                               before the

      SUBCOMMITTEE ON WORKFORCE, EMPOWERMENT & GOVERNMENT PROGRAMS

                                 of the

                      COMMITTEE ON SMALL BUSINESS
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                   WASHINGTON, DC, SEPTEMBER 8, 2005

                               __________

                           Serial No. 109-30

                               __________

         Printed for the use of the Committee on Small Business


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                      COMMITTEE ON SMALL BUSINESS

                 DONALD A. MANZULLO, Illinois, Chairman

ROSCOE BARTLETT, Maryland, Vice      NYDIA VELAZQUEZ, New York
Chairman                             JUANITA MILLENDER-McDONALD,
SUE KELLY, New York                    California
STEVE CHABOT, Ohio                   TOM UDALL, New Mexico
SAM GRAVES, Missouri                 DANIEL LIPINSKI, Illinois
TODD AKIN, Missouri                  ENI FALEOMAVAEGA, American Samoa
BILL SHUSTER, Pennsylvania           DONNA CHRISTENSEN, Virgin Islands
MARILYN MUSGRAVE, Colorado           DANNY DAVIS, Illinois
JEB BRADLEY, New Hampshire           ED CASE, Hawaii
STEVE KING, Iowa                     MADELEINE BORDALLO, Guam
THADDEUS McCOTTER, Michigan          RAUL GRIJALVA, Arizona
RIC KELLER, Florida                  MICHAEL MICHAUD, Maine
TED POE, Texas                       LINDA SANCHEZ, California
MICHAEL SODREL, Indiana              JOHN BARROW, Georgia
JEFF FORTENBERRY, Nebraska           MELISSA BEAN, Illinois
MICHAEL FITZPATRICK, Pennsylvania    GWEN MOORE, Wisconsin
LYNN WESTMORELAND, Georgia
LOUIE GOHMERT, Texas

                  J. Matthew Szymanski, Chief of Staff

          Phil Eskeland, Deputy Chief of Staff/Policy Director

                  Michael Day, Minority Staff Director

     SUBCOMMITTEE ON WORKFORCE, EMPOWERMENT AND GOVERNMENT PROGRAMS

MARILYN MUSGRAVE, Colorado Chairman  DANIEL LIPINSKI, Illinois
ROSCOE BARTLETT, Maryland            TOM UDALL, New Mexico
BILL SHUSTER, Pennsylvania           DANNY DAVIS, Illinois
MICHAEL FITZPATRICK, Pennsylvania    RAUL GRIJALVA, Arizona
LYNN WESTMORELAND, Georgia           MELISSA BEAN, Illinois
THADDEUS McCOTTER, Michigan          GWEN MOORE, Wisconsin
JEB BRADLEY, New Hampshire

                     Joe Hartz, Professional Staff

                                  (ii)


                            C O N T E N T S

                              ----------                              

                               Witnesses

                                                                   Page
Wilson, Congressman Joe (SC-2), U.S. House of Representatives, 
  U.S. Congress..................................................     4
Mix, Mr. Mark, President, National Right to Work Committee.......     5
Baird, Mr. Charles, Ph.D., Professor of Economics, California 
  State University, East Bay.....................................     7
Feinstein, Mr. Fred, Professor, University of Maryland, College 
  Park...........................................................     9
Galley, Mr. George, Electro-Mechanical Technician, Colt 
  Manufacturing..................................................    10
Butcher, Mr. Michael R., Lead Engineer/DER, Boeing Commercial 
  Airplane Group.................................................    12
McNicholas, Mr. John, CEO, Penloyd, LLC..........................    14
Leef, Mr. George, Executive Director, John William Pope Center 
  for Higher Education Policy....................................    16

                                Appendix

Opening statements:
    Musgrave, Hon. Marilyn.......................................    27
Prepared statements:
    Wilson, Congressman Joe (SC-2), U.S. House of 
      Representatives, U.S. Congress.............................    30
    Mix, Mr. Mark, President, National Right to Work Committee...    32
    Baird, Mr. Charles, Ph.D., Professor of Economics, California 
      State University, East Bay.................................    43
    Feinstein, Mr. Fred, Professor, University of Maryland, 
      College Park...............................................    48
    Galley, Mr. George, Electro-Mechanical Technician, Colt 
      Manufacturing..............................................    51
    Butcher, Mr. Michael R., Lead Engineer/DER, Boeing Commercial 
      Airplane Group.............................................    54
    McNicholas, Mr. John, CEO, Penloyd, LLC......................    60
Additional material:
    Greer, Mr. Stan, Senior Research Associate, National 
      Institute for Labor Relations..............................    63
    Poulson, Mr. Barry W., Ph.D., Professor of Economics, 
      University of Colorado, Boulder............................    72
    Spencer, Mr. William B., Vice President, Government Affairs, 
      Associated Builders and Contractors, Inc...................    96

                                 (iii)




 FREEDOM IN THE WORKPLACE - AN EXAMINATION OF A NATIONAL RIGHT TO WORK 
                                  LAW

                              ----------                              


                      THURSDAY, SEPTEMBER 8, 2005

                   House of Representatives
         Subcommittee on Workforce, Empowermentand 
                                Government Programs
                                Committee on Small Business
                                                     Washington, DC
    The Subcommittee met, pursuant to call, at 10:04 a.m. in 
Room 2360, Rayburn House Office Building, Hon. Marilyn Musgrave 
[Chairman] presiding.
    Present: Representatives Musgrave, Lipinski, Sodrel, Udall, 
Westmoreland 
    Chairwoman Musgrave. Good morning. This hearing will come 
to order. I thank you all for being here, and I would like to 
extend a special thank you to our witnesses, especially those 
who have traveled long distances. The topic we are going to 
talk about today is the establishment of a national right-to-
work law.
    I am very pleased that we have Congressman Joe Wilson here. 
I consider him a friend, a wonderful colleague to have, and I 
am a co-sponsor of your legislation, and I thank you for being 
here. We also have an excellent panel before us of policy 
experts, authors, and individual workers, and all of you have 
extensive experience, and we are looking forward to your 
testimony today.
    I want to be brief in my remarks because I am very eager to 
hear the testimony, and I also just want to say up front that I 
am a very enthusiastic supporter of the National Right To Work 
Act. While this is certainly a labor issue, I think that it is 
also a constitutional issue.
    The First Amendment of the Constitution guarantees American 
citizens the freedom of association, and that freedom must 
extend to the workplace. If one does not wish to join an 
organization, such as a labor union, the federal government 
should not force you to do so under the threat of losing your 
job. Yet due to a fatal flaw in the National Labor Relations 
Act, many workers are prevented from getting a job unless they 
agree to pay union dues. This is fundamentally wrong.
    Forcing someone to join a union as a condition of 
employment is a very real and unfair burden on working 
families, many who might disagree, or often do disagree, with 
the views of labor leaders.
    I really believe that adopting a national right-to-work law 
will strengthen our economy. A free and open market is the key 
to productivity, growth, and stability in our nation's economy, 
which works best when individuals have the freedom to choose 
from a wide array of products and services. I sincerely believe 
these principles have made our economy the strongest in the 
world.
    This belief must also apply to the workforce. It is at its 
best when individuals are free to make informed choices about 
the conditions of their employment. I find it ironic that just 
earlier this year, several of the unions under the umbrella of 
the American Federation of Labor, Congress of Industrial 
Organizations, decided that its leaders were not representing 
their interests sufficiently, so they did what individual 
workers are not allowed to do: They disassociated themselves 
with the AFL-CIO to represent themselves.
    Why is it that unions are allowed to disassociate 
themselves from each other, but when an individual worker wants 
to leave a union, he should face termination? It is a double 
standard that we can correct. Enacting H.R. 500, sponsored by 
my friend and colleague, Representative Joe Wilson, will do 
just that. The companion legislation in the Senate, S.370, has 
been introduced by Senator Trent Lott.
    I thank you all for being here today as we look at this 
very important issue, and I would like to yield to the 
distinguished Ranking Member, Mr. Lipinski, for any opening 
statement that he might have.
    [Chairwoman Musgrave's opening statement may be found in 
the appendix.]
    Mr. Lipinski. Thank you, Madam Chairman. I think we all 
agree that we need to do more than improve the competitiveness 
of America's small businesses in the poor economic climate that 
we have, but it is wrong to suggest that organized workers are 
responsible for the problems faced by our small businesses and 
for our faltering economy.
    We should not be looking for an undeserving scapegoat to 
blame for our economic problems. We should not try to weaken 
the rights of workers to organize under the National Labor 
Relations Act. Unions are not responsible for skyrocketing gas 
costs or the rising cost of the health insurance. They are not 
responsible for the burdensome federal regulations that 
continue to increase on our nation's small businesses, and they 
are also not to blame for China's trade and currency policies. 
Instead, unions contribute to the well-being of American 
workers.
    Last night, I attended a dinner of the National Electrical 
Contractors Association, [NECA], where they gave an award to 
the chairman of the full Committee, Don Manzullo. Don was here 
earlier, but unfortunately he is not here anymore. I attended 
this dinner of NECA and honored Don, but NECA members who 
talked to me about how good their relationship is with the 
union that they deal with, the IBEW, and I know this is a 
unique situation, but I think it is a good example, and we 
should learn from this about how much better off everyone could 
be made when there is cooperation between management and 
unions. Everyone can be much better off.
    But today, we will hear from a number of witnesses who will 
claim there are laws in effect in favor of unions, employees 
are being forced to join unions, and this is causing problems. 
You will hear terms like ``freedom of association'' and 
``compulsive unionism.'' The reality is that no one can be 
forced to join a union against their will. A union cannot take 
action against those who decide not to join their union. In 
fact, a union has a legal duty to represent every employee, 
whether or not they are a member of the union. Since unions 
must represent everyone, not only in collective bargaining for 
better wages and benefits, but also in any grievance the worker 
is involved in, nonunion employees must pay agency fees, not 
union dues, to the unions for services they provide. These are 
not union dues; no one is forced to join the union.
    You will hear testimony today how states with right-to-work 
laws create a better business environment. However, statistics 
show that prebargaining states have a proven record of lower 
poverty rates, higher wages, lower rates of workplace 
fatalities, and better health care benefits as compared to so-
called ``right-to-work states.'' In fact, one might say that 
the latter group of states should be known as ``right-to-work-
for-less states.''
    Employers are better off without these laws. At the same 
time, there is no evidence that these advantages are 
inconsistent with a strong business environment. If anything, 
they are an indication of a vibrant business climate. I find it 
hard to believe that the governors and the state legislatures 
of free-bargaining states would not want the best business 
environment. Strangely enough, when we talk so much in 
Washington about states' rights, what this bill would do would 
go against that standard by depriving states the right to 
determine how businesses operate. Right now, states do have the 
right to be so-called ``right-to-work states.''
    Our common goal on this Committee is to improve the 
economic environment for small businesses so we can create 
better jobs for Americans. Unfortunately, a failure to address 
critical small business issues has hurt the ability of our 
small businesses to grow and create jobs. We all want to work 
together. We all want to work together to help small 
businesses, Democrats and Republicans. It is best that we do 
all work together.
    Now, in closing, we have to note that we need to work right 
now to ensure that we do everything we can to help the victims 
of Hurricane Katrina, whether it is through SBA loans, 
technical assistance, or other means. There are Small Business 
Administration programs that can be used to help the thousands 
of small business owners who will be struggling to get back on 
their feet, and this is something that I know we all agree on 
and we are all going to work together on.
    I look forward to today's discussion and testimony, and I 
thank the chairwoman.
    Chairwoman Musgrave. At this time, I would like to welcome 
Congressman Joe Wilson. Thank you for being here with us today, 
and, of course, he is the bill sponsor.

      STATEMENT OF HON. JOE WILSON (SC-2), U.S. HOUSE OF 
                 REPRESENTATIVES, U.S. CONGRESS

    Mr. Wilson. Madam Chairman, colleagues from Illinois and 
Indiana, I want to thank you for the opportunity to testify 
today. I appreciate the Subcommittee's interest in the issue of 
compulsory unionism. Madam Chairman, I particularly appreciate 
your personal courage to articulate the issue. It means a lot, 
and they are very positive, the statements that you have made.
    I believe that compulsory unionism violates the fundamental 
principle of individual liberty, the very principle upon which 
this nation was founded. Compulsive unionism basically says 
that workers cannot and should not decide for themselves what 
is in their best interests. I can think of nothing more 
offensive to the core American principles of liberty and 
freedom.
    The National Right To Work Act [H.R. 500], which has 90 co-
sponsors, will address this most fundamental problem of federal 
labor policy. Does America believe that working men and women 
should be forced, as a condition of employment, to pay dues or 
fees to a labor union? I believe that no one should be forced 
to pay union dues to get or keep a job.
    This bill would not add a single word to the existing 
federal labor law. Rather, it would repeal those sections of 
the National Labor Relations Act and Railway Labor Act that 
authorize the imposition of forced-dues contracts on working 
Americans.
    Every worker should have the right to join or support a 
labor union. This bill protects that right. But no worker 
should be ever forced to join a union. H.R. 500 will strike 
that balance, and the vast majority of Americans agree.
    According to a March 2004 poll by Research 2000, 79 percent 
of Americans support Right To Work, and over 50 percent of 
union households believe workers should have the right to 
choose whether or not to join or pay dues to a labor union. 
That should come as no surprise. People want the freedom to 
decide what is in their best interests, and Right To Work 
expands every working American's personal freedom.
    Of course, compulsory unionism is not just a freedom issue. 
Right To Work brings economic benefits as well. I am happy to 
say that my own state, South Carolina, is one of the 22 states 
that has a right-to-work statute, and this has been in place 
since 1954. Over the past decade, right-to-work states have 
held a significant advantage in job creation, employer-provided 
health insurance, and real purchasing power over their 
compulsory unionism counterparts.
    According to University of Colorado economist Barry 
Poulson, after adjusting for cost of living, household income 
in right-to-work state metropolitan areas in 2002 was $50,571, 
nearly $4,300 higher than the average in forced-union-dues 
state metropolitan areas. But the sad fact is, even though 
South Carolinians have enjoyed the protection of a state right-
to-work law for decades, it is simply not enough. Railroad 
workers and those employed in federal enclaves are exempt from 
a right-to-work law's protection and must pay union dues or 
fees or be fired.
    Madam Chairman, that is why it is time for Congress to act 
and return to all American workers their rights as citizens of 
this country.
    In 1935, Congress chose to enact legislation that forces 
American workers to accept Big Labor's so-called 
``representation'' just to get or keep a job. It is now our 
responsibility to end compulsory unionism once and for all. 
Passage of H.R. 500, the National Right To Work Act, would not 
only give individual freedom back to America's working men and 
women but would help our nation's economic output as well. That 
is why I urge my colleagues to support this legislation which 
expands the freedom of hard-working Americans and gives them 
the freedom to choose whether to accept or reject union 
representation and union dues without facing coercion, 
violence, and workplace harassment by union officials.
    Madam Chairman, thank you and my colleagues for this 
opportunity to testify.
    [Congressman Wilson's testimony may be found in the 
appendix.]
    Chairwoman Musgrave. We appreciate you being here today, 
and I know that you have other commitments, so we thank you 
very much. Stay as long as you can, or do what you need to do, 
and thank you, Congressman.
    Mr. Wilson. I have got a pesky staff that is asking me to 
go to the next meeting.
    Chairwoman Musgrave. I sensed that. Thank you very much.
    Mr. Wilson. Thank you very much.
    Mr. Lipinski. We may not agree on this, but I thank 
Representative Wilson for coming to testify today.
    Mr. Wilson. Thank you so much.
    Chairwoman Musgrave. I will call our next panel at this 
time. Gentlemen, we have a five-minute limit on testimony, and 
so if you can, pay attention to the lights. When you get to the 
yellow light, it is getting time for you to sum up, if you 
would. So I will try to keep you on schedule out of respect to 
all of you.
    [Pause.]
    Chairwoman Musgrave. Our first witness is Mark Mix. He is 
the president of the National Right To Work Committee. Mr. Mix, 
welcome.

    STATEMENT OF MARK MIX, NATIONAL RIGHT TO WORK COMMITTEE

    Mr. Mix. Thank you, Madam Chairman, and thank you for the 
opportunity to speak in front of this Committee. Having been 
here before and been silenced by your gavel, I will stay within 
my time constraints.
    Chairwoman Musgrave. Flattery will get you nowhere. Well, 
actually it will, yes.
    Mr. Mix. It is a privilege to be here to testify on behalf 
of the National Right To Work Act, H.R. 500. It is important 
that we understand what we are talking about here. The change 
in the National Labor Relations Act that is being contemplated 
by this legislation does nothing to restrict workers' rights to 
join or associate with unions. We need to get that out up 
front.
    It is a very simple piece of legislation. As Congressman 
Wilson stated, it does not add a single word to federal law. It 
simply repeals those provisions that authorize the firing of a 
worker for failure to pay fees to a union as a condition of 
employment.
    As Congressman Wilson said, America was established as a 
free society, and all working men and women should be 
guaranteed the right to decide for themselves whether a union 
deserves their financial support. That right is guaranteed in 
the American Constitution, and legislative attempts to deny it 
must be nullified. That is what H.R. 500 would do.
    Because of its complexity, our federal labor law is not 
understood by most Americans, but the issue of right to work 
could not really be any simpler. Every worker must have the 
right, but no one should be compelled to join or financially 
pay dues to a labor organization as a condition of getting or 
keeping a job.
    The National Labor Relations Act abuses the freedom of 
working people to earn an honest living for themselves and 
their families. Under this so-called ``Magna Carta'' of 
workers' rights, employees who never requested a union, never 
voted for one, never asked for one, are then forced to accept 
its representation and then, to add insult to injury, forced to 
pay for that unwanted representation.
    The National Labor Relations Act is often perceived as the 
greater charter of freedom. That was not entirely unintentional 
by its drafters. In fact, it contains some of the most 
deliberately misleading language human beings could devise.
    Let me read just the essential portion of Section 7, the 
preamble of the Wagner Act under ``Rights of Employees.'' It 
says: ``Employees shall have the right to self-organization to 
form, join, or assist labor organizations, to bargain 
collectively through representatives of their own choosing, and 
to engage in other concerted activities for the purpose of 
collective bargaining or other mutual aid or protection, and 
shall also have the right to refrain from any or all such 
activities....''
    Now, what could be fairer than that: the right to, the 
right not to, the right to refrain? But let me finish the 
sentence that I just read. It says: ``Employees shall have the 
right to refrain except to the extent that such right may be 
affected by an agreement requiring union membership as a 
condition of employment....''
    Now, union membership, actual union membership, has been 
struck down by the courts. We are now at a point where they are 
required to join and be a ``member in good standing'' and can 
be forced to pay up to 100 percent in dues. So we do not 
contest the fact that no one is required to join a union; we 
are contesting the fact that they may be required to pay 100 
percent of the dues to keep their job, and we would see very 
little difference.
    The National Right To Work Act legislation that has been 
introduced by Congressman Wilson would end this cynicism by 
simply repealing those provisions in the act. Even the most 
avid promoters of compulsory unionism are forced to defend 
compulsory unionism on the basis of pragmatism and not 
principle.
    No less of an authority than former Secretary of Labor 
Robert Reich put this most succinctly. As a Harvard lecturer in 
1985, Mr. Reich gave the following explanation of federal labor 
law to an Associated Press reporter, and I quote his exact 
words. He said, ``In order to maintain themselves, unions have 
got to have some ability to strap their members to the mast.'' 
Continuing the quote: ``The only way unions can exercise 
countervailing power is to hold their members' feet to the fire 
... otherwise, the organization is only as good as it is 
convenient for any given member at any given time.''
    Former Secretary Reich has accurately, if callously, 
described the basic principles of federal labor law, that the 
convenience of union officials, i.e., the union security 
clause, must take precedent over the freedom of employees who 
wish to earn a living for themselves and their families.
    Indeed, it is high time that we go directly to the heart of 
the matter. Are the merits or demerits of congressional-
sanctioned compulsory unionism; freedom or coercion? This is a 
real issue: Should union membership be voluntary or compulsory? 
The underlying philosophy of those who believe in the right-to-
work principle can be best summed up in the words of Samuel 
Gompers, the founder of the American Federation of Labor, who 
urged, ``a devotion to the fundamentals of human liberty--the 
principles of volunteerism. No lasting gain has ever come from 
compulsion. If we seek to force, we but tear apart that which, 
united, is invincible.'' That is Samuel Gompers, the former 
president of the AFL.
    The most perceptive observers, both inside and outside 
organized labor, have long recognized that compulsory 
membership in unions is not necessarily beneficial to rank-and-
file workers but beneficial to union officials themselves. The 
National Right To Work Act, as I have said, would not add one 
word to federal law. I would simply repeal the provisions 
authorizing compulsory payment of dues as a condition of job 
employment.
    I thank the chairman again for the opportunity to testify, 
and I think I will yield my 12 seconds back.
    [Mr. Mix's testimony may be found in the appendix.]
    Chairwoman Musgrave. Our next witness is Dr. Charles Baird, 
professor of economics, California State University, East Bay. 
Welcome.

 STATEMENT OF CHARLES BAIRD, CALIFORNIA STATE UNIVERSITY, EAST 
                              BAY

    Mr. Baird. Thank you. Chairman Musgrave and Ranking Member 
Lipinski and members of the Subcommittee, thank you for the 
invitation to testify on the national right-to-work bill, and I 
am doing so on my own behalf.
    Chairwoman Musgrave. Dr. Baird, could you move the mike a 
little closer? Thank you so much. It will help us to hear you.
    Mr. Baird. The argument that it is proper to force workers 
who are represented by a union to pay the union for its 
services lest some would become free riders is, in a word, 
absurd. Economists define a ``free rider'' as one who receives 
net benefits from a collective action and can avoid paying for 
them due to the inherent nonexcludability of some goods. There 
is nothing inherent in any employment relationship that gives 
rise to a free rider problem. Congress created the free rider 
problem in labor relations when it enacted the principle of 
exclusive representation into law in 1935.
    Under the National Labor Relations Act, a union cannot 
bargain just for its voluntary members. It must bargain for all 
workers in the bargaining unit. Individual workers are even 
forbidden to represent themselves. If the union represented 
only its voluntary members, only they would receive any 
benefits that emerged from that representation. Other workers 
could choose individually to be represented by some other 
organization, or they could choose to represent themselves.
    Put another way, if unions want to eliminate the 
possibility of any worker being a free rider, they should join 
with me and advocate repeal of exclusive representation. 
Without exclusive representation, there would be no need for a 
National Right To Work Act because the question of union 
security would be moot. The argument that exclusive 
representation is justifiable as workplace democracy is 
vacuous, as I explain in my written testimony, but I do not 
have time here to state.
    Given exclusive representation, the unions' free rider 
argument amounts to saying that since Congress has agreed to 
override individual workers' freedom of association and choice 
of workplace representatives, Congress must also override 
individual workers' freedom of association in deciding whether 
or not to support a particular workplace representative. 
Opponents of right to work argue that one violation of freedom 
of association compels another violation of freedom of 
association.
    I argue that given the first trespass against freedom of 
association, which is exclusive representation, a National 
Right To Work Act is necessary to prevent the second trespass.
    Many argue that exclusive representation is a fact of life 
which we all must accept. Therefore, forcing workers to support 
unions is necessary to prevent free riding. However, it can 
never be proven that any worker free rides on any collective 
bargaining agreement. A forced rider is one who suffers net 
harms from some collective action who is compelled to pay for 
them. Even if one grants that unions can raise the wages and 
salaries that are paid to some workers, it does not follow that 
even those workers, on a net basis, gain from union actions. 
Costs and benefits are inherently subjective.
    Suppose a worker gets a $10 increase due to a union's 
activities. No third party can prove that the $10 increase 
benefits that worker either more than, less than, or the same 
as the cost that is imposed on that worker by, for example, the 
disutility the worker suffers from being forced to associate 
with the union. Any worker accused by a union of being a free 
rider can argue with just as much rigor that he or she is a 
forced rider. It is a conceit to argue that Congress or any 
other third party can make that determination for any worker.
    The argument that a National Right To Work Act would be a 
trespass against the rights of states to choose their own union 
security regulations is both disingenuous and silly. It is 
disingenuous because those who make it are exactly the same as 
those who advocate repeal of Section 14[b] of the National 
Labor Relations Act which permits states to have right-to-work 
laws in the first place. It is silly because the only reason 
that states have to concern themselves with a right-to-work 
question at all is because Congress imposed the National Labor 
Relations Act on all states.
    Congress trespassed against worker rights with the National 
Labor Relations Act, and Congress surely has the right to make 
amends, even the partial amends offered in the nation right-to-
work bill. For these and other reasons, I wholeheartedly 
endorse H.R. 500 and recommend its speedy enactment. Thank you.
    [Mr. Baird's testimony may be found in the appendix.]
    Chairwoman Musgrave. Thank you, Dr. Baird.
    Our next witness is Fred Feinstein, and he is a professor 
at the University of Maryland. Welcome.

      STATEMENT OF FRED FEINSTEIN, UNIVERSITY OF MARYLAND

    Mr. Feinstein. Thank you. My name is Fred Feinstein, and I 
am very pleased to be appearing before this distinguished 
Subcommittee today. In addition to currently serving at the 
University of Maryland, School of Public Policy, from 1994 to 
1999, I served as general counsel of the National Labor 
Relations Board.
    The basic law on union security agreements, I believe, is 
clear and has been in effect since enactment of the Taft-
Hartley law more than 50 years ago. Federal law prohibits 
compulsory unionism. No individual can be forced, as a 
condition of employment, to join a union. This is well 
established and does not require further legislation. The only 
question raised by this legislation is whether it is sound 
federal policy to place additional limitations on the ability 
of employers and unions to negotiate voluntary arguments about 
how a union can be compensated for services it is, as many have 
indicated, required under federal law to provide.
    The law is also clear, again, as has been suggested, that 
unions do not have the option of declining to represent 
employees who do not wish to pay for union services. Under the 
law, a certified union must provide fair representation to all 
employees in a bargaining unit, regardless of their views about 
the union. Now, we can disagree about this provision of the 
laws,--the previous speaker has--but it is the law. Once it is 
certified that a majority of employees seek union 
representation, the union must fairly and even-handedly 
represent each employee, whether or not an employee supports 
the union and whether or not the employee is, indeed, a union 
member. The union must represent each employee with the same 
degree of diligence, which is not a trivial obligation.
    Regardless of the obligation to represent all employees 
with equal diligence, under current law, Section 14[b] of the 
National Labor Relations Act restricts the freedom of employers 
and unions to enter into a contract requiring employees to 
contribute to the cost of representation expenses.
    The bill being considered today would impose this 
restriction on the 28 states that have chosen not to adopt 
these provisions, the so-called ``right-to-work laws.'' It 
would establish a national prohibition on the ability of 
employers and unions to voluntary negotiate agreements 
requiring employees covered by that agreement to compensate a 
union for reasonable representation expenses. Union security 
agreements would be prohibited not just in the 22 states but 
nationwide.
    This further restriction on the ability of unions to charge 
for representation services would, in my view, undermine the 
ability of unions to improve the working conditions of those 
they represent. There is significant evidence that the benefits 
of union representation are, indeed, substantial, and these 
benefits are available equally to all workers covered under a 
union contract, whether or not they are union members. For 
example, according to BLS, wages of workers covered by union 
contracts are 28 percent higher than wages of workers that do 
not have union contracts.
    It is also important to note that under federal law today, 
again, as has been suggested, the fee that a union can charge 
all employees includes only actual representation expenses. 
This includes expenses for such things as grievance and 
arbitration representation or the negotiation of collective 
agreements. It cannot include expenses for activities that are 
not representational in nature, such as expenses to support 
political candidates or activities to promote legislation, and 
unions are, indeed, required to maintain extensive records 
apportioning all of the resources that they expend.
    But I think, finally, it is important to view this 
legislation in the broader context of concerns about labor law 
today. Passage of this bill would add to the burdens, I 
believe, that workers already endure when they seek to form 
unions and bargain collectively. According to Human Rights 
Watch, workers in the United States today routinely face 
significant obstacles when they try to form a union, even 
though it is their fundamental right to do so. The National 
Labor Relations Act explicitly guarantees a worker's right to 
form a union and bargain collectively, but in far too many 
instances today, attempts by workers to gain union 
representation are met with intense employer opposition that 
lead employees, quite understandably, to conclude that they 
lack a meaningful right to union representation.
    According to reputable sources, approximately 50 percent of 
workers today say they would join a union if they had the 
chance, yet only approximately one-quarter of that number is 
actually represented by unions. I suggest that this 
representation gap is our most serious problem in terms of 
examining federal labor policy.
    In conclusion, then, I believe the right of employees to 
decline union membership is adequately protected under existing 
law, and a more pressing concern not addressed by the 
legislation under review is protecting the rights of employees 
who seek union representation.
    Madam Chairman, again, I appreciate the opportunity to 
appear today.
    [Mr. Feinstein's testimony may be found in the appendix.]
    Chairwoman Musgrave. Thank you, Mr. Feinstein, and at this 
time, I will recognize George Galley, and he is an electro-
mechanical technician from Colt Manufacturing. Welcome to the 
Committee today.

         STATEMENT OF GEORGE GALLEY, COLT MANUFACTURING

    Mr. Galley. Good morning, Madam Chairman and members of the 
Subcommittee. Thank you for the opportunity to testify before 
you today to share with you my personal experiences with the 
issue of forced unionism and to explain why I hope Congress 
will pass a national right-to-work law.
    Chairwoman Musgrave. Mr. Galley, would you pull the 
microphone just a little closer? Thank you so much.
    Mr. Galley. I am employed as an electrician for Colt 
Manufacturing Company in Hartford, Connecticut, where I have 
worked for 44 years. As you know, Connecticut does not have a 
right-to-work law to protect Constitution State citizens. 
Workers like myself pay the price.
    From 1961 until 1985, I was a member of the United Auto 
Workers of America Union, [UAW], the union that represents 
workers at Colt. In 1985, the UAW called a strike against Colt. 
I followed the strike orders for one month and two days. After 
this time, I decided that I needed to get back to work in order 
to provide for my family. I believe there is no question I made 
the right decision. Had I not decided to get back to work, I 
would have been on strike for approximately four years with the 
rest of the UAW members.
    At the conclusion of the strike, Colt rehired all striking 
employees. It was during this period when Colt handed out 
cards, which they asked each employee to sign, the cards 
authorizing the company to automatically deduct union dues. 
Because I was aware, unlike many of the employees at Colt, that 
there was an alternative to paying full union dues, I refused 
to sign the card and requested information about any other 
options available to me.
    Despite my refusal to sign the union card, Colt kept 
deducting full union dues from my paycheck. The situation 
persisted for some time, and on more than one occasion, I 
demanded information on my alternatives from Colt. Despite my 
requests, I was never informed of my Beck rights and never 
received any response other than I had to sign the union dues 
authorization card.
    Eventually, Colt stopped taking union dues from my paycheck 
because I had continually refused to sign the union dues 
authorization card. I was fired later that year.
    After my termination, I filed a charge with the National 
Labor Relations Board. After considerable delay, the regional 
director issued a complaint. I was reinstated to my employment 
at that time but was not reimbursed for the pay that I had 
lost. My case was grouped with several other charges filed 
nationwide. Rather than being heard by an administrative law 
judge, the case went to the NLRB on motions for summary 
judgment. However, once briefing was completed, the case 
languished for nearly seven years. Ultimately, the board ruled, 
but only after my attorney filed a petition for a writ of 
mandamus with the D.C. Circuit Court seeking to force the board 
to rule. However, I lost my case when the board finally made 
its decision. Later, I appealed my case to the D.C. Circuit 
Court and received a new trial in Hartford, Connecticut, which 
I won.
    I am now back on the job as a Beck objector, which 
supposedly grants me the right to withhold the portion of my 
union dues that would go to activities unrelated to collective 
bargaining. I am still forced to pay 72 percent union dues as a 
``fee'' to the UAW in order to keep my job. Every month, under 
the threat of being terminated yet again, I am forced to write 
a check to the UAW brass for the so-called ``privilege'' of 
working at Colt.
    Unfortunately, my experiences with the UAW have made me 
realize that once a worker becomes a Beck objector, that worker 
has no control over anything, even with the payment of union 
dues, or so-called ``fees,'' that are demanded by union 
officials. I have found that if a worker does not march in 
lockstep with the union dogma, that worker's concerns are not 
taken into account.
    Federal labor law continues to force me to fund an 
organization that purports to provide services--services that I 
do not want. Worse yet, despite the fact that I pay what they 
call my ``fair share,'' I am given no voice in how my money is 
spent.
    What I want is simple: I want nothing to do with the union. 
That is why I am urging Congress to pass the National Right To 
Work Act.
    As I stated before, I have worked for Colt for 44 years. I 
am proud of the work I do and enjoy working for the company. I 
resent very much the fact that I can be fired for refusing to 
support an outside, private organization. I do not believe that 
any American should be forced to pay a private organization 
just to hold a job and provide for his family.
    Passage of the National Right To Work Act would give me the 
freedom to do my job without the threat of being fired for the 
refusal to pay union dues and decide for myself whether or not 
a union deserves my support. I believe that decision is mine.
    Union officials claim that they provide a service to 
workers, but it should be up to individual workers whether or 
not they want that service. Union officials are also very 
political, so no worker should be forced to fund an 
organization with beliefs contrary to his or her own.
    [Mr. Galley's testimony may be found in the appendix.]
    Chairwoman Musgrave. Thank you very much, Mr. Galley. I 
appreciate your testimony.
    We now have Michael Butcher here. He is an engineer with 
Boeing. Welcome to the Committee.

 STATEMENT OF MICHAEL BUTCHER, BOEING COMMERCIAL AIRPLANE GROUP

    Mr. Butcher. Thank you, Chairwoman Musgrave and members of 
the Subcommittee. Thank you very much for the opportunity to 
share with you today my personal experience as a professional 
employee with the federally approved practice of forced 
unionism.
    As one of millions of Americans that has been forced to pay 
union dues, or so-called ``agency fees,'' as a condition of 
employment, many of us against our will, I can tell you it has 
been my hope for some time that Congress would work to pass the 
National Right To Work Act.
    Let me briefly introduce myself. I am an engineer employed 
by the Boeing Company in Washington State where I have been 
continuously employed since shortly after receiving a bachelor 
of science in aeronautical and astronomical engineering from 
Purdue University in 1986.
    When I joined Boeing, union membership was completely 
voluntary. That all changed in August of 2000, which was 
shortly after the Society of Professional Engineering Employees 
in Aerospace [SPEEA] union became an affiliate of the AFL-CIO. 
The first thing the AFL-CIO did was send Richard Trumka out to 
personally take over contract negotiations with SPEEA. I know, 
based on a personal conversation I had with the director of 
union relations at Boeing, that Trumka's number-one demand was 
that Boeing require every professional employee to pay union 
dues, or so-called ``agency fees,'' as a condition of 
employment. He made it clear to Boeing management that no 
contract without agency fees would be acceptable, no matter how 
good the offered wages and benefits were.
    From this point on, in order to receive a paycheck every 
other week, I was forced to pay dues just for the so-called 
``privilege'' of trying to earn a living. I was not unique 
either because almost 6,000 of my fellow co-workers who had 
historical not been SPEEA members were also forced to pay union 
dues. Regardless of whether or not I thought the union 
membership benefitted me, regardless of whether or not I agreed 
with the union's policies, I was forced to pay union dues, or I 
would have been fired. In fact, several engineers at Boeing, 
including a friend of mine, had their employment terminated by 
union request because they refused to pay union dues. I think 
this is just plain wrong, and that is why I am here today.
    Like many engineers at Boeing, I was recruited from out of 
state, and I did not know there was an engineering union until 
my first day on the job. As a professional employee, it was 
never my expectation to be part of a union; therefore, I 
consistently declined the union membership. Nothing has 
happened during my career to change my initial impression 
concerning the so-called ``benefits'' of union membership. In 
fact, it has been my experience that the union has only been a 
detriment to my career, and the services they claim to provide 
are of absolutely no value to me. Furthermore, I find the 
nonrepresentational activities of the union and its AFL-CIO 
affiliates to be inconsistent with my beliefs and values. I, 
therefore, have no interest in funding those activities.
    It is true that under the U.S. Supreme Court Communications 
Workers v. Beck decision, union officials cannot force me to 
pay for politics or other activities unrelated to collective 
bargaining. My person experience, however, is that this 
protection is next to useless. You see, as a Boeing employee, I 
learned that Beck is rarely enforced; therefore, SPEEA had 
little incentive to abide by the law. When given the 
opportunity to force myself and thousands of my co-workers to 
pay full union dues, SPEEA failed to comply with its 
obligations under Beck. In the case of SPEEA, I had to file two 
complaints with the National Labor Relations Board, and it took 
two years of legal process before SPEEA was forced to minimally 
comply with Beck.
    Initially, the union attempted to discourage potential Beck 
objectors by unlawfully notifying myself and others that Beck 
objections were subject to approval by the union and that an 
objector would have to state your reasons for objecting. 
Furthermore, they told us that they we would not be provided 
any services of the union, including answers to simple things 
like contract questions.
    As a Beck objector, I was also forced to go through a 
frustrating scheme that discouraged me from challenging the 
union's expenditures, including repeatedly giving me a 
breakdown of union expenses that was not performed by an 
independent audit, as the law requires.
    Despite continued and repeated violations of SPEEA's 
obligations under Beck, the union received only a minor slap on 
the wrist from the NLRB, which led me to conclude that 
enforcement penalties for unions caught cheating on Beck are 
negligible.
    I have also found that even if unions have a lawful and 
``legitimate'' audit performed by an outside organization, the 
audit basically just ensures that all of the union's expenses 
are accounted for. An auditor relies on the union to determine 
which expenses are chargeable, and the bulk of that is based on 
union timesheets which employees fill out which are not audited 
at all. Therefore, the union can set the fee at virtually any 
value they want.
    Three years ago, I gave up on the Beck process and became a 
religious objector. Since then, SPEEA has tried to have me 
fired twice. Again, I am not unique, since personally I know 
several other religious objectors that the union has tried to 
have fired as well.
    I have come to the conclusion over the last five years that 
the current system is inherently corrupt because basically the 
federal government has empowered the people who run the unions 
to legally extort money from the workers of America. That is 
right. The so-called union ``agency fee'' is widely referred to 
in my office by the people I work with as the ``union extortion 
fee.'' Even many of my co-workers who supported the union when 
union membership was voluntary describe the union agency fee as 
a mistake because they have seen how it has corrupted the union 
and made it much less responsive to their needs.
    The simple American freedom to choose who you want to 
associate with is such a fundamental right, whether it be a 
church, charity, or club, that there is absolutely no excuse 
that this same right should not exist when it applies to 
individual workers deciding whether or not to support or 
associate with a union. Unfortunately, federal labor law 
assumes that people like me are incapable of making that 
choice.
    [Mr. Butcher's testimony may be found in the appendix.]
    Chairwoman Musgrave. Thank you very much, Mr. Butcher. I 
appreciate your testimony.
    Our next witness is John McNicholas, and he is the CEO at 
Penloyd. Welcome to the Committee.

           STATEMENT OF JOHN McNICHOLAS, PENLOYD, LLC

    Mr. McNicholas. Thank you. Madam Chairman and members of 
the Subcommittee, I appreciate very much the opportunity to 
testify before you in favor of H.R. 500, the National Right To 
Work Act.
    There is no doubt in my mind that this legislation is 
important. I agree with the statement, no worker should be 
forced to pay union dues, or so-called ``fees,'' to a labor 
union just to get or keep a job. That is why it is my hope that 
Congress will work to pass H.R. 500.
    I believe that Right To Work is good for employers and 
employees alike, and I believe my experience has CEO of Penloyd 
supports this viewpoint in a very tangible fashion. If Oklahoma 
was not a right-to-work state, I might not be testifying before 
you today as CEO of Penloyd.
    In 2003, I became aware that Oklahoma Fixture Company in 
Tulsa, Oklahoma, had filed for Chapter 11 bankruptcy. The 
company employed workers represented by the carpenters union 
and the painters union. I joined the team and considered 
investing in the turnaround opportunity. After an extreme due-
diligence process, our team decided we could become profitable 
again with good management decisions and some structural 
changes. But before we make an investment, we assess risk 
factors that could lead to failure. We identified a risk that 
our workforce would not be willing to adapt quickly to changes 
required to survive international competition because they were 
union members. I do not believe we would have accepted that 
risk if Oklahoma was not a right-to-work state.
    On June 25, 2003, our team purchased the assets of Oklahoma 
Fixture Company and created a new company, Penloyd, LLC. 
Penloyd immediately hired most of the existing employees of 
Oklahoma Fixture Company.
    Since the purchase of the assets of the Oklahoma Fixture 
Company, Penloyd has grown from approximately 250 employees to 
500 employees. Several months after our acquisition, a very 
important event for the company's future success, our employees 
chose to decertify the existing unions in a free and fair 
election at their workplace.
    Penloyd specializes in retail fixture manufacturing. We 
design, produce, warehouse, and ship products to retail stores 
throughout the United States. Some of our well-known clients 
include Dillard's Department Store, Federated Department 
Stores, and Eddie Bauer.
    I can tell you that Penloyd is looking for additional 
opportunities to rehabilitate and develop existing 
manufacturing businesses. If we are successful in this effort, 
we will create more jobs for the American economy.
    So at a time when many right-to-work states are losing 
manufacturing jobs, Penloyd is seeking to create new American 
manufacturing jobs. There is no doubt that taking on a business 
that has previously struggled is no easy task, and this is also 
well known to our lenders and our customers.
    In acquiring the assets of Oklahoma Fixture Company, we 
needed to have as many positive factors going for us as we 
could before committing capital. One of those positive factors 
was that Oklahoma was a right-to-work state. If we had faced 
union officials who were militant and confrontational, 
championing arcane work rules, and decreasing management's 
decision-making flexibility, we could not have been successful 
in saving the business and creating about 250 new jobs.
    I believe the ability of union officials to force rank-and-
file workers to pay union dues, or so-called ``fees,'' in non-
right-to-work states sometimes leads to this militancy, support 
of arcane work rules, and unnecessary confrontation with 
management. It is certainly reasonable to deduce that union 
officials that can force all of their members to pay union dues 
have little or no incentive to take all of their members' 
concerns completely into account. As long as the union 
officials keep 51 percent of their membership happy, the 
interests of the remaining 49 percent may be considered a low 
priority.
    That is why I believe that rehabilitating an existing 
business is much easier, much cheaper, and much more efficient 
in states with right-to-work laws, which create an environment 
where union officials work with management to help achieve 
goals common to both business and rank-and-file workers.
    In right-to-work states, I believe union officials are much 
more likely to be concerned with keeping their members happy 
and may not oppose a much-needed management decision that 
workers see as benefiting everyone in the long run. This is the 
way it should be, and if Congress would pass a national right-
to-work law, it would be a huge step in the right direction.
    I know I am not just one of a handful of business leaders 
who feel this way. I know many other CEOs and business owners 
who have similar outlooks and experiences. I feel that union 
officials should have to earn the rank-and-file members' union 
dues. This way, members might be given more control over their 
union's activities. A union official may temper confrontational 
opposition to common-sense change, knowing that rank-and-file 
members would be able to withhold payment of union dues if they 
feel union officials were not acting in the workers' best 
interests.
    I believe that when individual workers are given liberty, 
it is good for business and employers alike. In my experience, 
I can tell you that Oklahoma's right-to-work law was a major 
factor in our decision to acquire the assets of Oklahoma 
Fixture Company and helped make it possible for the creation of 
approximately 250 jobs in a little over two years.
    My experience as CEO of Penloyd and my personal belief in 
freedom leads me to support the National Right To Work Act. I 
hope Congress will work to pass this important legislation.
    [Mr. McNicholas' testimony may be found in the appendix.]
    Chairwoman Musgrave. Thank you very much.
    Our last witness is George Leef. He is the executive 
director of John William Pope Center for Higher Ed. Policy. 
Thank you for being here, Mr. Leef.

 STATEMENT OF GEORGE LEEF, JOHN WILLIAM POPE CENTER FOR HIGHER 
                        EDUCATION POLICY

    Mr. Leef. Thank you. Representative Musgrave and members of 
the Committee, my name is George Leef. I am the director of the 
John William Pope Center for Higher Education Policy in 
Raleigh, North Carolina.
    Long before I took an interest in higher-education issues, 
however, I was interested in the labor law, and I thank you for 
the opportunity to address the Committee today on the state of 
federal law on labor relations. That was a subject I paid great 
attention to when I was in law school, and it is one that I 
have subsequently written about on several occasions.
    Back in 1990, I wrote a paper entitled ``The Case for a 
Free Market in Labor Representation Services,'' which was 
published in Cato Journal and a copy of which, I believe, has 
been provided for you. Much more recently, I wrote a book on 
the history of the right-to-work movement, entitled Free Choice 
for Workers, which explains what our labor relations statutes 
say and why I find it to be inappropriate for a free society. 
The book has just been published by Jameson Books.
    In my testimony, I would like to discuss the origin and 
provisions of the National Labor Relations Act, the keystone of 
federal labor relations policy.
    Historically, laws pertaining to labor, including union 
representation, were matters for state government. That is 
because the Constitution limits the power of Congress to the 
regulation of interstate commerce, and the particulars of the 
relationship between employer and employee were not regarded as 
falling under the founders' meaning in the phrase ``interstate 
commerce.'' The states, for the most part, and in my view, 
correctly, left questions of labor relations policy to the 
common-law principles of contract, tort, property, and agency.
    During the Great Depression, the idea that labor relations 
law was not properly a concern of the federal government was 
abandoned. Organized labor had strongly backed Franklin D. 
Roosevelt in the 1932 election and, once in office, FDR was 
quite willing to repay the favor with legislation desired by 
union officials. The result was the passage of the National 
Labor Relations Act, the NLRA, in 1935, which federalized labor 
relations law.
    Just in passing, I would like to say that some very eminent 
legal scholars regard the NLRA as both unconstitutional and 
extremely bad policy.
    The NLRA created a host of unique powers that take freedoms 
away from both workers and employers in order to assist union 
officials in organizing and maintaining their unions. For the 
present, I will mention just two of them. First, the law 
establishes a procedure for union elections wherein workers may 
vote for representation by a union, sometimes with a choice 
between unions, or no union representation.
    Under the law, the winning union becomes the exclusive 
bargaining representative of all of the workers in the 
bargaining unit, thereby compelling those who wanted a 
different union or no union at all to accept the victorious 
union as their representative. Furthermore, the results of that 
election are binding indefinitely and cover subsequently hired 
individuals.
    Thus, the law transforms that which had formerly been, and 
should be, a matter of personal choice into a collective 
decision which is quite difficult to reverse. Nowhere else in 
American law is a person denied the freedom to choose whether 
he will represent himself or to decide exactly who he wants to 
represent his interests.
    Second, the NLRA makes it a legal offense, an unfair labor 
practice, for an employer to fail to bargain ``in good faith'' 
with the certified union. Almost always, one of the first 
orders of business once a union has been certified is for its 
officials to negotiate a union security agreement with 
management, and we have heard some testimony to that effect 
just recently. Those agreements state that workers in the 
bargaining unit must pay the union's dues and obligate the 
employer to terminate anyone who does not. While employers are 
not legally compelled to consent to the demand for such a 
mandatory dues payment provision, refusal to do so can lead to 
costly legal proceedings with the NLRB. This is, therefore, 
bargaining with one side holding a gun. Combined with exclusive 
representation, we can see how the law promotes compulsory 
unionism.
    Widespread abuse of union power during World War II led to 
the passage of the Taft-Hartley Act in 1947, amending the NLRA 
in several ways, most significantly in recognizing that states 
could choose to enact what are called ``right-to-work laws'' 
shielding workers against union security agreements. Today, 22 
states have enacted such legislation, and the question for the 
Committee is whether a National Right To Work Act would be 
wise. I believe that it would be.
    First, as a moral proposition, I maintain that no one ought 
to be compelled to pay for the services of any private 
organization that he has not voluntary agreed to join or 
contract with. Many union-represented workers object to the 
political uses of their dues money, for example, and others 
feel that union officials do little or nothing that is 
beneficial to them in their jobs. Compelling them to pay dues 
is just as objectionable as compelling someone to pay fees for, 
let us say, Internet service that he does not want.
    And second, as a practical matter, right-to-work protection 
helps to make union officials more accountable. Where workers 
can simply stop paying dues if they become disenchanted with 
what the union is doing, the discipline on union officials is 
much stronger than if the worker has no recourse other than to 
quit his job.
    Passage of a National Right To Work Act would be an 
important step toward the restoration of a labor policy that is 
consistent with a free society. Further steps would need to be 
taken to reach that goal, but this is a useful one that I 
enthusiastically endorse.
    Chairwoman Musgrave. Thank you very much, Mr. Leef.
    I have been told we are going to have votes right away, so 
let us restrict ourselves, Members, to just five minutes.
    Mr. Mix, I think I will start out with a question for you. 
Is it true that unions must represent every employee in the 
workplace, or do they have the freedom to forego the privilege 
of exclusive representation and bargain only for their members?
    Mr. Mix. Thank you for that question. I think that we have 
talked a lot about that. The fact is, according to former 
Chairman of the National Labor Relations Board William Gould in 
his book, Agenda for Reform, he states very clearly, and I 
consider him to be an expert on labor law, he says federal law 
``permits members-only bargaining without regard to majority 
rule or an appropriate unit and without regard to 
exclusivity.''
    So the fact is here you have a Clinton appointee, William 
Gould, saying that exclusivity is not, indeed, the law of the 
land under the National Labor Relations Act, and union 
officials could choose to represent only their own members. And 
there are several other pieces of information that address this 
issue, and I would like to, with your permission, Madam 
Chairman, submit a study on union representation that is 
foisted on workers, not vice versa, for the record that answers 
this question considerably.
    But the fact is, when we have asked union officials--as a 
matter of fact, in 1993, a bill was introduced in this Congress 
to repeal that exclusivity in the law to allow voluntary 
bargaining where it would codify the fact that unions would 
only represent their workers. We invited Lane Kirkland, we 
invited Ted Kennedy to join Dick Armey to sponsor the bill to 
endorse that bill and to wipe out this so-called ``problem'' 
with workers who are not paying ``representational fees,'' and, 
of course, there was deadly silence from the other side. The 
fact of the matter is, we believe that if unions would 
represent only those members that wanted their representation, 
this problem would go away.
    I think it is interesting to note, in a couple of 
developments just recently in the paper--one is a CSN News 
Service story regarding an AFL-CIO--this was around Labor Day. 
It says: ``AFL-CIO nonaffiliate tops one million members.'' 
They have got this organization out there that allows people to 
join the AFL-CIO in a nonunion membership status, and they are 
crowing about how successful it is that these workers who want 
to join them voluntary have signed up, and they are growing in 
support.
    So I would say that, no, under the law, a union official is 
not required to become the monopoly bargaining agent. They 
could negotiate a clause in a contract that would say they 
would represent only their members and those that wanted their 
representation.
    Chairwoman Musgrave. Thank you very much.
    Mr. Lipinski, do you have questions?
    Mr. Lipinski. Thank you. I will try to do it quickly. I 
have a lot of questions.
    Mr. Feinstein, can you respond to what Mr. Mix just said?
    Mr. Feinstein. I must say, I am intrigued by it. I do not 
really understand it. It is my understanding of the law that 
there is an obligation. The union does have an obligation, at 
the risk of having charges filed against it if it fails to do 
so, to represent all members of the unit in terms of 
grievances, in terms of arbitration, and in terms of any other 
interests that the union represents with equal diligence, as it 
represents any other member of that unit.
    Now, I am not honestly sure what the quote that you are 
referring to, but I must say about this whole question of 
exclusive representation that it has wide ramifications because 
are we talking about, and are people suggesting, that if less 
than a majority of a unit seeks representation, that that is 
consistent with the perspective being suggested here? Let us 
say 35 percent or 45 percent of the workers seek union 
representation. Of course, under the prevailing interpretation 
of labor law, they do not have a right to do so, and, again, I 
would question, are people here, other members of this panel, 
in favor of an arrangement which does exist in other countries, 
I have to say, where the whole notion that you need a majority 
before you get any form of representation, which is the 
principle of our law, should be abandoned? I think that that is 
an interesting proposition. I think that is a proposition that 
perhaps some unions today or some advocates for unions today 
might consider discussing.
    Mr. Lipinski. Okay. I just want to move on because we do 
not have much time. We can come back to that. I want to ask Dr. 
Baird, who talked about the free rider problem--you are an 
economist, and as a professor of political science, also 
familiar with free rider problems, I am sure you acknowledge 
free rider problems do exist, and you are saying now--my 
understanding is that there are those who are nonunion members 
who are in a union shop, that they are not receiving benefits 
for what they have to give.
    My understanding is you are saying, and Mr. Feinstein had 
talked about how there are higher wages when you have a union--
there is also a lot of evidence that there are better medical 
benefits, better pension benefits--it is my understanding you 
are saying that this is not true, that there is not any benefit 
from having a union. Is that what you were saying?
    Mr. Baird. No, sir. That is not what I am saying. I am 
saying two things. I am saying, first of all, that it is only 
because of exclusive representation that there can be any kind 
of free rider problem in labor relations. There is nothing 
inherent in the employment relationship between an employee and 
employer that gives rise to any free rider problem, but because 
of exclusive representation, yes, there can be free riders. 
There can be.
    Now, as to the empirical question of whether unions, on 
balance, benefit workers relative to their nonunion 
counterparts, that is arguable. There are several empirical 
studies which suggest that unions do not, on average, benefit 
workers--make them any better off than comparable workers in 
comparable industries in comparable circumstances that are 
union free.
    Mr. Lipinski. There are certainly situations, and I will 
not argue with Mr. Galley or Mr. Butcher--they have had their 
experiences, and I am not going to say that there is never any 
problem that one sees, but I think it is akin to saying people 
who say they do not agree with things the government is doing 
and saying, I am not going to pay my taxes. The idea is that if 
people band together, they can get a better deal than an 
individual can do. If anyone would go out and try to negotiate 
for themselves, it is much more difficult because--do you think 
there is an uneven power between an individual who is going out 
to bargain for themselves and an employer?
    Mr. Baird. No, I do not. I think that whole idea of labor's 
bargaining-power disadvantage is a hoary myth, and that goes 
back to the 19th century, and I can point you to a study that 
was published in the Journal of Labor Research written by 
Morgan Reynolds which, I think, substantiates that, or at least 
makes it an arguable position.
    But I want to get back to the first thing that you started 
saying. You were making an analogy between the union question 
and government. Can a taxpayer refuse to pay because it 
disagrees with what the government does?
    Chairwoman Musgrave. I am going to cut you off, and if 
votes are not called, we will come back to that question, if we 
may. Thank you.
    Mr. Sodrel, do you have questions?
    Mr. Sodrel. Can I make a 30-second statement beforehand?
    Chairwoman Musgrave. You can use your five minutes however 
you want to.
    Mr. Sodrel. Well, thank you, ma'am.
    In my view, unions represent working people. They are 
professionals. They give advice and provide service to the 
working people. In my professional life, I have employed the 
services of professionals to represent me. I have employed 
attorneys, accountants, and some other professionals directly. 
I belong to several trade associations as well, but all of 
these associations were voluntary and mutually beneficial. If I 
thought I could do the job myself, I was free to do so. I 
believe the U.S. Constitution guarantees me that right, and I 
do not know how I can deny that right to my fellow Americans.
    To me, the issue is about liberty. It is solely about 
liberty. We fought a revolution over 200 years ago over the 
issue of individual liberty. The only question I have is I am 
curious, Mr. Butcher, how much did you have to pay, the agency 
fee versus union dues, in other words, as a percentage. Did you 
get a 20-percent discount, or did you get a 30-percent 
discount, or do you remember?
    Mr. Butcher. Over the two years I was a Beck objector, it 
varied. As I mentioned, the first couple of breakdowns of 
expenses that they gave us were totally phony. They had not 
been verified by an audit, and those hovered towards 90 
percent. When they were finally forced to give us a legitimate 
breakdown of expenses that was verified by an audit,--keep in 
mind, the auditor is only merely adding up the expenses to make 
sure that he has done the numbers correctly--a half a million 
dollars of expenses suddenly appeared which were not previously 
there, okay, mainly affiliate fees, and the Beck fee was 
lowered down to 85 percent, and it floated down in the 82-to-
83-percent range. Since then, it has been gradually creeping 
up.
    Mr. Sodrel. So you got anywhere from a 10-to-20-percent 
discount off standard union dues.
    Mr. Butcher. Yes, yes.
    Mr. Sodrel. Thank you. I yield back the balance of my time, 
Madam Chairman.
    Chairwoman Musgrave. Thank you very much. Ms. Moore, do you 
have questions?
    Ms. Moore. Thank you so much, Madam Chair and Mr. Ranking 
Member. I can tell you that I am just quite stunned by this 
testimony, being the daughter of union members. My mother was a 
teacher, and my dad was a member of the UAW.
    I guess I want to ask a couple of questions. There were 
some references to studies regarding the well-being or lack 
thereof of union members versus nonunion members, but I am 
looking at the United States Bureau of Labor statistics, which 
I think we all, in the public and private sector, rely upon, 
the Census Bureau, to give us accurate data versus private 
studies that there may be some mission involved, and what they 
have said is that 88 percent of private sector union workers 
have access to retirement benefits in their jobs compared with 
only 56 percent of nonunion workers. Seventy-three percent of 
union workers have access to defined pension plans, which we 
know is a very critical benefit these days, 73 percent versus 
16 percent of nonunion workers, and that 92 percent of union 
workers have access to job-based health care benefits, a real 
crisis of 48 million uninsured workers, compared with 68 
percent of nonunion workers. So these are Bureau of Labor data.
    I guess my bottom-line question to Dr. Feinstein, number 
one, is, are people forced to join a union?
    Mr. Feinstein. As I indicated in my testimony, and as, I 
think, the other testimony here today suggested, no, people 
cannot be forced to join a union. People can be required to 
reimburse the union for expenses expended in doing the 
representational services that a union is obligated to do for 
all of the people in the relative bargaining unit.
    So membership really here is not the issue. The question 
really is, can employers and unions voluntary negotiate a 
provision in a contract which says that the union has the 
ability to cover its expenses in part by charging reasonable 
expenses to each member that it is obligated to represent?
    Ms. Moore. So the expenses would be actually negotiating, 
you know, pension benefits, health care benefits. You know, I 
have 59-percent unemployment among African-American men in my 
district. They would love one of these UAW union jobs that you 
guys are eschewing at this point.
    I can understand the employer's perspective, the 
turnaround, the gentleman who turned the company around in 
Oklahoma--you said specifically that a risk in this investment 
were very well-paid carpenters and painters and that in order 
to be competitive internationally, you had to reduce these 
risks and that they chose to decertify the union.
    I am just wondering, because I am very concerned about 
globalization and international economics in my service here in 
Congress, do you really think that with global competition that 
we are going to win what I call this ``race to the bottom'' 
where, you know, say folk in China working for 61 cents an 
hour? Are these who you regard as your competitors? You know, 
what wage would carpenters and painters have to be paid in 
order for you to regard yourself as competitive with places 
that produce products at 60 cents an hour and use child labor?
    Mr. McNicholas. China is definitely our biggest competitor. 
We are not changing the wage we pay. What we look at before we 
commit capital and make an investment is can we work together 
with the workers to be more flexible, creative, smarter, use 
our advantage of short lead time to win amongst competition in 
the U.S. as well as international competition? Before we invest 
that capital, our view is that we get more cooperation in 
states that have right-to-work laws. Before we employ that 
capital, we want to get the best environment possible because 
it is extremely competitive and extremely difficult.
    Ms. Moore. Well, North Carolina is a right-to-work state, 
and they have lost more manufacturing jobs than anybody else, 
so I just am failing to see the connection. But the real 
question I guess I want you to respond to, the highest cost of 
any investment, as you know, is the workforce, so if your 
competition is someone who makes 60 cents an hour, it does not 
matter what economies of scale you are able to realize on 
infrastructure and equipment and all of that. If you cannot 
bargain--they do not have a union anymore, so you would not 
have to bargain with the union, but you would have to negotiate 
60 cents an hour in order to be directly competitive with the 
global economy.
    Chairwoman Musgrave. Thank you, Ms. Moore, very much.
    Ms. Moore. Thank you so much.
    Chairwoman Musgrave. We will see if we have time for 
another round before we are called to vote. I will start with 
Mr. Mix. Tell me about trends in union membership.
    Mr. Mix. Well, the trends in union membership are that they 
only represent about 7.9 percent of the private sector 
workforce in America today. The actual number of union members 
is not down that much, but the union density is down, and that 
is what the AFL-CIO is complaining about. I would suggest to 
you that the good news is that jobs are growing, and so the 
union density is down while the number of actual union members 
is down, I would say, a million or so from some peak union 
density periods.
    But the fact is, is that workers are saying no to organized 
labor out in the workplace. The number of certification 
elections is dropping dramatically at the National Labor 
Relations Board. I think union statistics are that only about 
80,000 workers were unionized through union-certification 
elections last year and that the bulk of new union members came 
through so-called ``card-check certification,'' which is 
another whole topic that we could get into.
    But the trend has been that union density is diminishing, 
and I think it is reflective of what we have heard in our 
testimony today that union officials are unresponsive to rank-
and-file workers, and the fact is that, as the distinguished 
former general counsel says, this is an agreement between 
employer and unions. It says nothing about employees and their 
rights. And I would suggest to you that like the AFL-CIO--as a 
matter of fact, Linda Chavez Thompson, the vice president of 
the AFL-CIO, after quoting publicly in a battle in a Tennessee 
after several years of trying to repeal the right-to-work law, 
she admitted publicly that it probably make sense for them to 
go out and try to get workers to join them voluntarily, and we 
wholeheartedly agree.
    In Idaho, when we passed the right-to-work law up there, a 
TV reporter stuck a microphone in front of the AFL-CIO 
president's face that night and said, ``What are you going to 
do now?'' and he said, ``I guess we are going to have to go out 
and sell our services to members, something we have not had 
much practice with.'' Those are compelling statements by union 
officials.
    In the State of Iowa, a union official for the teacher's 
union, the NEA affiliate out there, when asked about taking a 
position on one of the radical stands that the parent-teacher 
union had taken at their convention, was asked, on a 50,000-
watt, AM station, whether or not they were going to agree to 
that, and the union president said, ``No, we are a right-to-
work state. We would lose all of our members.''
    So these, I think, are anecdotes that are reflective of the 
employee choice that we believe should be part of the law that 
currently is not, and I think if unions would take the advice 
of Samuel Gompers and adhere to voluntary institutions, they 
would be better off. As we see from the statement from CNN News 
Service on Labor Day saying they have created a million new 
``nonunion members'' to the AFL-CIO, that is an exciting 
development. We have another quote from a union official in 
Arizona who said the right-to-work law actually has led to 
increased unionization in the State of Arizona because they 
have to work a lot harder to get union members.
    So those are exciting anecdotes, and I think a system of 
volunteerism is the secret to organized labor's success.
    Chairwoman Musgrave. Thank you. Mr. Lipinski, do you have 
another question?
    Mr. Lipinski. One question for Mr. McNicholas. You talked 
about the decertification of the union and how helpful that 
was. Could that have happened in any state? Did that rely on it 
being a right-to-work state?
    Mr. McNicholas. I do not know the answer to that.
    Mr. Lipinski. A union could be certified even if it is a 
free-bargaining state. Is that correct, Mr. Feinstein?
    Mr. Feinstein. Yes. That is correct.
    Mr. Lipinski. I will come back to Dr. Baird because you 
have been wanting to jump back on this. My understanding now, 
from your view, is that there is no benefit--there can be no 
benefit to workers joining together--
    Mr. Baird. I did not say that.
    Mr. Lipinski. --to negotiate because an individual is not 
at any disadvantage.
    Mr. Baird. I did not say that there are no benefits to 
union representation. I would never say that. That can only be 
decided on a case-by-case basis. The question I am addressing 
is whether there can be free riders, and, again, there can only 
be because of the perversity of the law, Section 9[a], that 
creates exclusive representation. That is the only reason there 
can be free riders. Now, on a case-by-case--
    Mr. Lipinski. Why is that the only reason there could be 
free riders?
    Mr. Baird. Because if a union represented only its 
voluntary members and no one else, it would be bargaining for 
only those voluntary members, and only those voluntary members 
would get the union-generated benefits.
    Mr. Lipinski. Create multiple, as many as possible, so 
different workers could be getting different--you have your 
union members, and then you have everyone else there who is not 
a union member is a free agent who negotiates--has their own 
benefits.
    Mr. Baird. Not necessarily. If you want a good, modern 
example of legislation that is not based on exclusive 
representation, that is based on members-only bargaining, I 
would point you to New Zealand and its 1991 Employment Contract 
Act where workers can decide whether to be represented by a 
union, whether to be represented by a third party who is not a 
union, or whether to represent themselves, and, yes, under 
those circumstances, there can be different pay being paid to 
people who are doing similar work simply because of the 
different outcomes of bargaining, and I do not find anything 
wrong with that whatsoever.
    Mr. Lipinski. Mr. Feinstein, do you think that that could 
work here?
    Mr. Feinstein. Well, it is certainly a system which is 
vastly different from the one we have in place where, again, 
you need a majority to support the collective bargaining 
process before members have any ability to sit down and 
negotiate with an employer. Again, I pose the question that I 
posed before: Are we talking about a situation in which any 
number of workers less than a majority can come together and 
request negotiations, and a meaningful process of negotiations 
would proceed even if a majority do not support it in the 
workplace? Again, that is a system which prevails in many 
places in Europe, and many have suggested that it might work in 
this country, but it is very different, and under our laws, the 
union is, indeed, required to represent all of the workers in 
the units for which they have been certified. The majority 
representation, exclusive representation, that we have been 
hearing about is the requirement here, and the suggestion of 
doing away with that would be something that is vastly 
different than the system we have in place.
    Mr. Baird. Could I respond to that briefly?
    Mr. Lipinski. Go ahead, Mr. Baird.
    Mr. Baird. I am fully in favor of having a situation where 
if 10 percent of the workers want to have a union represent 
them, that is perfectly okay with me. I am arguing against 
monopoly bargaining, which is exclusive representation. I want 
members-only bargaining, which is the form of unionization we 
had in this country under Section 7[a] of the National 
Industrial Recovery Act passed in 1933, and it is the most 
common form of union representation in the developed world.
    Mr. Lipinski. Okay. Mr. Leef, I was just informed that you 
want to be recognized. I did not see you there. Go ahead.
    Mr. Leef. If I could comment just briefly on the question 
we have been discussing here about exclusive representation, I 
came across an interesting passage in a very pro-union 
publication called Working USA recently. The article was 
entitled ``Toward a New Labor Rights Movement.'' The authors 
are James Pope, Peter Kellman, and Ed Bruno, all known to be 
vigorous advocates of unionism. Here is what they said. ``Under 
Section 9 of the NLRA, the presence of a majority union 
extinguishes the right of dissenters to bargain as individuals 
or to form their own minority unions. Thoughtful, pro-union 
analysts contend that when a majority union is insulated 
against competition, its officers may tend to ignore the 
interests of minorities. The fact that the overwhelming 
majority of industrial countries rejects exclusive 
representation should give us pause.''
    I think they are right. Exclusive representation was a bad 
mistake in 1935. The National Right To Work Act we are 
considering does not get rid of that, but I think that is 
something that we should be thinking about, even more radical 
change in our labor laws.
    Chairwoman Musgrave. Thank you, Mr. Leef.
    Mr. Lipinski, anything else?
    Mr. Lipinski. Mr. Feinstein?
    Mr. Feinstein. Yes. As I suggested, I do think that there 
are many supporters of unions--I am sure it is not a unanimous 
view--who would be interested in pursuing further conversation 
and thoughts about this whole question of minority unions and 
exclusive representation.
    I think it is important also to understand some of the 
other concerns, I think, that need to be addressed in the 
context of talking about that kind of fundamental change. They 
do also, I believe, relate to the rights of workers in the 
workplace. For example,--
    Chairwoman Musgrave. Thank you. We are going to wrap it up 
now. We have been called to vote.
    Gentlemen, I want to thank you all for your excellent 
testimony today. I appreciate your time and your expertise, and 
thank you for being in this hearing, and we are now adjourned.
    [Whereupon, at 11:28 a.m., the Subcommittee was adjourned.]
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