[House Report 105-397]
[From the U.S. Government Publishing Office]
105th Congress Report
HOUSE OF REPRESENTATIVES
1st Session 105-397
_______________________________________________________________________
WORKER PAYCHECK FAIRNESS ACT
_______________________________________________________________________
November 8, 1997.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Goodling, from the Committee on Education and the Workforce,
submitted the following
R E P O R T
together with
MINORITY, DISSENTING, AND ADDITIONAL VIEWS
[To accompany H.R. 1625]
[Including cost estimate of the Congressional Budget Office]
The Committee on Education and the Workforce, to whom was
referred the bill (H.R. 1625) to ensure that workers have
sufficient information about their rights regarding the payment
of dues or fees to labor organizations and the uses of employee
dues and fees by labor organizations, having considered the
same, report favorably thereon with an amendment and recommend
that the bill as amended do pass.
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Worker Paycheck Fairness Act''.
SEC. 2. FINDINGS.
The Congress finds the following:
(1) Workers who pay dues or fees to a labor organization may
not, as a matter of law, be required to pay to that
organization any dues or fees supporting activities that are
not necessary to performing the duties of the exclusive
representative of the employees in dealing with the employer on
labor-management issues.
(2) Many labor organizations use portions of the dues or fees
they collect from the workers they represent for activities
that are not necessary to performing the duties of the
exclusive representative of the employees in dealing with the
employer on labor-management issues. These dues may be used to
support political, social, or charitable causes or many other
noncollective bargaining activities. Unfortunately, many
workers who pay such dues or fees have insufficient information
both about their rights regarding the payment of dues or fees
to a labor organization and about how labor organizations spend
employee dues or fees.
(3) It is a fundamental tenet of this Nation that all men and
women have a right to make individual and informed choices
about the political, social, or charitable causes they support,
and the law should protect that right to the greatest extent
possible.
SEC. 3. PURPOSE.
The purpose of this Act is to ensure that all workers have sufficient
information about their rights regarding the payment of dues or fees to
labor organizations and the uses of employee dues and fees by labor
organizations and that the right of all workers to make individual and
informed choices about the political, social, or charitable causes they
support is protected to the greatest extent possible.
SEC. 4. WRITTEN CONSENT.
(a) In General.--
(1) Authorization.--A labor organization accepting payment of
any dues or fees from an employee as a condition of employment
pursuant to an agreement authorized by Federal law must secure
from each employee prior, voluntary, written authorization for
any portion of such dues or fees which will be used for
activities not necessary to performing the duties of the
exclusive representative of the employees in dealing with the
employer on labor-management issues.
(2) Requirements.--Such written authorization shall clearly
state that an employee may not be required to provide such
authorization and that if such authorization is provided, the
employee agrees to allow any dues or fees paid to the labor
organization to be used for activities which are not necessary
to performing the duties of exclusive representation and which
may be political, social, or charitable in nature.
(b) Revocation.--An authorization described in subsection (a) shall
remain in effect until revoked. Such revocation shall be effective upon
30 days written notice.
(c) Civil Action by Employees.--
(1) Liability.--Any labor organization which violates this
section or section 7 shall be liable to the affected employee--
(A) for damages equal to--
(i) the amount of the dues or fees accepted
in violation of this section;
(ii) the interest on the amount described in
clause (i) calculated at the prevailing rate;
and
(iii) an additional amount as liquidated
damages equal to the sum of the amount
described in clause (i) and the interest
described in clause (ii); and
(B) for such equitable relief as may be appropriate.
(2) Right of action.--An action to recover the damages or
equitable relief prescribed in paragraph (1) may be maintained
against any labor organization in any Federal or State court of
competent jurisdiction by any one or more employees for and in
behalf of--
(A) the employees; or
(B) the employees and other employees similarly
situated.
(3) Fees and costs.--The court in such action shall, in
addition to any judgment awarded to the plaintiff, allow a
reasonable attorney's fee, reasonable expert witness fees, and
other costs of the action to be paid by the defendant.
(4) Limitation.--An action may be brought under this
subsection not later than 2 years after the date the employee
knew or should have known that dues or fees were accepted or
spent by a labor organization in violation of this Act, except
that such period shall be extended to 3 years in the case of a
willful violation.
SEC. 5. NOTICE.
An employer whose employees are represented by a collective
bargaining representative shall be required to post a notice, of such
size and in such form as the Department of Labor shall prescribe, in
conspicuous places in and about its plants and offices, including all
places where notices to employees are customarily posted, informing
employees that any labor organization accepting payment of any dues or
fees from an employee as a condition of employment pursuant to an
agreement authorized by Federal law must secure from each employee
prior, written authorization if any portion of such dues or fees will
be used for activities not necessary to performing the duties of the
exclusive representative of the employees in dealing with the employer
on labor-management issues.
SEC. 6. DISCLOSURE TO WORKERS.
(a) Expenses Reporting.--Section 201(b) of the Labor-Management
Reporting and Disclosure Act of 1959 is amended by adding at the end
the following new sentence: ``Every labor organization shall be
required to attribute and report expenses in such detail as necessary
to allow members to determine whether such expenses were necessary to
performing the duties of the exclusive representative of the employees
in dealing with the employer on labor-management issues.''
(b) Disclosure.--Section 201(c) of the Labor-Management Reporting and
Disclosure Act of 1959 is amended--
(1) by inserting ``and employees required to pay any dues or
fees to such organization'' after ``members''; and
(2) inserting ``or employee required to pay any dues or fees
to such organization'' after ``member'' each place it appears.
(c) Written Requests.--Section 205(b) of the Labor-Management
Reporting and Disclosure Act of 1959 is amended by adding at the end
the following new sentence: ``Upon written request, the Secretary shall
make available complete copies of any report or other document filed
pursuant to section 201.''.
SEC. 7. RETALIATION AND COERCION PROHIBITED.
It shall be unlawful for any labor organization to coerce,
intimidate, threaten, interfere with, or retaliate against any employee
in the exercise of, or on account of having exercised, any right
granted or protected by this Act.
SEC. 8. REGULATIONS.
The Secretary of Labor shall prescribe such regulations as are
necessary to carry out the amendments made by section 5 not later than
60 days after the enactment of this Act and shall prescribe such
regulations as are necessary to carry out the amendments made by
section 6 not later than 120 days after the enactment of this Act.
SEC. 9. EFFECTIVE DATE AND APPLICATION.
This Act shall be effective immediately upon enactment, except that
sections 4 and 5 pertaining to worker consent and notice shall take
effect 90 days after enactment and section 6 pertaining to disclosure
shall take effect 150 days after enactment.
Explanation of Amendments
The provisions of the substitute are explained in this
report.
Purpose
The purpose of H.R. 1625, the Worker Paycheck Fairness Act
is to ensure that all workers have sufficient information about
their rights regarding the payment of dues or fees to labor
organizations and the uses of their dues and fees by labor
organizations and to ensure that the right of all workers to
make individual and informed choices about the political,
social or charitable causes they support is protected to the
greatest extent possible.
Committee Action
H.R. 1625, the Worker Paycheck Fairness Act, was introduced
by Representative Harris W. Fawell on May 15, 1997, and has
over one hundred cosponsors including the entire Republican
House leadership.
The Subcommittee on Employer-Employee Relations held a
hearing on mandatory union dues on March 18, 1997. At that
hearing, the subcommittee heard from workers from across the
country who testified about the intimidation, stonewalling and
deception they have experienced in their attempts to exercise
their rights, under Communications Workers of America v.
Beck,\1\ to object to the use of their union dues or fees for
purposes that were not necessary to collective bargaining. The
subcommittee also heard from individuals from several
organizations that had represented workers who had attempted to
object to the noncollective bargaining use of their union dues
or fees and they highlighted both the significant challenges
under the current law and the depth of the frustration workers
feel with regard to mandatory assessment of union dues and
fees. Testimony was received from the Honorable Esteban Edward
Torres, Member of Congress; Jane Gansmann, West Chicago,
Illinois; Kerry W. Gipe, Matthews, North Carolina; E. Grady
Thurston, Suisun City, California; Robert A. St. George, St.
Paul, Minnesota; Bob Williams, President, Evergreen Freedom
Foundation, Olympia, Washington; Patrick J. Manshardt,
Attorney, Individual Rights Foundation, Los Angeles,
California; Morgan O. Reynolds, Professor, Department of
Economics, Texas A&M University, College Station, Texas;
Allison Beck, General Counsel, International Association of
Machinists and Aerospace Workers, AFL-CIO; and James B.
Coppess, Associate General Counsel, Communications Workers of
America.
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\1\ 487 U.S. 735 (1988).
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The Committee on Education and the Workforce held a hearing
on H.R. 1625 on July 9, 1997. At the hearing, testimony was
again received from workers from all over America relating the
terrible frustration they have experienced in trying to
exercise their Beck rights under current law. These workers, as
well as individuals experienced in the legal aspects of
asserting Beck rights, testified in support of H.R. 1625 and
indicated it would inject more fairness into the mandatory dues
collection process. Testimony was received from Kevin Spence,
Phoenix, Arizona; Charles E. Barth, Cornelius, North Carolina;
Daniel A. Klosowski, Milwaukee, Wisconsin; Steven J. Nemirow,
Attorney, Portland, Oregon; Roger Pilon, Director, Center for
Constitutional Studies, CATO Institute, Washington, DC;
Marshall J. Breger, Visiting Professor of Law, Columbus School
of Law, the Catholic University of America, Washington, DC;
Mitchell Kraus, General Counsel, Transportation Communications
Union, Rockville, Maryland; and James B. Coppess, Associate
General Counsel, Communications Workers of America.
Hearings on mandatory union dues were also held by the
Subcommittee on Employer-Employee Relations in the 104th
Congress. On April 18, 1996, the subcommittee received
testimony from Gary Bloom, Southhaven, Minnesota; James Cecil,
Clarkston, Michigan; Len Cipressi, Los Angeles, California;
Gary Dunham, Buffalo, New York; Charles R. Serio, Linthicum,
Maryland; John Wilson, Neosho, Missouri; Marshall J. Breger,
Visiting Professor of Law, Columbus School of Law, the Catholic
University of America, Washington, DC; W. James Young, Staff
Attorney, National Right to Work Legal Defense Foundation,
Springfield, Virginia; Victoria Bor, Attorney, Sherman, Dunn,
Cohen Leifer & Yellig, Washington, DC (testifying on behalf of
the International Brotherhood of Electrical Workers); and Mark
Schneider, Associate General Counsel, International Association
of Machinists and Aerospace Workers, AFL-CIO, Washington, DC.
On June 19, 1996, the subcommittee held a hearing on
legislation similar to H.R. 1625 that was introduced in the
104th Congress, H.R. 3580, the Worker Right to Know Act. At
this hearing, the subcommittee testimony from Mary S.
Burkholder, Chambersburg, Pennsylvania; William H. Hitchings,
Chicago, Illinois; Charles W. Baird, Professor of Economics and
Director, Smith Center for Private Enterprise Studies,
California State University, Hayward, California; Raymond J.
LaJeunesse, Staff Attorney, National Right to Work Legal
Defense Foundation, Springfield, Virginia; Michael A. Taylor,
Attorney, Powell, Goldstein, Frazer & Murphy, Washington, DC;
Marshall J. Breger, Visiting Professor of Law, Columbus School
of Law, the Catholic University of America, Washington, DC;
James B. Coppess, Associate General Counsel, Communications
Workers of America; and Helen Gibson, Agency Fee Administrator,
Communications Workers of America.
By unanimous consent, the Subcommittee on Employer-Employee
Relations was discharged from further consideration of H.R.
1625 on October 8, 1997. On that same date, the Committee on
Education and the Workforce approved H.R. 1625, as amended, by
a voice vote, and, also by a voice vote, ordered the bill
favorably reported.
Committee Views
Introduction and summary
Although almost a decade ago, the U.S. Supreme Court
established that workers who are forced to pay union dues as a
condition of employment may not be required to pay dues beyond
those necessary for collective bargaining, Beck \2\ rights have
remained illusory. To begin, employees must first be aware that
they have a right to object to non-collective bargaining dues.
The fact of the matter is that the actual text of the National
Labor Relations Act, as currently written, still appears to
permit unions and employers to agree to make union membership
and payment of full union dues a condition of employment. The
law also puts the burden on the employee to object to non-
collective bargaining dues and, if no objection is made, the
employee may be liable for full dues. Further, if an employee
wants to object to the payment of non-collective bargaining
dues, the union may require the employee to resign from the
union and, in the process, the employee loses critical
workplace rights such as the right to ratify a contract or vote
to go on strike.
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\2\ Id.
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If an employee gets this far and decides to affirmatively
object, the employee must often withstand threats and
intimidation from coworkers and union officials, only to have
to renew the objection each year. In sum, the right of an
employee to object to the payment of any dues beyond those
necessary for collective bargaining has remained more of a
legal right than a practical one. The hurdles an employee must
overcome are many, requiring extreme persistence, knowledge of
the law, and a willingness to buck the system and give up
participation in decisions affecting his or her work
environment.
The Worker Paycheck Fairness Act addresses each of these
shortcomings of current law. The legislation creates a new
requirement in Federal law directing any labor organization
accepting payment of any dues or fees from an employee as a
condition of employment pursuant to an agreement authorized by
Federal law to simply secure from each employee prior,
voluntary, written authorization for any portion of such dues
or fees which will be used for non-collective bargaining
activities. Asking unions to secure up-front consent is widely
supported by the American people--an October 1997 ABC News/
Washington Post poll found that 82% favor such a requirement.
The Worker Paycheck Fairness Act includes effective remedial
provisions modeled on the Family and Medical Leave Act
providing that any labor organization which failed to secure
the required authorization would be liable to the affected
employee for damages equal to two times the amount of the dues
or fees accepted in violation of the Act together with
interest. The employee could also recover attorneys' fees and
costs.
Unionized employers would be required to post a notice
informing employees of these new consent requirements. The
Worker Paycheck Fairness Act also requires more detailed
financial reporting by labor organizations, gives workers
paying union dues or fees the same access to financial
information as union members, and allows any interested party
to make a written request for financial reports filed with the
Department of Labor. Consistent with other workplace laws, the
legislation would also protect workers against coercion or
retaliation in the exercise of their rights under this Act. The
Worker Paycheck Fairness Act injects needed fairness into the
mandatory dues collection process and builds upon the reasoning
of the Supreme Court in Beck to finally transform the promise
of that decision into a reality.
current law fails to protect workers' rights
A decade ago, the Supreme Court established in
Communications Workers of America v. Beck \3\ that workers
cannot be forced under union security clause to pay dues or
fees to a union beyond those ``necessary to performing the
duties of an exclusive representative of the employees in
dealing with the employer on labor-management issues.''
Unfortunately, Beck rights as currently constituted have proven
elusive to the average working American. After receiving
testimony from numerous workers from all across this nation and
from a host of organizations that advocate on behalf of
employees related to their union dues obligation, the Committee
has concluded that the rights enunciated by the Supreme Court
in Beck do not offer employees a meaningful right to object to
union dues or fees not necessary to collective bargaining. The
problem with Beck rights as currently available are manifold.
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\3\ 487 U.S. 735, 762 (1988)
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lack of notice
The problems begin with the notice, or lack thereof, that
employees have of their right under Beck to object to the use
of compulsory dues for purposes not necessary to collective
bargaining. As Marshall Breger, former Solicitor for the
Department of Labor during the Bush administration and
currently a law professor at Catholic University's Columbus
School of law, testified: ``There has been considerable
controversy as regards how non-union agency fee payers are
expected to learn of their Beck rights. Unions have no specific
interest in appraising workers of their `refund rights' because
the use of the refund option reduces their discretionary funds.
Indeed even some employers believe that it is in their interest
to reduce the transactions costs under union security
agreements. Perhaps it is the case that Beck rights have passed
into the common consciousness of industrial relations--I have
seen no evidence to sustain that proposition, however.'' \4\
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\4\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong. 2nd Sess., at
12 (April 18, 1996)(Serial No. 104-66).
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The experiences of the workers who testified before the
Committee reinforce the conclusions that Mr. Breger articulated
about the lack of notice. Bill Hitchings, a longtime member of
the Carpenters' Union, stated: ``[T]he union makes no attempt
whatsoever to make the membership aware that they have options
under the Beck ruling * * * I've been deprived of information.
I don't know whether it's on purposes or just an oversight, but
when I made objection to [political spending] with my union ,
they certainly never mentioned Beck to me.'' \5\ Similarly,
Robert St. George, an airline industry worker from St. Paul,
Minnesota, told the Committee: ``When [the union
representative] was asked at this meeting if there wasn't some
way we could just pay for representation, as I remember it,
[he] made the incredible claim that we could not because
Minnesota was not a Right to Work State and that can only be
done in a Right to Work State. [He] would not even tell us
about our Beck rights when asked.'' \6\
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\5\ Hearing on H.R. 3580, the Worker Right to Know Act, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
197,363 (June 19, 1996)(Serial No. 104-66).
\6\ Hearing on Mandatory Union Dues, Before the Subcommittee on
Employer-Employee Relations, 105th Cong., 1st Sess., at 24 (March 18,
1997)(Serial No. 105-9).
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Finally, Daniel Klosowski, a broadcast engineer from
Milwaukee, Wisconsin, testified: ``No one explained to me what
my obligations for union dues were, nor was I given a copy of
the contract to read. That should have been the time when my
obligations were discussed regarding dues, and whether I had
the choice of even joining the union. This is still the current
practice used by the stewards today; they do not tell new hires
what their rights are * * *'' \7\ A poll conducted last year
for Americans for a Balanced Budget backs up the experiences of
these workers. The survey found that only 19% of union members
know that they can object to the use of union dues for non-
collective bargaining purposes.
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\7\ Hearing on H.R. 1625, the Worker Paycheck Fairness Act, Before
the Committee on Education and the Workforce, 105th Cong., 1st Sess.,
(July 9, 1997)(Statement of Daniel A. Klosowski).
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Neither the National Labor Relations Board (NLRB) nor the
Department of Labor has taken any steps to address this
widespread lack of notice. In its most comprehensive ruling
interpreting Beck, the NLRB concluded that it was sufficient
for the union to print a notice of Beck rights only once a year
in the inside of its monthly magazine.\8\ Although, why non-
union fee payers are expected to pick up and read the union
magazine is less than clear. Further, the Board and the current
Administration have failed to require that Beck notices be
posted in the workplace. One of President Clinton's initial
acts upon taking office was to rescind an executive order
issued by President Bush requiring federal contractors to post
Beck notices.\9\
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\8\ California Saw & Knife Works, 320 NLRB No. 11 (Dec. 20, 1995)
\9\ Executive Order 12836 (February 1,1993) rescinding Executive
Order 12800 (April 13, 1992).
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union resignation required
Employees who clear this initial hurdle of knowledge of
their rights under Beck and want to object to the use of their
union dues for political or social causes are often required to
resign their membership in the union.\10\ This is not an easy
thing for many employees to do for a number of reasons. First
and foremost, as testimony the Committee heard from James
Young, an attorney with the National Right to Work Legal
Foundation, points out, unions often either wittingly or
unwittingly (Mr. Young argues the former) mislead their
employees on the effect resignation from the union will have on
their employment, implying that resignation will led to
discharge.\11\ The text of the collective bargaining agreement
itself exacerbates this deception as union security clauses
often require full membership in the union as a condition of
employment, even though the courts have made it clear that this
cannot be demanded of employees.\12\
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\10\ The Beck decision did not address whether or not an employee
can be required to resign from the union in order to exercise Beck
rights. In a later decision, the Fourth Circuit Court of Appeals did
find that employees do not have a right to remain a member of a union
yet only pay for the costs of union activities necessary to collective
bargaining. Kidwell v. Transportation Communications International
Union, 946 F.2d 283 (4th Cir. 1991).
\11\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
112 (April 18, 1996)(Serial No. 104-66).
\12\ National Labor Relations Board v. General Motors Corp., 373
U.S. 734 (1963).
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The experiences of several of the workers who testified
before the Committee buttress the observations made by Mr.
Young. Gary Bloom, a medical records clerk from Southhaven,
Minnesota, related his experience as follows: ``[The union
official] mentioned that as part of the union contract, I must
become a member of Local 12, 31 days after being hired and if I
chose not to become a member, she would have no alternative but
to request that Group health would terminate my employment
there.'' \13\ Similarly, Kerry Gipe, an airline mechanic from
Matthews, North Carolina, testified ``I was told that joining
the union was a mandatory part of working for the company.''
\14\
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\13\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
26 (April 18, 1996) (Serial No. 104-66).
\14\ Hearing on Mandatory Union Dues, Before the Subcommittee on
Employer-Employee Relations, 105th Cong., 1st Sess., at 17 (March 18,
1997) (Serial No. 105-9).
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workers experience intimidation and coercion
Even for employees who find out the truth, many who object
to the union's ``extracurricular'' activities may believe that
union representation brings them benefits in the workplace and
thus may be reluctant to resign. Some employees may also fear
the reaction that union resignation may bring from fellow
employees. Several workers appearing before the Committee
testified as to the coercion and intimidation they experienced
once they began to question the orthodoxy of full union
membership and dues payment. Again, Kerry Gipe told the
Committee: ``* * * the union began an almost immediate smear
campaign against us, led by our Local President * * *
portraying us as scabs, and freeloaders * * *. We had our names
posted repeatedly on both union property and company property
accusing us of being scabs. We were thrown out of our local
union hall, and threatened with physical violence * * *. We
were accosted at work, we were accosted on the street. We were
harassed, intimidated, and threatened. We were told that our
names were being circulated among all union officials in order
to prevent us from ever being hired into any other union shop
at any other location. The union membership was told that we
were refusing to pay any union dues which created a very
hostile environment among our fellow workers.'' \15\
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\15\ Hearing on Mandatory Union Dues, Before the Subcommittee on
Employer-Employee Relations, 105th Cong., 1st Sess., at 15 (March 18,
1997) (Serial No. 105-9).
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James Cecil of Clarkston, Michigan, testified that ``the
union agent wanted to know why I would not sign the check-off
and join * * * he became angry and asked me who the hell I
thought I was? Did I think I was some kind of intellectual? Did
I think I was better than the other workers out there? I told
him no, but I know what my rights are and I intend to defend
them * * *. He promised me in no uncertain terms that he would
bring the full force of his and the other unions down on me if
I dared to do that * * * I was greatly concerned about
retaining my job and for my physical well-being.'' \16\
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\16\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
29 (April 18, 1996) (Serial No. 104-66.
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loss of workplace rights
Even if one withstands the intimidation and coercion, once
an employee resigns from the union he or she loses the right to
have a voice in the myriad decisions made between the exclusive
bargaining representative and the employer about the terms and
conditions affecting his or her employment. In most workplaces,
employees who are part of a bargaining unit that is represented
by a union, but who are not union members, have no right to
participate in the internal affairs of the union (e.g. cannot
vote in union elections), have no right to vote in decisions to
strike an employer, and have no right to vote to ratify a
contract offer of an employer. Under a union security
agreement, a nonmember can be forced--as a condition of
employment--to pay for the costs of union representation but
can be denied participation in all decisionmaking with regard
to what that representation entails.\17\
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\17\ See Testimony of W. James Young, Hearing on Mandatory
Assessment of Union Dues, Before the Subcommittee on Employer-Employee
Relations, 104th Cong., 2nd Sess., at 110-111 (April 18, 1996) (Serial
No. 104-66).
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Several workers appearing before the Committee expressed
frustration at the Hobson's choice they were facing. Leonard
Cipressi from Los Angeles, California told the Committee:
``When you exercise your Beck rights you don't get to vote on
contracts that affect you, your family, your peers. Not only
that, you don't get to exercise free speech because you're not
allowed to go to union meetings.'' \18\ Gary Dunham described
the situation under current law as forcing him to ``choose
between first amendment rights and workplace rights'' and to
forego his rights to participate in the union and to vote on
his contract.\19\
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\18\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
92 (April 18, 1996) (Serial No. 104-66).
\19\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
54 (April 18, 1996) (Serial No. 104-66).
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The words of the unions themselves speak volumes as to the
detriment experienced by workers forced to resign from the
union in order to assert Beck rights. The International
Association of Machinists and Aerospace Workers (IAM) posted a
notice in Kerry Gipe's workplace making very clear that ``these
employees have lost their say in all union activities except
the right to be represented in accordance with their grievance
perocedures and strike benefits if they choose not to become a
scab and cross our picket line.'' The International Brotherhood
of Electrical Workers (IBEW) union security fee payers
objection plan provided that: ``Employees who elect to become
agency fee payers--that is, who choose not to become full-
fledged IBEW members--forfeit the right to enjoy a number of
benefits available only to full union members. Among the
benefits available only to full union members are the right to
attend and participate in union meetings; to nominate and vote
for candidates for union office; the right to participate in
contract ratification and strike votes; the right to
participate in the formulation of IBEW collective bargaining
demands; and the right to serve as delegates to the
International Convention.''
procedural hurdles
If the employee is willing to accept these very real
limitations on his or her role in the workplace, the
meaningfulness of the employee's right to object to dues being
used for non-collective bargaining purposes is further diluted
by the practical obstacles to the exercise of that right. The
workers who testified before the Committee highlighted some of
the procedural hurdles--limited window period for making
objections, annual renewal requirements for objectors, very
specific requirements regarding mailing objections, objections
must be made to multiple parties. Again, Kerry Gipe indicated
that ``the current system of resigning from the union and then
re-applying annually * * * is a further heavy burden that the
workers of this country should not be required to bear. This
practice is clearly intended to make your objection to
supporting these causes as difficult as possible.'' \20\
Charles Serio of Linthicum, Maryland told the Committee: ``No
matter how scrupulously I followed the policy prescribed by
CWA, my demands for an agency fee reduction were ignored * * *
I subsequently received my first agency fee reduction * * *
more than two years after my initial effort.'' \21\
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\20\ Hearing on Mandatory Union Dues, Before the Subcommittee on
Employer-Employee Relations, 105th Cong., 1st Sess., at 15 (March 18,
1997) (Serial No. 105-9).
\21\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
36 (April 18, 1996) (Serial No. 104-66).
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Suffice to say there are not any easy answers for
employees, whether they are union members or not, who want to
take issue with the activities of the union that go beyond what
may be a yeoman's effort by that union in representing
employees in the workplace. The Committee views these issues as
ones of basic fairness. So long as unions and employers have
the unique power under Federal law to divert a portion of a
worker's salary for collective bargaining expenses under the
pain of the loss of the worker's job, The Committee has an
obligation to ensure that workers are treated with respect and
fairness. Workers have a right to know why money is taken out
of their paycheck, how money legitimately taken is used, and a
realistic and available right to stop money from being taken
out of their paychecks that is not used for legitimate
collective bargaining purposes. This is exactly what the Worker
Paycheck Fairness Act is designed to provide.
the worker paycheck fairness act
The Worker Paycheck Fairness Act merely says to unions who
want to require workers to pay union dues as a condition of
keeping their jobs, if you want to spend dues for reasons not
necessary to collective bargaining, (1) get written consent of
the workers first; and (2) provide better information
concerning how the dues were spent. The legislation is designed
to answer the lament of workers like Gary Dunham who told the
Committee ``This four-year ordeal has opened my eyes to the
abuse that is possible under current labor law. If I don't pay
dues or fees to my union, I will be fired. In practical terms,
my money is being used for causes and ideas I oppose and my
four-year effort shows me there is nothing I can do to change
this. So I am turning to you, hoping that you will help me and
the thousands of other workers who find themselves in a similar
situation.'' \22\
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\22\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
54-55 (April 18, 1996) (Serial No. 104-66).
---------------------------------------------------------------------------
The Worker Paycheck Fairness Act is about common sense and
basic worker rights. It is not about trying to silence unions
or interfere with the role they can and should play in the
political process. This legislation will allow unions to spend
their money exactly as they currently do. The only difference
is that individual workers, who provide the lion's share of
their union's financial resources, must first give their
written consent before being obligated to pay for those
expenses that have nothing to do with collective bargaining.
up-front consent
The most dramatic improvement contained in the Worker
Paycheck Fairness Act is a change to an up-front consent, opt-
in procedure. This stands in contrast to the process under
current law which requires workers to affirmatively object,
that is, to opt-out, of paying noncollective bargaining dues,
and to renew their objection each year. Under the bill, labor
organizations that accept payment of any dues or fees from
employees as a condition of employment pursuant to an agreement
authorized by Federal law must secure from each employee a
prior, voluntary written authorization for any portion of dues
or fees used for noncollective bargaining activities. Under
current law, an agreement requiring the payment of dues or fees
to a labor organization as a condition of employment--a so-
called union security clause--is permissible both under the
National Labor Relations Act \23\ and the Railway Labor
Act.\24\
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\23\ 29 U.S.C. section 158(a)(3).
\24\ U.S.C. section 152, Eleventh.
---------------------------------------------------------------------------
H.R. 1625 sets forth several specific requirements for the
terms of the written authorization each designed to ensure that
workers are well-apprised of their rights and obligations
regarding the payment of dues or fees to a labor organization.
The authorization must clearly state that the employee is not
required to provide the authorization--and thus is not required
to pay those dues or fees used for noncollective bargaining
activities. It must also state that if the authorization is
provided--and thus the employee agrees to pay noncollective
bargaining dues or fees, the labor organization may use those
dues or fees for activities that may be political, social or
charitable in nature.
The Worker Paycheck Fairness Act also provides that the
authorization remains effective until revoked and may be
revoked at anytime upon giving 30 days written notice.
Much has been made of the fact that H.R. 1625 does not have
any application to corporations or other membership
organizations. The Committee believes that there are sound
policy reasons for drawing a distinction between labor
organizations utilizing a union security clause and other
organizations. First of all, the Worker Paycheck Fairness Act
does not apply to every union. It only applies to those unions
that have voluntarily chosen to enter into a union security
clause with an employer requiring employees to pay union dues
or fees as a condition of employment. Herein lies the critical
difference between unions and corporations or other membership
organizations. Unions, by a grant of power from the Federal
government, can force employees to pay dues to the union as a
condition of keeping their jobs; corporations cannot force
individuals to invest in them nor can other membership
organizations force individuals to join and pay dues.
The Committee believes that it is entirely fair to balance
this special ``taxing'' power given to unions with special
obligations to ensure that employees paying mandatory dues are
well-informed as to their rights and obligations regarding
those payments. Here is how a long-time member of the
Carpenters' Union, Bill Hitchings, drew the distinction between
unions and corporations:
``[A]s a stockholder of AT&T, wouldn't I have the
option of divesting myself of that stock without
endangering my ability to feed my family, clothe
myself, house myself, provide medical care for myself?
I mean, we're talking apples and oranges here. I'm
talking about my job. I can take money from an
investment in AT&T and turn it into another stock if I
disagreed terribly with what AT&T is doing with my
money. I have no option of joining another carpenters'
union. There ain't one.'' \25\
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\25\ Hearing on Mandatory Assessment of Union Dues, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
362 (April 18, 1996)(Serial No. 104-66).
---------------------------------------------------------------------------
collective bargaining dues/noncollective bargaining dues
H.R. 1625 requires that a written authorization be secured
for any dues or fees which will be used for activities which
are ``not necessary to performing the duties of the exclusive
representative of the employees in dealing with the employer on
labor-management issues.'' This language is taken directly from
the holding in the Beck decision where the Supreme Court
stated: ``We conclude that section 8(a)(3) of the National
Labor Relations Act, like its statutory equivalent, section 2,
Eleventh of the Railway Labor Act, authorizes the exaction of
only those dues and fees necessary to performing the duties of
an exclusive representative of the employees in dealing with
the employer on labor-management issues.'' \26\
---------------------------------------------------------------------------
\26\ 487 U.S. 735, 762 (1988).
---------------------------------------------------------------------------
The Committee relied on this language from Beck in drafting
H.R. 1625 because the language most accurately reflects the
services that a worker is required to pay for when he or she
must pay dues or fees to a labor organization under a union
security clause. In short, under the terms of the legislation,
a line is drawn--reinforcing the line that already exists under
current law--between collective bargaining dues and
noncollective bargaining dues. A worker subject to a union
security clause may be required to pay only those dues or fees
necessary for collective bargaining. A worker may be asked to
pay additional dues or fees for noncollective bargaining
activities, and such dues or fees may be accepted only if the
union has secured a voluntary written authorization from the
worker.
Under the formulation set forth in H.R. 1625, the types of
activities that a worker could be forced to finance through
dues or fees paid under a union security clause are only those
necessary to support the union's activities in representing the
employees before their employer on labor-management issues.
Thus, preparations for collective bargaining, negotiating with
an employer, representing employees in grievances, and dealing
with contract issues (e.g. determining who would be affected by
a lay-off under a seniority system, resolving a dispute about
the parameters of an employer-provided healthcare plan) would
fall within the duties of the exclusive representative of the
employees and could be financed with mandatory dues or fees
without triggering a consent requirement.
The Committee finds that virtually all political or
lobbying activity would fall outside the scope of collective
bargaining expenses and thus would trigger the up-front consent
requirement. This would include political activity related to
elections for public office, as well as lobbying on matters of
public policy. There is significant Supreme Court precedent
that the former is not chargeable to objecting employees under
the current Beck rubric.\27\ And, with respect to the latter,
both the Supreme Court \28\ and lower courts have begun to
review unions' lobbying expenses for purposes of determining
whether such expenses fall within the category of collective
bargaining activities. The Court of Appeals for the District of
Columbia recently concluded that the Air Line Pilots
Association could not charge objecting employees for lobbying
on airline safety issues. The court concluded: ``That the
subject of safety is taken up in collective bargaining hardly
renders the unions' government relations expenditures germane.
Under that reasoning, union lobbying for increased minimum wage
laws or heightened government regulation of pensions would also
be germane. Indeed if the union's argument were played out,
virtually all of its political activities could be connected to
collective bargaining; but the federal courts, including the
Supreme Court, have been particularly chary of treating as
germane union expenditures that touch the political world.''
\29\
Consistent with this decision, it is the Committee's view
that, while lobbying on matters of public policy (particularly
with regard to workplace issues) may have some relevance to
collective bargaining, it is clearly not necessary to
performing the duties of the exclusive representative of the
employees in dealing with the employer on labor-management
issues. Thus, a labor organization would not be able to use any
portion of an employee's mandatory dues or fees for lobbying
activities without securing prior consent.
---------------------------------------------------------------------------
\27\ See e.g. International Association of Machinists v. Street,
367 U.S. 740 (1960); Communications Workers of America v. Beck, 487
U.S. 735 (1988); Lehnert v. Ferris Faculty Association, 500 U.S. 507
(1991).
\28\ The Supreme Court in Lehnert indicated that lobbying generally
was not chargeable to objecting employees; it did intimate that there
might be a narrow exception where lobbying expenses may be chargeable
if the lobbying was related to legislative ratification of fiscal
appropriation for a collective bargaining agreement. While finding that
the labor legislation lobbying expenses at issue were not chargeable,
the Special Master suggested in determinations reviewed by the Fourth
Circuit in the Beck case that some types of lobbying may be chargeable.
776 F.2d 1187 (4th Cir. 1985), en banc, 800 F.2d 1280. Although the
Appeals Court agreed with the Special Master's disallowance of the
lobbying expenses at issue, neither the Fourth Circuit nor the Supreme
Court addressed the issue of legislative lobbying on workplace issues.
Most other decisions speak in general terms about political or
ideological activities being not chargeable. See e.g. International
Association of Machinists v. Street, 367 U.S. 740 (1960); Chicago
Teachers Union v. Hudson, 475 U.S. 292 (1986).
\29\ Miller v. Air Line Pilots Association, 108 F.3d 1415 (D.C.Cir.
1997).
---------------------------------------------------------------------------
Similarly, the Committee finds that organizing activity is
not necessary to collective bargaining and thus triggers the
requirement for a written authorization. This is consistent
with the reasoning of the Supreme Court in Ellis v. Brotherhood
of Railway Clerks, \30\ finding that organizing is not
chargeable to objecting employees because it has only the most
attenuated benefit to collective bargaining on behalf of the
fee payer. The committee would note that it views with disfavor
the recent National Labor Relations Board ruling on this point
that runs counter to the Ellis holding. See International
Brotherhood of Teamsters, Local 443, NLRB Case 34-CB-1763
(October 2, 1997).
---------------------------------------------------------------------------
\30\ 466 U.S. 435 (1984)
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Other types of activities that fall outside the formulation
of collective bargaining activities and thus trigger the up
front consent requirement include contributions to charitable
organizations \31\ or social causes and union-sponsored social
or cultural events. \32\
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\31\ This is consistent with Lehnert v. Ferris Faculty Association,
500 U.S. 507 (1991), where the Supreme Court found that a contribution
from a local union to its parent that was not part of the local's
responsibilities was more in the nature of a charitable contribution
and thus was not chargeable to objecting employees.
\32\ In this regard, the Committee would disagree with the Supreme
Court's conclusion in Ellis v. Brotherhood of Railway Clerks, 466 U.S.
435 (1984), that the expenses for various social activities were
chargeable. Although the Court emphasized the de minimis nature of the
expenses, the Committee believes that social events are not necessary
to performing the duties of the exclusive representative of the
employees in dealing with the employer on labor-management issues.
---------------------------------------------------------------------------
REMEDIES
The Worker Paycheck Fairness Act includes a comprehensive
remedial scheme modeled on that of the Family and Medical Leave
Act. Where a labor organization fails to get the necessary
authorization and spends dues or fees paid under a union
security clause on noncollective bargaining activities, the
legislation allows a worker to sue individually or as part of a
class in any Federal or state court. The labor organization
would be liable for damages equal to double the amount of the
dues or fees accepted in violation of the legislation plus
interest calculated at the prevailing rate. In addition, a
court could award attorney's fees and costs as well as such
equitable relief as may be appropriate.
The remedial provisions of H.R. 1625 are central to its
effectiveness. One of the problems with current law under Beck
is that employees are either unable to pursue their claims in
court because of a lack of resources or because they are
enmeshed in the morass of the National Labor Relations Board.
As Roger Pilon of the CATO Institute testified to the
Committee: ``The enforcement provisions of [H.R. 1625),
especially the provisions for fees and costs are a welcome
improvement. Were the fees and costs subsection to be stripped
subsequently from the bill, however, I cannot imagine how the
average worker, absent pro bono assistance, could vindicate his
rights. It is imperative, therefore, that this provision be
kept in the bill--not least because the bill arises in the
first place from the practical problems that surround the
enforcement of Beck rights.'' \33\
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\33\ Hearing on H.R. 1625, the Worker Paycheck Fairness Act, Before
the Committee on Education and the Workforce, 105th Cong., 1st Sess.,
(July 9, 1997) (Statement of Roger Pilon).
---------------------------------------------------------------------------
If its determinations as to which expenses were related to
collective bargaining and which are not is challenged in court,
the labor organization would bear the burden of persuasion in
demonstrating that it properly spent the mandatory dues or fees
solely on activities necessary for performing its duty as the
employee's representative before the employer.\34\ In other
words, the union would have to demonstrate that it secured
consent for any dues spent for noncollective bargaining
activities. And, where consent was not secured, the union would
have to show that its expenses were limited to collective
bargaining activities. The D.C. Circuit recently concluded that
Beck challenges under the National Labor Relations Act required
an independent audit of the union's calculations of reductions
in agency fee payments finding that such an audit was the
``minimal guarantee of trustworthiness.'' \35\ The committee
feels that a similar requirement would be appropriate under the
Worker Paycheck Fairness Act.
---------------------------------------------------------------------------
\34\ This is consistent with the case law that led to the Beck
decision. See Railway Clerks v. Allen, 373 U.S. 113 (1963).
\35\ Ferriso v. National Labor Relations Board, CA DC, No. 96-1321
(September 23, 1997).
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Notice
H.R. 1625 requires all unionized employers to post a notice
in their workplaces informing employees that any labor
organization accepting payment of any dues or fees from an
employee as a condition of employment pursuant to an agreement
authorized by Federal law must secure from each employee prior,
written authorization if any portion of such dues or fees will
be used for activities not necessary to performing the duties
of the exclusive representative of the employees in dealing
with the employer on labor-management issues. Although labor
organizations would be notifying employees of these rights as
they attempt to secure consent from individual workers for
noncollective bargaining dues, this posting requirement will
serve the purpose of reiterating to employees what the
respective obligations are of workers and unions under the
Worker Paycheck Fairness Act. It is similar to the posting
requirement demanded of federal contractors under an Executive
Order issued by President Bush in 1992 \36\ and later rescinded
by President Clinton.\37\
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\36\ Executive Order 12800 (April 13, 1992).
\37\ Executive Order 12836 (February 1, 1993).
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disclosure
The Committee's numerous hearings found the reporting and
disclosure of union financial information under current law to
be entirely inadequate. As stated by Marshall J. Breger,
professor of law at Catholic University's Columbus School of
Law, in testimony before the Committee, the information unions
must currently provide to the Department of Labor is ``not
particularly useful in giving union members or anybody a full
understanding of the purposes for which the union is spending
its money.'' \38\ Furthermore, Breger testified, ``Individual
union members have had great difficulty in getting information
and in testing the accuracy of the information given them.''
\39\ H.R. 1625 amends the Labor-Management Reporting and
Disclosure Act (LMRDA) of 1959 \40\ to require more detailed
financial reporting by labor organizations, to provide workers
paying union dues or fees the same access to financial
information as union members, and to give any interested party
the right to make a written request for financial reports filed
under the LMRDA.
---------------------------------------------------------------------------
\38\ April 18, 1996 oral testimony of Marshall J. Breger before the
Employer-Employee Relations Subcommittee of the House Committee on
Education and the Workforce.
\39\ June 19, 1996 oral testimony of Marshall J. Breger before the
Employer-Employee Relations Subcommittee of the House Committee on
Education and the Workforce.
\40\ 29 U.S.C. 401, et seq.
---------------------------------------------------------------------------
Section 6(a) amends Section 201(b) of the Labor-Management
Reporting and Disclosure Act of 1959 by adding at the end the
following new sentence: ``Every labor organization shall be
required to attribute and report expenses in such detail as
necessary to allow members to determine whether such expenses
were necessary to performing the duties of the exclusive
representative of the employees in dealing with the employer of
labor-management issues.''
Title II of the LMRDA, also known as the Landrum-Griffin
Act, requires that unions file annual financial, known as LM
reports, with the Department of Labor. The goal for the
reporting of expenditures under the LMRDA should be complete
transparency and full disclosure. Unfortunately, the current
LM-2 form \41\ only requires unions to file yearly their income
and expenses according to what accountants call an ``object
classification''--which identifies expense categories, such as
salary, rent, transportation, etc., and requires unions to
indicate simply the amount of money spent in those categories.
While this provides a flat dollar amount spent on certain
items, it does not allow anyone looking at the form to
determine the purpose for which the money was being used.
Section 6 of H.R. 1625 recognizes that the more a dues payer
knows about the purposes for which a union spends its money the
better able he or she is to decide whether to elect to allow
his or her money to be spent on noncollective bargaining
activities
---------------------------------------------------------------------------
\41\ Unions having $200,000 or more in gross annual receipts must
file with the Department of Labor an ``LM-2'' form. Unions which have
gross annual receipts totaling less than $200,000 for its fiscal year
may elect to file an ``LM-3'' form. If a union has gross annual
receipts totaling less than $10,000 for its fiscal year, it may elect
to file an ``LM-4'' form. 29 CFR Part 403.4 The Department of Labor
receives more than 35,000 forms each year.
---------------------------------------------------------------------------
The intent of this provision is to mandate that unions file
such information by ``functional classification'' \42\--setting
forth the purposes for which the money was being used--in a
manner similar to rules proposed by the Bush administration. In
April 1992, the Department of Labor issued a Notice of Proposed
Rulemaking \43\ proposing to revise the various financial
report forms unions must file with the DOL yearly to reflect
various functional categories. These rules, which the Committee
intends the rules promulgated under Section 6 of H.R. 1625 to
be modeled after, designated the following eight functions:
contract negotiation and administration; organizing; safety and
health; strike activities; political activities; lobbying;
promotional activities; and other. \44\ In addition, the
Committee would urge that a ninth category be created for
charitable contributions to cover all contributions by the
labor organization to tax-exempt and other charitable/social
organizations. The testimony the Committee received from
workers indicated that they often differed with their union's
choices regarding which charitable/social groups to support as
much as they differed with the union's political choices.
---------------------------------------------------------------------------
\42\ A need for functional reporting was recognized as far back as
1978, when the American Institute of Certified Public Accountants
(AICPA) encouraged labor organizations to report on a functional basis.
See 57 FR 14244 at 14245 (April 17, 1992).
\43\ Id. at 14244--14246.
\44\ In issuing its proposed rules, the Department of Labor found
that a rule requiring ``functional'' reporting did not constitute a
``major rule'' in that it would not have an annual effect on the
economy of $100 million or more--thus, no regulatory impact analysis
was prepared or was necessary. 57 FR at 14246.
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The Committee envisions that each expense item contained on
the LM-2 would be further broken down with these nine
functions. It is more helpful or dues payers to know not simply
the amount of money being spent for travel, for example, but
whether that travel was undertaken for organizing, contract
administration, collective bargaining, strike activities,
political activities or lobbying and promotional activities.
This is the sort of detailed information workers need to find
out how the money they pay to the union is actually being
spent. For activities that clearly fall outside the ``core''
union activities of collective bargaining, contract
administration and grievance adjustment--such as for politics,
charitable contributions, social causes, think tanks, etc.--the
more detailed disclosure requirements would serve not only to
educate all dues payers, but would also readily alert dues
payers laboring under a union security agreement that their
prior consent in required for any such expenditures.
Following the Department of Labor's issuance of final rules
in October 1992,\45\ the Clinton administration in December
1993 issued final rules rejecting the Bush administration's
proposed changes pertaining to filing--rescinding the
functional reporting requirements and causing the current LM-
forms to remain basically the same as when the program began in
1960.\46\ As pointed out by Breger, in testimony before the
Committee, the reporting rules promulgated after the LMRDA was
passed nearly 40 years ago were ``cut to the trim of
technological feasibility.'' \47\ In contrast, today's computer
software, Breger testified, allows labor organizations to more
easily provide extensive and useful information to dues
payers.\48\
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\45\ 57 FR 49282-49290 (October 30, 1992).
\46\ 58 FR 67594-67604 (December 21, 1993).
\47\ June 19, 1996 written testimony of Marshall J. Breger before
the Employer-Employee Relations Subcommittee of the House Committee on
Education and the Workforce, p. 9.
\48\ Id.
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Section 6(b) amends LMRDA Section 201(c) to ensure that a
labor organization's obligation to make available to all of its
members the information contained in reports it must file with
the Department of Labor pursuant to the LMRDA extends to
``employees required to pay any dues or fees to such
organization'' as well as to ``members.'' All dues payers, not
just union members, are entitled to the LMRDA's guarantee of
access to the information unions use to meet their reporting
obligations. Section 6(b) ensures this entitlement. Section
6(b) also extends to ``employees required to pay any dues or
fees to such organization'' the right granted to ``members''
under the LMRDA to sue any labor organization in any state
court of competent jurisdiction or in the district court of the
United States for the district in which such labor organization
maintains its principal office, to permit such employee for
just cause to examine any books, records, and accounts
necessary to verify any report the labor organization must file
pursuant to the LMRDA.
Section 6(c) amends LMRDA section 205(b) to make clear that
any person may write the Department of Labor to receive a
complete copy of any report or other document the labor
organization must file pursuant to LMRDA section 201, which
includes, among other information required by section 201
(a)(1)-(a)(5), the labor organization's constitution and bylaws
and annual financial report. As pointed out to the Committee in
July 9, 1997 testimony from Marshall J. Breger, the tens of
thousands of LM-2 disclosure statements are currently kept on
file in Washington, DC at the Department of Labor's Office of
Labor-Management Standards (OLMS). These reports, Breger
testified, ``are not retrievable by computer and are available
only on the OLMS's receipt of a five-digit file number
corresponding to the file.'' \49\ The public, Breger noted,
must attempt to find files numbers in a reference book last
published in 1990. ``Many of the file numbers are not
updated,'' Breger said, ``which makes finding some files
practically impossible. In addition, their are significant
restrictions on the number of files that can be examined or
photocopied per day. Thus, the Department's existing disclosure
leaves much to be desired.'' \50\ Section 6(c) of H.R. 1625 is
necessary to ensure the public's access to this critical
information which is fundamental to union democracy.
---------------------------------------------------------------------------
\49\ July 9, 1997 written testimony of Marshall J. Breger before
the Employer-Employee Relations Subcommittee of the House Committee on
Education and the Workforce, p. 8.
\50\ Id. at 8-9.
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anti-retaliation/Coercion
The Worker Paycheck Fairness Act makes it unlawful for any
labor organization to coerce, intimidate, threaten, interfere
with, or retaliate against any employee in the exercise of, or
on account of having exercised, any right granted or protected
by the legislation. This prohibition on retaliation would
prevent a union from intimidating or taking any adverse action
against an employee because he or she exercised rights of
consent under the Act. It would also prevent unions from
forcing workers to resign their union membership--and in the
process, to give up critical workplace rights such as the right
to vote on ratifying contracts or approving strikes--in order
to exercise their rights under the bill.
The anti-retaliation provision responds to the earlier-
cited testimony of many workers who spoke of the harassment and
intimidation some unions use to pressure employees to not
exercise their rights regarding the payment of union dues. Such
a provision, which would send a signal that this type of
conduct will no longer be tolerated, is a common feature in
employment rights laws. The language of the anti-retaliation
provision is modeled after that found in section 503 of the
Americans with Disabilities Act and in section 704 of Title VII
of the Civil Rights Act of 1964, and is consistent with the
provisions of section 7 of the NationalLabor Relations Act and
the protections of section 105 of the Family and Medical Leave Act. Any
union guilty of coercing an employee in deciding whether to give
consent to the use of dues for political, social, civic or other non-
collective bargaining purposes, or of retaliating against an employee
for declining to give consent, would be liable to the employee in
accordance with the previously outlined remedial provisions.
In addition to the more typical types of harassment and
coercion, the prohibition on retaliation would prevent a union
from expelling a member who refused to give consent to the use
of his dues for noncollective bargaining purposes. Thus, the
provision would overrule the decision of the Fourth Circuit in
Kidwell v. Transportation Communications International
Union.\51\ In that decision, the court confronted the issue of
whether the union had to permit union members to exercise their
Beck rights and thus allow them to pay reduced fees. While the
court was sympathetic to Kidwell's argument that she should not
have to resign from the union because in doing so she would
have to give up participation in certain union activities that
have an impact on the conditions of her employment (for
example, ratification of the collective bargaining agreement),
the court held, interpreting Beck and other cases, that the
union could require a union member to resign from the union if
he or she wished to exercise Beck rights.
---------------------------------------------------------------------------
\51\ 946 F.2d 283 (4th Cir. 1991).
---------------------------------------------------------------------------
The Committee believes that the reasoning of the district
court in the Kidwell case--the lower court decision was
reversed by the Fourth Circuit--more fairly balances the rights
of dissenting workers and the needs of the union as the
exclusive bargaining representative. In findings that even a
union member was entitled to a reduction in her union dues for
all union expenses unrelated to collective bargaining, the
district court concluded that ``when the union strays from that
charter given by the Railway Labor Act * * * and uses dues to
support candidates, religious beliefs, or any other ideological
cause, it is not an answer to say to one who is opposed to
those views, `leave the union'.'' \52\ Like the Committee, the
district court was persuaded that it was not fair to ask union
members to choose between their workplace rights and their free
speech rights. The Worker Paycheck Fairness Act protects the
basic rights of both members and nonmembers of the union by
giving both an equal ability to exercise their rights under the
legislation without fear of retribution.
---------------------------------------------------------------------------
\52\ 731 F.Supp 192 Md. 1989).
---------------------------------------------------------------------------
conclusion
So long as labor organizations and employers have the
unique power under Federal law to force workers to pay dues or
fees to a union under the pain of the loss of the worker's job,
the Committee believes that the law must ensure that workers
have the fullest information possible as to their rights and
responsibilities regarding those payments. Workers have a right
to know why money is taken out of their paycheck, how money
legitimately taken is used, and a realistic and available right
to stop money from being taken out of their paychecks that is
not used for legitimate collective bargaining purposes. An
October 1997 ABC News/Washington Post poll and a CNN/USA Today/
Gallup poll revealed that 82% and 72%, respectively, of those
surveyed agreed that unions should be required to get written
permission from each worker prior to using dues money for
political purposes. This is exactly what the Worker Paycheck
Fairness Act is designed to provide.
The Worker Paycheck Fairness Act merely says to unions who
want to require workers to pay union dues as a condition of
keeping their jobs, if you want to spend dues for reasons not
necessary to collective bargaining, (1) get written consent of
the workers first; and (2) provide better information
concerning how the dues were spent. This isn't too much to ask.
Summary
H.R. 1625, the Worker Paycheck Fairness Act, creates a
free-standing statute which would require labor organizations
that accept payment of any dues or fees from an employee as a
condition of employment pursuant to Federal law to secure from
each employee prior, voluntary, written authorization for any
portion of such dues or fees which will be used for activities
not necessary to performing the duties of the exclusive
representative of the employees in dealing with the employer on
labor-management issues. The legislation provides that such an
authorization is effective until revoked and may be revoked
upon giving 30 days written notice. H.R. 1625 gives workers
enforcement rights modeled on those granted by the Family and
Medical Leave Act. Under the legislation, if a labor
organization fails to get the employee's authorization but
violates the law by using dues or fees for noncollective
bargaining purposes, the employee may file an individual or
class action lawsuit in Federal or State court to recover
double the amount of dues or fees illegally accepted, as well
as attorney's fees, costs of litigation, and any appropriate
equitable relief.
The bill also requires unionized employers to post a notice
telling employees of their right to be asked permission should
the union want to spend any portion of their dues or fees on
non-collective bargaining activities. Finally, H.R. 1625 amends
the Labor Management Reporting and Disclosure Act (LMRDA) to
make it easier for workers to give their informed consent by
requiring more detailed financial reporting by labor
organizations, providing workers paying union dues or fees the
same access to financial information as union members, and
giving any interested party the right to make a written request
for financial reports filed under the LMRDA.
Section-By-Section Analysis
section one
Provides that the short title of the bill is the ``Worker
Paycheck Fairness Act.''
section two
Establishes the findings of the Committee related to the
rights of workers paying dues or fees to a labor organization,
the uses of dues or fees by labor organizations, and the rights
of individuals regarding the political, social and charitable
causes they support.
section three
Provides that the purpose of the Act is to ensure that all
workers have sufficient information about their rights
regarding the payment of dues or fees to labor organizations
and the uses of their dues and fees by labor organizations and
to ensure that the right of all workers to make individual and
informed choices about the political, social or charitable
causes they support is protected to the greatest extent
possible.
section four
Provides that any labor organization accepting any payment
of dues or fees from an employee as a condition of employment
pursuant to Federal law must secure from each employee prior,
voluntary, written authorization for any portion of such dues
or fees which will be used for activities not necessary to
performing the duties of the exclusive representative of the
employees in dealing with the employer on labor-management
issues. Also provides that such an authorization shall remain
in effect until revoked and may be revoked upon giving 30 days
written notice. Also provides for a civil action by employees
and specifies the liability of labor organizations that violate
the terms of the Act.
section five
Requires employers whose employees are represented by a
collective bargaining representative to post a notice informing
employees that any labor organization accepting any payment of
dues or fees from an employee as a condition of employment
pursuant to Federal law must secure from each employee prior,
voluntary, written authorization for any portion of such dues
or fees which will be used for activities not necessary to
performing the duties of the exclusive representative of the
employees in dealing with the employer on labor-management
issues.
section six
Amends the Labor-Management Reporting and Disclosure Act
(LMRDA) to require more detailed financial reporting by labor
organizations, to provide workers paying union dues or fees the
same access to financial information as union members, and to
give any interested party the right to make a written request
for financial reports filed under the LMRDA.
section seven
Provides that it is unlawful for a labor organization to
coerce, intimidate, threaten, interfere with, or retaliate
against any employee in the exercise of, or on account of
having exercised, any right granted or protected by this Act.
section eight
Authorizes the Secretary of Labor to prescribe regulations
to implement sections five and six.
section nine
Provides that the Act shall be effective immediately upon
enactment, except that sections 4 and 5 shall take effect 90
days after enactment and section 6 shall take effect 150 days
after enactment.
Oversight Findings of the Committee
In compliance with clause 2(1)(3)(A) of rule XI of the
Rules of the House of Representatives and clause 2(b)(1) of
rule X of the Rules of the House of Representatives, the
Committee's oversight findings and recommendations are
reflected in the body of this report.
Government Reform and Oversight
With respect to the requirement of clause 2(1)(3)(D) of
Rule XI of the Rules of the House of Representatives, the
Committee has received no report of oversight findings and
recommendations from the Committee on Government Reform and
Oversight on the subject of H.R. 1625.
Committee Estimate
Clause 7 of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison by the
Committee of the costs which would be incurred in carrying out
H.R. 1625. However, clause 7(d) of that rule provides that this
requirement does not apply when the Committee has included in
its report a timely submitted cost estimate of the bill
prepared by the Director of the Congressional Budget Office
under section 403 of the Congressional Budget Act of 1974.
Constitutional Authority
H.R. 1625, the Worker Paycheck Fairness Act, provides
rights to workers subject to union security agreements
negotiated under the National Labor Relations Act (NLRA) and
the Railway Labor Act (RLA). Both the RLA \53\ and the NLRA
\54\ have been determined, by the Supreme Court, to be within
Congress' Constitutional authority. Because the Worker Paycheck
Fairness Act places additional restrictions on the use of dues
or fees paid to labor organizations pursuant to union security
clauses under the NLRA and RLA, the legislation is similarly
within the scope of Congressional powers under Article I,
Section 8, Clause 3 of the Constitution of the United States.
---------------------------------------------------------------------------
\53\ Texas & New Orleans Railroad v. Brotherhood of Railway &
Steamship Clerks, 281 U.S. 548 (1930).
\54\ National Labor Relations Board v. Jones & Laughlin Steel
Corp., 301 U.S. 1 (1937).
---------------------------------------------------------------------------
Application of Law to Legislative Branch
Section 102(b)(3) of Public Law 104-1, the Congressional
Accountability Act (CAA), requires a description of the
application of this bill to the legislative branch. H.R. 1625
creates a right on behalf of all workers who pay dues or fees
to a labor organization as a condition of employment pursuant
to an agreement authorized by Federal law. Thus, the bill would
apply to legislative branch employees to the extent that they
are subject to union security agreements authorized by Federal
law requiring the payment of union dues or fees. However, the
labor relations of legislative branch employees are governed by
the Federal Labor Relations Act which currently does not permit
the negotiation of a union security clause. While the rights
created by section 1625 do not inure to legislative branch
employees at this time, they would be available should the
Federal Labor Relations Act be amended, or a separate law
enacted, allowing the negotiation of a union security clause.
Unfunded Mandate Statement
Section 423 of the Congressional Budget & Impoundment
Control Act requires a statement of whether the provisions of
the reported bill include unfunded mandates. The Committee
received a letter regarding unfunded mandates from the Director
of the Congressional Budget Office. See infra.
Budget Authority and Congressional Budget Office Cost Estimate
With respect to the requirement of clause 2(1)(3)(B) of
rule XI of the House of Representatives and section 308(a) of
the Congressional Budget Act of 1974 and with respect to
requirements of clause 2(1)(3)(C) of rule XI of the House of
Representatives and section 403 of the Congressional Budget Act
of 1974, the Committee has received the following cost estimate
for H.R. 1625 from the Director of the Congressional Budget
Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, October 24, 1997.
Hon. William F. Goodling,
Chairman, Committee on Education and the Workforce, U.S. House of
Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1625, the Worker
Paycheck Fairness Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Christina
Hawley Sadoti.
Sincerely,
James L. Blum
(For June E. O'Neill, Director).
Enclosure.
H.R. 1625--Worker Paycheck Fairness Act
Summary: H.R. 1625 would place new requirements on unions
and employers relating to the payment of union dues and fees by
workers. The bill would require labor organizations with union
security agreements to obtain prior written authorization from
workers for any portion of their dues or fees that are used for
non-representational activities. It would require labor
organizations to report separately their expenses for
representational and nonrepresentational activities on
financial disclosure forms filed with the Department of Labor
(DoL). The bill would also require all employers with workers
who are represented by unions to post notices regarding their
union's duty to obtain authorization before accepting required
dues or fees that are partially used to fund non-
representational activities. CBO estimates that enacting H.R.
1625 would result in increased costs to the Office of Labor-
Management Standards (OLMS) in the Department of Labor of about
$2 million per year beginning in fiscal year 1998 and about $9
million over the 1998-2002 period, assuming that appropriations
are made accordingly. Because the bill would not affect direct
spending or receipts, pay-as-you-go procedures would not apply.
H.R. 1625 contains both intergovernmental and private-
sector mandates, as defined in the Unfunded Mandates Reform Act
(UMRA). CBO estimates that complying with these mandates would
impose no significant costs on state, local, or tribal
governments. CBO is uncertain whether the direct costs of
complying with the private sector mandates would exceed the
threshold specified in UMRA in the first year the bill would be
effective. CBO estimates that the direct cost of those mandates
would not exceed the threshold in subsequent years.
Estimated cost to the Federal Government: H.R. 1625 would
require labor organizations to provide more information in
financial disclosure forms which they file with the Department
of Labor. In 1996, about 33,600 labor organizations filed such
forms. H.R. 1625 would require OLMS to develop new forms for
these organizations to use. In addition, OLMS would need to
provide compliance assistance and training on these new forms
and would experience an increase in case processing costs. In
1992, the Bush administration sought to make changes similar to
those provided for in H.R. 1625 through administrative action.
At that time, OLMS estimated the additional costs of developing
new forms, providing new forms, providing necessary compliance
assistance, and processing cases at $1.35 million per year.
Adjusted for inflation, these costs would be about $1.6 million
in fiscal year 1998 and slightly larger amounts each year
thereafter.
H.R. 1625 also would require employers of workers who are
covered by collective bargaining agreements to post notices
regarding their union's responsibility to obtain authorization
in order to spend a portion of their dues or fees on non-
representational activities. Currently, employers are required
to post notices regarding minimum wage and maximum hour
requirements, equal opportunity and anti-discrimination
provisions, and other information regarding workplace safety.
The federal costs of requiring some employers to post
additional information would not be significant.
The costs of this legislation fall within budget function
500 (education, training, employment, and social services). The
estimated budgetary impact of H.R. 1625 is shown in the
following table.
ESTIMATED BUDGETARY IMPACT OF H.R. 1625
[By fiscal year, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
1998 1999 2000 2001 2002
----------------------------------------------------------------------------------------------------------------
WITH ADJUSTMENTS FOR INFLATION
Authorizations of appropriations under current law:
Estimated authorization......................... 299 310 321 332 344
Estimatd outlays................................ 297 308 319 330 342
Proposed changes:
Estimated authorization......................... 2 2 2 2 2
Estimatd outlays................................ 1 2 2 2 2
Authorizations of appropriations under H.R. 1625:
Estimated authorization......................... 301 312 323 325 346
Estimatd outlays................................ 298 310 321 332 344
WITHOUT ADJUSTMENTS FOR INFLATION
Authorizations of appropriations under current law:
Estimated authorization......................... 299 299 299 299 299
Estimatd outlays................................ 297 299 299 299 299
Proposed changes:
Estimated authorization......................... 2 2 2 2 2
Estimatd outlays................................ 1 2 2 2 2
Authorizations of appropriations under H.R. 1625:
Estimated authorization......................... 301 301 301 301 301
Estimatd outlays................................ 298 301 301 301 301
----------------------------------------------------------------------------------------------------------------
Notes: Spending under current law is based on the level provided for the Employment Standards Administration in
the House-passed version of the Labor-HHS appropriations bill for 1998.
Components may not sum to totals because of rounding.
Pay-as-you-go considerations: None.
Estimated impact on State, local and tribal governments:
H.R. 1625 contains two intergovernmental mandates as defined in
UMRA. The bill would require employers (including state, local,
and tribal governments) that allow collective bargaining to
post notices informing employees of their new rights under the
bill. The bill would also require state courts to impose
certain remedies for violations of employee's rights under the
bill. Based on Census data and information from the American
Federation of State, County, and Municipal Employees, CBO
estimates that even if all state, local, and tribal governments
in states that allow collective bargaining were required to
post notices, compliance costs would not be significant. The
new requirements on state courts would not result in any
additional costs because they simply specify certain elements
of judgments to be awarded by the courts.
Estimated impact on the private sector: H.R. 1625 would
impose two new private sector mandates--one on labor
organizations and one on employers--and would expand an
existing mandate on unions. CBO has been unable to obtain
sufficient data to determine whether the aggregate direct cost
of the three mandates in H.R. 1625 would exceed the statutory
threshold specified in UMRA ($100 million in 1996, adjusted
annually for inflation) during the first year the mandates
would be effective. In each case, the cost of the mandate
declines substantially after the first year, and CBO estimates
that the aggregate direct cost of the mandates in the second
through fifth years would not exceed the statutory threshold.
First, the bill would require labor organizations with
union security agreements (which require union and nonunion
members to pay dues or fees to the union as a condition of
employment) to obtain prior written authorization from workers
for any portion of those payments to be used for activities
other than employee representation. (Representation activities
include collective bargaining, contract administration, and
grievance adjustment; non-representational activities include
advertising not related to representational matters, union
organizing, lobbying, political activities, and litigation that
does not directly concern the bargaining unit.) In 1988, the
Supreme Court decided in Communication Workers of America v.
Beck that non-union members are required to pay dues or fees to
a union need only pay for the share of union expenses going for
representational activities. To exercise this right, however,
the workers must formally object to the payment of higher fees.
The cost of this mandate would be greatest in the first
year it was effective because authorizations would need to be
requested from all current workers. In subsequent years,
authorizations would need to be requested only from new
workers, which could occur during the normal hiring process.
The first-year cost to the unions would depend on the number of
workers from whom authorizations would be requested and the
average cost to the union of requesting an authorization.
Little information exists on either of these quantities. Only
29 states currently allow union security agreements, and in
1996 a total of 13.2 million union members were employed in
those states. An additional 1.9 million non-union members
nationwide were represented by unions. The number of workers
who were actually employed under union security agreements is
unknown. Furthermore, not all of the workers employed under
union security agreements would be requested to provide
authorizations. Unions that spend significant portions of their
funds on nonrepresentational activities would find it
advantageous to obtain authorizations from workers. However,
the prevalence and magnitude of spending on nonrepresentational
activities is not known.
Second, the bill would increase financial reporting
requirements on labor organizations by requiring them to report
separately their expenses for representational and
nonrepresentational activities. Under current law, labor
organizations must file financial disclosure forms with the
Department of Labor. Those forms include information on assets,
liabilities, disbursements to union officers, receipts, and
other expenditures, but they do not include information on the
purposes for which expenditures are made.
All labor organizations that currently file financial
disclosure forms with the Department of Labor would have to
comply with the bill's reporting requirements. In 1996, there
were 33,600 such labor organizations. The cost of the reporting
requirements would vary with the type, size, and activities of
labor organizations, but most of this information is not
available. These costs would be greatest the first year the
requirement would be in effect because many labor organizations
would have to set up new reporting and accounting systems. In
following years, the cost of producing a report would be
relatively low. For some unions with union security agreements,
the initial cost of the reporting requirements might not be
large, because under current law they must disclose their
nonrepresentational expenses and calculate reduced fees for
nonmembers who formally object to paying for such expenses.
Finally, H.R. 1625 would require all employers with workers
who are represented by a union to post notices informing their
workers of the union's duty to obtain their authorization if
some of their required dues or fees are used for
nonrepresentational purposes. These requirements would impose a
largely one-time cost on employers with union workers. To
comply with these requirements, employers would have to post
notices in at least one area in each of their establishments.
Currently, employers are required to post notices regarding
fair labor standards and workplace safety requirements. This
new posting requirement,however, would apply only to employers
of workers covered by collective bargaining agreements. Of the
approximately 3 million establishments with paid employees, the
share with union workers is not known. In any case, the cost
per notice could be quite small. Therefore, CBO estimates that
the overall cost of this mandate to employers would be less
than $10 million in the first year the mandate is effective and
negligible in later years.
Estimated prepared by: Federal Cost: Christina Hawley
Sadoti. Impact on State, Local, and Tribal Governments: Marc
Nicole. Impact on the Private Sector: Kathryn Rarick.
Estimate approved by: Paul N. Van de Water, Assistant
Director for Budget Analysis.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3 of rule XIII of the Rules of the
House of Representatives, changes in existing law made by the
bill, as reported, are shown as follows (existing law proposed
to be omitted is enclosed in black brackets, new matter is
printed in italic, existing law in which no change is proposed
is shown in roman):
LABOR-MANAGEMENT REPORTING AND DISCLOSURE ACT OF 1959
TITLE II--REPORTING BY LABOR ORGANIZATIONS, OFFICERS AND EMPLOYEES OF
LABOR ORGANIZATIONS, AND EMPLOYERS
report of labor organizations
Sec. 201. (a) * * *
(b) Every labor organization shall file annually with the
Secretary a financial report signed by its president and
treasurer or corresponding principal officers containing the
following information in such detail as may be necessary
accurately to disclose its financial condition and operations
for its preceding fiscal year--
(1) * * *
* * * * * * *
Every labor organization shall be required to attribute and
report expenses in such detail as necessary to allow members to
determine whether such expenses were necessary to performing
the duties of the exclusive representative of the employees in
dealing with the employer on labor-management issues.
(c) Every labor organization required to submit a report
under this title shall make available the information required
to be contained in such report to all its members and employees
required to pay any dues or fees to such organization, and
every such labor organization and its officers shall be under a
duty enforceable at the suit of any member or employee required
to pay any dues or fees to such organization of such
organization in any State court of competent jurisdiction or in
the district court of the United States for the district in
which such labor organization maintains its principal office,
to permit such member or employee required to pay any dues or
fees to such organization for just cause to examine any books,
records, and accounts necessary to verify such report. The
court in such action may, in its discretion, in addition to any
judgment awarded to the plaintiff or plaintiffs, allow a
reasonable attorney's fee to be paid by the defendant, and cost
of the action.
* * * * * * *
reports made public information
Sec. 205. (a) * * *
(b) The Secretary shall by regulation make reasonable
provision for the inspection and examination, on the request of
any person, of the information and data contained in any report
or other document filed with him pursuant to sections 201, 202,
203, or 211. Upon written request, the Secretary shall make
available complete copies of any report or other document filed
pursuant to section 201.
* * * * * * *
MINORITY VIEWS
H.R. 1625 Is Just Another Example of the Ongoing Republican Attack on
the Rights of Working People
From the start of the 104th Congress, a newly elected
Republican Majority has tried to undermine the rights of
working Americans and the institutions that seek to protect
those rights. For example, Republicans have sought to subvert
the forty-hour work week; to gut the protections afforded
workers under the Occupational Safety and Health Act; to repeal
Davis-Bacon and the Service contract Act; to legalize company
unions; and to permit employers to once again raid employee
pension plans. In addition, Republicans have sought to expand
the ability of employers to redefine workers as independent
contractors and thereby evade health insurance and pension
obligations, unemployment insurance and social security
contributions otherwise owed to workers. The Republican
leadership even fought unsuccessfully to prevent the minimum
wage from being increased.
Now, the Republicans are proposing to enact legislation
that is calculated to cripple the ability of unions and the
workers they represent to effectively participate in the
political affairs of the nation. In effect, this legislation
seeks to effectively disenfranchise American workers. In truth,
this bill is the Republican party's retaliation against working
families and their unions for their role in the 1996 elections.
Republicans are trying to muzzle the legitimate voice of
working men and women who, through their unions, dared to tell
the truth about the anti-worker Republican agenda.
In the name of enforcing the right of a minority to dissent
from engaging in political activity, this legislation
deliberately and intentionally tramples on the right of the
majority to do so. The legislation infringes on the right of
workers to establish their own rules regarding union
membership. The legislation infringes on the right of workers
to determine for themselves the activities of their own
organizations. The legislation imposes costly, crippling
paperwork requirements upon unions, thereby effectively
imposing a punitive tax on all those represented by unions.
While imposing unreasonable and unfair infringements on the
rights of workers to engage in political activity through their
unions, the legislation places no restrictions at all on the
political activities of employers or employer associations. To
justify this blatant, one-sided attempt to distort the
democratic process, the Majority has dismissed, ignored, or
distorted the substantial protections afforded by existing law
to all those represented by unions.
Unions Have a Long and Proud Tradition of Participating in the
Political Process, and Union Members Are Well Aware of and Supportive
of this Tradition
The fact that unions engage in political activity is, of
course, neither new nor news. As Justice Felix Frankfurter has
pointed out, ``It is not true in life that political protection
is irrelevant to, and insulated from, economic interests. It is
not true for industry or finance. Neither is it true for
labor.'' \1\ Labor unions have recognized this since their
inception. As Justice Frankfurter stated:
---------------------------------------------------------------------------
\1\ Machinists v. Street, 367 U.S. 740, 814-815 (1961) (dissenting
opinion).
To write the history of the [Railroad] Brotherhoods,
the United Mine Workers, the Steel Workers, the
Amalgamated Clothing Workers, the International Ladies
Garment Workers, the United Auto Workers, and leave out
their so-called political activities would be sheer
mutilation. Suffice it to recall a few illustrative
manifestations. The AFL, surely the conservative labor
group, sponsored as early at 1893 an extensive program
of political demands calling for compulsory education,
an eight-hour day, employer tort liability, and other
social reforms. The fiercely contested Adamson Act of
1916 was a direct result of railway union pressure
exerted upon both the Congress and the President. More
specifically, the weekly publication ``Labor''--an
expenditure under attack in this case--has since 1919
been the organ of the railroad brotherhoods which
finance it. Its files through the years show its
preoccupation with legislative measures that touch the
vitals of labor's interests and with men and parties
who effectuate them. This aspect--call it the political
side--is as organic, as inured a part of the philosophy
and practice of railway unions as their immediate
bread-and-butter concerns.\2\
---------------------------------------------------------------------------
\2\ Id. at 800.
Nor, contrary to the impression the majority has sought to
foster, have unions ever made a secret of their political
activity. Indeed, to do so in a democratic society such as ours
is obviously and inherently counterproductive. As Mr. Coppess
---------------------------------------------------------------------------
has testified:
Over the years, the labor movement has led the
crusade for enactment of the minimum wage and the
forty-hour workweek, for laws protecting occupational
safety and health, assuring the security of pensions,
and prohibiting invidious discrimination in employment.
We have done so because union members, acting through
the democratic processes of their unions, decided that
it was right and proper to do so--for the sake not just
of union members but of all working Americans. And,
today we continue to advance the interests of working
families by leading the effort to preserve and
strengthen the employee-protective laws, and to protect
the system of social insurance on which workers and
older Americans depend.\3\
---------------------------------------------------------------------------
\3\ Prepared statement of James B. Coppess, Hearing on Mandatory
Union Dues, Before the Subcommittee on Employer-Employee Relations,
105th Cong., 1st Sess. (March 18, 1997).
---------------------------------------------------------------------------
[W]orkers know that unions attempt to advance the
interests of those they represent through political
action. Workers know that when they vote for union
representation. Workers know that when they vote to
approve collective bargaining agreements containing
union security clauses requiring everyone to pay their
fair share for representation. And workers know that
when they vote on the level of dues they are willing to
pay and on the leaders who will set their union's
agenda.
Workers make these decisions with their eyes wide
open about union political activity--as to both the
fact of such activity and its cost. Indeed; unions are
required to disclose more about their finances than any
other organization of which I am aware. And if the
membership want more information, it is free to elect
leaders promising such or to amend their organization's
constitution and bylaws to so provide.
Anyone who claims that unions could pursue the
political course they have consistently followed
without substantial majority support is willfully
misunderstanding the relationship between elected
leaders and representatives and their constituency.\4\
---------------------------------------------------------------------------
\4\ Hearing on H.R. 3580, the Worker Right to Know Act, Before the
Subcommittee on Employer-Employee Relations, 104th Cong., 2nd Sess., at
320 (June 19, 1996)(Serial No. 104-66).
Claims by anyone that they did not know that unions engaged
in political activity are, at best, disingenuous.
Current Law Protects the Rights of Union Objectors
Republican assertions that current labor laws run roughshod
over dissenting union members are not simply false, but gross
distortions. Republicans contend falsely, that unions may force
workers to pay for union political activity. In fact, no
employee may be required to join a union as a condition of
employment. Membership in a union is purely voluntary. Nor is
any employee required, as a condition of employment, to
underwrite union political activity.
Unions, by law, are democratic organizations whose officers
and policies are required to be determined by the majority will
of their members. In fact, the democratic principles embodied
in our labor laws are borrowed from the democratic procedures
we use and honor all across the country when we choose our city
councils, our mayors, our school boards, and Members of
Congress.
Unions are required by law to inform all employees who are
subject to a collective bargaining agreement, including an
agency fee or union security provision, that they are not
required to pay any part of the union dues not related to
collective bargaining, contract administration, or grievance
adjustment. Unions must inform such employees of the
percentages of their union dues that are used for purposes that
are not germane to collective bargaining, contract
administration, or grievance adjustment. Moreover, unions must
establish procedures to ensure that those employees who choose
not to support the union's political activity, do not pay any
part of the union dues that are used for purposes that are not
germane to collective bargaining, contract administration, or
grievance adjustment.
Those who believe their right to refrain from paying for
any union activity unrelated to collective bargaining, contract
administration, or grievance adjustment have not just one, but
two different forums by which they may seek remedy. They may
file a complaint with the National Labor Relations Board, in
which case the Government, rather than the employee, will
undertake the cost of investigation and, if merited, the
prosecution of the allegation. Alternatively, the employee may
sue the union directly for violating its duty of fair
representation.
In fact, those who are represented by unions have extensive
rights under current law. By law, unions are democratic
organizations whose officers and policies are required to be
determined by the majority will of their members. Additionally,
unions are already under more extensive reporting and
disclosure requirements than virtually all other institutions
in the country, and are required to report all of their income
and expenditures to members, to the Government, and to the
public. Under the National Labor Relations Act, bargaining unit
members have a statutory right to either nullify the agency fee
provision of a contract or decertify the union if the majority
feels that either the agency fee provision or the union is no
longer in their best interest. Union members have a statutory
right to inspect their union's books and to vote on the amount
of dues the union will charge its members. The National Labor
Relations Act also prohibits unions from charging those who are
subject to an agency fee provision excessive or discriminatory
fees. In short, the alleged evil this legislation seeks to
correct is one that had already been rendered nonexistent by
law.
If the polls cited by the majority for the proposition that
union members support ``up-front'' consent are accurate, it is
fully within the ability of those union members to implement
such a requirement. In fact, however, public opinion polls show
that members like their unions speaking out on their behalf. A
poll by Peter Hart Associates taken after the 1996 election
found that 85 percent of members supported their union's fight
to increase the minimum wage and protect Medicare. They also
strongly supported voted guides, voter encouragement efforts,
and efforts to lobby Members of Congress on issues affecting
working families. These are the very kinds of activities
Republicans want to squelch with its shut down of union
democracy.
Unions Are Already Under More Extensive Reporting and Disclosure
Requirements Than Virtually All Other Institutions in the Country
H.R. 1625 imposes onerous reporting burdens on unions, yet
unions are already subject to extensive reporting and
disclosure requirements. Subchapter III of the LMRDA requires
unions to file full reports regarding the procedures by which
the union operates\5\ and annual reports detailing the
financial conduction of the union including all receipts and
expenditures by the union.\6\ In addition, the LMRDA
specifically provides:
---------------------------------------------------------------------------
\5\ 29 U.S.C. 431(a).
\6\ 29 U.S.C. 431(b).
Every labor organization required to submit a report
under this subchapter shall make available the
information required to be contained in such report to
all of its members, and every such labor organization
and its officers shall be under a duty enforceable at
the suit of any member of such organization in any
State court or competent jurisdiction or in the
district court of the United States for the district in
which such labor organization maintains its principal
office, to permit such member for just cause to examine
any books, records, and accounts necessary to verify
such report.\7\
---------------------------------------------------------------------------
\7\ 29 U.S.C 431(c).
As James B. Coppess stated in testimony before the
---------------------------------------------------------------------------
Subcommittee on Employer-Employee Relations on March 18, 1997:
Given this legal structure, there is no room to doubt
that the decisions unions make to support or oppose
particular pieces of legislation or particular
candidates for public office, and the decisions unions
make to expend money in support of such views, reflect
the views of the majority of union members. Indeed, one
reason workers form unions in the first instance is
precisely to be able to band together to participate in
legislative and political affairs.
In 1988, the Supreme Court Made it Clear in ``Communication Workers v.
Beck,'' That No Worker Can Be Compelled To Support Union Political
Activity
Unit Communication Workers v. Beck was decided 1988, the
Supreme Court had ``never before delineated the precise limits
8(a)(3) places on the negotiation of an enforcement of union-
security agreements * * * ''\8\ However:
---------------------------------------------------------------------------
\8\ Communication Workers v. Beck, 487 U.S. 735, 745 (1988).
Over a quarter century ago we held that 2, Eleventh
of the RLA does not permit a union, over the objections
of nonmembers, to expend compelled agency fees on
political causes. Because the NLRA and RLA differ in
certain crucial respects, we have frequently warned
that decisions construing the latter often provide on
the roughest of guidance when interpreting the former.
Our decision in [Machinists v. Street, 367 U.S. 740
(1961)], however, is far more than merely instructive
here: we believe it is controlling, for 8(a)(3) and 2,
Eleventh are in all material respects identical. * * *
Thus, in amendment the RLA in 1951, Congress expressly
modeled 2, Eleventh on 8(a)(3), which it had added to
the NLRA only four years earlier, and repeatedly
emphasized that it was extending `to railroad labor the
same rights and privileges of the union shop that are
contained in the Taft-Hartley Act.' In these
circumstances, we think it clear that Congress intended
the same language to have the same meaning in both
statutes.\9\
---------------------------------------------------------------------------
\9\ Id., 745-747 (citations omitted).
The dissenting opinion \10\ in Beck vigorously asserted
that 8(a)(3) does not limit the union's authority to collect
from nonmembers the same dues and fees it collects from
members.\11\ Notwithstanding the dissent, however, the Beck
decision has settled the issue of whether 8(a)(3) ``includes
the obligation to support union activities beyond those germane
to collective bargaining, contract administration, and
grievance adjustment.` \12\ In the word of the Court, ``We
think it does not.\13\ Since 1988, it has been unlawful to
require any employee, as a condition of employment, to
financially support through the payment of dues or fees union
activities that are not germane to collective bargaining,
contract administration, or grievance adjustment.
---------------------------------------------------------------------------
\10\ Justice Brennen delivered the opinion of the Court, in which
Chief Justice Rehnquist, and Justices White, Marshall, and Stevens
joined. Justices Blackmun, O'Connor, and Scalia concurred in part and
dissented in part. Justice Kennedy took no part in the consideration or
decision of the case.
\11\ The Court's conclusion that 8(a)(3) prohibits petitioners from
requiring respondents to pay fees for purposes other than those
`germane' to collective bargaining, contract administration, and
grievance adjustment simply cannot be derived from the plain language
of the statute. In effect, the Court accepts respondents' contention
that the words `dues' and `fees,' as used in 8(a)(3), refer not to the
periodic amount a union charges its members but to the portion of that
amount that the union expends on statutory collective bargaining. Not
only is this reading implausible as a matter of simple English usage,
but it is also contradicted by the decisions of this Court and of the
NLRB interpreting the section. Section 8(a)(3) does not speak of `dues'
and `fees' that the employees covered by the union-security agreement
may be required to tender to their union representative; rather, the
section speaks only of `the periodic dues and initiation fees uniformly
required as a condition of acquiring and retaining membership.' Thus,
the section, by its terms, defines `periodic dues' and `initiation
fees' as those dues and fees `uniformly required` of all members, not a
portion of full dues. As recognized by this Court, `dues collected from
members may be used of a variety of purposes, in addition to meeting
the union's costs of collective bargaining. Unions rather typically use
their membership dues to do those things which the members authorize
the union to do in their interest and on their behalf.' By virtue of
8(a)(3), such dues may be required from any employee under a union-
security agreement. Nothing in 8(a)(3) limits, or even addresses, the
purposes to which a union may devote the moneys collected pursuant to
such an agreement.''
``The Court's attempt to squeeze support from the legislative
history for its reading of congressional intent contrary to the plain
language of 8(a)(3) is unavailing * * * Indeed, on balance, the
legislative history reinforces what the statutory language suggests:
the provisos neither limit the uses to which agency fees may be put nor
require nonmembers to be charged less than the `uniform' dues and
initiation fees. Id., at 768-770 (citations omitted),'' Beck dissenting
opinion.
\12\ Id., at 745.
\13\ Id.
---------------------------------------------------------------------------
``Beck'' Rights Are Aggressively Enforced
The Majority contends that, despite the Beck decision,
``Beck rights remain illusory.'' The contention does not stand
up when compared to the facts. Proponents of H.R. 1625 assert
that the National Labor Relations Board has not protected Beck
rights. As Mr. Coppess has testified:
In California Saw & Knife Works,\14\ the NLRB--
largely following rules announced by the NLRB General
Counsel at the time Beck was decided in 1988--imposed
an exacting set of requirements on labor unions which
seek to collect agency fees. The Board first held that
before a union may require a nonmember to pay such a
fee, the union must inform the nonmember of his right
to object to paying for activities `not germane to the
union's duties as bargaining agent' and his right to
`obtain a reduction in fees for such activities.' The
NLRB further held that a nonmember who exercises such
right by submitting an objection, must be charged a
reduced fee, reflecting the union's calculation of the
percentage of its overall expenditures devoted to
activities germane to collective bargaining. Finally,
the Board held that the objecting nonmember must be
`apprised of the * * * basis for the calculation,' and
must be notified of his right to challenge the union's
calculations.
---------------------------------------------------------------------------
\14\ 320 NLRB No. 11 (1995).
---------------------------------------------------------------------------
California Saw thus provided dissident workers, who
do not agree with the Majority's decisions to pursue
certain legislative or political ends, with a fully-
developed set of rules to protect the dissident's
rights. Those rules are far more elaborate than
anything that exists to protect, for example, dissident
stockholders. And over the past six months, the Board
has made clear that it stands ready to vigorously
enforce those rules through a series of decisions
holding unions guilty of violating the law where unions
had either failed to give a Beck notice to all
nonmembers, to establish procedures through which
nonmembers could object to paying for activities
unrelated to collective bargaining, or to provide
nonmembers who submitted objections with the required
breakdown of union expenditures.\15\
---------------------------------------------------------------------------
\15\ Board cases enforcing California Saw cited by Mr. Coppess
include IUE Local 444 (Paramax Systems), 322 NLRB No. 1 (Aug. 27,
1996); Production Workers Local 707 (Mayo Leasing), 322 NLRB No. 9,
(Aug. 27, 1996); Laborers Local 265 (Fred A. Newman Co.), 322 NLRB No.
47 (Sept. 30, 1996); Carpenters Local 943 (Oklahoma Fixture Co.), 322
NLRB No. 142 (Jan. 10, 1997); Theatrical Stage Employees Local 219
(Hughes-Avicon International Inc.), 322 NLRB No. 195 (Feb. 14, 1997);
and UFCW Locals 951, 1036, and 7, 16-CB-3850 (Jan. 31, 1997) (ALJ
opinion).
---------------------------------------------------------------------------
Nor was the Board inactive during the period between the
Beck decision and California Saw. Within months of the Beck
decision, the General Counsel issued a comprehensive statement
of what she believed necessary for a union to comply with
Beck.\16\ NLRB regional offices actively prosecuted unfair
labor practice charges alleging Beck violations on the basis of
noncompliance with the General Counsel's interpretive
guidelines. Those prosecutions were continued by General
Counsels appointed under both the Bush and Clinton
administrations.
---------------------------------------------------------------------------
\16\ NLRB General Counsel Memorandum, GC-88-14 (Nov. 15, 1988).
---------------------------------------------------------------------------
As has been previously stated, an employee alleging a
violation of Beck rights may bring a charge before the NLRB,
whose decisions may be appealed to the Federal circuit courts,
or may sue a union directly in Federal district court. The
contention that a judiciary made up of large numbers of
Republican appointees has been hesitant to enforce or has
somehow diminished Beck rights is neither plausible nor
accurate. The Majority, themselves, cite evidence to the
contrary, pointing out that the D.C. Circuit, in Ferriso v.
National Labor Relations Board,\17\ has concluded that a
union's calculations of the percentage of dues and fees that
are used for collective bargaining, contract administration,
and grievance adjustment must be confirmed by an independent
audit.
---------------------------------------------------------------------------
\17\ CA DC, No. 96-1321 (September 23, 1997).
---------------------------------------------------------------------------
The efforts to enforce Beck rights in a meaningful manner
is not simply reflected in the law and the efforts of the Board
and the courts to enforce the law, but is regularly reflected
in the actions of unions. During hearings several unions
explained the practices and procedures they have undertaken to
comply with Beck. While different unions have adopted different
procedures, the practices of the International Association of
Machinists are illustrative of union efforts. According to Mark
Schneider, Associate General Counsel of the Machinists:
Each year we notify all of our represented employees
through a notice in our newspaper at the end of each
year that if they wished to become dues objectors the
following year, they should make that request in
writing to our General Secretary Treasurer in
Washington, D.C. Because we require that objection
requests be submitted to a particular union officer
during a particular one-month ``window period,'' we
felt that fairness required that we provide notice to
all of our represented employees on an annual basis
describing these requirements.
We also advise our represented employees of the size
of the reduction they should expect, and of the kinds
of expenditures in sufficient detail for them to
understand what activities they are funding, and what
activities they are no longer funding, pursuant to the
union's calculation. Finally, we advise them that if,
after reviewing this material, they wish to challenge
the union's allocation, the union will provide them
with the complete audit that supports its calculation,
and so armed give them the opportunity to make that
challenge before a neutral arbitrator selected by the
American Arbitration Association. At that arbitration
the union bears the burden of justifying its expense
allocation, and agrees in advance to be bound by the
arbitrator's decision.
In order to fairly allocate union expenditures, every
union staff member keeps contemporaneous records of his
or her time, on forms specially prepared for Beck
purposes. On these records, employee time is broken
down into various categories, such as, for example,
``attending union meetings,'' ``legislative
activities,'' ``grievances and arbitration'' and so on.
From these time sheets, accountants determine how much
of the time of each of the union's departments is
properly chargeable to objectors, and how much is not.
Accountants then take the C.P.A. audited expenditure
figures from the union's general ledger, and allocate
expenditures in accordance with the percentages derived
from the time records. A summary of this material then
is provided to every dues objector, and the complete
audit is provided to any objector who requests a copy
and wishes to challenge the union's conclusion in the
neutral arbitration.
Each year, during the objector cycle, the union
escrows a sufficient sum of money to assure that,
should it be determined by an arbitrator that it has
not provided a sufficient reduction, any difference
will be covered by the escrow account. In that way,
objectors are assured that not a penny of their money
will even inadvertently be spent on matters not germane
to the collective bargaining process.
In sum, under the regime established by the Board,
and in place at our union, employees are fully aware of
their Beck rights and have every opportunity to
exercise them in a meaningful manner. The union's Beck
compliance program--for the most part required by law--
has imposed substantial burdens on the union. And we
most emphatically believe that if any modification of
the existing rules is in order, it would be in the
direction of less regulation, and not more.\18\
---------------------------------------------------------------------------
\18\ Prepared statement of Mark Schneider, Hearing on the
Assessment of Union Dues, Before the Subcommittee on Employer-Employee
Relations, 104th Cong., 2nd Sess. (April 18, 1996).
---------------------------------------------------------------------------
H.R. 1625 Ignores Substantive Flaws in Labor Law and Proposes
Fundamental Changes to the Law Based on Dubious Anecdotes
To buttress a nonexistent case for the need to protect Beck
rights, the Majority has produced anecdotal evidence of the
hardships faced by workers. However, the Republicans have
produced no systemic evidence beyond partisan polling
information for the contention that Beck rights are routinely
violated or difficult to enforce. In fact, there is no evidence
for those kinds of systemic abuses.
There is substantial evidence, however, for the systemic
abuse of other provisions of the National Labor Relations Act.
The major thrust of section 8(a)(3) has nothing to do with
agency fees, but provides that it is ``an unfair labor practice
for an employer by discrimination in regard to hire or tenure
of employment or any term or condition of employment to
encourage or discourage membership in any labor organization. *
* *'' Notwithstanding 8(a)(3), it is estimated that 10,000
workers are unlawfully fired every year for seeking to exercise
their right to organize. In one out of every four organizing
campaigns, workers are unlawfully fired for seeking to exercise
statutorily protected rights. According to a recent survey, 44%
of all workers who are not represented by a union would vote to
join a union tomorrow, but for the fact that doing so may cost
them their jobs.
But the Majority is not just indifferent, they are hostile
to addressing these kinds of systemic abuses of the law. H.R.
1625, was intentionally crafted in a manner that precludes our
ability to even attempt to redress the systemic problems in the
law. Rather than seeking to amend the National Labor Relations
Act and the Railway Labor Act, the statutes that authorize
agency fees in the first instance, H.R. 1625 was deliberately
crafted as a free standing statute in part in order to preclude
amendments that may deal with more substantive problems in the
law.
The Majority's animosity for the rights of workers is also
reflected in the fact that the potent remedies provided in H.R.
1625 are not extended to the full range of labor rights
protected by Federal law. Workers have a right to form and join
unions. Where workers exercise that right, they also are
protected from being required as a condition of employment from
having to finance union activities that are not germane to
collective bargaining, contract administration, or grievance
adjustment. The right to pay less than full union dues,
however, is meaningless unless workers exercise the right to
organize. There is no general obligation under the NLRA
requiring employers to inform employees of their right to form
and join unions. Nor does H.R. 1625 provide such a requirement.
However, where employees do act to form or join unions, H.R.
1625 requires employers to post notices informing employees of
their right to pay less than full union dues. The Majority
unfairly proposes to require that employers post notices
informing workers of their right not to pay less than full
union dues, while refusing to require employers to inform
workers of their right to join a union in the first instance.
It is illustrative of the Majority's anti-worker bias.
This bias is even more obvious with respect to another
aspect of the remedies provided under H.R. 1625. Special
damages are not available to employees under section 8(a)(3)
where an employer unlawfully fires a worker for seeking to form
or join a union. However, H.R. 1625 provides double damages in
circumstances where a union effects a violation of 8(a)(3) by
requiring an objector to pay full union dues. As has been
previously pointed out, under the LMRDA union members have the
right to determine how much their union dues will be, and under
the NLRA union dues may not be excessive or discriminatory. As
Mark Schneider pointed out in testimony before the
subcommittee:
The discussion over the appropriate procedural rules
to implement Beck is a discussion that in practical
terms is a discussion over extremely small amounts of
money. Union dues in the Machinists Union is something
like $25-$30 each month. The reduction owed a dues
objector is routinely something in the nature of 20% of
that amount--only a small portion of which, I hasten to
add--relates to expenditures for political activity. A
disagreement over the appropriate safeguards that
should be in place to assure the accuracy of the
union's reduction calculation--whether it is properly
19% or 20%, or how to structure an arbitration system
that fairly gives an objector opportunity to claim that
the reduction is properly a higher percentage than
claimed--is literally a dispute over pennies. Without
disparaging in any way the importance of the ongoing
discussion about the implementation of Beck or the
merits of one or the other holdings of the NLRB in
California Saw, I would respectfully suggest that there
are matters within the jurisdiction of the NLRB of far
more critical importance to the workers we represent,
and, for that matter, to the employer community, that
are not getting the attention that Beck compliance has
achieved, and I look forward to the day when these
other critical issues are given the attention they
deserve.\19\
---------------------------------------------------------------------------
\19\ Prepared statement of Mark Schneider, Hearing on the
Assessment of Union Dues, Before the Subcommittee on Employer-Employee
Relations, 104th Cong., 2nd Sess. (April 18, 1996).
H.R. 1625 provides damages for financially meaningless,
though philosophically important, improper acts of a union
which claims more dues money from an employee than it is
entitled to, or which spends such funds in a manner unrelated
to collective bargaining and inconsistent with the employee's
views. Being unlawfully fired, however, is a financial, as well
as a psychological, catastrophe for a worker.
The NLRA generally provides ``make whole'' remedies for
employer unfair labor practices. Where an employee has been
unlawfully discharged, an employee is generally entitled to
reinstatement and back wages for the period the employee was
unemployed, minus any wages the employee could have earned
during that period. As evidenced by the number of workers who
are annually discharged in violation of 8(a)(3), existing
remedies do little to deter employer violations. Employers
often contest the unfair labor practice and thereby prolong the
period for which the employee is unlawfully without a job or an
income. The employee is entitled to neither punitive nor
compensatory damages as a result of the harm he or she suffers
as a result of the employer's unlawful action. If an employee
defaults on a car loan or a mortgage payment as a result of the
employer's unlawful discharge, the employee does not receive
additional compensation for that loss. Typically, employees end
up settling such charges without being reinstated and without
even receiving the full compensation to which they are
entitled.
Even where employees are reinstated, they are commonly gone
within one year of reinstatement. To contend that a worker
should be entitled to damages where a union has misused minimal
amounts of a worker's money, but should not be entitled to
damages where an employer has unlawfully abridged the ability
of that worker to earn a livelihood demonstrates a staggering
animosity for the rights and welfare of working Americans. Yet,
that is exactly the circumstances the Majority would seek to
create by enacting H.R. 1625.
H.R. 1625 Imposes Prohibitively High Costs of Compliance on Unions
Implementation of H.R. 1625 would, in effect, result in a
tax increase for all union members. If the Worker Paycheck
Fairness act is enacted, unions would be required to collect
16.3 million signatures from workers. In order to obtain the
16.3 million individual authorizations, the cost will be
approximately $1 per person, for a response and retrieval rate
of significantly less than 100 percent. Add to that 2.7 million
hours of effort, and the value of that time calculated at
$15.05, the average wage of a union employee, then the cost of
collecting signatures is $40.6 million plus the estimated $16.3
million, to prepare authorization forms and explanatory
materials, distribute them, and follow-up on signatures.
This bill does not define reporting requirements, but
presumably unions would have to delineate for their members
what activities and expenses were involved in political
expenditures. This bookkeeping would impose new administrative
burdens to most of the 33,800 or more labor entities. Keep in
mind that many locals are very small and the majority have no
paid staff and no computerized records or accounts, developing
new and sophisticated reporting systems is neither easy nor
inexpensive. A leading accountant with significant experience
working with trade unions estimates that setting up such a
system would cost a minimum of $2,000 in professional
accounting time, not to speak of the time necessary for union
officials to work with the systems. Many locals do not have the
funds to pay these accounting costs. Estimated start-up costs
to comply with this provision of the proposed legislation would
be approximately $3.4 million, conservatively. If the 33,800
labor entities needed to develop new accounting systems, then
start-up costs could run as high as $6.8 million, meaning that
between $13.2 million and $26.5 million would be spent each
year maintaining the systems and generating reports.
An undertaking of this magnitude is mammoth, especially
where a local has members in multiple locations. Monumental
effort is required at each stage of the process--notice,
distribution, solicitation, response, and follow-up. The new
administrative burdens and requirements would cost nearly as
much as $90 million initially and $27 million every year
thereafter.
The requirement for national banks and corporations to gain
similar authorizing signatures is not significant, given that
``stockholders or employees'' rarely pay dues, initiation fees,
or other payment as a condition of employment.'' The
requirement for labor unions clearly is significant, since dues
are the way in which these organizations fund their existence.
H.R. 1625 is an Invitation for Further Litigation
As interpreted by the Supreme Court, the federal labor law
``does not permit a union, over the objections of nonmembers,
to expend compelled agency fees on political causes.'' \20\
Recognizing that the ``the majority * * * has an interest in
stating its views without being silenced by the dissenter,''
the Court has taken care to articulate a rule that attain[s]
the appropriate reconciliation between majority and dissenting
interests in the area of political expression'' and
``protect[s] both interests to the maximum extent possible
without undue impingement of one on the other.'' \21\
---------------------------------------------------------------------------
\20\ Communication Workers v. Beck, 487 U.S. 735, 745 (1988),
citing Machinist V. Street, 367 U.S. 740 (1961).
\21\ Machinists v. Street, 367 U.S. at 773.
---------------------------------------------------------------------------
The proponents of H.R. 1625 have expressed their
dissatisfaction with the ``reconciliation between majority and
dissenting interests'' struck by the Supreme Court. Consistent
with this position, the bill would overturn each component of
the rule articulated by the Court to the obvious end of
inflicting ``undue impingement'' upon the majority's right of
free association and expression.
Where the Supreme Court has stated that ``dissent is not to
be presumed--it must be affirmatively made known to the union
by the dissenting employee,'' \22\ the union they have chosen
to represent them before that union can accept normal dues.
There the Supreme Court expressly limits the right of dissent
to ``nonmembers'',\23\ bars unions from accepting normal dues
payments from even voluntary members without having first
received from them statements of agreement with the union's
political positions. And where the Supreme Court states that
the dissenters' ``grievance stems from the spending of their
funds for purposes not authorized by the Act in the face of
their objection, not from * * * the mere collection of funds,''
\24\ H.R. 1625 bars unions from collecting normal membership
dues from employees who have not signed special forms stating
their agreement with the union's political positions.
---------------------------------------------------------------------------
\22\ Street, 367 U.S. at 774.
\23\ Beck, 487 U.S. at 745, H.R. 1625.
\24\ Street, 367 U.S. at 771.
---------------------------------------------------------------------------
The rights of employees with respect to the use of their
contractually required payments to unions have been forged over
years of litigation. In one stroke, H.R. 1625 would completely
unsettle this area of the law, leaving unions, employers, and
most especially employees completely unsure of where they
stand. As a general rule, caution should be exercised in making
a drastic change in settled legal principles, if for no other
reason, than to avoid the flood of litigation that inevitably
follows such changes. But in the labor relations context, where
uncertainty not only leads to litigation but it undermines
industrial stability and employment security, legislative
action upsetting established rights should be done with
caution.
The problems that H.R. 1625 claims to address are
fictitious. The protections afforded those represented by
unions with regard to the political activities of the union far
exceed those afforded to the members of any other organization.
The assertion that employees may be required to underwrite
union political activity or that current law condones or in any
way coddles union efforts to coerce employees into underwriting
union political activity is a gross canard. Neither 8(a)(3) nor
2, Eleventh serves as any justification for imposing different
rules upon the political participation of unions than those
generally applicable to all other organizations.\25\
---------------------------------------------------------------------------
\25\ The rights and protections afforded under section 2, Eleventh
of the Railway Labor Act are not administered by an agency but are
directly enforced by the courts. It has been unlawful since 1961 for a
union subject to the RLA to require an employee as a condition of
employment to underwrite any union costs that are not associated with
the costs of negotiating and administering collective agreements and
adjusting and settling disputes. (see Machinists v. Street, 376 U.S.
740 (1961). Further, until controversy concerning 8(a)(3) arose in the
last Congress, no serious need has ever been felt to codify the Street
decision.
---------------------------------------------------------------------------
H.R. 1625 Imposes Onerous Obligations on the Political Participation of
Unions That Are Required of No Other Institution
The Majority states that ``Unions, by a grant of power from
the Federal government, can force employees to pay dues to the
union as a condition of keeping their jobs; corporations cannot
force individuals to invest in the union nor can other
membership organizations force individuals to join and pay
dues.'' To the extent that the Majority is implying that a
union may force any employee to underwrite any activity that is
not related to collective bargaining, contract administration,
or grievance adjustment, they are being disingenuous. However,
the contention that other organizations cannot or do not
effectively coerce members to underwrite their political
activities is equally inaccurate. Both union and nonunion
employees own substantial amounts of corporate stock through
employee pension plans, profit sharing plans, 401(k) plans, and
other forms of retirement savings plans. Most employees have no
voice in how their money is invested and no knowledge of what
stocks are owned by their retirement plans. Nevertheless,
corporations regularly and routinely expend millions of dollars
more than unions on political activities every year, at the
expense of the return workers might otherwise receive for their
pension investments, frequently for purposes that are
antithetical to the interests of workers, without seeking the
prior approval of anyone.
The money that employers and employer organizations are
spending, for example, to dissuade the Congress from regulating
health maintenance organizations, to diminish protections under
the Occupational Safety and Health Act, or to prevent the
minimum wage from being increased is money that was directly
earned by the efforts of workers. It is money that otherwise
may have been used to increase the wages and benefits of
workers. It is money that is instead being spent for the
explicit purpose of preventing wages and benefits from being
increased. It is money that does not belong to corporate
managers. And it is money that is spent without any input from
the workers. To contend that such workers have right to find
another job is not a realistic alternative for most workers,
does not ensure that the worker will not run into the same
problem at the next job, and is an alternative, unrealistic as
it may be, that is equally applicable to an employee who is
subject to an agency fee provision.
The truth of the matter is that union members have far more
voice in determining the political activities of their union,
both legally and practically, than shareholders have of
determining how their money is spent for political purposes by
corporate managers. Workers have voluntarily joined the union,
in part, for the express purpose of engaging collectively in
political activity. A shareholder typically buys stock solely
for the purpose of the return the investment will produce. Yet,
virtually every corporation regularly and routinely spends
shareholder money to finance the expression of political views
with which the shareholder may or may not agree.
Further, the money spent by corporations on political
activity vastly exceeds anything spent by unions. Businesses
accounted for 87% of all soft money contributions to Democrats
and 96% of all soft money contributions to Republicans over the
period of 1995 and 1996. Over the same period, labor accounted
for 11% of Democratic soft money contributions and 1% of
Republican soft money contributions. In total money, businesses
spent $171 million in soft money contributions, compared to the
slightly less than $10 million spent by labor. And this is but
the tip of the iceberg. Including trade association fees, so
called public interest advertising, independent expenditures,
and direct lobbying expenses, corporations spend hundreds of
millions, perhaps billions, of other people's dollars for the
purpose of engaging in political activity. So much for the
Republican concern that ``all men and women should have a right
to make individual and informed choices about the political,
social, or charitable causes they support.'' \26\
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\26\ H.R. 1625, Section 2, paragraph (3).
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Notwithstanding the limited financial interests that
individual workers have in H.R. 1625, the harm that H.R. 1625
would visit upon unions and upon the rights of workers, as
compared to any other segment of society, are substantial. H.R.
1625 is a deliberate, calculated effort to place unions and the
workers they represent at a unique and substantial disadvantage
with regard to their ability to participate in politics as
compared to any other group. This legislation is not about
protecting free and open political debate, it is about the
ability of one group of Americans, workers, to participate in
that debate. What this legislation ultimately seeks to
accomplish is to distort the democratic processes of this
country. At the least, it is the hope of the Republican
leadership to use this legislation, or similar legislation, to
blame Democrats for their failure to enact campaign finance
reform legislation. At the most, Republicans hope to silence
their perceived political adversaries, those who advocate for
and on behalf of workers.
Conclusion
Labor unions operate on the principle that it is the right
of the majority to decide the duties of membership, and that
those who want the privileges of membership must accept the
responsibilities that come with it. Political parties,
churches, business associations, girl scout troops and all
other voluntary associations operate on the same principle. For
example, it is typical for those who wish to select a
Republican candidate for political office to be required to be
members of the Republican Party.
The Supreme Court has long recognized that an organization
has the right to ``determin[e] . . . the boundaries of its own
association, and of the structure which best allows it to
pursue its political goals, is protected by the Constitution.''
\27\ And ``any interference with the freedom of [the
organization] is simultaneously an interference with the
freedom of its adherents.'' \28\
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\27\ Tashijan v. Republican Party of Connecticut, 479 U.S. 208, 224
(1986).
\28\ Democratic Party of the United States v. Wisconsin, 450 U.S.
107, 122 (1981).
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Beck incorporates these fundamental principles of freedom
of association while safeguarding the right of dissidents to
withdraw from the group without suffering adverse employment
consequences and without any obligation to pay for a union's
political or ideological activities. However, to force a union
to allow dissidents who withdraw from membership to retain the
right to participate in membership decisions would turn Beck--
and the First Amendment--on their heads.
If freedom of association is to have any meaning, the
members of the association must have the right to decide how
best to pursue their common interest and common mission. To
prevent union members from deciding that their union will
engage in political activity, and that those who choose to join
the union will support that activity through a portion of their
dues, is to strike at the heart of union members' rights of
association. What the Supreme Court has said in the political
party context is equally apt here: ``these proposals would
`limit [unions'] associational opportunities at the critical
juncture at which the appeal to common principles may be
translated into concerted action and hence to political power
in the community.'' \29\
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\29\ Tashjian, supra, 479 U.S. at 216.
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Indeed, that is precisely the point. To prohibit unions
from using dues money to press for the enactment of legislation
or the election of candidates sympathetic to working families--
or to require each member every year to sign a written
agreement authorizing such activities would effectively silence
the only voice working families have in our society.
For all the talk about union expenditures in the last
election, the fact of the matter is that, according to the
Center for Responsive Politics, corporate interests outspent
union interests by a margin of 17 to 1. We need a more level
playing field for working people in politics, not one that is
more skewed in favor of corporate interests. And, we will do
every thing we can to resist these blatant attempts to punish
the labor movement for having had the temerity to stand up for
the men and women they represent, and to protect the right of
their members to participate on a full and equal basis in the
political decision making process in this country.
William L. Clay.
Dale E. Kildee.
Major R. Owens.
Patsy T. Mink.
Tim Roemer.
Lynn Woolsey.
Chaka Fattah.
Carolyn McCarthy.
Ron Kind.
Harold E. Ford, Jr.
George Miller.
Matthew G. Martinez.
Donald M. Payne.
Robert E. Andrews.
Robert C. Scott.
Carlos Romero-Barcelo.
Ruben Hinojosa.
John F. Tierney.
Loretta Sanchez.
Dennis J. Kucinich.
DISSENTING VIEW
I. Introduction
The use of union dues, which, in the 29 non-Right to Work
states workers must pay as a condition of employment, for
political causes opposed by the worker is, in the words of
Thomas Jefferson ``both sinful and tyrannical.'' However, this
congressionally-created wrong does not justify the expansion of
federal power over the relationship between unions, workers,
and employees contained in the Worker Paycheck Fairness Act
(H.R. 1625). The Worker Paycheck Fairness Act not only
continues congressional unconstitutional interference in
America's labor markets, it also fails to deal with the root
cause of the problem. Furthermore, it is doubtful that the new
regulations and mandates in this bill will achieve the goal of
stopping union officials from using forced dues for politics.
The problem of using of compulsory union dues for politics
is rooted in those federal laws that equally sanction
compulsory unionism. Federal laws authorizing compulsory dues
for any reason violate the principle of individual liberty upon
which this country was founded. Therefore, the constitutional
solution to the problem of the use of forced dues for politics
(or any other reason) is to repeal those sections of federal
law giving union officials the power to force workers to pay
union dues as a condition of employment.
II. H.R. 1625 Creates New Burdens on Employers, Unions and Employees
The Worker Paycheck Fairness Act sets up a new federal
regulatory system, complete with mandates on union officials,
employers and workers, to control union political spending.
Under this bill unions wishing to spend dues receipts on
politics must obtain a signed statement from every dues-paying
worker authorizing the use of their dues for political
purposes. The bill also requires unions to produce more
detailed expense reports so workers can determine how much of
their expenses were spent on items other than collective
bargaining.
These requirements will impose tremendous costs on labor
unions, costs which Congress has no authority to impose.
Supporters of this bill may attempt to justify imposing this
burden on labor union as necessary to ensure union officials do
not abuse their federally-granted privilege of collecting
compulsory dues. However, Congress' original abuse of its
authority to empower union officials in no way justifies
federal interference in a union's internal operations. Unions
are constitutionally entitled to the same freedom from federal
mandates as every other private institution in America. The
power to force employees to pay dues that are used for
political purposes, which unions have as a result of federal
protections, is a justification for repealing those laws, not
for placing new mandates on onions, employees, and employers.
This bill also places a new, unfunded mandate on businesses
by requiring every employer to post a notice in their workplace
informing workers of their rights under this statute. Mandating
that employers place a notice on their property constitutes a
taking of private property, however minor, without just
compensation.
The Worker Paycheck Fairness Act will also place new
burdens on the very people who the act is designed to aid: the
American worker. For example, millions of American workers will
likely be faced with an increase in union dues in order to
cover the additional costs incurred in complying with this
mandate.
Furthermore, requiring workers to sign a card stating
whether or not they wish to contribute to union politics
burdens the free speech rights of both those workers who would
wish to support union political activity and those who do not
wish to underwrite union politics. Workers should not be
required to fill out paperwork, that may later become part of a
public record if the union's expenditures are challenged in
court, in order to exercise their first amendment rights to
participate (or not participate) in politics. Rather than
having to comply with government mandates to ensure their
forced union dues are spent properly, workers should simply be
returned the freedom to choose whether or not they will pay
union dues for any purpose.
A further infringement on the rights of union members is
the provision providing that a worker who objects to having
part of his dues used for union officials is still entitled to
all the rights and privileges of union membership. This is an
infringement on the freedom of association rights of those who
chose to pay for union politics freedom of association. A union
should have the ability to determine its own rules for
membership, Congress should not force those who pay for union
politics to associate with those who choose not to pay for
political activities.
Ironically, this infringement of the union members' freedom
of association is rooted in the special privileges granted
union officials by federal law. Under the National Labor
Relations Act, union officials have the power to represent all
employees at a worksite, whether or not they are members of the
union or even whether or not they desire union representation.
Furthermore, employers at a unionized workplace are forbidden
by federal law from bargaining over working conditions with any
individual employee, a violation of the employee and the
employers' right to freely contract. Therefore, a union dues
payer who objects to the use of union dues and gives up his
membership in the union, is, in essence, giving up his rights
to have a say in his wages, hours, and benefits. The fate of
the unions under this bill is yet another example of how those
who seekto enrich themselves by seeking special privileges from
the federal government eventually lose their own liberties to the
leviathan state they helped construct.
III. H.R. 1625 Will Not Curtail the Use of Forced Dues for Politics
It is highly questionable as to whether placing these
mandates on unions and employers will effectively curtail the
use of forced-union dues for politics. Several times since the
passage of the National Labor Relations Act, Congress has
amended the law to provide for greater federal control of labor
unions, yet union corruption remains a serious problem, as
evidenced by the voiding of recent government supervised and
financed Teamster elections. Given this history it appears
likely that when dishonest union officials battle federal
regulators over political spending, the union officials will
successfully disguise their spending on politics as funds spent
of purposes related to ``exclusive representation.''
One of the goals of the act is to end the harassment of
workers who assert their right not to pay for politics. This is
certainly a laudable goal. One of the most shameful aspects of
the modern labor movement is the all-too-frequent use of
threats and even actual violence against workers who object to
the policies of union officials. However, it is unlikely that
this bill will stop corrupt unions from harassing independent-
minded workers. If this bill becomes law, corrupt unions will
harass workers who refuse to authorize the use of their dues
for politics, or who challenge union officials in occur for a
refund of those dues allegedly spent for politics.
The persecution of workers by unscrupulous union officials
will continue until Congress repeals the federal laws that give
unions the power to coerce workers to pay union dues and accept
union representation, since corrupt union officials' ability to
tyrannize workers flows from the unconstitutional powers grated
them by Congress.
IV. H.R. 1625 Implicity Legitimizes Compulsory Unionism
The primary reason Congress should reject this bill is its
faulty premise. By stating, in the very first finding, that
``Workers who pay [union] dues may not * * * be required to pay
to that organization any dues or fees supporting activities
that are not necessary to performing the duties of the
exclusive representation of the employee* * *'' the drafters of
this bill implicitly accept the legitimacy of compulsory
unionism, as long as the dues collected by compulsion are not
spent for politics purposes. However, union political spending
per se should not be the concern of Congress. Even if union
political spending was 10 times as much as it is now it would
not be a proper subject of Congressional regulation--as long as
it was from voluntary dues. Conversely, even if union officials
never spent another dime on politics, Congress would still be
morally obligated to repeal those laws empowering union
officials to force workers to pay dues for any purposes. It is
the collection of forced dues that damages our system--not any
particular use to which those dues are put!
The problems with H.R. 1625 were eloquently stated by Harry
Beck, the lead plaintiff in the Supreme Court case which
established the right of forced-dues payers to a refund of that
portion of their dues spent on politics, ``you don't solve the
forced dues in politics problem by letting the union bosses
keep the force while trying to micro-manage their `politics.'
The government lawyers, accountants and bureaucrats love that
approach [i.e. the approach contained in H.R. 1625] because it
would give them job security. The legislative solution to
coercion isn't to keep it under a GOP-approved system of
regulation--but to end it!''
V. Conclusion
The Worker Paycheck Fairness Act (H.R. 1625) attempts to
address the very serious problem of the use of forced union
dues for political purposes through the establishment of a new
system of coercion. This bill places new mandates on workers,
employers, as well as on unions. The system established in HR
1625 not only compounds the constitutional violations of the
federal laws that give unions the power to force workers to pay
union dues, it also will fail to address the problem it is
designed to solve. If this bill becomes law, corrupt union
officials will simply use ``creative accounting'' to
distinguish their political spending and/or use force and
intimidation to ensure workers ``consent'' to having their
forced dues spent on politics.
In its attempt to solve a congressional-created problem
with new restrictions on American liberties, HR 1625 parallels
proposals to ``reform'' campaign finance by limiting freedom of
speech as both expand government power rather than attack the
root cause of the problem--too much ``congressional activism''
in which constitutionally are non-governmental affairs!
Instead of passing an unconstitutional, ineffective law,
Congress should follow the advice of Harry Beck--stop trying to
regulate union officials' use of the fruits of their coercion
and repeal the unconstitutional laws that authorize the
collection of forced dues. Only by revoking union officials'
legislatively-ordained coercive privileges can Congress end the
scourge of forced dues for politics and restore true freedom to
America's labor markets.
Ron Paul.
ADDITIONAL VIEWS
I strongly oppose H.R. 1625 because it would prevent unions
and the workers they represent from participating in the
political process. I fully support and agree with the analysis
of the legislation contained in the Minority Views.
Carolyn McCarthy.