A not so minor nuance in the right to work debate

digitalfirehose (58)in #economics • 6 years ago

I'm a union man if I can join one. I used to work in a union sheet metal shop. I know first hand, the many benefits of working in a union. I didn't mind being in a pool of workers. I liked the idea of having a one-stop-shop to find another job if I needed one. I really enjoyed the great pay and benefits.

I have also watched the decline of unions in the United States. At one point, union labor was about 30% of employment in the United States. Now it's closer to 6% and the results have been laid bare to see. Massive inequality has taken it's toll. Wages have been stagnant for 30 years or more, depending on the sources you use.

Lately, there has been an uproar over a Supreme Court ruling (JANUS v. AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, COUNCIL) that says that non-members cannot be compelled to pay agency fees for representation services provided by a union. It's an interesting case because the plaintiff's argument is that any money he paid could be used for a political purpose. The plaintiff said that no one should be compelled to contribute to a union because the union will somehow figure out a way, either directly or indirectly, to use the money received for a political purpose.

That's an interesting argument, but I've read a few articles on the case and a spot check of articles I've found seem to be missing an important nuance in the narrative: unions that are asking for agency fees are also exclusive representatives wherever shops are unionized. In the Janus case, it's a public school. Exclusive representation means that only the union may bargain for employees. Individuals are not permitted to bargain independently of the union with the employer. No other agency or agent may bargain for an employee in a union shop where the union enjoys exclusive representation rights.

I did a search through the official opinion for the term "exclusive", as in "exclusive representation", and found it mentioned 46 times. This is a major theme in the case, but the press went with 1st Amendment angle instead. The press is telling us that compelling a man to pay agency fees to a union infringes his 1st Amendment rights. But the court is saying something else.

In Janus, the court said that agency fees are not inextricably linked to exclusive representation. The court also said that about 27% of federal employees are comfortably represented by unions with exclusive representation rights. The court also said that agency fees are prohibited by federal law for employers that are federal agencies. Yet somehow, unions have managed to maintain a rather high rate of membership in the federal government, regardless of the lack of compelled agency fees.

But there is something else missing from this debate. Unions actively seek out exclusive bargaining rights in an attempt to establish a monopoly position. It would seem obvious why unions do this: they want the best possible negotiating position for their members.

As so often happens in life, in order to get one thing, we often have to relinquish something else. And as a result of that court ruling, gaining exclusive representation rights comes at the cost of having to pass on the benefits of that service to people who didn't pay for it. Considering that union membership is still very high in the federal government (relative to the private sector), and all of the history since Reagan fired all of the air traffic controllers more than 30 years ago, the federal employee unions are still doing OK even without agency fees.

This isn't to say that unions are doing all that great now in the private sector since then, but this nuance in the debate is intriguing. The way this story is reported in the press, we're led to believe that all unions must represent all employees according to law. The facts show that they're not. All the unions have to do is surrender exclusive representation rights and then the free rider problem is not an issue anymore.

In addition to that, if unions were to avoid seeking out and retaining exclusive representation rights, then members and non-members can more readily work side by side, providing a clear demonstration of the benefits of union membership. Employers would then have a meaningful choice to make between union and non-union labor instead of an all-or-nothing agreement. Employees would be able to make that choice without worry about being fired. Further, economists would be in a better position to compare how the market responds to clear and unambiguous labor choices in the market.

It is also interesting to me to see that neither side of the debate has mentioned exclusive representation as a major factor in the decision handed down by the court. What makes this debate even more interesting is that the court's decision mentioned exclusive representation 46 times in a document that is 83 pages long. Why would this point be missing from so much editorial and punditry?

Both sides are being disingenuous by omitting from political discourse, the effects of exclusive representation. Anti-union organizations are spreading a lie that says that in all cases, unions must represent all workers, and that is impression that is easy to get when one looks at their statements. Pro-union organizations are also spreading this lie by omitting the exclusive representation clauses of union agreements with employers. Both sides omit this point to make the other side look bad.

Unions don't want to discuss exclusive representation because they might have to surrender it in order to deal with the free rider problem. Discussion of the free rider problem in relation to exclusive representation rights could generate enough political force to require unions to avoid exclusive representation rights. In other words, you can't complain about a condition you created, unions.

The business community doesn't want to talk about exclusive representation, either. At least, not in the mainstream press. By omitting discussion of exclusive representation and highlighting the free rider problem, they are distracting us from the real cause of the condition that unions complain of, they are in effect, enabling unions to perpetuate the lie. The business community wishes for people to believe that unions have a power which they do not have. The power that says once organized, the union must represent everyone in the workplace where the union has managed to prevail.

If you complain about the free rider problem the solution is simple: don't seek and acquire exclusive representation rights. If you're a business and you don't want the union to have monopoly power in your shop, then don't sign a contract that permits exclusive representation for your workers. It takes two to tango here.

And the press, well, they need to be more forthcoming and bring the entire issue into focus by discussing the free rider problem in relation to exclusive representation.

Once all parties are on board, we might actually see union membership increase because employers and employees will all see that union membership is not an all-or-nothing choice. Without exclusive representation rights, unions might actually be able to compete on the merits of union membership rather than monopoly power. Isn't that monopoly power what unions complain of about employers in the first place?

Write on.