OPINION: Hey ALEC, be careful what you wish for

By BENJAMIN SACHS

Boston (PAI) – The American Legislative Exchange Council (ALEC), which unites business lobbyists and executives with state lawmakers and officials to craft deregulatory statutes – including Labor rights curbs – is promoting a model statute that conditions a corporation’s eligibility for any state “economic development incentives” on the corporation’s agreement not to respect the results of a card check.

In simple terms, the statute dictates that any firm wanting state economic development funds must waive their federal Labor law right to recognize a union based on signed union election authorization cards from a majority of workers. Tennessee has enacted the statute and the Georgia Senate just passed it.

Chances are the law is preempted by federal Labor law. Because the statute applies to things like tax credits in which the state has no specific proprietary interest but only a generic governmental interest, a court is likely to find the “market participant” exception to National Labor Relations Act preemption does not apply.

This is different than, say, tax increment financing where a state or locality maintains an investment-like interest in the success of the project being financed. It’s also different than a tailored grant program.

But I’ll leave the preemption analysis for another time. For now, I’d like to raise a different question: What if the ALEC statute isn’t preempted? What would it mean if states could condition access to all economic development money on a corporation’s compliance with the state’s vision of good Labor policy? What would it mean if California, Illinois, Massachusetts, Michigan, Minnesota, and New York could enact their version of an ALEC-like law?

WHAT STATES MIGHT REQUIRE
If the ALEC statute isn’t preempted, here’s a (very incomplete) list of what states might require corporations to do to qualify for economic development money:

• Recognize a union when a majority of workers signs authorization cards.
• Agree that all the corporation’s employees in the state will be union by default, subject to the right of employees to petition for a decertification election.
• Agree not to hold captive audience meetings or one-on-one meetings with supervisors.
• Grant union organizers access to non-work areas of company property.
• Agree to multi-employer bargaining units upon union request.
• Agree to participate in sectoral bargaining if the state establishes a sectoral bargaining process.
• Agree to permit employees in the state to engage in so-called secondary activity.
• Provide employee contact information to unions seeking to organize those employees.
• Submit first contracts to binding arbitration after three months.

Some of these conditions might raise other, non-preemption related questions. Tying the ban on captive audience meetings to economic incentives, for example, might be challenged on unconstitutional conditions grounds. And some of the conditions might change the costs of the incentive programs.

To the extent that corporations view unions as an added cost, these conditions might require states to increase the amount of available development funds. At the same time, the conditions would serve as a highly effective guarantee that the jobs created through the deployment of the development funds are high-wage, high-quality jobs.

But the bottom line is that if the ALEC statute survives preemption review, states will be free to experiment with a whole host of ways to better enable workers to form and join unions.

(Benjamin Sachs, founder and editor-in-chief of the OnLabor blog, is the Kestnbaum Professor of Labor and Industry and faculty director of the Center for Labor and a Just Economy. Among his pre-Harvard positions,  Sachs was associate general counsel of the Service Employees union.)