The System Is Stacked Against the Unions

Suppose you were an employer whose employees were represented by a union. Now suppose that the labor laws you bargain under state that when the parties reach an impasse, you, the employer, get to impose your final offer. What would you do?

When I asked my 12-year-old daughter this, she said, “Well, duh! I’d try to get to an impasse so I could impose whatever I wanted. Actually, I’d offer things I really wanted and that the union would hate. That way I’d get my way, and we’d be at an impasse.” Then she asked if this was just some joke.

In fact, this is the way U.S. labor laws work and have been working for the last couple of decades. There are some legal details, of course. The employer who bargains in bad faith can’t implement his final offer. However, since the mid-1980s, the National Labor Relations Board has allowed employers to come to the table with a strong view as to what they want and make no movement. Employers can propose terms they know will be completely unacceptable and are certain to lead to an impasse. None of this is considered bad faith bargaining. As a result, it’s not hard for an employer to do no real bargaining, but also not to have bargained in bad faith.

The best that unions can do under this system is make concessions in an effort to show that the parties are not at an impasse. They know that if the workers strike, the employer can replace them. Although the law forbids firing strikers, it allows an employer to permanently replace them. As my labor law professor said back in school, “Query: Would you rather be fired or permanently replaced?”

Implementation is now a common feature of U.S. bargaining. Among the employers that have implemented their final offers in recent years are Caterpillar, the Detroit News, the National Football League, Major League Baseball owners, Exxon, International Paper and Bridgestone/Firestone.

The law that allows this practice makes a tremendous difference in how collective bargaining works in the U.S. and limits how effective unions can be. I recently gave my labor law class a mock bargaining exercise. The students were all given the same issues for bargaining but had to negotiate under three different legal systems. One was the U.S. system. In the second, strikes were illegal and if an impasse was reached, an arbitrator would pick the best offer. In the third, strikes and lockouts were legal, there could be no replacements, and no changes could be made until both sides agreed.

I divided the students into management and union caucuses so that they could formulate their strategies and plan how to respond to the other side’s tactics. The differences were stunning. Under the U.S. system, the management caucus tried to figure out how to make it appear that they were bargaining while trying to get to an impasse so they could implement. The union tried to decide what concessions they could make to stave off impasse and whether they dared risk a strike. No one was thinking about how to reach a bargain that would best meet the needs of all parties.

Under the other systems, both sides realized that they would have to make concessions and narrow their differences. Both planned to engage in real bargaining.

My students’ reactions mirrored real life. A recent study I was involved in found that 50% of union negotiators were concerned about impasse and implementation; 30% said the union had made concessions solely to avoid impasse; 56% said that the employer had told them that impasse or implementation was likely and in 26% of the negotiations in which impasse was threatened, the employer did implement.

In other words, implementation plays a destructive role in U.S. collective bargaining. It practically forces employers and unions not to bargain. It offers employers such a large reward for not bargaining that it would be an extraordinary employer who could resist the temptation by actually bargaining as the NLRB intended.

The recent International Labor Organization’s World Labor Report 1997-98 asks why unions have declined. The report points to economic issues and globalization but gives scant attention to the laws in each country.

There can be no doubt that allowing implementation upon impasse is particularly pernicious. It has reduced U.S. collective bargaining to a shadow play in which the image of bargaining is projected onto a screen while behind the screen, the reality is only an effort to avoid or reach impasse.