As an employer, learn about the labor laws that cover your business, why workers unionize, and what the law allows with unionization.
Your workplace is rumored to become unionized. You’ve heard the buzz in the coffee room and in the corridors. No official union activity has started yet, but employees’ demands for workplace changes and calls for a union to make them happen are getting louder.
All this union talk puzzles you. You created what you thought was a fair, safe and pro-employee work environment. Why and how is this happening?
The short answer is that unions allow employees to bargain collectively with their employers to protect their rights in the workplace. A bargaining unit can do what employees are less able to do as individuals, namely, negotiate improvements in working conditions.
Small businesses as union targets
If you thought your small or medium-sized business (SMB) wasn’t big or bad enough to be unionized — especially with unionization reportedly on the decline — you’d be wrong. Under the National Labor Relations Act (NLRA), a bargaining unit can be just 2 people who share a work-related interest, mission or goal.
The chances of your workplace becoming unionized depend on various legal factors, Chief among them is:
- Who can form a bargaining unit
- Who’s eligible for union membership
- What employers, workers and unions can and can’t do
- What an election win or defeat means
The chances of your organization becoming unionized may be less if you operate in one of 27 states with “right to work” laws, According to the National Conference of State Legislatures (NCSL), these states can decide whether employees in an organized workplace must join a labor union to get or keep a job and pay union dues as nonunion members.
So, before you decide whether to support or avert unionization in your workplace, it pays to know whether labor laws cover your business, why people unionize, and what the law allows in the unionization process.
The laws covering unionization
The NLRA covers most private-sector employers, including retailers, healthcare organizations, manufacturers, and private colleges, and universities.
The act doesn’t cover federal, state, or local governments. Nor does it apply to employers who are covered by the Railway Labor Act or those who hire only agricultural workers.
If your business is exempt from the act, your employees’ rights aren’t protected by the NLRA.
Why workers join unions
Hugh F. Murray, III, chair of McCarter & English’s Labor & Employment practice, told Workest in an email interview that with union membership in the private sector at record lows and organizers finding new ways to attract employees, any workplace is a target for unionization.
Murray noted that if a company or an industry is in the middle of a transformation of some kind, the employees may be nervous about the future and think they may need a union’s help if, say, the company is sold.
Employees’ top reasons for unionization
In a 2009 report by Fisher Phillips, a labor and employment firm, the top 5 reasons employees cited for joining a union were:
- The report recognized that favoritism applies in multiple circumstances. But it generally refers to unfair treatment.
- Inadequate pay and benefits. According to the report, employees typically equate union membership with better wages and benefits, but in reality, unionization can but doesn’t always guarantee workers higher compensation.
- Overlooking workplace safety. Employers must provide employees with a healthful, hazard-free work environment or risk violating Occupational Safety and Health Administration (OSHA) rules. The report noted that unions often make health and safety the center of their organizing campaigns.
- Employees who feel humiliated, embarrassed, belittled or overlooked by their employer may look to unions to rectify the situation.
- Ignoring grievances and complaints. Disregarding employees’ claims of mistreatment or wrongdoing tips the balance” in favor of unions, who, as the report indicated, give workers a say in performing their job.
What unionization says about your company
Is your employees’ desire to unionize a reflection of your workplace?
“It is always a reflection of something in the company’s culture, although not uniformly a reflection of something bad in the company’s culture,” Murray noted. “The fact that employees feel that a [union] would be helpful indicates that there is something missing from the status quo.”
“The fact that employees feel that a [union] would be helpful indicates that there is something missing from the status quo.”
Who can and can’t form a union
Most employees in industries covered by the NLRA have the right to form or join a union.
Temporary workers who staffing firms hire to work for 3rd-party companies can form or join a union without either employer’s consent. In 2016, the NLRB overturned a 2000 ruling that restricted unionization for temporary workers.
If you hire seasonal workers for summers or holidays, they, too, have organizing rights.
However, the National Labor Relations Board (NLRB) restricts the ability of workers who meet the legal definition of an independent contractor (as opposed to an employee) under the Fair Labor Standards Act (FLSA) from unionizing.
Any independent contractors you hire aren’t protected by the NLRA and therefore have no legal right to form a union.
Keep in mind that these rulings could change as political parties gain or lose power in the four branches of government. For example, the party representing the Administration holds the majority seats on the NLRB, with the votes to reverse current rulings.
Who’s not eligible to join a union
The NLRB doesn’t protect employees whose involvement in union activity presents a conflict of interest. Employees who fall into this category typically are managers, supervisors, and executives. Their role in unionization is about bargaining on behalf of the employer, not the employee.
Employees fit in this unprotected category if they:
- Hire, fire, promote or make equally powerful decisions about other employees.
- Oversee employees, including reassigning their work or altering the workflow.
Other employees who are unprotected by the NLRA include:
- Those who help with confidential union-related matters.
- The parents or spouses of union eligible employees.
- Domestic workers.
- Workers outside the U.S.
Employers’ rights and restrictions
The NLRA prohibits employers from denying employees their right to unionize.
Unlawful tactics that interfere with organizing include:
- Restraining or coercing employees into not organizing.
- Threatening to fire employees or take away their benefits for joining a union.
- Promising benefits to employees for not unionizing.
- Threatening a business closure if employees organize.
- Undermining organizing efforts by questioning employees about their union allegiances or activities.
- Punishing employees for organizing, filing an NLRB complaint or participating in an NLRB investigation by firing, laying off, transferring or assigning more difficult tasks to them.
Although you have a right to expect your employees to perform their jobs during scheduled work hours, you can’t stop them from engaging in union activity, such as group assembly or handing out union materials, before or after work hours or during breaks.
The NLRA protects employees’ rights to organize by also keeping unions in check. The law prohibits unions from:
- Threatening employees with losing their jobs if they don’t support the union.
- Trying to suspend, discharge, or otherwise punish employees for not being union members, even if they paid or offered to pay a lawful initiation fee and periodic fees thereafter.
- Refusing to process employees’ grievances because they criticized union officials, aren’t union members, or aren’t union members in states where union security clauses are not allowed.
- Fining employees who officially resigned from the union for engaging in union activity after resigning or for crossing an unlawful picket line.
- Engaging in misconduct on the picket line, such as assaulting or threatening non-strikers or barring them from the employer’s site.
- Striking over issues unrelated to employment terms and conditions or coercing neutral parties into engaging in labor disputes.
Unions also must follow rules on union/employee relations and dues.
The path to union representation
If at least 30% of employees sign cards or a petition in favor of forming a union, the NLRB will hold an election.
Employees have 2 paths toward unionization:
- If at least 30% of employees sign cards or a petition in favor of forming a union, the NLRB will hold an election. If the majority of those voters choose the union, the NLRB will certify the union as the employees’ collective bargaining representative; or
- You, as the employer, may voluntarily recognize the union, usually based on signed union-authorization cards, as your employees’ representation.
While the 2nd path to unionization doesn’t let you “encourage” your employees to organize, it may signal your willingness to work and negotiate employment issues with them.
Once the NLRB certifies a union, you’re required to bargain in good faith over your employment terms and conditions with the employees’ union representative. (See special rules for the construction industry.)
When unions are good for employers
As long as employers, employees and unions follow NLRA rules, unionization should work for all 3 parties. But are unions ever good for a business?
Murray cited examples of unions that fit in well with an employer’s business plan. “Professional sports leagues enjoy an antitrust exemption that is based largely on the presence of the players’ unions,” he said. “Most states that are licensing cannabis require ‘labor peace agreements’ in order to obtain a license.”
In other ways unions benefit employers, Murray noted that:
- Construction unions are a reliable source of skilled employees.
- Customers may see an employer’s business brand as ‘union friendly.’
- Certain employers with large government contracts may have a union to help them lobby for better funding.
Instead of having a negative automatic reaction to unionization, Murray advised employers to be prepared well in advance of a union organizing campaign, if possible, and try to understand what unionization would mean from a business perspective.
Preparing for unionization
So, how should you prepare for an organizing campaign? Murray recommended that you:
- Evaluate employees’ compensation levels against equivalent market rates.
- Recognize other issues that concern employees (e.g., safety, diversity, fairness, etc.).
- Take note of union activity locally and in your industry.
- Identify and retain an attorney who’s well-versed in labor law (if, for example, a union files an election petition, you’ll need to respond to important legal issues in as little as seven days).
- Think about how you would respond to a hypothetical union organizing campaign.
- Make sure your supervisors know the company’s position on unionization.
- And finally, take steps to ensure that line-level supervisors are treating employees fairly.