Vol. 2 No. 1 March 2010

President Snubs Senate

President Obama has made two appointments to the National Labor Relations Board (NLRB), exercising a prerogative that presidents use to bypass Senate confirmation of controversial nominees during recesses. The President's appointments are:

• SEIU and AFL-CIO attorney Craig Becker, who has been widely opposed by business groups
• Attorney Mark G. Pearce, a member of the New York State Industrial Board of Appeals

Becker's strong pro-labor views were broadly attacked by businesses and Republicans since he was nominated last year. In a February 4, 2010, letter to Sen. Mike Enzi of the Senate Health, Education, Labor, and Pensions Committee, the U.S. Chamber of Commerce wrote, "Mr. Becker has written prolifically about the National Labor Relations Act, the law he would be charged with interpreting and enforcing should he be confirmed. Many of the positions taken in his writings . . . would disrupt years of established precedent and the delicate balance in current labor law. These positions have raised significant concerns in the employer community.

"Too many concerns remain for employers to be comfortable with this nomination. Among those concerns are the extent to which Mr. Becker would restrictively interpret employers' free speech rights and the extent to which he would seek to expand the use of intermittent strikes and other forms of work stoppages that disrupt the right of employers to maintain operations during labor disputes."

Becker now becomes the second union attorney on the NLRB, joining Chair Wilma B. Liebman, who is a former lawyer for the Bricklayers and Allied Craftsmen, and for the International Brotherhood of Teamsters.

The effect of two labor attorneys as NLRB members could be immense. As Stewart Acuff of the Utility Workers Union of America explained, "If we aren't able to pass the Employee Free Choice Act, we will work with President Obama and Vice President Biden and their appointees on the NLRB to change the rules governing forming a union through administrative action."

Becker's writings and speeches frequently have been called extreme by Republicans and business organizations. He has written, for example, that he favors mandatory unionization where an employee would choose which union to join, not whether to join a union.

In a 1993 Minnesota Law Review article, he argued that traditional tenets of democracy should not apply in union representation elections. Becker wrote that employers should be barred from:

• Attending NLRB election hearings
• Challenging election results even with evidence of union misconduct
• Placing observers at representation elections to challenge ballots
• Holding captive audience presentations

Becker also has called for representation elections to be held at neutral locations, not at the employer's workplace, and that mail-in ballots should be permitted.

Becker and Pearce join current NLRB members Chairman Wilma B. Liebman, a Clinton appointee, and Peter C. Schaumber, a Bush 43 nomination.

First named to the Board in 1997, Liebman is an outspoken proponent of labor unions, as the following passage from the

Journal of Labor and Society¹ illustrates:

[A]n exclusive orientation toward an individual-rights regime could have troubling political and social consequences. Workers may view the employment relationship in purely individual terms and may fail to grasp common economic interests and the potential of collective action at work, as well as in the public sphere.

Without a functioning collective bargaining system, fundamental economic issues are placed off the table: distribution of wealth, control, and direction of economic enterprises. What institution will be as effective in efforts to minimize the randomness of fortune of democratic capitalism?

And without a strong independent trade union movement, what institution will stand effectively as a counterweight in our democracy to the growing political influence of corporations? What institution will speak for working people-indeed for the middle class-as effectively?

The fact that the Board has had only two members since 2007 has caused a lengthy backlog of several hundred undecided cases. Additionally, the Board is awaiting a decision from the U.S. Supreme Court concerning the legality of the 586 two-member decisions it has issued since 2007; three courts have said that only two members are needed to issue rulings, while a third court has said at least three members are needed.

Having two union lawyers on the Board could have two dramatic consequences for labor issues:

• The NLRB, in theory, has broad discretionary power to issue rules implementing provisions similar to the Employee Free Choice Act. With Liebman and Becker leading the way, the Board could circumvent the need for Congressional action on EFCA and issue rules on card-check, shortened election periods, and employer involvement in unit determination.
• The new "Obama Board" also may reverse a number of important pro-business rulings issued earlier in the decade by the Bush Board. Liebman wrote strongly worded dissents to these and many other decisions, and as Board chair, her previous disagreements could become the roadmap for reversing them.

Key NLRB decisions that may be reversed by the new Board include:

• Oakwood Healthcare, Inc., which in 2006 clarified and expanded the definition of "supervisor." Not only is the Liebman Board likely to reverse this ruling, Congress is expected to revive consideration of the Re-Empowerment of Skilled and Professional Employees and Construction Tradeworkers (RESPECT) Act, which also would overturn the ruling. In her dissenting opinion, Liebman called the Bush Board majority's decision "mistaken in every critical respect."²
• The Dana case, which found that employee rights are best served by secret ballot elections rather than by a voluntary card check process.
• In the Register-Guard case, the Bush Board ruled that an employer can lawfully maintain a policy barring non-business use of its e-mail system. For example, an employer could permit e-mail solicitation for Girl Scouts but bar solicitation for union activities.
• The majority of NLRB members in the IBM case decided that employees in nonunion workplaces do not have a right to have a representative of their choosing at disciplinary meetings. Liebman strongly opposed the ruling.
• In Harborside Healthcare, Inc., the Board in 2004 ruled that pro-union activity of a supervisor warrants overturning a representation election if it "tended to have such a coercive effect on the employees that it was likely to impair their freedom of choice in the election." In her dissent at the time, Liebman wrote, "The majority's approach threatens to deprive unions of their natural leaders in the workplace."
• Toering Electric Co.: The Board in 2007 held that union salts (union employees who seek employment at companies the union is targeting) may not always be considered employees within the meaning of the NLRA. In her dissent, Liebman wrote that the ruling "continues the Board's rollback of statutory protections for union salts who seek to uncover hiring discrimination by nonunion employers and to organize their workers."

The coming months promise to be tumultuous at the NLRB, especially if the Board decides to administratively implement card check and other EFCA provisions. Employers should be prepared for major changes affecting how unions organize, and be proactive in their readiness efforts. For more information, contact IRI Consultants at info@iriconsultants.com, or by calling (313) 965-0350.

¹Working USA: The Journal of Labor and Society, Vol. 11, No. 1, March 2008
²Jones Day, Recent Developments in Traditional Labor Law, February 2010

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 2 No. 3 - June 2010

The nation's largest healthcare union and the biggest nurse union have joined forces. The Texas healthcare industry is feeling the impact.

When the Service Employees International Union (SEIU) and California Nurses Association/National Nurse Organizing Committee (CNA/ NNOC) signed a "peace treaty" in 2009, many observers were skeptical. After bitterly feuding for years, how could the two unions actually join forces to organize hospitals?

A look at recent events in Texas indicates they can.

The 2009 agreement called for CNA to organize nurses, with SEIU unionizing the rest of the house. In the last few weeks, the unions have won votes in five Texas hospitals. Also, nurses at Cypress Fairbanks Medical Center in Houston narrowly rejected a bitterly fought attempt to decertify the CNA, which previously had won there.

Additionally, SEIU Healthcare Texas has filed representation petitions aimed at skilled maintenance employees at Del Sol Medical Center, and for technical and maintenance employees at Valley Regional Medical Center.

Texas is a right-to-work state, one of 22 in the country. Traditionally, unions have avoided right-to-work states because of their conservative, antiunion cultures and the financial uncertainty involved. Why try to organize Texas, one of the least-unionized states in the country? More important, how are they doing it?

Why Texas?

CNA and SEIU Election Wins in Texas

May and June 2010

Because union membership continues its decades-long decline, unions are desperate to grow revenue. The only way to do it is by collecting dues from new members. Using a conservative average of $500 per member per year, organizing 1,000 employees would boost a union's balance sheet by $500,000 annually.

The fact that SEIU and CNA are active in right-to-work states is a measure of just how hungry they are for additional revenue. Right-to-work laws dictate that if a labor agreement is reached, employees cannot be forced to pay union dues (although they still are subject to the terms of the agreement). Obviously, SEIU and CNA are betting that enough employees will voluntarily pay dues to make it worth their while.

Once an election has been held, peer pressure to join the union is very strong. In fact, 2009 data from the Bureau of Labor Statistics reveal that when employees in Texas vote in favor of unionization, more than 80 percent of them join the union and pay dues. Unions call employees who don't join and pay "free riders" because they are covered by the same contract and the union is still required to represent them.

But why Texas healthcare? Two reasons: size and growth. Texas has the third-highest number of registered nurses in the country. Only California and New York have more, and many already are unionized.

Equally important is growth. Since 2000, Texas' population has boomed nearly 20 percent, from 20,852,000 to 24,782,000. Some experts project that figure could soar to 33,000,0001 by 2020 - a 32 percent increase. Linked with the continued growth in healthcare over the next decade, Texas could be a gold mine for dues-hungry unions.

Union incursions in Texas are part of a broader Southwest strategy that has seen SEIU and CNA trying to organize nurses in Arizona and Nevada for several years. To the east, SEIU and CNA both have devoted significant resources to organizing Florida healthcare workers. They've been largely unsuccessful so far, but they take a long-term view of organizing. And right-to-work states or not, unions are willing to make the investment given the size of the potential pay-out.

How?

Texas is a case study for smart unions that have deep pockets and a long-term view of organizing. SEIU and CNA have been planting seeds in Texas for several years. SEIU began gaining a foothold in 2006 when it initiated a corporate campaign against major building owners and building maintenance companies in Houston in an effort to organize janitors. The campaign attracted strong support from civil rights activists and union members in northern states. It worked, and SEIU has spread its size and influence in major cities throughout the state.

At roughly the same time, CNA/ NNOC began a campaign that focused more on image building than organizing. When Hurricane Katrina devastated Louisiana in 2005, the union organized a massive effort to rush nurses to stricken communities including shelters in Texas. With a well-orchestrated publicity effort, the union established a positive image throughout the region.

Both SEIU and CNA are politically savvy and potent. Much of SEIU's clout has been focused on Washington and important congressional elections. CNA, on the other hand, has tended to stay away from electoral politics and Washington infighting, choosing instead to make state legislation a forum for gaining public awareness and nurse support.

Naturally, CNA's legislative focus has been nurse-centric, concentrating on staffing ratios, mandatory overtime and such safety/protection issues as needle sticks. Although it's succeeded with staffing ratios only in California, the union continues to hammer these issues in various states. It also has conducted continuing education seminars in which nurses are told about staffing ratio legislation, then given cards that purport to gather contact information, but in fact are union authorization cards.

None of these tactics has caused a groundswell of support for unions in Texas. They have, however, begun to lay a solid foundation there. As is true everywhere, not only has union membership declined, but also approval ratings of unions among the general public. Unions know they have an uphill battle, but as recent events show, the seeds they planted several years ago now may be starting to blossom.

EFCA and Neutrality Agreements

Two factors could flatten the path for union organizing: the Employee Free Choice Act (EFCA) and neutrality agreements.

EFCA was a casualty of the healthcare reform battle. Congressional leaders and the White House asked unions to put EFCA on the back burner, turning their efforts instead to garnering support for healthcare reform. The strategy succeeded, but in the year since EFCA was introduced, support for it has dwindled.

Reports of EFCA's death, however, are premature. Unions' greatest hope for major changes in the way they organize probably is the National Labor Relations Board (NLRB), which now is stacked in favor of organized labor. Craig Becker, an SEIU and AFL-CIO attorney, was appointed to the Board by President Obama while Congress was in recess this spring. He became the second union attorney on the NLRB, joining Chair Wilma B. Liebman, who is a former lawyer for the Bricklayers and Allied Craftsmen, and for the International Brotherhood of Teamsters.

The effect of two labor attorneys on the Board could be immense. As Stewart Acuff of the Utility Workers Union of America explained, "If we aren't able to pass the Employee Free Choice Act [in Congress], we will work with President Obama and Vice President Biden and their appointees on the NLRB to change the rules governing forming a union through administrative action."

Neutrality or "fair election" agreements can have nearly as potent an effect on organizing as card check. By agreeing to what in effect are "gag orders," organizations give up their most powerful tool to remain union-free. The recent SEIU and CNA victories in Texas all were at hospitals with neutrality agreements in place. Newspapers there wrote of employees who complained that all their supervisors were permitted to say about unions was contained on a 3x5 card, messages that they had to read verbatim.

What's Next

The organizing hiatus many unions took in 2008 and 2009 is over. They feel empowered, emboldened. They helped elect a Democratic president and Democratic majorities in Congress. In healthcare especially, they're winning elections and replenishing their coffers. Unions are confident that the Dept. of Labor and NLRB will make substantive changes in election procedures, financial reporting and other critical issues.

Now that they've laid a solid foundation in Texas, indications are that SEIU and CNA have picked Florida and Kansas healthcare organizations as their next targets. Florida, where SEIU has built a strong presence over the years, could serve as the model nationally for the union's reinvigorated organizing efforts.

SEIU Healthcare Florida members June 15 voted to merge with 1199SEIU United Healthcare Workers East in what the two unions are calling a "Partnership for Power." SEIU Healthcare Florida's 20,000-plus members will join forces with the more than 300,000-member 1199SEIU, the largest healthcare workers' local in the country.

According to the merger agreement, which is set to take effect July 1, 1199SEIU will:

• Funnel money and personnel into Florida to help organize more healthcare workers and negotiate first contracts for them
• Increase member dues for employees in acute care hospitals to 2% of gross income, with a cap of $75/ month: thus, each 1,000 new members will yield as much as $900,000 additional revenue to 1199SEIU annually
• Mobilize its member-retirees living in Florida to help with organizing, representation and political campaigns
• Support nurse organizing, including joint work with CNA/NNOC

"It Can't Happen Here" Isn't a Strategy for Success

No healthcare organization anywhere in the country can consider itself immune to union organizing. While the Teamsters, Communications Workers of America and a few other unions dabble in healthcare organizing, SEIU, CNA and the new National Nurses United (NNU) clearly are the leaders. Their targets are hospitals and health systems with employees who feel they:

• Don't have a voice in how the organization is run
• Aren't meaningfully communicated with by management
• Aren't treated with dignity and respect

Other factors play a part, of course. But nothing has a greater impact on being union-free than voice, communication and dignity/ respect. Employees who are satisfied in those three categories don't want unions.

FOOTNOTE:

1. Texas Office of the State Demographer

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 4 - August 12, 2008

At the American Nurses Association (ANA) House of Delegates meeting in June, Michigan Nurses Association (MNA) leadership announced that the union was withdrawing immediately as a constituent member of the national group.

For any one unit," ANA argues. "ANA's proposal is not a "one size fits all" approach to staffing. Instead, it tailors nurse staffing to the specific needs of each unit…this approach treats nurses as professionals and empowers them at "The health care industry is changing, and ANA's stance on issues does little or nothing to address the crisis that nurses and the profession face," John Karebian, MNA's executive director of labor, explained in a press release. "It's clear that ANA has no interest in supporting in a meaningful way the staff nurse performing essential bedside care," added Diane Goddeeris, MNA president. MNA's move reveals a power struggle among nurses unions - and one of the primary issues is being couched in terms of patient safety.

Federal regulation requires hospitals certified to participate in Medicare "have adequate numbers of licensed registered nurses, licensed practical nurses, and other personnel to provide nursing care to all patients as needed." The vague federal code gives states the responsibility to ensure that staffing meets patient needs. Unions are manipulating public perception about patient safety and influencing state and federal legislators to address alleged staffing deficiencies.

Nurse-Staffing: Who Decides?

There are differing philosophies about nurse staffing legislation - and the conflicting views have widened a division among nurses associations. The distinction is who determines adequate nurse-staffing levels: healthcare executives familiar with their organizations' strengths and market demands for care or union leaders seeking to prove value and clout to members.

ANA has launched a Safe Staffing Campaign and is advocating for federal legislation that promotes nurse-staffing plans developed by hospital committees comprised of executives and staff nurses. "Many factors including acuity of patients, level of experience of nursing staff, layout of the unit, level of ancillary support-are key to establishing the "right" nurse-patient ratio last to have a decision-making role in the care they provide."

ANA has worked with Congressional representatives to draft and introduce the Registered Nurse Safe Staffing Act. If passed, the legislation would hold hospitals accountable for the development and implementation of nurse-staffing plans.

More aggressive unions, like the MNA, challenge the staffing plan approach. Their argument: unless healthcare executives are mandated to comply with specific, mandatory nurse-to-patient staffing ratios, budget-conscious hospitals will sacrifice patient care for profits.

Yet, after years of federally sponsored research, no direct correlation can be drawn to prove that nursing ratios lead to improved patient outcomes. That hasn't stopped the California Nurses Association (CNA), which successfully advocated for ratio legislation in California, from continuing to press for ratios and lend its support through its National Nurses Organizing Committee (NNOC) to state nurses associations lobbying for them in other states, including in Ohio and Massachusetts.

NNOC's Ohio chapter scoffed at the state's recently passed staffing legislation."It's a joke," Katrina Howard, an NNOC organizer, complained to the Columbus Dispatch. The legislation requires hospitals to develop an in-house committee to determine registered nurse staffing plans but permits healthcare executives the flexibility to adjust staffing based on patient volume and acuity.

The Massachusetts Nurses Association cried foul when the state senate passed a staffing bill in July that would require hospitals to develop a plan with input from nurses. The union called the bill a "travesty." President Beth Piknick claimed that "thousands of patients each year will continue to be harmed by avoidable medical errors and hospital infections, and too many of them will die."

While the CNA is advocating in state capitals, the United American Nurses (UAN) is lobbying in Washington for federal legislation regarding nurse-to-patient ratios. It argues that other public service industries, such as airlines, are government-regulated to ensure there "is adequate staffing for safe operations."

Changes in Affiliation

As with most political issues, sides have been taken, relationships severed and new alliances formed. MNA, the third largest ANA affiliate, was not the first to break ranks from the ANA. In 1995, the CNA ended its relationship with ANA. Then in 1998, the Pennsylvania Nurses Association left ANA to form the Pennsylvania Association of Staff Nurses and Allied Professionals (PASNAP). Within the next few years, the state nurses associations for Maine and Massachusetts also terminated their affiliation with the ANA.

Concurrently, activist nurses within ANA, a traditional professional organization best known for Magnet Status credentialing, founded a labor arm called the UAN in 1999. Two years later the new organization was brought under the AFL-CIO umbrella as a chartered affiliate. In 2002, the CNA, Massachusetts Nurses Association, Maine Nurses Association, PASNAP and United Health Care Workers of Missouri formed the American Association of Registered Nurses (AARN).

AARN appears defunct as a formal organization, replaced instead by strengthening relationships between state nurses associations, the CNA and NNOC. In 2006, the Maine State Nurses Association affiliated with the CNA/NNOC. In 2007, CNA joined the AFL-CIO, replacing the void created when the SEIU left with other unions to form Change to Win. PASNAP announced in early 2008 that it also affiliated with CNA/NNOC. Rumors abound about MNA partnering with the California nurses union as well, which certainly would help CNA/NNOC's endeavor to build a "National RN Movement."

While AFL-CIO sister unions CNA and UAN agree about staffing ratios, they may butt heads about organizing strategy. UAN engaged CNA-rival Service Employees International Union (SEIU) in an agreement to "divide and organize." UAN will recruit nurses while SEIU will focus on organizing remaining healthcare workers. This agreement, as well as other issues, led to an exodus from UAN last December when the state nurses associations in New York, Ohio, Oregon and Washington announced their disaffiliation. About two weeks later, the ANA announced that too it would sever its relationship with UAN within six months.

Issues Management

Alliances, defections and turmoil among and within unions only will continue as they battle for revenue and market share. The challenge for today's healthcare executive is in understanding who is promoting a legislative agenda, what the true motivation is and then to develop a plan of action. Essential aspects of such issue management are strong communications programs and relationship-development and maintenance with internal and external stake-holders. They need to be aware of your contributions to the community and understand your organization's position on respective issues so they are willing and able to help when you ask for support.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 8 - October 2008

Why Unions Want It?

For unions trying to organize workers, which of these two methods offers the path of least resistance?

NLRB-Supervised Election

• Spend months convincing employees to sign petitions asking for an election to decide whether they want to be represented by a union;
• Submit the petitions to the NLRB to determine if they're valid;
• Once the NLRB approves the election petitions, spend months and between $2,000 and $3,000 per employee convincing them that they should vote to join the union;
• Wait as employees privately cast ballots for or against unionizing in an election supervised by the NLRB.

Card Check

• Convince 50 percent of a business' employees to sign cards or petitions that say they support the union.

Because the difference is so obvious, unions - and the members of Congress who rely on the $300,000,000 that labor reportedly will spend this election cycle to get elected and re-elected - have made enactment of the Employee Free Choice Act (EFCA) one of their highest priorities of 2009. Recent articles in the Wall Street Journal, BusinessWeek and elsewhere suggest passage is a certainty if a Democrat is elected president and Democrats widen their margins in Congress. (In fact, if Democrats gain veto-proof, two-thirds majorities in both the House and Senate, it won't matter which party wins the White House.)

What's in a Name?

Unions and their supporters are marketing the "free choice" act as a boon to workers supposedly yearning to become union members. Organizers say the NLRB-supervised election process is too burdensome and gives employers an opportunity to pressure workers against voting in a union.

But unions already win in excess of 50 percent of secret ballot elections. In the first six months of 2008, unions won 74 percent of representation elections in healthcare, and 66 percent in non-healthcare (both are the highest success rates in 10 years).

In the relatively few instances where businesses agree to card check - usually as the result of a brutal corporate campaign - union win rates with card checks are nearly 100 percent. Union win rates for neutrality and "fair election" agreements typically exceed 80 percent. For the first time and pursuant to a court ruling last year, the NLRB is tracking requests for voluntary recognition by way of card check. In the last 12 months, unions have submitted more than 300 of these VR petitions.

"Following the money" - determining who would benefit most at the bottom line - indicates the labor movement's true motivations for EFCA.

American union membership reached its peak in the 1950s, and has steadily fallen ever since. By the end of 2007, overall U.S. unionization stood at 12.1 percent, with only 7.5 percent of private sector employees represented by a union.

For unions, fewer members equates to:

• Less union revenue
• Lower union executive salaries
• Smaller paid union staffs
• Less money for political support
• Less political clout

By increasing union membership, all these factors reverse. How effective could EFCA be? Service Employees International Union (SEIU) President Andy Stern claims that EFCA could add as many as 20 million new members in fairly short order.

There are two provisions in the EFCA that would change labor relations more than anything since the Taft-Hartley Act of 1947:

1) The virtual elimination of secret ballot elections has drawn the most attention. Two implications make the bill especially effective for unionization:

• Whereas the NLRB election process gives employers time to communicate their views about unionization with employees, card check drives could be over before employers know they exist.
• At the same time, because union organizers can "cherry pick" the employees they think likeliest to sign, many employees might never be contacted, and would never know what the union is up to.

2) Equally as onerous as EFCA's card check provisions are the sweeping "fast track" changes it would make to the collective bargaining process:

• Once the union is in place, bargaining must begin 10 days after the union asks for it.
• If union and management are at an impasse after 90 days of bargaining, the Federal Mediation and Conciliation Service (FMCS) would step in to bring them together.
• If the two sides are still at odds after 30 days of mediation, FMCS would appoint an arbitration board whose order - "agreement" - would be in place for two years.

Altogether, EFCA not only would strip employees' right to privacy, but also deny free speech privileges and the right of employers to control wages, benefits, work rules, scheduling and other operational and financial matters. Former Democratic Senator, presidential candidate and staunch labor supporter George McGovern speaks plainly:

Instead of providing a voice for the unheard, EFCA risks silencing those who would speak. Under EFCA, workers could lose the freedom to express their will in private, the right to make a decision without anyone peering over their shoulder, free from fear of reprisal. To fail to ensure the right to vote free of intimidation and coercion from all sides would be a betrayal of what we have always championed.

What Can Employers Do?

• Develop a clear, concise policy describing where your organization stands on unionization. Ensure that everyone understands it, starting with your board of directors and senior management.
• Make comprehensive changes in your workplace that become part of its culture. Create an environment that makes employees believe they have a great place to work and don't need a union. The goal: when a union organizer comes calling with a card or petition to sign, your employees say "no thanks."
• Create employee advisory groups that help you get wind of dissatisfaction before its gets out of control. Dissatisfied employees quickly can come to believe that a union is the only answer.
• Implement an alternate dispute resolution process so that employees who have grievances can get them taken care of quickly.
• Ensure that all employees are engaged in the day-to-day operation and long-term success of the organization. If employees believe there's an us/them attitude in their workplace, they're prime targets for union organizers.
• Every organization communicates from the top down; that's how things get done. The best businesses know that bottom-up communication is just as important. Employees know - generally - what you want; do you know what they want?
• Supervisors give orders, provide direction. Do yours also know how to communicate in a way that not only ensures work gets done properly, but that makes employees understand why it should be done a certain way? Do they know how to take constructive criticism and make changes suggested by their subordinates? Communicating "why" and listening to employee suggestions are key elements of engagement.
• Washington has been awash with lobbyists for both sides of the issue since EFCA (HR 800, as it's technically known) was introduced in 2007. While lobbyists hold enormous sway, legislators do pay attention to constituents. Letters, phone calls, e-mails and, best yet, personal visits from employers and local community leaders could help delay or kill the bill. Your message should be what's wrong with the bill for your employees, your community and your business.
• Your employees are just as important an audience as your Congressional team. Every employer has a right to communicate with its workers about important legislation. Assume going in that most employees are familiar only with the union's side of the argument.
• For most people, loss of privacy and unpressured choice are the most compelling arguments against EFCA. Make sure your employees know exactly what EFCA would take away from them. Also compelling is the issue of union dues; employees who know how much they'd pay monthly can be less vulnerable to organizing.
• At the same time, far too many employees don't have a firm grasp of what they really have when it comes to pay and benefits, two prime targets of union organizers. Doing everything possible to familiarize workers, not only with what they have, but also its value, can help union come-ons fall on deaf ears.
• As an aside: tool kits, which typically include printed materials, videos and e-mails are good workplace communication tools. However, they can never take the place of face-to-face communications between supervisors and their direct reports. We recommend training every management employee about how best to communicate EFCA, including answering questions, and requiring them to hold meetings with all of their employees.
• Depending on an employer's hiring status, communicating with new employees can make a big difference should a union come calling. New hires often can be the softest targets for organizers.
• And finally, immediately create a quick-response team that's empowered to make critical decisions. Have the team prepare an emergency operations plan to enable a rapid response to a card-check drive. Train supervisors about what to look for. Give them a toll-free number that's staffed 24/7 to report card-check activity. Prepare communications materials in advance; once a card check drive is discovered, it could end while you're still writing and obtaining approvals.

Even if EFCA doesn't become law, these preparations can help every organization become more effective.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 2 No. 4 - November 2010

Healthcare Labor Relations: Uncertainty Grows

The Republican/Tea Party tsunami that swept through Congress November 2 adds complexity to an already uncertain situation for labor legislation and regulation.

• Republicans will have a 239-184 majority in the House starting in January. They also will hold all leadership posts, including the committees and sub-committees that do the heavy lifting shaping legislation before it is voted on. However, Democrats retained control of the Senate, limiting Republican options for sweeping changes.
• A good number of the new House members defeated more mainstream Republicans in the primaries. Many of these incoming freshmen used campaign rhetoric about bucking the Washington establishment, further clouding the crystal ball for what Congress might do to labor law in 2011. Whether Republican leaders will be able to control their caucus enough to thwart or reverse Democratic initiatives remains to be seen.
• The status of healthcare reform also adds to the uncertainty next year for healthcare organizations. Many Republican candidates during the campaigns attacked "Obamacare" and vowed to repeal it if elected. The morning after the election, John Boehner (R-OH), who is poised to become House Speaker, vowed to roll back the healthcare bill, branding it a "monstrosity." Senate Minority Leader Mitch McConnell (R-KY) said "the Republican leadership in the House and Senate is committed to [the law's] repeal."

The historic Republican shift in the House -- the largest since 1948 -- almost certainly indicates that the brief pro-labor tilt is likely to swing back toward business's interests next year. Indeed, Republicans reportedly are preparing legislation to reverse what momentum labor has gained. One bill under discussion would prohibit employers from entering into "card check" agreements with unions, a process often used now to bypass secret-ballot elections; a number of state legislatures have passed or are considering similar measures. Other draft legislation would limit labor's political clout by stopping unions from using members' dues money for political purposes unless members give written permission.

What Can a Lame Duck Do?

Republican control is two months away, however. Until next January, Democrats still control both houses of Congress, providing time for a lame duck session (slated to begin Nov. 15) to pass pro-union labor law modifications.

Lame duck sessions of Congress can be unpredictable. Special interests of all stripes pressure legislators who are leaving Washington and don't especially care what they leave behind for their successors. Thus, the door is opened for frustrated labor supporters who have seen the Employee Free Choice Act (EFCA) back-burnered for two years.

While the coffin may be closed in Congress on EFCA's card check provision, other elements of the bill could still have some traction. Expedited elections especially are on the table, raising the possibility that Congress could ram through a new law reducing the time to campaign for NLRB-supervised elections.

All Eyes on the NLRB

As cloudy as labor's prospects appear to be in Congress, the skies are sunnier for unions at the NLRB. Organized labor is hopeful that through board decision-making, new regulations and rule making, the NLRB will reverse many of the pro-employer rulings of the Bush administration and make it easier for unions to organize workers.

With its 3-1 Democratic majority, the NLRB has a quorum that strongly believes that the Board has tilted too far in business's favor, and that big changes must be made in order to help unions. Board chair Wilma Liebman, Craig Becker and Mark Pearce all have strong pro-labor leanings, and they seem prepared to act on labor's behalf.

Liebman and Becker are the point of the spear. Both are former union attorneys, Liebman for the Teamsters and Bricklayers and Becker for SEIU and AFL-CIO. Both strongly favor reducing employer power in the workplace.

Pearce recently promoted drastically cutting the time for holding union representation elections, from 42 days from filing a union petition to as little as five days after the petition is filed with the NLRB. Pearce also has suggested postponing all voter eligibility issues until after the election; supervisory status, unit placement, voter eligibility, part time, contracted employees, joint employer status, confidential and managerial employees, and others would be left undecided until after the election.

While not as threatening as card check, expedited elections nonetheless would be very difficult for many employers to manage; unions could spend as much time as they needed quietly collecting petition signatures, then file the petition and have an election only days later.

Unions have long said the current five- or six-week lag is unjust because it gives employers too much time to convince employees to not unionize. The longer the period before the vote, the greater the likelihood of unfair labor practices from both sides, Pearce said. Over the past year, the NLRB conducted more than 2,200 elections with a median of 38 days between the filing of the petition and the election, he noted. "I think we can do better."

Becker Term-limited, NLRB Needs to Move Quickly but Carefully

Because President Obama's nomination of Craig Becker to the NLRB was opposed so intensely, the president was forced to bypass the Senate and appoint Becker during Congress's spring 2010 recess. Because Becker did not receive Senate confirmation, his term will expire late next year instead of the five years for members who are confirmed by the Senate. Additionally, Chair Liebman's term expires in August 2011, and the recent retirement of Member Peter Schaumber left a Republican vacancy for President Obama to fill.

Liebman, Becker, Pearce and their backers in Congress and the White House will need to determine what strategy to take with EFCA issues. The current Board line-up may be the most pro-labor roster for years to come; the first half of 2011 could be a now-or-never period for unions.

Liebman et al need to move with some caution, however; although the NLRB theoretically is an independent agency, it still relies on Congress for funding. Over the years, Congress hasn't been shy about cutting the budgets of agencies that have acted contrary to its preferences. That the new Congress's preferences will be different than those of Ms. Liebman, Mr. Becker and Mr. Pearce is an understatement.

Pro-labor Changes Already Made or Underway

• The Labor Department is committed to tougher enforcement of labor laws to reverse a "culture of noncompliance" that Labor Dept. Solicitor M. Patricia Smith claims has developed over the past 10 years.
  Smith said that the Bush Administration had emphasized compliance assistance while investigations and enforcement of labor laws declined. "They relied on trickle-down enforcement; it doesn't work any better than trickle-down economics."
  As a result of reduced enforcement, "many employers developed a 'catch-me-if-you-can' attitude," Smith said. "Our challenge is to change that attitude." Among the new tactics for increased enforcement, Smith said, are increases in criminal prosecution, use of enterprise-wide enforcement actions, industry-wide targeting for wage violations and liquidated damages in wage and hour cases.
  
• The NLRB has ruled that a union practice of displaying large stationary banners at a secondary employer's business is not coercive, and so does not violate U.S. labor law.
  The decision covers three Arizona cases in which union carpenters held 16-foot-long banners near two medical centers and a restaurant to protest work being performed for the owners of the establishments by contractors that the union claimed paid substandard wages and benefits. Two banners declared "SHAME" while a third urged customers not to eat at the restaurant.
  
• NLRB Acting General Counsel Lafe Solomon in late October announced an initiative to strengthen and streamline the board's response to charges filed when employees are fired in the midst of a union organizing campaign.
  Solomon said his office will consider seeking a federal injunction that would compel an employer to offer reinstatement to the fired workers pending litigation of the underlying unfair labor practice case. Additionally, new timelines and procedures have been created to speed the process.
  "Firing an employee in the middle of a union organizing campaign can quickly destroy the campaign by creating a climate of fear in the workplace. Clearly, it can also have a devastating effect on the employee's life. We need to ensure that the statutory rights of unlawfully fired employees are restored in real time," Solomon said. "These cases go to the very essence of our enforcement responsibilities."

Visibility of Strikes Growing

Although the use of strikes by unions continues to decline, their visibility in healthcare has increased significantly this year.

In Philadelphia, nurses represented by the Pennsylvania Association of Staff Nurses and Allied Professionals (PASNAP) struck Temple University Hospital for 28 days. PASNAP is a National Nurses United (NNU) affiliate.

In California, there have been strike threats at more than 100 hospitals and nursing homes. Among the potential targets were 35 facilities owned by Catholic Healthcare West, along with 10 Sutter hospitals. The unions claimed that pay, benefits and nurse staffing levels were their rationale for attempting to take nurses away from patient bedsides to walk the picket lines.

In June, 12,000 members of the Minnesota Nurses Association (MNA) went on a one-day strike at 14 Twin Cities hospitals, garnering nationwide publicity in the process. While the work stoppage appeared to have no impact on patient care, the extensive media coverage heightened public awareness of staffing ratios and other issues.

The MNA is a member of National Nurses United, the nurse super-union formed last year by the California Nurses Association/National Nurse Organizing Committee (CNA/NNOC), United American Nurses and the Massachusetts Nurses Association. Currently, NNU has 32 affiliates.

Texas, Kansas wins propel CNA/NNOC & SEIU into Florida

The intensity of union organizing in the Sunshine State continues to grow.

Coming off a sweep in Texas -- six wins at six hospitals (including a decertification victory) -- and victories in Kansas, SEIU and CNA/NNOC moved on to Florida as the next target of opportunity.

The Texas and Kansas victories were the first significant products of an agreement signed last year between SEIU -- the nation's largest healthcare union -- and CNA/NNOC -- the biggest nurse union. The 2009 pact called for wall-to-wall organizing, with CNA organizing nurses, and SEIU targeting the rest of the house.

While the joint wins in Texas and Kansas are indicative of the power NNOC and SEIU together can wield, SEIU on its own has launched a major push in Florida, partnering with NNOC in some instances and going solo in others. The union, which has built a strong presence in the Sunshine State, has taken a number of steps to add potency to its healthcare organizing.

In June, the 20,000-member SEIU Healthcare Florida merged with the 300,000-member 1199SEIU United Healthcare Workers East. According to the merger agreement, 1199SEIU will:

• Funnel money and personnel into Florida to help organize more healthcare workers and negotiate first contracts for them
• Increase member dues for employees in acute care hospitals to 2% of gross income, with a cap of $75/month -- $900 a year
• Mobilize its member-retirees living in Florida to help with organizing, representation and political campaigns
• Support nurse organizing, including joint work with NNOC Florida

SEIU Healthcare Florida currently represents workers at more than 100 facilities across the state, including such major for-profit healthcare chains as HCA, Tenet, SeaCrest, Greystone and University of Miami Hospital.

Members of NNOC Florida waged a grassroots campaign throughout the summer to generate support for mandatory nurse-to-patient ratio legislation. Though unsuccessful during the 2010 legislative session, NNOC and its legislative sponsors plan to reintroduce the Florida ratio bill in 2011.

In the meantime, NNOC Florida nurses across the state are expected to continue attending city and county council meetings asking members to adopt resolutions calling on delegates representing each city or county to support the ratio bill in Tallahassee when it is reintroduced.

The first governmental unit to pass the NNOC resolution was the Gulfport City Council. NNOC also persuaded the Space Coast League of Cities to recommend adoption of the resolution in the following cities: Cape Canaveral, Cocoa, Cocoa Beach, Indialantic, Indian Harbour Beach, Grant-Valkaria, Malabar, Melbourne, Melbourne Beach, Melbourne Village, Palm Bay, Palm Shores, Rockledge, Satellite Beach, Titusville and West Melbourne.

Additionally, there are now seven NNOC Metro Committees at work on the "Ratios and Rights" campaign, including Tampa/St. Pete, Orlando, Ft. Lauderdale/Miami, Palm Beach County, Daytona Beach, Gainesville and Jacksonville.

California Healthcare Election Results: SEIU Prevails

The bitter feud between the SEIU and the California breakaway National Union of Healthcare Workers (NUHW) lost a bit of steam in September when a statewide group of Kaiser Permanente healthcare employees voted in favor of staying with SEIU, rather than switching allegiance to NUHW.

A total of 30,295 mailed ballots, from among 43,000 eligible voters, were received by the regional NLRB office. It was the largest mail ballot election in the agency's history. SEIU won by an 18,290 - 11,364 vote margin.

Nurses Red-Shirting

"Red-shirting" generally means giving an injured college athlete another year of eligibility. National Nurses United (NNU) has expanded the definition to include demonstrating union support.

At hospitals in Illinois, Iowa, Michigan, Washington, D.C., Nebraska and elsewhere, nurses have been spotted wearing red scrub shirts and jackets with "NNU" on the front pocket and "job security, social security and Medicare for all" on the back. A stethoscope surrounds the back slogan.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 7 - February 27, 2009

The first two months of the new year have seen a flurry of labor activity, much of it related to the new President and Congress. After eight years of the business-friendly Bush administration, the pendulum has swung back in labor's favor, giving the nation's unions a sense of empowerment not felt since the Carter years. Here are the most important developments so far this year:

EFCA Intro Delayed

The highest-priority legislation for labor - the Employee Free Choice Act (EFCA) - has yet to be introduced in the new Congress, causing much speculation as to why. The obvious answer is that Washington has placed the highest priorities on the stimulus package and other economic issues, not leaving time for much else.

Many also suspect that unions have backed off their EFCA push at President Obama's behest. Because business groups are vehemently opposed to the measure, the president doesn't want to risk losing their support this early in his term.

Also causing the EFCA delay is behind-the-scenes wrangling to modify it before it's introduced, possibly removing the mandatory card check element that is anathema to business. One possible substitute is "expedited elections," which would shorten the traditional six-week period between filing a petition and holding an election to as little as five days.

Senate Majority Leader Harry Reid (D-NV) recently indicated that the legislation isn't likely to be formally considered until perhaps this summer.

Card Check Use Extensive Even Without EFCA

Unions petitioned the NLRB for recognition in more than 550 card-check organizing drives between October 2007 and January 2009, demonstrating their commitment to card check as a faster, more effective, less-expensive alternative to secret ballot elections.

Overall, there has been more than one request for card-check certification every day for the last 16 months. Businesses generally enter into card check and neutrality/fair election agreements with unions only to stop damaging corporate campaigns.

Obama Labor Appointees

High-level, pro-labor appointees just didn't exist in the Bush White House. President Obama has ended the drought by making several high-profile appointments with strong labor ties:

• Hilda Solis is the new Secretary of Labor. She is a four-term California Congresswoman who has been a vocal union supporter and EFCA sponsor.
• Ellen Moran, a former AFL-CIO staffer who coordinated the union's corporate campaign against Wal-Mart, was named White House communications director.
• Patrick Gaspard, SEIU Local 1199's former executive vice president of politics and legislation, was named director of the White House Office of Political Affairs.

Obama Enacts Pro-labor Laws

In his first 10 days in office, President Obama signed four bills that reverse Bush-era labor policies, restoring some of the clout unions had lost over the last eight years:

• The Lilly Ledbetter Fair Pay Restoration Act makes it much easier for plaintiffs to file wage discrimination claims. It reverses a Supreme Court decision requiring complaints to be filed within 180 days after disparities are discovered.
• The Notification of Employee Rights under Federal Labor Laws Act, which requires businesses holding federal contracts above $100,000 to inform employees of their pro- and antiunion rights. It reverses a Bush administration rule that required companies to post a notice informing employees that they had a right to not join a union.
• The Nondisplacement of Qualified Workers under Service Contracts Act requires that, when a federal agency changes contractors, the new company first offer jobs to the non-supervisory employees who worked for the previous contractor. This restores a rule set by President Clinton, but voided by Bush.
• The Economy in Government Contracting Act prevents federal contractors from being reimbursed for money they spend to "support or deter their employees' exercise of their right to form unions and engage in collective bargaining." As with all new laws, this act is open to interpretation and challenge. The current thinking is that hospitals, for example, can still encourage employees not to unionize; they just can't pay for it with Medicare funds.

Historic Pact Creates Largest RN Union

The country's three largest nurse unions - the California Nurses Association (CNA), United American Nurses (UAN), and the Massachusetts Nurses Association (MNA) - have announced plans to unite, creating a 150,000-member organization called the United American Nurses-National Nurses Organizing Committee.

Details of the arrangement are sketchy. Some reports say the move is a merger, with others calling it an "advocacy association." CNA president Deborah Burger said the three unions will maintain their identities, with the new group intended to give union-represented nurses a national voice and more organizing strength.

UAN, based in Silver Spring, Md., has members in 12 states. MNA, based in Canton, Mass., has members in its home state and is conducting organizing campaigns in New Hampshire and Connecticut. In addition to California, CNA has members in Texas, Nevada, Maine, and Pennsylvania.

Rose Ann DeMoro, CNA executive director, said the new association will:

• Provide nationwide coordination in the campaign for single-payer health care
• "Organize all nonunion direct care RNs"
• Provide a national voice for nurses' rights, safe nursing practices including RN-to-patient ratios, and nurses' health care plans
• A national pension plan for union RNs

SEIU Creates $50-million Campaign

SEIU launched "Change That Works," a $50-million campaign designed to:

• Pass the Employee Free Choice Act
• Lower healthcare costs and provide quality, universal coverage
• Increase funding for education & childcare
• Take on elected officials who fail to live up to their pro-union campaign promises

Stern/Rosselli Fight Intensifies

The bad blood between SEIU's Andy Stern and United Healthcare Workers-West's Sal Rosselli intensified. With charges of financial mismanagement, fraud, misappropriation and nepotism flying, SEIU placed UHW into trusteeship and removed its leadership, including the popular Rosselli.

Rosselli and his loyalists countered by launching the 150,000-member National Union of Healthcare Workers (NUHW) and quickly filed dozens of petitions to decertify SEIU at California hospitals and long-term care facilities, as well as to certify the new NUHW as employees' bargaining representative.

The SEIU/NUHW feud could have widespread impact on healthcare unionization throughout the state. With the NUHW fighting hard to decertify SEIU representation and put itself in place, and SEIU fighting just as hard to maintain membership, it's likely that neither union will have the resources to organize elsewhere - perhaps creating an opening for the California Nurses Association to fill the void.

SEIU/CNA Feud Continues

The long-standing animosity between CNA and SEIU took a curious turn in February, with CNA issuing statements and developing Web sites suggesting that SEIU had initiated a "hostile takeover" campaign designed to "divide and conquer CNA." The two unions repeatedly have gotten in each other's way, most notably in Nevada. CNA beat SEIU in a bitterly fought contest in Reno at St. Mary's Regional Medical Center. CNA also won in Las Vegas at three St. Rose Dominican Hospitals, but the SEIU complained to the NLRB and forced a run-off election. The election's results - 392 for SEIU and 390 for CNA - still are in limbo pending the NLRB's review of 11 challenged ballots.

Conclusion: EFCA is Key

EFCA is a game-changer. Whether it ultimately is a card check or expedited elections bill, it will determine just how much ground unions are able to regain in the next few years. SEIU's Andy Stern claims mandatory card check would enable unions to add 1,000,000 members a year.

Many observers assumed it would be a shoe-in immediately following the elections. Things have become less certain in the last few weeks as business groups have lined up strongly against it. The position of the American Hospital Association and its affiliate, the American Society for Healthcare Human Resources Administration, is typical. A portion of their joint position paper, which was drafted last year follows [emphasis is AHA/ ASHHRA's]):

The AHA opposes H.R. 800/S. 1041 [EFCA's bill numbers in the previous session of Congress] because it strips away existing safeguards assured under federal law and leaves workers unprotected from outside influence and pressure. The legislation also would further impose binding arbitration between employers and employees if, after 120 days of negotiation, no contract agreement has been reached.

Alternatively, the AHA and its American Society for Healthcare Human Resources Administration support the Secret Ballot Protection Act, which would amend the NLRA to require that union recognition be based on a secret ballot election conducted by the National Labor Relations Board. [This act] would protect the interests of both the employer and the employee by ensuring that both sides have an opportunity to make their case, and that those employees are able to express their decision in private, free from undue pressure or influence.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 2 No. 2 - May 2010

"Our local unions and divisions should drive our national priorities, not the other way around, and our national initiatives should be designed to put wind in the sails of our local and industry-based organizing strategies."

Mary Kay Henry, who has taken the helm of the two-mil-lion-member Service Employees International Union (SEIU), seems predisposed to place more emphasis on local control and organizing rather than the political clout and national focus of her predecessor, Andy Stern. How much difference such a shift might make to hospitals and other primary targets of SEIU organizing is hard to gauge.

Even a relatively small change in emphasis, with a corresponding resource reallocation, could have a major impact on organizing. SEIU's annual budget is about $120 million, so taking even five percent out of politics and putting it into organizing could have significant consequences; $6 million buys a lot of purple buttons, t-shirts and leaflets. In a demonstration of the union's increased commitment to organizing, it announced May 8 an immediate $4 million allocation to reinvigorate private sector organizing throughout the country.

Stern, who spent 38 years with SEIU, 14 of them as president, announced his retirement in mid-April, leaving behind a career filled with success and controversy. Henry brings a strong, 32-year union healthcare resume to the job, including the last six years as executive vice president of SEIU healthcare operations. Her accomplishments include:

• Labor advisor and member of the U.S. Conference of Catholic Bishops' Subcommittee on Catholic Health Care, which issued the controversial 1999 paper, "A Fair and Just Workplace: Principles and Practices for Catholic Health Care"
• "Top 25 Women in Healthcare" citation from Modern Healthcare
• Groundbreaking labor agreements between SEIU and Catholic Healthcare West, Beverly Enterprises, Tenet and HCA
• National labor-management partnership at Kaiser Permanente, the nation's largest HMO
• Strategic alliance with Allina Hospitals and Clinics

According to her official bio, "Mary Kay is leading a national effort by SEIU to build new kinds of partnerships with hospital employers - partnerships that will improve the quality of patient care, strengthen the hospital's competitive performance, and give workers a voice in decisions that affect care and working conditions."

Noticeably absent from the bio is any mention of political activity, in stark contrast to Stern and his protégé, secretary-treasurer Anna Burger, the person Henry beat for the union's top job.

Stern and Burger helped turn SEIU into arguably the nation's most politically potent union. For instance:

• Stern was the most frequent White House visitor in 2009.
• Stern and Burger helped convince President Obama to appoint SEIU attorney Craig Becker to the NLRB while Congress was in recess.
• Anna Burger and AFL-CIO President Richard Trumka are members of the President's Economic Recovery Advisory Board.
• Michael Kerr, who oversaw finance and administration at SEIU, is Assistant Secretary for Administration and Management in the Labor Dept.
• Patrick Gaspard, SEIU Local 1199's former executive vice president of politics and legislation, is director of the White House Office of Political Affairs. n John Sullivan, SEIU associate general counsel, is a member of the Federal Election Commission.

Stern was the driving force behind the formation of three powerful coalitions that lobbied for health care reform, bringing together such strange bedfellows as AARP, the Business Roundtable, Allina Hospitals & Clinics, Catholic Healthcare West, Daughters of Charity, Greater New York Hospital Association, Kaiser Foundation Hospitals, Kaiser Permanent, Los Angeles County Department of Health Services, AT&T, Intel, Kelly Services, Inc., Communications Workers of America, the Center for American Progress, and the Committee for Economic Development.

Will Henry continue down that political path or, as some observers predict, attempt to take SEIU in a more grassroots direction? There are too many variables to tell for sure, at least at this stage. More to the point, the union might not have to do anything and still be a big winner.

Regardless what SEIU does internally, the stage already is set at the National Labor Relations Board (NLRB) for major changes in union organizing. With SEIU's Becker now on the Board, along with two other strong unionists including Chair Wilma Liebman, who is a former labor counsel for the Bricklayers and Allied Craftsmen, and the International Brotherhood of Teamsters, labor has the green light for its agenda.

The NLRB, in theory, has broad discretionary power to issue rules implementing provisions similar to the Employee Free Choice Act. The Liebman/Becker Board (along with Obama appointee Mark Pearce) could circumvent the need for Congressional action on EFCA and issue rules on card-check, shortened election periods, and employer involvement in unit determination.

The new Board also is poised to reverse a number of important pro-business rulings issued earlier in the decade by the Bush Board. Liebman wrote strongly worded dissents to these and many other decisions, and as Board chair, her previous disagreements could become the roadmap for reversing them.

Finances also will play a huge role in determining SEIU's strategic direction. The union spent $85 million during the 2008 campaign season, and is spending considerable sums on this year's mid-term contests. "SEIU is on the field, it's in the White House, it's in the administration," Stern said during the celebration of the Obama administration's first 100 days.

But that power came at a stiff price: "We maxed out the credit card and now we're paying it off," Stern told the Wall Street Journal. The union took out $25 million in loans in 2008 to meet expenses and saw its net assets fall by nearly half. It needs cash, and its primary revenue source is union dues.

As politically potent as SEIU is, its organizing muscle is at least as formidable - that's why it became the country's fastest-growing union under Stern. In 2009, SEIU's overall win rate in RC elections hit 81 percent, among the highest of any union and above the national average of 75 percent.

It has 4,000 dedicated organizers and an annual budget of more than $120 million. Each new member pays roughly $500 annually in dues. With a) some form of EFCA, or b) the changes the NLRB seems poised to make, or c) a reallocation of funds from politics to organizing, it's feasible that SEIU could add 250,000 to 500,000 members a year (Stern and other labor leaders have predicted that card check could boost the country's labor rolls by a million members a year).

An organization as large as SEIU can't turn on a dime; as long as a Democrat is in the White House, it won't need to. Moreover, the union is a democracy, and Henry can't make major shifts unilaterally. Any changes are likely to be incremental, at least at first.

Given the new composition of the NLRB and Henry's track record in healthcare organizing, the odds are strong that the country's hospitals and healthcare systems will be faced with increased organizing pressure for the next several years. The only question is likely to be one of tactics, not strategy; namely, will SEIU attempt to organize systems via corporate campaigns, or individual hospitals via traditional organizing?

The answer to that lies mostly with Congress and the NLRB. If Congress passes some form of EFCA-like legislation, or if the NLRB implements card check or accelerated elections on its own, unions would have a much, much easier job organizing through traditional means. Because unions generally resort to corporate campaigns when traditional organizing efforts fail, corporate campaigns would become much less necessary.

It also is important to remember, however, that Mary Kay Henry has had great success with healthcare "partnerships," a term of art that often means fair election or neutrality agreements; her bio says she is building more of them. That could make the game even more interesting for the nation's hospitals and healthcare systems.

One thing is clear: the state of flux in labor-management relations that began after the 2008 elections isn't going to abate any time soon. Even if a major power shift in Congress comes about this fall, the new, pro-labor NLRB will be around for awhile.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Volume 1 No. 10 - July, 2009

Labor unions have made significant inroads in organizing recently with the issuance of two documents by the Catholic Church: a papal encyclical reiterating strong support for unions, and a Bishops’ report supporting fair election agreements between labor and management.

Pope on Social and Economic Justice

The Vatican June 29 issued Caritas in Veritate (Charity in Truth)¹, by Pope Benedict XVI. The Pope writes that businesses have a moral obligation to operate not simply by profits, but by “an ethics which is people-oriented. Profit is useful if it serves as a means toward an end, but once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty. Every economic decision has a moral consequence.”

In a section on the right of people everywhere to enjoy a decent standard of living, the encyclical says, “Lowering the level of protection accorded to the rights of workers, or abandoning mechanisms of wealth redistribution in order to increase the country’s international competitiveness, hinder the achievement of lasting development.”

“The goal should be decent employment for everyone, which means work that ... permits the workers to organize themselves freely, and to make their voices heard.

“Here budgetary policies, with cuts in social spending often made under pressure from international financial institutions, can leave citizens powerless in the face of old and new risks; such powerlessness is increased by the lack of effective protection on the part of workers’ associations. Through the combination of social and economic change, trade union organizations experience greater difficulty in carrying out their task of representing the interests of workers, partly because Governments, for reasons of economic utility, often limit the freedom or the negotiating capacity of labour unions. Hence traditional networks of solidarity have more and more obstacles to overcome.

“The repeated calls issued within the Church’s social doctrine, beginning with Rerum Novarum [Rights and Duties of Capital and Labor, issued by Pope Leo XIII in 1891]², for the promotion of workers’ associations that can defend their rights must therefore be honoured today even more than in the past, as a prompt and far-sighted response to the urgent need for new forms of cooperation at the international level, as well as the local level.”

U.S. Conference of Catholic Bishops on Fair Election Agreements

A week before the encyclical was released, the U.S. Conference of Catholic Bishops (USCCB) issued Respecting the Just Rights of Workers³, which codifies “fair election agreements,” a powerful organizing tool unions have sought – and waged bitter corporate campaigns over – since the 1970s. At its core, it strongly urges Catholic hospitals to relinquish much of their legal rights to communicate with employees about unions. The agreement covers more than 600,000 employees at nearly 600 Catholic hospitals nationwide.

The document contains “guidance and options” for union organizing in Catholic hospitals. It is the product of a decadelong dialog among the USCCB, Catholic hospital management, and labor unions representing healthcare workers. Its architects include a retired cardinal, two bishops, the CEO of the Catholic Health Association of the United States, SEIU, AFL-CIO, AFSCME, and the American Federation of Teachers.

Respecting the Just Rights of Workers is the direct descendent of “Principles and Practices for a Fair and Just Workplace in Catholic Health Care,”⁴ a draft document USCCB released in 1999 that unions have used ever since to press for “fair election agreements.” Although the new document and its accompanying background materials don’t mention the Employee Free Choice Act (EFCA), its timing and content clearly will help the effort.

Seven Principles for Labor and Management

The “guidance and options” spell out seven principles of “civil dialog between unions and employers focusing on how the workers’ right to decide will be respected.”

They strongly recommend "unions and employers enter into a Local Agreement that, at a minimum, addresses [the seven principles]."

The Seven Principals of Respecting the Just Rights of Workers:

• Respect: All parties are committed to demonstrate respect for each other's organization and mission.
• Equal access to information: "The union and employer should agree in advance on an equal number of written, verbal, or other communications for employees," and the employer should not conduct mandatory meetings about unionization.
• Truthful and balanced communications: All written communications should be "reviewed and jointly approved by the employer and union." Communications should be "factual, accurate, and holistically truthful."
• Pressure-free environment: Neither side will "make comments or engage in activities" that could be considered harassment, threats, intimidation, or coercion.
• Fair and expeditious process: Employees will be allowed to vote through a secret ballot election supervised by the National Labor Relations Board "or another mutually agreed upon process," without lengthy hearings and delays.
• Meaningful enforcement: A "neutral authority will be designated to ensure the principles are followed and resolve issues that arise."
• Honoring employee decisions: All sides will honor the results of the election or other mutually agreed upon process, and will not engage in negative or disparaging conduct regardless of the outcome.

Not Carved in Stone

The new accord leaves lots of room for interpretation. For example, Cardinal Theodore McCarrick, the retired Archbishop of Washington, D.C. who chaired the process, emphasized that the guidelines are suggestions and are not binding on any Catholic healthcare institution. "It offers options and alternatives rather than commandments and mandates."

On the other hand, Dennis Rivera, chair of SEIU Healthcare, said he "has nothing but the highest expectations that the guidelines will be adhered to by a majority of Catholic health care institutions." Rivera was one of the union representatives who worked on Respecting the Just Rights of Workers.

Impact of the Documents

Although both the Pope's encyclical and the Bishop's guidelines are sure to have a major impact on union organizing, it's difficult to gauge the full extent of their reach.

Respecting the Just Rights of Workers directly applies only to the country's 600 Catholic hospitals. With the imprimatur of the Church in hand, unions will embark on a major effort to organize the country's 600,000 employees of Catholic hospitals and health systems.

The document also will be used by unions and union-friendly organizations as part of their push for EFCA. Having respected organizations like the USCCB and Catholic Health Association as authors of the document is sure to grab the attention of federal lawmakers.

Longer term, Respecting the Just Rights of Workers could be used by unions as a new paradigm to organize other non-Catholic, faith-based healthcare organizations, and, perhaps, non-faith-based. By winning at several high-profile Catholic facilities, unions could leverage the document nationwide. Used in conjunction with EFCA, the impact could be immense.

The encyclical, on the other hand, is less targeted. It can be expected to play a significant role in the EFCA debate but, because it is not a how-to manual like the Bishops’ paper, it isn’t as useful as an organizing tool. Most likely, its greatest impact will be in Catholic organizations, most prominently healthcare. In general, encyclicals tend to have more influence than actual power outside of Catholicism.

Following are steps IRI recommends taking to deal with Respecting the Just Rights of Workers and, should its influence spread or become more focused, Caritas in Veritate as well.

Partnering with Experts Essential

Unions didn’t spend 10 years crafting Respecting the Just Rights of Workers only to have it sit on a shelf. Clearly, Catholic healthcare management is in labor’s cross hairs more than ever before. Unions have spent decades attempting to force hospitals and hospital systems across the country to accept “fair election agreements” much like Respecting the Just Rights of Workers. When hospitals refused, unions launched corporate campaigns that caused economic harm to the hospitals, damaged their reputations and hurt relationships with their stakeholders.

Unions knew exactly what they wanted in the 1970s when they began agitating for “fair election agreements,” and they know now as well. SEIU, the largest healthcare union, is also the fastest growing. It is as sophisticated as any business, has far more political clout and knows how to get what it wants. Expecting the SEIU to turn up on your doorstep with a blank sheet of paper saying, “Let’s talk” is a mistake. When SEIU targets a hospital or system, they’ll come fully prepared with their demands. Given labor’s pressing need for revenue, SEIU, its new strategic partner the California Nurses Association
(CNA), as well as other healthcare-focused unions will go into action soon.

Catholic hospitals will need help to keep from giving a union everything it wants in a Local Agreement. While Respecting the Just Rights of Workers is new, the mechanisms it contains are decades old. To succeed, hospitals should seek the most competent legal and labor relations counsel possible.

Essential Questions about the Principles

Catholic healthcare leaders should immediately engage their board of directors, religious sponsors and other key internal stakeholders to determine where everyone stands on Respecting the Just Rights of Workers as a whole, on each of its seven principles and its “New Paradigm.” Catholic organizations will need to ask themselves some tough questions, including:

Is it in our organization's best interest to adopt or reject the document in its entirety?

• What are the comparative costs . financial, service, quality, productivity, flexibility, and image . of rejecting versus accepting the Seven Principles?
• What do we gain in exchange for forfeiting much of our legal right to communicate our views on unions directly to our employees?
• What is our limit on each of the principles . how far are we willing to go to satisfy the union?
• The principles allow non-election decision making for employees. Would we agree to card check instead of a secret ballot election?
• How will accepting or rejecting some or all of the principles affect our relationship with our sponsors, local Catholic leaders, and external stakeholders?
• The principles specify that the employer and union "designate a neutral authority who shall have binding authority to enforce the local agreement and resolve issues that arise during the courseh of the organizing campaign. The union will have its favorite candidates. How far are you willing to go to reject their candidate or insist on your own?
• Will we accept the principles in general, but refuse to accept one or more of them?

Cardinal McCarrick himself acknowledged that the process of union and Catholic healthcare management developing a Local Agreement based on the Seven Principles will be rigorous: ""Principles are often more clear in high-level discussions than in the midst of local realities and personalities, especially when there is real pain and anger resulting from previous or ongoing disputes and tactics."

Preparing for the Seven Principles

At the same time leadership is considering these issues, Catholic healthcare needs to prepare for the possibility that a union - SEIU, CNA or another - will call soon and have a draft document that it would "like to discuss."

For Catholic hospitals and health systems that believe that maintaining a direct working relationship with employees is in their organization's best interest, five steps should be taken as soon as possible:

• Education
• Employee engagement
• Leadership training & development
• Organizational risk assessment
• Communications

EDUCATION

Respecting the Just Rights of Workers is only a guide, an outline of how Catholic hospitals and unions should interact before and during an organizing campaign. Making that outline operable could fill volumes . volumes that unions already have developed and will bring with them to Catholic hospitals.

Catholic healthcare leaders need to understand the implications of what Respecting the Just Rights of Workers would mean to the organization, how it will change their entire approach to union readiness, and its potential impact on operations and profitability.

IRI has years of experience helping Catholic healthcare leaders to understand:

• The differences between traditional union organizing and "fair election agreements"
• Current union practices & win rates
• Labor laws and the constraints on employers, plus the constraints of the "guidance and options"
• What "fair election agreements" say on paper, and how they actually work
• ""Fair election agreements" tactics
• Impact on employee relations
• Impact on flexibility and overhead

• Fastrack Teams^sm. Making cross-functional change using traditional methods can be a long, frustrating exercise. Our Fastrack^sm system, on the other hand, produces lasting results faster while giving employees the satisfaction of changing - in one or two days - processes that affect their work.
• Employee Advisory Groups. One of the most effective tools to promote engagement and manage difficult issues, Employee Advisory Groups are used to provide focused, non-binding employee input. Proven "safety valves," their uses range from helping to guide organizational decision making, improve problem solving and understand employee concerns, soliciting ideas and anticipating and understanding the effect of management's decisions on employees.
• Peer Review. Conflict exists in every professional and personal relationship. It's inescapable. IRI's Peer Review process, designed as an in-house grievance procedure, gives employees a participatory process for resolving problems fairly and impartially. Organizations that deal with employee conflicts this way benefit from reduced exposure to litigation, higher morale, better productivity and a reduced likelihood of unionization.

• Leadership Development & Coaching. Results, relationships and readiness are three qualities found in every successful leader. But what if a high-potential individual in your organization needs improvement in one of these areas?

  IRI helps clients develop trusted and credible leadership behaviors. We help leaders motivate employees through programs that leverage effective dialogue and communication, as well as remove barriers and resistance to change. The result is a culture that empowers employees to take ownership of their performance, make good decisions, and not feel the need to join a union.

• Change Management. Leaders must appreciate the importance of organizational change. They must know when revolutionary, not incremental, change is essential. Being able to adapt to change, whether driven by internal or external forces, allows organizations to survive such changes as Respecting the Just Rights of Workers and EFCA.

  IRI helps management integrate employees in an organization's success, and allow them to recognize change as an opportunity rather than a threat. We help empower leaders to inspire a sense of ownership and urgency needed to reject unionization.

• Organizational Communications Training. The most preferred, most-respected source of information in a workplace typically is the employee's direct supervisor.
  This preference starts at the very top of the business.

On delicate subjects like unionization, it's essential that managers and supervisors:

• Initiate dialogue
• Guide it
• Respond to it
• Comply with the National Labor Relations Act

• Be more effective when communicating with employees
• Inspire employees and improve morale
• Deliver difficult news
• Manage difficult personalities
• Be more effective in managing work

• Pay
• Benefit programs
• Employee voice
• Communication
• Working conditions
• Staffing
• Scheduling
• Promotional opportunities
• Management
• Co-worker relations
• Job Security
• HR policies & procedures

Positive Employee Relations Audit (PERA). PERA provides an efficient and dynamic "gap analysis" to evaluate and diagnose the strengths and liabilities of employee relations cultures and systems. IRI's PERA considers such IRI Intelligence Briefing News and Developments Affecting the Workplace critical measures as employee turnover, performance, work attitudes, absenteeism and predisposition to union organizing.

Issue Identification and Improvement (I^3®). This proprietary diagnostic and organizational improvement system identifies and addresses workplace issues through employee focus groups. The tool measures issues as diverse as human resources, operations, staffing, workplace communications, work environment, equipment, compensation and benefits, and teamwork.

Corporate Campaign Vulnerability Assessment. When unions can't get what they want, they'll up the ante. Dating back to the 1970s, unions have used "corporate campaigns" to wage long-term economic, political and psychological warfare against target organizations.

Whether it's to organize workers or force concessions in bargaining, the objective of corporate campaigns is to cause more pain to the target organization than it can stand.

Catholic hospitals that choose not to abide by Respecting the Just Rights of Workers risk becoming targets of corporate campaigns. IRI thoroughly evaluates organizations' vulnerability to that powerful tool. Our communications and labor relations professionals then help clients fix the weaknesses we uncover.

Human Resource Alignment Audit. This diagnostic tool determines the degree to which internal policies and procedures are being adhered to, and identifies the barriers impeding adherence. Not simply a "compliance audit," IRI's HR Alignment Audit combines a carefully designed mix of structured interviews with employees and managers, focus groups and surveys. IRI's auditors are experienced professionals who have lived with compliance issues, and understand the associated implications.

COMMUNICATIONS

Newsletters, emails, posters, flyers, videos and other tangible communication tools tend to give employers a false sense of security. "We told employees that last quarter in the newsletter" doesn't mean that employees read it, believe it or understand it.

With Respecting the Just Rights of Workers - with or without EFCA - communicating the issue of unionization needs to be done regularly, credibly and persuasively.

Research for decades has shown that employees' preferred source of information is face-to-face and from their immediate supervisor/manager. Unfortunately, the most-used source in most organizations is the rumor mill.

The problem is that many line managers don't:

• Have the skills to communicate effectively
• Feel comfortable answering difficult employee questions
• Fully understand or support what they're saying
• Have the tools they need to persuade their employees

Add to these issues ineffective messaging and slow-moving communication processes, and the chances of rapidly and effectively rebutting union claims are slim.

By stripping employers of much of their legal rights to communicate with employees, Respecting the Just Rights of Workers will make such organizational communications challenges infinitely more difficult. Its "guidance and options" for "Truthful and Balanced Communications" specifies:

• The union and employer will jointly review and approve all written communications to all employees.
• All communications must be "proportionate, mutually agreed upon, and conform to the 'truthful and balanced' principles" of the accord.
• The union and employer will have access to the same means of disseminating information and will agree in advance on an equal number of written, verbal or other communications to be made available to employees.
• The employer will not conduct mandatory or one-on-one meetings about unionization with employees.
• Employers must not use information from union constitutions and by-laws to create fears about fines or expulsion.

IRI thoroughly assesses employee communications processes and messages, then helps to maximize their effectiveness. Our Organizational Communications Audit is a thorough assessment of an organization's ability to effectively communicate critical messages. IRI's communications audits pinpoint current practices that work well, and identify opportunities for more robust, results-oriented communications.

Our communications audits give employers clear insight into critical issues that might enhance or impede their ability to maintain a direct working relationship with employees. IRI's communication consultants then help leadership teams to eliminate communication weaknesses and enhance strengths.

FOOTNOTES:
¹ http://www.vatican.va/holy_father/benedict_xvi/encyclicals/
documents/hf_ben-xvi_enc_20090629_caritas-in-veritate_en.html
² http://www.vatican.va/holy_father/leo_xiii/encyclicals/documents/
hf_l-xiii_enc_15051891_rerum-novarum_en.html
³ http://www.usccb.org/sdwp/national/respecting_the_just_rights_of_
workers.pdf
⁴ http://www.usccb.org/sdwp/national/workplace.shtml

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 6 - December 2008

How Unions Leverage Religion to Organize Workers

Over the past several years, an increasing number of hospitals and healthcare systems have experienced criticism from an unexpected source: the Church.

In each case, a labor union was the instigator. The union relies on principles from the hospital’s own affiliated religious community as a basis for organizing employees and, in some cases, recruits local clergy, board members and other community stakeholders in its efforts to organize at the hospital.

The union questions whether the hospital or healthcare system is supporting or “living” the religious social teachings of the church, particularly when the administration has taken a stand against unionization. But the underlying issue is how the union can be more effective in its organizing efforts.

For example, in the ongoing corporate campaign against St. Joseph Health System in California, the Service Employees International Union (SEIU) has made an issue of whether St. Joseph’s is following the Catholic faith’s social teachings found in papal encyclicals that support the “natural right” of employees to voluntarily associate. The union recruited local and national clergy and religious groups to join in the campaign against the ministry to get the Sisters of St. Joseph of Orange, the system’s sponsor, to enter into a system-wide organizing agreement with SEIU that includes a neutrality agreement and would bypass the NLRB-supervised election process.

Consequently, headlines like "Union-Busting Nuns" and "Labor Organizing a Bad Habit" have been used in stories about the organizing efforts at the healthcare system. Rallies and vigils attended by workers, priests, former nuns, local politicians and labor leaders have been held at the Sisters' convent. White papers were written. A critical Web site was created featuring negative media coverage, accusations of corporate greed and misbehavior and employee and patient "horror stories." And charges were filed with the NLRB.

While labor organizers may draw heavily from Catholicism, the themes, unions use in corporate campaigns are consistent across all faiths:

• Worker dignity
• Social justice
• Fair wages and benefits
• Freedom to associate
• Respect for human life

Coalition Building

When engaged in a corporate campaign, unions often build coalitions with organizations outside the labor movement, in part to leverage the credibility of other community organizations and take the focus off the union. When a union focuses on religious issues during a campaign at a hospital, it puts management in the difficult position of opposing respected religious leaders in their communities.

A growing number of national organizations have become secondary participants in union corporate campaigns, including Jobs with Justice (JwJ). The group developed a “Religious Action Kit” that provides study materials and advocacy tools for clerical advocates. Founded in 1987 by Larry Cohen – now president of the AFL-CIO’s Communications Workers of America – JwJ actively supports union organizing campaigns across the country through a network of grassroots coalitions, which include religious, community, student and civil rights groups.

The AFL-CIO also coaches community activists and union supporters to build these outside relationships on its Web site that includes the report, “Ten Things You Can Do to Build Religion-Labor Partnerships.” Meanwhile, the National Interfaith Committee for Worker Justice (IWJ) has joined the AFL-CIO as sponsor of “Labor in the Pulpit” to educate employees about the relationship between faith and work. IWJ also offers a resource guide that features suggestions for integrating pro-labor concepts in sermons.

The “living wage” movement is another area where unions, religious leaders and community activists – like the Association of Community Organizations for Reform Now (ACORN) – have aligned in organizing campaigns at health systems. Issues relating to social justice have surfaced in corporate campaigns supported by the United Methodist Church and numerous Catholic ministerial and lay groups. The National Baptist Convention, the organization representing African-American Baptist Churches, also has become increasingly active in corporate campaigns.

According to Catholic doctrine, the living wage issue encompasses the fair treatment of employees, including a wage that enables them to afford the basic necessities. An employer may be in compliance with state and federal minimum wage laws but, according to union organizers, executives still are guilty of earning overly generous compensation packages by adopting unsafe worker productivity objectives and paying wages that push employees below federal poverty lines.

In Good Faith

Beginning with Leo XIII’s Rerum Novarum in 1891, the Catholic Church has been clear about supporting employees’ “natural right” to voluntarily associate. But unions and other groups rely on ambiguities in official religious proclamations to convince employees that the church endorses unionization. They’ll use language, like the “right to decide through a free and fair process” to pressure hospitals into neutrality agreements or publicly shame them if managers attempt to educate employees about the organization’s interest in maintaining a direct working relationship.

“American unions universally encourage workers to adopt an us-versusthem attitude toward employers, which is contrary to Leo’s vision,” writes Charles W. Baird in Liberating Labor. “Leo XIII would not endorse modern unionism in America.”

Indeed. According to the United States Conference of Catholic Bishops, “The core of Catholic teachings…is that it is up to workers – not bishops, managers, union business agents, or management consultants – to exercise the right to decide through a fair and free process how they wish to be represented in the workplace.”

Employers and employees should be careful about sources cited by unions to support their claims of church support. In July 2008, the Catholic Scholars for Worker Justice published “Catholic Social Doctrine and Worker Justice: A Call to the Common Good.” In the small print, the authors admit that the “views expressed in this document represent the professional judgment of Catholic Scholars for Worker Justice. CSWJ is an independent organization and does not speak in an official capacity for the Roman Catholic Church.” In fact, the Labor Guild, a decades-old group founded by unionists who enlisted Jesuit priests to lecture members about labor matters, coordinated the publication.

Most major religions have made statements about their positions on unionization. The philosophies are similar in that they call on management and employees to act morally and in good faith to reach equitable solutions regarding wages and working conditions. They endorse the need for employees to have an active voice in decision-making that affects them as well as rights to choose whether they want third-party representation.

The Presbyterian Church, for instance, supports the rights of all workers to choose to organize for the purpose of collective bargaining. The United Methodist Church states its support for the "right of public and private employees and employers to organize for collective bargaining into unions and other groups of their own choosing." And the Central Conference of American Rabbis promotes its longterm advocacy of the labor movement and "the rights of employees to form unions for the purpose of engaging in collective bargaining and attaining fairness in the workplace."

How Should Organizations Respond?

• Educate senior leadership about church positions regarding unions and workplace issues;
• Adopt a simple, straight-forward position about unionization and communicate it to employees and new hires;
• Incorporate faith-based messaging in internal and external communications;
• Establish and maintain strong relationships with local church and community leaders;
• Conduct a corporate campaign vulnerability assessment to determine where your organization is vulnerable to attack and what opportunities exist to mitigate those vulnerabilities.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Nursing Union Victory Opens New Organizing Frontier

Last week, the California Nurses Association/National Nurses Or-ganizing Committee made sig-nificant ground on a new labor frontier: Texas.

In its successful election to organize the nearly 300 nurses of Houston's Cypress Fair-banks hospital, part of the Tenet health sys-tem, the CNA/NNOC claimed title as the first union to organize nurses in a state long resis-tant to labor's entreaties.

More so than any other single event, this election and the legislative initiatives spon-sored by union, will have significant impact on Texas hospitals and health systems in the coming months.

Because of Texas' long history as a right-to-work state, facilities in the state may be ill-prepared to respond to aggressive organiz-ing and corporate campaign activity that has become a fact of life for so many hospitals elsewhere in the country.

The Cypress Fairbanks Story

By a close 119 to 111 vote, RNs at Cypress Fairbanks voted to join the CNA/NNOC af-ter a low-key organizing campaign that lasted less than three months.

The union's victory was influenced largely by the so-called "peace accords" Tenet signed last year with both the CNA and Service Em-ployees International Union (SEIU). Under that agreement, Tenet hospitals are limited to the extent they can campaign against the union.

These agreements have the effect of stifling open discussion and dialogue in the work-place about unionization. At Cypress Fair-banks, for example, a group of nurses that opposed unionization was not permitted to meet, discuss the election or distribute mate-rials anywhere in the workplace.

Cypress is the smallest of Tenet's four hospitals in the Houston region, with fewer than 200 beds. In media reports following the vote, boastful NNOC organizers were quick to turn their sights on larger Tenet facilities, including the three hospitals in Dallas and a health system in El Paso.

Getting to know the CNA/NNOC

Few state-based unions have engineered a more successful debut on the national stage than the CNA, which has enjoyed explosive growth. Since its 2003 decision to expand beyond California through the NNOC, the CNA has organized nurses in hospitals in Maine, Illinois, Nevada and Pennsylvania and now claims as many as 80,000 members in all 50 states.

The union also has formed powerful al-liances, joining first with the United Steel-workers, then in 2007 taking charter among the powerful unions that make up the AFL-CIO. The partnership is mutually beneficial - infusing CNA with resources and placing President Rose Ann DeMoro on the executive committee of the country's best-known union while helping the AFL-CIO fill a void created when in 2005 the SEIU and six other unions disaffiliated to form Change to Win after a caustic political and ideological fight with AFL-CIO leadership. DeMoro described the CNA's move as necessary to build a "militant, united force" that would resuscitate the labor movement.

In recent months, the CNA/NNOC has been sparring in brutal competition with the Service Employees International Union, challenging its rival for both dues-paying members and prominence in the national la-bor movement.

The CNA has built its member base through campaigns advocating single-payer health care, staffing ratios and whistleblower protection, as well as traditional organiz-ing. And few unions - with the exception of the SEIU - have made more effective use of modern day organizing tools, including web-based communications and corporate campaigns that target employers with fierce negative publicity campaigns as a means of softening resistance.

NNOC Texas

In Texas, the CNA/NNOC is taking a two-pronged approach to establishing a beach-head, with organizing campaigns on one front and legislative campaigns on the other. The union has brought to Texas its crusade to mandate nurse-patient ratios- a law that union got passed in California against stiff odds and to much fanfare. Working in con-cert with the SEIU on this tack, the unions are targeting the 2009 legislative session.

Both publicity-savvy and organizationally astute, the CNA/NNOC first made its pres-ence known in Texas following Hurricanes Katrina and Rita in 2005, when the union dispatched several hundred volunteer nurses from California to Houston to assist relief ef-forts. It was no coincidence that Texas rather than Louisiana was the focus of the camera-ready campaign ... the state just happened to be the union's next organizing target. And the cadre of CNA nurses came to town with more than hurricane victims in mind.

Soon thereafter, the union began send-ing delegations of nurses the other direction - flying Texas RNs to California for a special screening of "Sicko," the Michael Moore doc-umentary highly critical of the U.S. healthcare industry. For the price of a two-day trip, the union enlisted dozens of Texas organizers.

And after only a few short years, NNOC Texas had established active committees across the state, from Houston to El Paso, Dallas, Austin, Brownsville and San Anto-nio.

As is the case with its work in other states, the CNA/NNOC makes a direct appeal to RNs based on the pillars of patient safety, workload and respect for the profession. Rarely in its literature does the union use the old-style union lure of better pay and bene-fits, instead courting this white-collar, educat-ed workforce with a strategically principled, altruistic appeal.

But the union is typically less benevolent toward the hospitals and executive leadership they target. In its rapid rise to prominence, the CNA/NNOC has been an aggressive critic of "corporate" medicine and hospital man-agement, which it readily accuses of putting profits before patient care.

As the union demonstrated in its home state, the most successful campaigns have a villain, and in California that villain was Gov. Arnold Schwarzenegger, who took a political beating at the hands of the nurses union when he tried to delay implementation of the hospi-tal staffing ratios.

With an aggressive, take-no-prisoners ap-proach to achieving its goals, the union has shown no more mercy toward hospital execu-tives and administrators in its tirades against the healthcare industry - a campaign that al-ready has gained traction in Texas.

In our extensive experience working in hos-pitals targeted or organized by the CNA, we have identified the key issues and tactics at play in CNA campaigns and how leaders can prepare and position their hospitals.

Are Texas Hospitals Prepared?

As the NNOC advances in Texas, health systems and hospitals should be prepared for a significant uptick in organizing and corporate campaign activity.

These efforts typically generate intense scrutiny on a number of potentially delicate issues, including executive compensation and profitability, staffing ratios, charitable care and community benefit, billing and collec-tions, bonds and financing, workplace fines and violations and facilities.

Preparation for a corporate campaign re-quires significantly more lead time than nec-essary to prepare for a traditional organizing campaign - in part because of the broad range of issues at play and the extensive coalitions unions build in opposition to the employer. Unions are often at work preparing the foun-dation for a corporate campaign months be-fore the first salvo is fired.

Even in its very early stages, union organiz-ing activity has implications for a hospital's entire operations - in terms of security, staffing, management training, communica-tions and community relations. And too of-ten, it's too late to correct any issues by the time the first union card shows up on cam-pus.

To prepare effectively, hospitals must re-view not only the traditional policies and procedures that govern distribution, visiting hours, solicitation and security, but also take a careful pulse of the workforce to identify areas of the greatest vulnerability.

Managers in particular must be trained and equipped to address the myriad issues they will face in organizing campaigns, and the leadership team be aware of the issues that alienate employees and have plans in place to address them.

Texas healthcare facilities should take no solace in the state's right-to-work legacy. With the SEIU already active in the state to organize service workers and nurses under the banner of the Nurse Alliance, the rivalry between the two unions promises to generate a tremendous amount of activity in Texas as neither union will cede the state to the other. And now that CNA/NNOC has forced the first crack in the wall, the next wedge prom-ises to be only larger.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 2 April 20, 2008

Fueled by bitter rivalry, election-year politics and a mix of ambition and opportunity, unions have significantly escalated their organizing efforts in the healthcare industry, with 2008 shaping up to be a watershed year for U.S. labor.

Although union membership in the industrial sector has been in a free-fall for many years, just the opposite is true in the healthcare industry where, as one organizer puts it, unions hope to put the movement back into the labor movement.

By year end, hospitals and health systems could be facing a starkly more hostile organizing environment as emboldened unions make organizing the central focus in the labor power struggle.

This new threat presents a real opportunity for healthcare leaders to take action, by taking the pulse of their organizations and identifying weaknesses and openings that a union could exploit.

Those hospitals committed to maintaining a union-free workplace must be prepared to begin or renew a dialogue with managers and employees about what unionization could mean and cost. Most important, leaders must be able to articulate to employees the advantages of having the freedom and professional autonomy possible only through a direct working relationship with their supervisors and managers.

By acting now to educate managers and make organizational improvements, health leaders could help ensure that employees are less receptive to union appeals. The goal: to make the workplace a less vulnerable target.

The campaign to organize healthcare workers is playing out most aggressively in California, Texas, Ohio, Illinois, Florida, Washington and Pennsylvania, although there is some activity in nearly every state.

Two key factors have led to this escalation of organizing:

1. The Battle of the Healthcare Titans: California Nurses Association/National Nurses Organizing Committee v. Service Employees International Union

Rarely have rival unions been so publicly antagonistic or aggressively hostile in competing for the votes and voice of healthcare workers.

While hospital nurses and other healthcare workers have been prime organizing targets for many years, labor's recent success in this arena has created new momentum.

One difference between organizing in healthcare workers and other employees is the success of these unions in moving beyond the traditional union focus on pay and benefits to make members part of a broader cause. That's achieved in part by labor's efforts to align with lawmakers and business leaders in support of national healthcare re-form, a politically popular cause.

But an even more potent appeal to healthcare workers is labor's self-appointed role as the guardians of healthcare workers and safe like that enacted in California, is behind ratio legislation in at least a dozen states - a campaign the union is also using to collect the names and contact information for nurses across the country.

The SEIU, meanwhile, has put its political advocacy behind legislation to increase funding for nurse training and retention - a campaign designed to strengthen the union's appeal to RNs as well as the patient care aides and service workers that make up the majority of SEIU members.

Both unions now boast success rates topping 80 percent in healthcare petition elections. But neither is content to share the spoils.

Consider the face-off between the CNA/ NNOC and SEIU in Ohio, where the CNA scuttled a scheduled March 11 representation election scheduled as part of a deal between the SEIU and Catholic Healthcare Partners to give employees an opportunity to vote yea or nay after the union spent years trying to organize the system. In spoiling the SEIU's hard fought deal, the California-base union not only challenged its rival in the CHP arena, but made clear that it would compete to organize nurses in hospitals across the country."We're in a war with SEIU," Rose Ann DeMoro, CNA's head, told participants at a conference April.

The CNA/NNOC has ramped up its organizing and political activity from coast to coast, using FOIA requests to obtain nurses' names and information from state nurse licensing boards and attempting to raid bargaining units represented by state hospital associations. Recently, the CNA/NNOC made a play for Texas nurses already represented by AFL-CIO sister union, AFSCME.

In the weeks since the Ohio skirmish, the unions have taken their battle public in an extension of the rift begun when the SEIU and several allied unions split off from the AFL-CIO, and the CNA joined the old-guard federation - forever ending the uneasy alliance the two unions had forged in those hospitals and health systems where the CNA represented RNs and the SEIU represented service workers.

The CNA has since launched at least two public websites highly critical of the SEIU, including www.ServingEmployersInsteado-fUs.org and www.SEIUwatch.org.

And the SEIU responded with www. ShameonCNA.com, which includes an on-line petition for nurses to share their "bad CNA experiences."

The battle is certain to rage on for a long time to come, but the end result for hospitals is aggressive competition for members that will play out in the form of more aggressive organizing campaigns in the workplace.

2. Employee Free Choice Act

The dueling unions do, however, agree on one thing - as do labor unions in every industry: the Employee Free Choice Act. This legislation continues to gain support on Capitol Hill as a result of coordinated union efforts to keep the legislation in the public eye during a pivotal election year.

The EFCA has long been on the radar of executives, human resources and employee relations professionals as a serious threat to the time-honored tradition of secret-ballot elections governed by the National Labor Relations Board.

But few workers on the frontlines of healthcare recognize the full impact of the legislation which, if passed, would make organizing far easier by imposing what amounts to a national neutrality agreement on employers.

Using benign terms like "neutrality" and "free choice," sponsors talk about the proposed law without mentioning what it really means to workers - a radical change in labor law that would deny them the right to cast a vote for or against joining a union.

During an April 2 hearing of the Senate Appropriations committee, for example, subcommittee Chairman Tom Harkin (D-IA), promised to push the measure through "in order to rebuild the economic security for the middle class of America."

Absent from the debate is much discussion of the likely result for many hospitals - workers inadvertently "signing up" for union representation by doing nothing more than signing a card requesting information on a patient care issue. That could mean no informed choice, and little recourse.

The burden is on an organization's leadership to educate managers and employees about the EFCA, and take the debate from the political rhetoric on Capitol Hill to the real-world ramifications in the workforce.

Ready, Aim ...

A new era of healthcare union organizing is already here. And if Democrats succeed in capturing the White House and a filibuster-proof majority in the Senate, the then inevitable passage of the EFCA gives labor an enormous advantage.

On the theory that success is where preparation and opportunity meet, forward-looking hospital leaders should begin preparing for new era in union activity now - not when the first union card appears, but in anticipation that it might.

Employers should begin a conversation now with employees about the benefits of a direct relationship in the workplace, as well as the costs to patient care common in union workplaces that experience bruising contract battles, belligerent union stewards and the risk of frequent work stoppages. These conversations are more effective before an organizing effort begins and absent the high emotions that a labor campaign brings.

In this environment, hospitals must not only understand their weak points, but also work to address them.

One useful tool is a Corporate Campaign Vulnerability Assessment, a process that probes and highlights the issues and areas most vulnerable to attack. Completed well in advance of union activity, an objective assessment allows leaders to address issues where possible and to develop the communications and outreach materials that will help shore up support and defend the organization's reputation.

Another useful tool is a comprehensive employee opinion survey and assessment process that allows managers to identify the areas of greatest dissatisfaction, pride and engagement in the workplace.

Now is the time to educate managers about how to recognize early signs of union activity, how to respond to employee questions, and the critical rules governing employers under National Labor Relations Act.

Now is the time for hospitals to make sure that they have the right organizational and communications structures in place to preserve or improve employee satisfaction and provide employees a meaningful voice in the organization.

In modern organizing, unions do far more than court workers with promises of better pay and job security. They also try to vilify companies and damage their reputations as a way of attracting allies and undermining an employer's relationship with its workers and the community it serves.

Few healthcare organizations are impervious to union organizing efforts. But it is far better to build a strong wall ahead of time and prepare for a battle than to be late to the battlefield and go in unprepared.

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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Vol. 1 No. 9 - June 2009

Service Employees International Union President Andy Stern recently proclaimed, "SEIU is on the field, it's in the White House, it's in the Administration." No hyperbole there. From the Economic Recovery Advisory Board to the federal stimulus bill to the NLRB, unions already are regaining influence in Washington, none more so than SEIU.

SEIU Lawyer is NLRB Nominee

The labor movement has scored two more seats on the National Labor Relations Board, the agency that oversees federal law governing almost all employee relations in the private sector. The President's first choice to fill a vacant Board seat was Craig Becker, who currently serves as associate general counsel to both the SEIU and AFL-CIO.

Becker is a skilled lawyer with sterling credentials. He graduated summa cum laude from Yale in 1978, and received his law degree there in 1981.

Becker's labor philosophy slants sharply pro-union. In a 1993 Minnesota Law Review article, for example, Becker argued that traditional tenets of democracy should not apply in union representation elections. He wrote that employers should be barred from attending NLRB hearings about elections, from challenging election results even with evidence of union misconduct, and from "placing observers at representation elections to challenge ballots." According to the Wall Street Journal, Becker has gone so far as to argue that that any "captive audience" meeting a company holds ought to be grounds for overturning an election.

Also nominated to the NLRB is Mark Gaston Pearce, who has represented labor unions for his entire career, much of which has been in private practice. Pearce is on the Board of Directors of the Lawyers Coordinating Committee of the AFL-CIO.

Assuming Senate confirmation, Becker and Pearce will join Peter Schaumber and Wilma Liebman on the Board. Schaumber, a Bush 43 appointee whose term expires in 2010, is a respected former assistant U.S. Attorney. The President has not yet nominated a candidate to fill the fifth seat on the Board.

Former Union Attorney Named NLRB Chair

Wilma Liebman, a former labor counsel for the Bricklayers and Allied Craftsmen and the International Brotherhood of Teamsters has been appointed NLRB Chair by President Obama.

First named to the Board in 1997 by President Clinton, Liebman is an outspoken proponent of labor unions, as the following passage from the Journal of Labor and Society¹ illustrates:

[A]n exclusive orientation toward an individual-rights regime could have troubling political and social consequences. Workers may view the employment relationship in purely individual terms and may fail to grasp common economic interests and the potential of collective action at work, as well as in the public sphere.

Without a functioning collective bargaining system, fundamental economic issues are placed off the table: distribution of wealth, control, and direction of economic enterprises. What institution will be as effective in efforts to minimize the randomness of fortune of democratic capitalism?

And without a strong independent trade union movement, what institution will stand effectively as a counterweight in our democracy to the growing political influence of corporations? What in situation will speak for working people-indeed for the middle class-as effectively?

Labor Department Direction Changing Fast

President Obama's highest-profile pro-labor appointment to date is Labor Dept. Secretary Hilda Solis. She was first elected to Congress in 2000, defeating a nine-term Democratic incumbent 69 percent to 31 percent by focusing on labor and environmental issues.

A strong supporter of the original Employee Free Choice Act, she served as treasurer of American Rights at Work, the only member of Congress to hold a leadership position with the pro-union group. While in Congress, she had a 99 percent "liberal quotient" from Americans for Democratic Action.

The Obama/Solis agenda includes:

• Plans to add 250 new investigators to its Wage and Hour Division, the first step in what's expected to be a major crackdown on employer wage-and-hour violations. According to Human Resources Executive, the Labor Dept. estimated last year that as many as 70 percent of employers were not in full compliance with the Fair Labor Standards Act.

  The president's nominee to head the division is Lorelei Boylan, currently director of strategic enforcement in the New York Labor Department's Labor Standards Division.

  While in New York, Boylan instituted an initiative that deputizes nonprofit community activists - mostly either members of unions or union-connected groups such as the Association of Community Organizations for Reform Now (ACORN) - to monitor private-sector employer practices. The state trains volunteers, assigns them geographic territories to patrol, and lines them up with contact persons to whom they can report apparent wage and hour violations.

• A proposed budget increase of $600 million in discretionary spending for enforcement of laws and procedures governing businesses, and sharp reductions in funding to the DOL unit that investigates union misconduct.

Unions in the Administration

Just below the Cabinet level are a number of critical, union-member appointees, including:

• Anna Burger, SEIU executive vice president, and Richard Trumka, secretary-treasurer of the AFL-CIO, have been appointed to the President's Economic Recovery Advisory Board. They join such notables as former Federal Reserve Chairman Paul Volcker, Harvard economist Martin Feld-stein, former SEC Chairman William Donaldson, and the CEOs of GE, UBS Americas, Caterpillar and Oracle.
• Michael Kerr, who oversaw finance and administration at SEIU, was confirmed as Assistant Secretary for Administration and Management in the Labor Dept.
• Patrick Gaspard, SEIU Local 1199's former executive vice president of politics and legislation, is now director of the White House Office of Political Affairs.
• Ellen Moran, a former AFL-CIO staffer who coordinated the union's corporate campaign against Wal-Mart, stepped down from the White House communications director position to become chief of staff to Commerce Secretary Gary Locke.
• John Sullivan, SEIU associate general counsel, was appointed to the Federal Election Commission.

SEIU, CNA "Bury Hatchet"

SEIU and the California Nurses Association (CNA/NNOC) have set aside a long-standing, contentious rivalry, bringing together two of the most influential labor voices in healthcare. The two unions announced plans to collaborate on organizing healthcare workers and lobbying Congress to pass pro-labor legislation.

In a joint announcement, the unions said they agreed to:

• Coordinate organizing efforts, with the CNA/NNOC focusing on registered nurses and the SEIU on other health-care employees
• Pool resources in support of legislation that will make it easier to organize employees and implement a broad range of workplace regulations
• Refrain from raiding each other's members
• Create a new joint RN organization in Florida

The détente of sorts may serve to burnish labor's public image after several much-publicized incidents of union infighting and rivalry. With labor's candidate in the White House and Washington controlled by Democrats, unions are allocating millions of dollars and human capital to forward their political agenda.

EFCA up in the Air

The Employee Free Choice Act continues to be a subject of intense debate, even though Senate leaders shelved it temporarily when they saw they didn't have the 60 votes to overcome a Republican filibuster.

A variety of suggested compromises have been floated, including proposals to remove the bill's card check provision and replace it with expedited elections. Under this provision, election campaigns would last only five or 10 days instead of the now-standard six weeks.

However, many EFCA opponents believe that the bill's provision to institute mandatory arbitration of labor contracts could cause more far-reaching damage to employers than card check. A Wall Street Journal² op-ed written by a former director of the Federal Mediation and Conciliation Service and a former NLRB chair laid out the case:

Mandatory arbitration is devastatingly bad policy - it throws a monkey wrench into the collective bargaining process. Nothing would more certainly make private bargaining a waste of time. Why make concessions at the bargaining table that would simply move the starting point for arbitration? An arbitration panel's power to dictate terms is virtually limitless. Such panels could impose uncompetitive wage rates and unworkable work rules. Arbitrators could also impose mandatory union dues and discharge for failure to pay. Collective bargaining strikes a balance between the normal desires of management to keep costs down and retain flexibility, and the union's desire to deliver on promises made to employees. Current law provides that bargaining parties are not required to make concessions. Thus, resolving these differences takes time, since sometimes their goals are unrealistic.

As of now, the fate of EFCA is entirely up in the air. The bill's lead sponsor, Sen. Tom Harkin (D-IA), has threatened to force a vote and "let lawmakers vote their conscience" if opponents aren't willing to work with him on a compromise. Without the mandatory 60 votes, however, Republicans could knock it back to the sidelines with a filibuster.

The Cost of Unionization

From the micro level - individual employers - to the macro - the American economy - the business costs of unionized workplaces are considerable. With some form of the Employee Free Choice Act in place, the costs are expected to climb sharply.

America's northern neighbor has had decades of experience with one form or another of card check organizing. Until 1976, every Canadian province³ had only card check organizing - no secret ballot elections. Subsequently, the provinces began moving away from mandatory card check and experimenting with labor elections similar to those in the U.S. As of now, 68 percent of the Canadian workforce is covered by mandatory election laws, with 32 percent covered by card check.

Canada has a union density (percentage of the workforce that's unionized) of 30.3 percent, which is 2.5 times the 12 percent U.S. density. According to the Canadian LabourWatch Association⁴, card check in Canada has created a fertile field for unions - and has cost the country plenty.

Studies suggest that amid such pervasive unionization, businesses there have experienced a three percent reduction in share price and a 15 percent dip in profits after becoming unionized. Similarly, unionized Canadian businesses have experienced roughly 3.8 percent slower growth than their nonunion counterparts.

Pluses and Minuses

Why are American unions pushing so hard for EFCA? Follow the money.

Andy Stern has estimated that EFCA would increase union membership by 1.5 million a year for the next 10 years. Using a conservative estimate of $425 yearly union dues per member, EFCA could grow union income by more than $637 million each year for the next decade.

But if Stern is right, what would the cost of that bonanza be to American businesses?

A study submitted to Congress⁵ earlier this year estimated that for every three percentage points gained in union membership, the following year's unemployment rate would increase one percentage point and job creation would fall by 1.5 million jobs.

In other words, if EFCA - with card check or some other mechanism that makes organizing easier, faster and less expensive for unions - took effect in January 2010, and union density jumped from 12 percent to 15 percent next year - from 15.5 million to nearly 20 million members - then the number of unemployed Americans would grow by between 2.3 and 5.4 million by January 2011.

The same study also predicted:

• An increase in employer wage costs, depending on the industry, of between eight and 22 percent
• A decrease in plant output of 9.6 percent
• A decrease in employee hours worked of between one and two hours each week
• Unionized firms investing 10 percent less in the business than nonunion businesses

So, How Much Will It Cost Me?

Too many unknowns stand in the way of forecasting employer-specific effects of EFCA. Unions want it so badly because it would grow revenues. But even if the current card check provision falls by the wayside in Congress (not a sure thing), such other mechanisms as "quickie" elections also could be very effective.

If Congress passes legislation that makes organizing easier for unions, and if the NLRB and Labor Dept. change the way business and union labor relations are regulated, the impact on employer costs will be enormous.

With increased unionization:

• Compensation costs will increase. One study of hospital wage costs⁶ found between five and nine percent higher wages after unionization
• Non-wage costs will rise
  • Legal costs & additional staff involved with contract negotiations and administration, grievances, mediation, arbitration, lawsuits
  • Unfair labor practice fines of up to $20,000 per incident, plus legal fees and staff resources, plus treble damages for back pay
• Productivity will drop
  • Unionized employees are given paid time off for union business
  • Lower morale, sick-outs, strikes and a "not my job" mentality
  • More staff required because supervisors are prohibited from performing work that's tasked to unionized employees
• Flexibility will decrease
  • More rigid work rules
  • Change initiatives require union involvement & approval

"You Ain't Seen Nothing Yet"

Altogether, Washington is in the midst of a massive political realignment not seen in many years. As the political pendulum continues its leftward swing, the importance of the changes noted here will be magnified. For example:

• The DOL is expected to make a major shift in interpreting the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), the law that governs financial transactions and administrative practices of labor organizations, businesses, labor consultants - and possibly law firms - and the reports they are required to file. These reports cover activities related to persuading employees about exercising their rights to organize and bargain collectively. The shift is expected to result in much closer scrutiny of business activities and much less oversight of unions.
• While not a certainty, it's likely the courts will call Al Fran-ken the winner in the bitterly contested Minnesota Senate race, giving Democrats a filibuster-proof 60 vote plurality and opening the door wide for extensive pro-union legislation beyond EFCA.
• The pro-labor majority on the NLRB could erase all the business-friendly policy changes of the Bush years. Some have suggested that the Board's labor bias could become as pronounced as the Carter administration's in the 70s. Once President Obama's NLRB nominees are confirmed, the board will face a lengthy agenda of issues including:
  • Whether more workers whose jobs fall in the gray area between salaried management and hourly laborers should be allowed to unionize
  • How much freedom workers should have to use company email systems to promote union membership
  • How much access union organizers should have to workplaces
  • What constitutes unacceptable intimidation by employers seeking to oppose union organizing drives
• The SEIU and AFL-CIO appointees in the White House, sure to be joined by others throughout the administration, could strongly affect employer issues not covered by the Labor Dept. and NLRB.
  n Despite its difficulties, EFCA - in some form - still appears to have a fighting chance to become law. Whatever its provisions, it will make union organizing much easier. Even without EFCA, however, expected actions by the NLRB and Labor Dept. will change the business landscape dramatically.
• Another indication of what's ahead is the coalition of nursing unions - California Nurses Association/National Nurses Organizing Committee, the United American Nurses, and the Massachusetts Nurses Association - that recently urged Congress to pass legislation mandating national nurse staffing ratios. The unions' reasoning is that it's easier to persuade 535 federal legislators to pass a bill than thousands of state legislators to pass 49 bills (California already having ratios).

As President Obama recently said at a fundraiser in Beverly Hills, "You Ain't Seen Nothing Yet."

FOOTNOTES:

1. Working USA: The Journal of Labor and Society, Vol. 11, No. 1, March 2008
2. Wall Street Journal, March 13, 2009
3. The only nationwide labor laws in Canada govern such federally regulated industries as banks, railways, airlines and telecommunications. Most other businesses that operate in more than one province are governed by provincial laws.
4. www.labourwatch.com
5."An Empirical Assessment of the Employee Free Choice Act: The Economic Implications," Anne Layne-Farrar, LECG Consulting, alayne-farrar@lecg.com
6."Unionization and the Cost of Producing Hospital Services," Journal of Labor Research

The IRI Intelligence Briefing is published periodically for the benefit of IRI’s clients and industry associates. If you would like to receive the IRI Intelligence Briefing by e-mail, please send your e-mail address to newsletter@iriconsultants.com and put Intelligence Briefing in the subject line. Your privacy is assured and your e-mail information will be not used for any other purpose. For more information, please contact Jim Trivisonno at 313.965.0350, extension 422.

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