Democrats Are Close To Implementing Big Fines For Illegal Union Busting

The deal reached on Biden’s Build Back Better framework includes monetary penalties of up to $100,000 for employers who violate labor law.

It may finally cost something for employers to illegally break unions.

Congressional Democrats and the White House on Thursday reached a tentative deal on a trimmed-down yet still historic $1.75 trillion spending package that would broaden the social safety net and address climate change. Although it’s still subject to changes, the current version of the Build Back Better framework includes a potentially landmark reform to labor law: monetary penalties for union busting.

The latest iteration of the bill released by House and Senate leaders Thursday would fine employers up to $50,000 for each “unfair labor practice,” and up to $100,000 in cases where a worker was illegally fired. An unfair labor practice ― commonly called a ULP ― is a violation of the National Labor Relations Act, the New Deal-era law that protects the right of workers to form unions or join together to improve their working conditions.

“These fines will actually make the law real.”

- Rebecca Givan, Rutgers University

These fines would have big impact because currently, there’s almost no downside to breaking the law. If an employer is found to have illegally fired union supporters, the most they have to do is offer reinstatement and backpay. And the backpay is “mitigated” — meaning any other wages the worker earned elsewhere after getting fired would be subtracted from what the scofflaw employer owes the person it fired.

In many cases, an employer found to have committed ULPs merely has to hang a poster in the workplace acknowledging they did so. With such weak penalties, employers are acting rationally when they violate the law, which is why ULPs are so common in organizing drives.

But with monetary penalties, employers might make a different calculation.

“These fines will finally give a fairly toothless law some enforcement power. Employers have been able to break the law with impunity,” said Rebecca Givan, an associate professor of labor studies at Rutgers University. “These fines will actually make the law real, and will force employers to follow rules that have been on the books for over half a century.”

The penalties have a place in Democrats’ spending bill because they raise revenue. To survive under the rules of budget reconciliation — the process Democrats are using in an effort to pass the legislation on a party-line vote — a provision needs to have some kind of budgetary effect.

But the real idea behind the penalties isn’t to bring in money ― it’s to stop employers from breaking the law, and make it easier for workers to organize. That’s why the penalties are included in another one of Democrats’ sweeping plans: the Protecting the Right to Organize Act, or PRO Act, which seeks to buck up labor rights. The penalties would be the most significant piece of the PRO Act to make it into the Build Back Better framework.

Union membership in the U.S. is hovering near historic lows, particularly in the private sector, where just 6.3% of workers now belong to a union. In the years following World War II, roughly a third of U.S. workers were in unions. President Joe Biden has pledged to help turn around the labor movement, promising to be “the most pro-union president you’ve ever seen.”

Amazon settled a case involving unfair labor practice charges over the firing of two workers who’d criticized the company on climate change.
Amazon settled a case involving unfair labor practice charges over the firing of two workers who’d criticized the company on climate change.
via Associated Press

Benjamin Sachs, a labor law professor at Harvard Law School, said the inclusion of labor law reforms in Biden’s signature bill would show that collective bargaining is part of the administration’s broader vision for economic fairness.

“The Biden administration understands why organizing rights are essential to rebuilding the economy. Those things are related to one another,” Sachs said.

Like many other experts, Sachs has argued for a complete reconstruction of labor law to give workers more leverage, finding that the current system has essentially failed to create a needed counterweight to employers.

“We need a real overhaul to labor law, and that’s not this,” he said of the union-busting penalties. “But in terms of fixes to the current system, this is great progress.”

According to a 2019 analysis by the Economic Policy Institute, employers were charged with committing ULPs in 41.5% of union elections overseen by the National Labor Relations Board in 2016 and 2017. The employer was accused of illegally firing workers in nearly 20% of cases, and coercing or threatening employees in nearly 30%.

Researchers cautioned that their findings “likely understate the extent of employer aggression against unions,” since many violations go unreported.

The NLRB often changes rules and precedents making conditions more or less favorable to workers organizing, depending on whether there’s a Democratic or Republican majority on the board. But amendments to the law like the one being considered by Congress right now are extremely rare, said Kate Bronfenbrenner, director of labor education research at Cornell’s Industrial and Labor Relations School. One notable example would be when Congress extended collective bargaining rights to nonprofit health care workers in 1974.

“The way the process works now, they tend to get settled out because the penalties are just pieces of paper. ... But when these penalties start to have value, the unions are not going to settle them. It will become much more high-stakes.”

- Kate Bronfenbrenner, Cornell's Industrial and Labor Relations School

Bronfenbrenner’s research has shown that employers have grown more aggressive in combating organizing campaigns in recent decades, which she believes is a major factor in the declining rate of unionization.

She cautioned that there are still large, powerful employers that would view even a $100,000 fine as the “cost of doing business.” She cited Amazon, which unleashed a robust anti-union campaign to defeat an organizing drive at its Bessemer, Alabama, warehouse earlier this year.

A labor board official has called for that election to be rerun because Amazon went to great lengths to have a U.S. Postal Service mailbox for ballots installed on warehouse grounds. Amazon also settled a case involving unfair labor practice charges over the firing of two workers who’d criticized the company on climate change.

But most employers will have to take the fines seriously, she said. And unions may be less likely to seek settlements when there are meaningful penalties attached to the cases.

“The way the process works now, they tend to get settled out because the penalties are just pieces of paper. To the union, the penalties are not that important because they don’t do anything,” Bronfenbrenner said. “But when these penalties start to have value, the unions are not going to settle them. It will become much more high stakes.”