December 2012, Week 1


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Wed, 5 Dec 2012 22:53:57 -0500
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What “Right to Work” Would Mean for Michigan

By Roland Zullo, Research Scientist

Institute for Labor and Industrial Relations 
University of Michigan

There is an effort afoot to make Michigan a “right to
work” state. Unfortunately, most citizens are unaware
of what “right to work” means or the implications if
such a law is passed. Our purpose here is to explain
the law, map the arguments for and against, and
describe potential effects for Michigan should such a
proposal become law.

To begin, the term “right to work” (hereafter RTW) is a
misnomer. RTW has nothing to do with the right of a
person to seek and accept gainful employment. Rather,
RTW laws prohibit a labor union and employer from
negotiating union security clauses. What are union
security clauses? Union security clauses are contract
provisions that regulate the collection of union dues.
In non-RTW states, such as Michigan, the parties are
free to negotiate a range of union security options.
Unions typically prefer “union shop” terms that require
every person benefiting from union representation to
pay union dues. In RTW states, the parties are barred
from negotiating union security clauses, making the
default the “open shop,” where the payment of dues is
optional for workers represented by the union. Between
these two policy poles are arrangements that require
represented persons to pay a proportion of full dues,
and even to allow objectors to unionization to
contribute dues to charity. Such arrangements are,
however, also proscribed under the RTW proposal before

Labor unions are nearly universal in their opposition
to RTW laws, and their argument is straightforward:
each person that benefits directly from union
representation should pay their fair share of the cost
of that representation. In the very least, represented
persons should pay a dues amount to cover the expense
of negotiating and administering the labor agreement
(what are referred to as collective bargaining
activities). For unions, this is just since, by law,
they are required to represent all persons within a
bargaining unit. It is critical to appreciate that
although unions have some input into the composition of
the bargaining unit, they cannot exclude persons that
simply do not want unionization.

It is the National Labor Relations Board, or similar
agency at the state level, that holds final judgment
over bargaining unit membership. Determination is based
on “community of interest” criteria (e.g. similar
skills, proximity, and so forth). Any job meeting those
criteria is included, regardless of how a particular
individual holding a job feels about unionization.
Then, if a majority of workers in the bargaining unit
elect to unionize, union leaders must represent all
unit members fairly and without prejudice.

Supporters of RTW laws advance two major arguments.
First is that RTW laws make a state more attractive to
investment, and that passage of RTW law will lead to
job growth. While such statements may sound attractive
to a state that is facing economic hardship, the
evidence here is in dispute. Like Michigan, nearly
every state in the union has lost manufacturing jobs
over the last six to eight years, but it is unclear
whether the rates of job loss are related to RTW laws.
Our economic problems in Michigan are due primarily to
the woes in the auto industry, which RTW would not fix.
When making location decisions businesses rate factors
such as the quality of the regional workforce, the
regulatory environment, and tax incentives before ever
considering RTW laws.

The second and main argument for RTW is rooted in
libertarian ideology: individuals should not be
required to financially support any collective, unions
in this case, against their will. This “free
association” position focuses on the inherently
coercive practice of demanding a sacrifice from all
that benefit from a collective endeavor. Coercion
exists when an individual objects to the purpose or
activities of the collective, yet is unable to withhold
their support. In the U.S., a workplace becomes
unionized when a majority of the employees in a
bargaining unit petition for union representation. This
“50 percent plus 1” method of determination almost
guarantees the presence of a minority group that did
not want a union. Further, in many instances a person
gains union coverage by accepting employment at a
worksite that is already unionized, without ever having
the opportunity to vote for or against unionization. In
a non-RTW state, a labor union and employer can agree
to a union security clause that requires all covered
persons to pay dues to finance collective bargaining
activities. In such situations, someone seeking to
avoid paying dues to the union has three options: exit
their job, convince union leadership to negotiate an
open shop, or persuade fellow workers to decertify the
union. Given that the last two outcomes are hard to
achieve, the most viable option for dissenters is to
work elsewhere. Thus, the term “right to work” means,
in its elongated form, the right to work in a unionized
setting, and reap the benefits of collective
representation, without having to contribute toward the
cost of obtaining those benefits.

And the benefits are indisputable. Depending on the
occupation, unionized workers earn wages that are ten
to forty percent higher than their nonunion
counterparts. The positive differential for other forms
of compensation, such as health care insurance and
pensions, is even greater. Perhaps more important than
economics, however, are matters involving justice.
Nearly all union contracts feature an informal form of
due process: a grievance procedure that ends in final
and binding arbitration through which unions resolve
disputes over the contract and employer discipline. As
such, in most union settings an employer must show
proof that a worker committed a wrongdoing in order to
discharge them. By contrast, in a non-union setting
workers are “at will” and can be discharged for any
reason (or none at all) that is not proscribed by
federal law.

It is important to note these benefits, because while
promoting free association and individual liberty sound
noble, the use of such concepts to advance RTW
legislation belie a less lofty motive: to undermine the
economic and political power of wage-earners.

As the financiers of the RTW program are well-aware,
when workers act collectively they gain power at work
and in society. In states that have passed RTW
legislation, the wages and benefits of all workers,
union and non-union, are lower than national averages.

One reason is that the gains by unionized workers spill
into the non-union sectors through the so-called
“threat effect”: in the presence of a strong regional
union movement, employers with a non-union workforce
will raise wages and benefits to discourage employees
from unionizing. Remove the threat and non-union
employers have greater latitude to lower compensation,
to require workers to perform dangerous tasks or work
in unhealthy environs, or to treat workers without
dignity. This is the hidden agenda behind the RTW
effort: strengthen the hand of employers by passing a
law that weakens the vanguard institutions promoting
economic and social equity for wage-earners. In this
sense, RTW is both a bald attack on organized labor as
well as a veiled assault on wageearners.

To understand how RTW laws weaken organized labor it
useful to couch this discussion in theory. Social
scientists that study collective behavior often refer
to the “collective action problem” for movement
development. It begins with the premise that any
collective endeavor needs resources such as volunteer
effort, money, or other assets to succeed.
Unfortunately, individuals that stand to enjoy the
fruits of the collective also have an incentive to
avoid making any contribution, especially if they
believe the collective will succeed without their
support. With too many “free riders,” of course, the
collective becomes resource-starved, causing it to
under-perform or fail. To minimize this problem, rules
are necessary that limit the ability of an individual
to shirk their obligation to the collective. There are
many examples of this phenomenon in society, but the
most obvious is taxation for funding public services.
Politicians may debate the level of tax, how taxes are
collected, or how taxes are spent, but there is no
question that it would be a disaster to allow the
payment of taxes to be optional. Compulsory taxation is
necessary to ensure the adequate financing of public

Similarly, for organized labor, union security
provisions are the rules that resolve the collective
action problem. A union shop simply mandates that
everyone pays their fair share. Open shop arrangements,
on the other hand, are problematic because they present
incentives for employees to refrain from contributing
to the union, and “free ride” on the sacrifices of
dues-paying members. Ultimately the financial support
necessary to operate a union is undermined.

So what are the predictable consequences if Michigan
becomes a RTW state? To answer that question, we need
to first map how unions affect our society. The most
mentioned role that unions play is in the economic
system, as a bargaining agent for workers. As described
above, unions use their collective power to gain a more
equitable share from production, and also to negotiate
rules that improve the level of justice at work. Under
RTW laws, existing unions would direct resources toward
internal member mobilizing in an effort to retain this
role. This redirection of resources, however, would
mean fewer funds for new member organizing, and
Michigan would likely experience a diminished threat
effect. A second recognized role for labor is in the
political system. Labor unions have a long history of
pursuing legislation that benefits all wage-earners:
higher minimum wage laws, universal health care, health
and safety protections, to name a few. Union’s leverage
to achieve gains in these areas is directly related to
their ability to mobilize support during the political
cycle. As such, unions operate telephone banks, engage
in member education, and canvass communities to inform
their members and the public to get out the vote. Under
RTW laws we can expect resources for these activities
to diminish, resulting in lower voter turnout among the
working class and a political system that is less
responsive to Michigan’s non-rich. Finally, labor
unions are active in civic affairs. As human
institutions embedded in our communities, unions
frequently organize collections on behalf of the less
fortunate, they are among the largest givers to
charitable organizations, such as the United Way, and
they even occasionally fund popular community
activities, such as little league teams. Under RTW, we
should expect this role to decline.

Unions are certainly not flawless. They are
organizations that breathe a measure of democratic life
into an otherwise autocratic corporate culture. And as
democracies, unions can embrace the best and the worst
of human intentions. On balance though, labor unions
have an admirable history. In every capitalist economy,
the standards for economic, political and social equity
are owed in part to a vibrant, independent union
movement. Consider this final thought, fellow citizens,
as you contemplate whether Michigan is to become a RTW


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