American workers will continue to become more productive as the digital revolution advances. But United States labor law must be reconstructed to recognize changes in work and the employment relationship and to once again effectively permit workers to organize and designate representatives to bargain with their employers. Otherwise, workers will not share the increased income generated by their productivity, ultimately threatening economic growth.
Richard L. Trumka is president of the AFL-CIO. Craig Becker is general counsel.
The problem is that the employment relationship is dynamic, but U.S. labor law has not been since President Franklin D. Roosevelt signed the National Labor Relations Act in 1935. There are many explanations for the rapid expansion and gradual contraction of worker representation during the past 80 years but that mismatch is key.
The two decades after the NLRA became law witnessed a surge of worker organizing that created the modern U.S. labor movement and, with it, the American middle class. Union membership as a percentage of the workforce reached its peak in the mid-1950s and as a raw number in the late 1970s. In the intervening decades, Americans enjoyed unparalleled shared prosperity.
Since the 1970s, in contrast, as the number of union members has gradually declined, workers’ productivity has continued to increase, but wages have not gone up proportionally. As a result, workers’ share of income gains has fallen sharply. In fact, in the 15 years between 1997 and 2012, the top one percent received more than 70 percent of income growth while the share going to the bottom 90 percent fell. According to sources as diverse as the International Monetary Fund, Standard & Poor’s, and the Organization for Economic Cooperation and Development, the resulting inequality is threatening economic growth.
Underlying these trends is the fact that the free market drives innovation, but also a relentless effort to reduce costs, including labor costs, and that one primary area of “innovation” in the past half-century has been in avoiding the “cost” of complying with law. Employers have escaped U.S. labor law by moving jobs across borders and by restructuring their relationship with the workers in order to claim that they no longer employ them.
But the law governing worker representation has not kept up. Under President Carter, in 1977 the House of Representatives adopted modest reforms designed to expedite National Labor Relations Board processes, grant unions an opportunity to reply to employer speeches to employees on company time in the workplace, and enhance the remedies available for violations of the law, but those reforms were blocked in the Senate by a filibuster despite the support of 58 of the chamber’s 100 members. In 2007, the House adopted the Employee Free Choice Act but the measure died in the Senate when a majority again could not end debate. That act would have enabled workers to achieve representation once a majority registered their desire for it in writing, insured that workers who choose representation experience at least one collective bargaining agreement with their employer, and increased penalties for violation of the law. Reform has not occurred, not because it is not needed and not because a majority does not favor it, but because a minority has used undemocratic procedures to permit U.S. labor law to become outdated and, therefore, ineffective.
An increasingly global labor market now demands that law reach beyond national borders to be effective, but the U.S. refuses to join the international community in the area of labor law. The U.S. has ratified only two of the eight core International Labor Organization conventions, and has refused to ratify the central 1948 Convention on Freedom of Association and Protection of Right to Organize, which has been ratified by 153 nations, including all the other major industrialized countries.
Even the fundamental constitutional liberties secured by workers’ collective action in the middle-third of the last century have, since the 1970s, increasingly been seized by corporate employers. Two years after President Roosevelt signed the NLRA, organizers from the CIO came to Jersey City, New Jersey, to distribute pamphlets discussing, in the words of the Supreme Court, “the rights of citizens under the National Labor Relations Act.” People fanned out on public sidewalks for the purpose of “the organization of unorganized workers into labor unions” for “the betterment of wages, hours of work and other terms and conditions of employment.” They were met by police, acting at the direction of Mayor Frank Hague, who searched the organizers, confiscated their handbills, escorted some out of the city and arrested others. The workers’ suit rose to the Supreme Court and established the constitutional right of ordinary people to use public space to organize and express their views.
But, increasingly since the late 1970s, corporations have displaced individuals as First Amendment litigants and as the beneficiaries of constitutional protection. Business has used the First Amendment as a sword, to argue that regulation, including of their labor relations, interferes with corporate liberty, and as a shield, to protect the ever increasing flow of money into our electoral system.
When the Supreme Court decided the Hague case in 1939, the justices made clear that a corporate plaintiff, even though it was the American Civil Liberties Union in that case, “cannot be said to be deprived of the civil rights of freedom of speech and of assembly, for the liberty guaranteed by the due process clause is the liberty of natural, not artificial, persons.”
As late as 1978, Justice William Rehnquist, appointed by Republican President Richard Nixon, continued to question, albeit in dissent, whether a corporation—“an artificial being, invisible, intangible, and existing only in contemplation of law”—possessed political liberties. “A State grants to a business corporation the blessings of potentially perpetual life and limited liability to enhance its efficiency,” Rehnquist observed. “It might reasonably be concluded that those properties, so beneficial in the economic sphere, pose special dangers in the political sphere.” But by 2010, in Citizens United v. FEC, which struck down limits on corporate spending in support of candidates for federal office, the Supreme Court asserted that it had long rejected the argument that political speech of corporations could be treated differently “simply because such associations are not ‘natural persons.’”
In the last several years, the consequences of this history have become palpable for most Americans. The New York Times reported in June that 65 percent of respondents in a nationwide survey believe the gap between rich and poor is a problem that needs to be addressed now. Almost three-quarters say that large corporations have too much influence, about double the number who say the same about unions. Fifty-seven percent agree that government should do more to reduce that growing gap between the wealthy and the rest of the population, compared with only 39 percent who disagree.
And this history also teaches us what government should do—modernize our labor laws to once again foster strong organizations of working people in order to restore balance in the economy and the polity.
For the Future of Work, a special project from the Center for Advanced Study in the Behavioral Sciences at Stanford University, business and labor leaders, social scientists, technology visionaries, activists, and journalists weigh in on the most consequential changes in the workplace, and what anxieties and possibilities they might produce.
