Fixing flawed labor laws needs support from Snowe and Collins

Why are wages stagnating and economic inequality rising around the country? Part of the answer is even as states invest tens of billions of dollars in local economies, through state government contractors and economic development dollars, multinational corporations reap the benefits in high profits while employees see little benefit.

And if any employees demand a fairer share of company revenues by trying to form a union, many are illegally fired; in fact, according to the National Labor Relations Board (NLRB), over 20,000 American workers are illegally fired or disciplined each year for demanding their rights at work. But since the NLRB doesn’t have the power to issue anything more than a slap on the wrist, these labor violations just keep going.

Unfortunately, Sens. Olympia Snowe and Susan Collins have refused to support legislative reforms to fix these problems in federal labor law. The U.S. House of Representatives has passed the Employee Free Choice Act , a bill to increase fines on labor violators and make it easier for workers to form labor unions, but a likely filibuster in the Senate could doom the law.

Many state government leaders have demanded the Senate join in fixing our failed federal labor law, since doing so is critical for restoring the ability of state government leaders to promote high-wage regional economic strategies and not see taxpayer money going to subsidize labor lawbreakers.

The payoff from stronger employee freedom to form unions is the benefits from economic development strategies would more readily flow to employees – and back to taxpayers in the form of income taxes and sales taxes from more robust spending by working families. And with fewer companies like Wal-Mart able to dump their health care costs onto the public, state taxpayers will save money on the spending side of the ledger as well.

What infuriates many state leaders is federal law requires them to hand out local government contracts and economic development money to union-busting firms, no matter how many times those firms have broken the law – and the federal government does nothing itself to deter those repeat labor law violators.

This doctrine dates back to a 1986 Supreme Court decision called Wisconsin Dept. of Industry v. Gould, which struck down a 1979 Wisconsin law that denied public contracts to any firm found to have violated federal labor law three times within a 5-year period. The Wisconsin law, like similar ones around the country at the time, was hardly unyielding – firms could reapply for government funds within three years if they kept their noses clean.

But the Supreme Court declared that however weak the sanctions for illegal behavior are under federal labor law, those weak standards are a lowest common denominator of corporate behavior that states are required to accept for all state contractors.

Since states therefore can’t deter repeat labor-law violators themselves, they need the federal government to help stop those corporate repeat offenders. This is what the Employee Free Choice Act would change.

Currently, the punishment for a company illegally firing a worker for speaking out in favor of having a union is the company must restore any pay the worker lost due to the illegal firing. That’s it. There are no additional fines or penalties.

It’s equivalent to punishing a shoplifter by making them return stolen merchandise to the store with no other penalty – and has about the same deterrence effect on illegal corporate behavior as such a weak theft statute would have. And there are no increased fines for repeat offenders under current labor law.

Under EFCA, however, companies would be required to pay treble damages to employees who suffer illegal firings or other retaliation during the course of a union organizing campaign. And firms found willfully or repeatedly violating the law would be subject to an additional civil fine of up to $20,000 per violation.

These are real deterrents to illegal corporate behavior.

Since the federal government sets the standard for corporate accountability in the area of labor relations – and imposes that standard on state governments in how they deal with their own contractors – state leaders are increasingly speaking out in demanding that federal labor law be given real teeth.

If we want to see stronger local economies and higher wages for our citizens, we need Snowe and Collins to step up and support the Employee Free Choice Act.

Rep. John Patrick, D-Rumford, is former president of UPIU Local 900 in Rumford. Nathan Newman is the Policy Director of the Progressive States Network.