Dear Heritage Foundation,

May 20, 2009 5:11 pm ET — Ari Rabin-Havt

Media Matters Action Network stands 100% behind our fact check.

Dear Heritage Foundation,

We noticed that you objected to our fact check of your attack on binding arbitration in the Employee Free Choice Act.  Here are some thoughts we would like to share with you. 

First, writing "Read the bill" over and over again does not constitute an argument or contradict our claims in any way.  We did read the bill and reached conclusions based on the facts.

Every assertion in our fact check contained a citation. Meanwhile, your 664-word response contained just four links -- one to our original post, two stating "read the bill," and a fourth linking to your own argument about Detroit in the 1970's.

Moreover, the conservative business community has embraced the use of arbitration in a wide variety of situations. According to the U.S. Chamber of Commerce's Institute for Legal Reform: "Virtually any type of dispute between private individuals or entities can be addressed by arbitration, including, for example, contract, real estate, employment, and tort disputes." [U.S. Chamber of Commerce's Institute for Legal Reform, "Issues Resource Center," accessed 4/23/09; emphasis added]

It seems strange that in contract disputes between employers and unions, the same principle suddenly does not apply.

In addition, you seem to have some facts about the text of the bill itself wrong:

Media Matters claims that "Arbitration is not mandatory if both parties are negotiating in good faith." But that is not true. Read the bill.

Here is what the bill says:

SEC. 3. FACILITATING INITIAL COLLECTIVE BARGAINING AGREEMENTS.

Section 8 of the National Labor Relations Act (29 U.S.C. 158) is amended by adding at the end the following:

'(h) Whenever collective bargaining is for the purpose of establishing an initial agreement following certification or recognition, the provisions of subsection (d) shall be modified as follows:

'(1) Not later than 10 days after receiving a written request for collective bargaining from an individual or labor organization that has been newly organized or certified as a representative as defined in section 9(a), or within such further period as the parties agree upon, the parties shall meet and commence to bargain collectively and shall make every reasonable effort to conclude and sign a collective bargaining agreement.

'(2) If after the expiration of the 90-day period beginning on the date on which bargaining is commenced, or such additional period as the parties may agree upon, the parties have failed to reach an agreement, either party may notify the Federal Mediation and Conciliation Service of the existence of a dispute and request mediation. Whenever such a request is received, it shall be the duty of the Service promptly to put itself in communication with the parties and to use its best efforts, by mediation and conciliation, to bring them to agreement.

'(3) If after the expiration of the 30-day period beginning on the date on which the request for mediation is made under paragraph (2), or such additional period as the parties may agree upon, the Service is not able to bring the parties to agreement by conciliation, the Service shall refer the dispute to an arbitration board established in accordance with such regulations as may be prescribed by the Service. The arbitration panel shall render a decision settling the dispute and such decision shall be binding upon the parties for a period of 2 years, unless amended during such period by written consent of the parties.'. [emphasis added]

The bill clearly states: "If after the expiration of the 90-day period beginning on the date on which bargaining is commenced, or such additional period as the parties may agree upon."

What that means is: "all time limits under the Employee Free Choice Act can be extended by mutual consent of the parties-giving the parties flexibility to use the time frames that fit their specific needs. Voluntary negotiations can proceed as slowly or quickly as necessary as long as both parties feel that the other is negotiating in good faith," which, coincidentally, is what we wrote.

Why is the arbitration process important? As we previously pointed out, an MIT study showed that "only 56 percent of units in which a majority of employees voted for a union and were certified for bargaining by the NLRB were successful in reaching a first contract. Only 38 percent of such units reached a contract within one year."

A few additional points:

1.                 In 2000, Human Rights Watch reported "that the failure of workers to win union contracts 'is especially acute in newly organized workplaces where the employer has fiercely resisted employee self-organization and resents their success.'" 

2.                  The Federal Mediation and Conciliation Service stated: "initial contract negotiations are often more difficult than established successor contract negotiations, since they frequently follow contentious representation election campaigns."

3.                  NLRB General Counsel Ronald Meisburg wrote: "Moreover, of all charges alleging employer refusals to bargain, almost half occur in initial contract bargaining situations (49.65%)."

These facts clearly point to the need for an arbitration process.

You write:

Media Matters claims that "Arbitration Encourages Voluntary Settlements" and that it "Does Not Inflate Wages," but ignores Wathen's point that the possibility of government-imposed contracts give the union every incentive to demand the sun, the moon, and the stars and then send the dispute to the government, hoping Uncle Sam will "split the baby" and give them half of their extreme proposal.

This argument has no basis in reality. Arbitrators don't simply "split" the baby.  The reality is: "Arbitrators tend to be conservative and shy away from imposing any innovations in an award."

You write:

To defend government-imposed contracts, Media Matters points to public sector binding arbitration. They essentially argue that the government imposing a contract on itself has not proved a disaster, so having the government impose contracts on workers and businesses will work out fine too. But this ignores the huge differences between government [sic] the private sector, and between public sector arbitration procedures and what EFCA forces on workers and employers.

Once again, you reach a conclusion citing no data. The fact is data on private sector binding arbitration cases demonstrate the exact same thing:

The Canadian private sector evidence is very similar and particularly relevant.  The labor relations statutes of six Canadian provinces and the Federal Sector provide for first contract arbitration, closely mirroring the arrangements intended by the Employee Free Choice Act.  Across these seven jurisdictions (some with more than 30 years experience with such first contract arbitration) the arbitration rates (percent of cases in which an award was required to resolve the negotiations) ranged between a high of eight percent and lows of less than one percent.  Moreover, the use of mediation prior to or during the arbitration proceeding was successful in resolving the vast majority (in British Columbia just under 90 percent) of the cases without resort to an arbitration award. [Labor and Employee Relations Association, 3/15/2009]

In addition, according to American Rights at Work:

First contract mediation and arbitration has been successful in Canada.  Labor laws in the Canadian provinces of Manitoba, British Columbia, Ontario, Quebec, Newfoundland, Saskatchewan, and the federal jurisdiction all provide for first contract mediation and binding arbitration.

  • First contract arbitration laws were enacted in several provinces in the 1970s, and were strengthened in Ontario and British Columbia in the early 1990s. A substantial portion of the Canadian workforce is now covered by first contract arbitration laws. First contract arbitration has been an incentive for management and labor to bargain productively, and has improved labor-management relationships. First contract arbitration is seldom used. It has not been invoked as a standard response to bargaining deadlocks, but rather as a corrective response to employers' refusal to recognize newly organized unions and bargain a first contract. The overwhelming majority of cases are resolved through mediation or settlement between the parties.

You write:

EFCA, however, has none of the limited safeguards contained in public sector arbitration. Read the bill. It only applies to new contracts, before any issues like promotion procedures and work duties have been settled. The government arbitrator would impose those, without the benefit of a previous contract to look back on. And unlike public sector arbitration there are no standards for the arbitrator to use. None at all. Which is why Wathen explained that - if EFCA became law - collective bargaining negotiators like himself would make extreme demands and hope to get part of what they asked for.

Unfortunately businesses, unlike governments, do go bankrupt. A company like General Motors cannot tax Americans to cover the costs of a contract they cannot afford. To cut costs they lay off workers instead. With EFCA many American workers will find themselves without work, thanks to a government-imposed contract the arbitrator thought looked good on paper but proved unworkable in practice.

Once again, I would like to point out:  "Arbitrators tend to be conservative and shy away from imposing any innovations in an award."

Furthermore, "[t]he well understood goal of arbitrators in interest disputes has long been to fashion an agreement which the parties would have been likely to reach had they bargained to agreement." [Labor and Employee Relations Association, 3/15/2009]

Your anti-worker rhetoric and scare tactics are unsourced and simply not grounded in reality. Businesses rely on binding arbitration for a variety of functions. 

Media Matters Action Network stands 100% behind our fact check.

Sincerely,

Ari Rabin-Havt

Print