U.S. Chamber Highlights Effect of Arbitration Provision in Card Check Legislation

Provision Gives Government Unprecedented Power Over Labor Contract Negotiations

WASHINGTON, D.C. — A mandatory binding interest arbitration provision tucked into the possible card check legislation would have disastrous results for American businesses, according to a letter the U.S. Chamber of Commerce requested a leading employment law firm send to lawmakers on Capitol Hill. This often overlooked portion of the bill would give the federal government the power to set wages, benefits, and work rules for employers in a wide variety of industries throughout the economy.

"The interest arbitration provision would overturn decades of labor laws and usher in an unprecedented intrusion into the private sector by the government," said Randel Johnson, vice president of Labor, Immigration, and Employee Benefits at the U.S. Chamber, in responding to the findings in the letter. "Stunningly, it would allow bureaucrats with little or no knowledge of the industry to force mandates on employers and employees that would last for two years and leave them with no backup plan in case the market tanks or unforeseen problems occur.

"In this uncertain economy, businesses need the flexibility to react quickly to market conditions," Johnson added. "This provision will remove the ability of businesses to respond and will result in job losses, increased costs for consumers, and businesses leaving the country."

The legislation would give a government arbitrator authority to decide a broad range of workplace issues, such as wages, schedules, promotions and the ability to use employees in the most efficient and effective way. This arbitrator's decision would be imposed for two years.

The letter was authored by R. Theodore Clark, Jr., senior partner in the Labor and Employment Law Department at Seyfarth Shaw LLP and delivered to the Chairmen and Ranking Members of the Senate Health, Education, Labor and Pensions Committee and the House Committee on Education and the Workforce.

The provision has been included in the Employee Free Choice Act, or card check legislation, that is expected to be introduced later this year. The U.S. Chamber has been an outspoken leader opposing card check and requested Seyfarth Shaw, who has dealt with more than 500 interest arbitration contract negotiations, to evaluate the provision.

View the full letter here: /issues/letters/2009/090213efca.htm

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

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