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It’s not exactly a secret that union membership has been in decline over the past fifty years. In fact, unions now represent just 10.5 percent of the overall workforce, and only 6.4 percent of private sector workers. This lack of density is a considerable problem, since without union members there is no revenue for union leaders.
But what if unions could come up with a system under which they could represent all workers in an industry without actually having to recruit them or win representation elections? Unions like the SEIU have decided this is just what is needed in the United States, and they have latched onto a concept from Europe referred to as sector-level (or sectoral) bargaining.
Sector-level bargaining would allow an organization representing employers in an industry, such as a trade association, to negotiate with a union over terms and conditions of employment until a deal is reached. The government would then apply that deal to all businesses in that industry, even businesses that had no actual union members.
From the union perspective, this arrangement would be ideal because it would reduce the amount of time and energy required to secure worker support for union representation. Indeed, unions could represent potentially millions of workers without having to win a single election.
For businesses, this type of bargaining would mean that all companies in an industry would be covered by a single contract that might bear no relation to their ability to meet the terms of said contract in terms of wages, benefits and work rules. Starting a new business in these circumstances would be nearly impossible. Sector-level bargaining also would increase the potential for disruptive, industry-wide strikes, similar to those seen in other countries with such a system.
Sector-level collective bargaining also would force workers into a union contract regardless of their wishes. From the many examples of unions’ having lost representation elections (see here, here, here, and here) it’s obvious that many workers would not welcome such an arrangement.
That the SEIU would support sector-level bargaining comes as little surprise given its prolonged and unsuccessful campaign to unionize the fast food industry, starting with McDonald’s. That campaign sought to force the McDonald’s corporation to negotiate on behalf of its independently owned and operated franchise restaurants nationwide by naming it a joint employer of their employees (which essentially would destroy the franchise business model).
Such a dramatic change to the NLRA would require an act of Congress and a presidential signature, which is currently not forthcoming. That could always change, however, and employers and workers would be wise to keep an eye on the SEIU’s proposal. As a recent article in Vox pointed out, the decline in union membership in recent decades has been due primarily to the fact that unionized firms “have added fewer jobs over time than their non-union counterparts.” Vox added that an attraction of sector-level bargaining for union leaders is that under such a system, “there’s no reason for union membership to decay as firms with more union members do worse.” Great for union leaders perhaps, but not so good for workers, businesses and the economy.