April 24, 2009Client Alert

EFCA Compromise in the Cards

As Congress gets back to work after the Easter recess, passage of the Employee Free Choice Act (“EFCA”) in its current form is increasingly unlikely as support for the bill continues to unravel. While Senate Republicans were previously worried about having the necessary votes to mount a successful filibuster, these concerns are now largely moot, at least at this juncture, given that several Senate Democrats have publicly come out against EFCA. The increasing opposition to the bill has been predicated on the poor economy and concerns that EFCA, if adopted now in its current form, may hamper the country’s economic recovery. As a result of the wavering support for EFCA, attempts at developing a compromise bill are already underway.

Several Senators who previously supported EFCA in 2007, now openly oppose EFCA. In early April 2009, Dianne Feinstein (D) of California withdrew her support for the bill citing the failing economy as the primary reason. Blanche Lincoln (D) from Arkansas, who voted for cloture in 2007, announced on April 6 that she now opposes the bill in its current form. Lincoln explained that she doesn’t think the time is right for EFCA because the country has bigger problems. In 2007, Arlen Specter (R) of Pennsylvania was the only Republican in the Senate to support EFCA. Specter announced in March, however, that he now opposes the bill.

Other Senators, while not openly opposing EFCA, have expressed concerns with the bill or have been reluctant to take a position. Some Senators are still taking a “wait-and-see” approach. Mark Pryor (D) from Arkansas supported the 2007 version of the bill, but refused to co-sponsor the legislation when it was introduced again in 2009. Ben Nelson (D) of Nebraska and Jim Webb (D) of Virginia are both wavering in their support of EFCA. Tim Johnson (D) of South Dakota and Mark Udall (D) of Colorado face political pressures to oppose EFCA. Though Johnson was a co-sponsor of the bill, he remains officially undecided. Udall recently indicated, however, that he is in favor of bringing EFCA to a vote before the full Senate.

Given that EFCA is the most sweeping proposal for labor law reform since 1935, much is at stake in the current debate over the bill. Accordingly, everyone who is anyone will be jockeying for position as the “deal-making” phase of EFCA’s evolution begins. The likelihood of a successful compromise being reached will depend in large part, however, on the ability of EFCA supporters to address the concerns of Senators, such as Feinstein and Lincoln, that EFCA not undermine efforts to stimulate the economy or contribute to lengthening the recession. In addition, the issue of preserving the secret ballot in union elections will continue to be at the center of the EFCA debate. Indeed, during the March 10th hearing of the U.S. Senate Committee on Health, Education, Labor, and Pensions, which was entitled “Rebuilding Economic Security: Empowering Workers to Restore the Middle Class” and dealt with EFCA, these issues surfaced repeatedly.

Indications by EFCA supporters, such as Andy Stern of the Service Employees International Union, of willingness to compromise have sent pundits scrambling to uncover what compromises are likely. Given vigorous lobbying efforts on both sides of the issue, the proliferation of rumors over EFCA, and the complexity of negotiations among the many stakeholders, it may be some time before a compromise bill emerges. Nevertheless, some compromise possibilities may include: expedited elections, union access to employees at work, or supermajority card-check recognition.

EFCA continues to capture the attention of employers even after key Democratic Senators announced their refusal to support EFCA in its current form. Employers realize that the results of the 2008 elections were a harbinger of change in labor-management relations. EFCA or a compromise version of EFCA is one form in which this change may manifest itself. Another is in the form of the National Labor Relations Board (NLRB). While not garnering the press coverage of EFCA, the NLRB under the Obama administration is expected to overturn many Bush-era decisions and policies.

To thrive in the new labor-management landscape, preparation is essential. Employers are taking steps now to find out about the likely changes in the law, to understand how these changes will affect them, and, most importantly, to position themselves to proactively address the challenges that will be presented by these changes. Appropriate training of managers and supervisors, and a close review of company policies and practices, are important parts of this preparation.

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