20 August 2009

Union Actvism Protection

A big problem often faced in organizing drives is the intimidating impact of illegal worker firing. Here is how the management abuse works:
  1. Worker supports the union obviously enough that management finds out.
  2. Management fires the person even though it is illegal to fire workers for union activity.
  3. The worker has problems paying bills, etc.
  4. After the drive is resolved (for or against a new union), Management quietly settles and pays back wages for the illegal firing.
During the time between steps 2 and 4 other workers hear whispers that if they work with the union they'll "be next" and "how will they pay their bills?" etc...

This can obviously have a chilling impact on the drive.

That's the problem, here is my solution:

Create a special loan product that will pay the worker their normal wages until the drive is settled. The collateral for the loan is the backpay obligation from the employer (not including the penalty).

Possible Outcomes

Most of the time, backpay eventually arrives and the union is reimbursed. In this case, the worker gets money immediately and over the period from firing to settlement. Morale doesn't suffer. The worker keeps the penalty (or perhaps shares it with the union activism fund). The union loses the opportunity cost of the capital, but ends up with a lump sum. In this case the forgone interest on the small amount of money pales in comparison to the increased momentum on an organizing drive.

Some of the time though, backpay doesn't come through. Anyone know how often this happens? In that case the union has blunted the intimidation power of the firing but expends capital to do it.

On balance, it seems like the cumulative benefits in the more common cases exceed the costs in the rare bad case and organizing is strengthened in all cases.

Thoughts? Problems?


  1. This is a really inonvative idea. I like it.

    A couple of problems with the backpay awards. First, the guarantor of the loan needs to know the worker's immigration status.

    Second, back pay might be difficult to calculate. I'm thinking specifically of the recent John T. Jones Construction vs. Board case, were the issue in dispute was how fringe benefits should be calculated.

    Finally, while continuing the pay of a worker who has been terminated in violation of the Act is a very nobel cause, once a union supporter is terminated, the damage has been done. I'm not sure that a guaranteed income, absent a guarantee of rehire, can surmount the chilling effect of axing a union supporter.

  2. It is a great idea. Unfortunately it's practically impossible to get all of the AFL-CIO unions behind such a fund. There have been attempts to create a national strike fund in the past but they have failed because some of the more conservative trade unions are not big supporters of this kind of solidarity and unity. It's pretty sad.