Labor Relations Weekly #10
Welcome to The Labor Leader - a weekly recap of the most valuable content on labor relations from an employer's perspective. The National Labor Relations Act covers both union and non-union private-sector employers. This newsletter is a digest of my views on labor laws, the National Labor Relations Board, and unions.
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Amazon Labor Union has Failed to Organize Any Other Warehouses
We all know that one Amazon warehouse voted to go union in Staten Island, New York last year. Have you heard about the other warehouses where union organizing never got off the ground?
After the Staten Island win, the Amazon Labor Union (ALU) announced it would organize workers in Kentucky. This was ALU’s first attempt to organize outside of New York, and it chose to start in the South.
When will unions learn they cannot organize Southern workers?
In September 2021, a Kentucky Amazon warehouse employee, Littrell, launched an informal committee to address health and safety issues at his warehouse.
This occurred at the same time the Staten Island employees (and others) were organizing their unions. Littrell's committee was comprised of a few dozen employees.
In April 2022, the Staten Island warehouse went union. The ALU offered unlimited support to Littrell’s efforts in Kentucky. Per Littrell, “they promised us whatever we would need to get the organizing drive done.”
Littrell eagerly accepted the ALU's offer. In doing so, he turned down offers from the Teamsters and IAM. Neither of those unions had successfully organized any Amazon warehouses.
In August 2022, Amazon fired Littrell. This happens frequently and can have nothing to do with retaliation. Union organizers often violate company policy. Sometimes it is to become a martyr for their cause, other times they are misled into thinking they are invincible.
After Littrell’s termination, the ALU pulled out resources from the Kentucky organizing campaign and abandoned its efforts.
Poof. No Littrell. No ALU. No union organizing drive. No union vote.
It has been nearly a year since the Staten Island win. The ALU has failed to organize any other Amazon warehouse. It has attempted to organize others across the country – including a current drive in California – but so far the ALU has not been able to gain any traction at any other facility.
Yet, based on media coverage, Amazon seems to be at risk of having several warehouses go union. Based on facts, though, Staten Island may be its only warehouse to ever vote for union representation.
What do you think - will the ALU successfully organize other warehouses or was the Staten Island warehouse an anomaly?
Increase in Immigrants = Decrease in Union Membership
Did you know that the increase in immigrants into the U.S. correlates to the decrease in union membership?
According to the CATO Institute, between 1980 and 2020, union membership sank from 40% to 11%, and immigrants were responsible for nearly 30% of that decline.
Per CATO, immigrants have a lower preference for unionization. They also increase diversity in the workforce. The increased diversity, in turn, decreases solidarity among workers. Without solidarity, organizing workers is very difficult.
Union organizers used to see immigrants as a threat to membership because of the law of supply and demand. The greater the supply of immigrants, the lesser the demand for unions.
Unions used to dislike immigrants so much that the American Federation of Labor (the AFL part of the AFL-CIO) strongly supported the Immigration Act of 1924 which slashed the annual number of immigrants into the United States from over 1 million per year to just tens of thousands by 1930s.
Prominent labor leader and civil rights activist A. Philip Randolph applauded the Immigration Act of 1924 but wanted to see immigration cut to zero. To him, zero immigrants would help Black Americans.
United Farm Workers leader Cesar Chavez also fiercely opposed immigration. He pressed for increased deportations to prevent farms from using migrants as replacement workers during union strikes.
But in 2000, as union membership plummeted, the AFL-CIO did an about-face and endorsed an increase to legal immigration.
By then, unions were playing the numbers game: the more people in the pool, the better the chance that one of them would be willing to pay union dues.
The about-face did not pay off and statistically was never going to pay off.
Over the past 25 years, immigrants have been 33% less likely to join unions and less likely to feel solidarity with their American-born co-workers regardless of race or national origin.
Finance Unionism: How Unions Got Rich While Membership Tanked
I heard an interesting concept: “Finance Unionism.” This helps explain how unions have become so wealthy while their membership numbers have plummeted. I’m curious to hear your thoughts about this.
According to the U.S. Department of Labor, since 2000, labor’s net assets (assets minus debt) rose from $11 billion in 2000 to $32 billion in 2021. This is a 191% increase.
At the same time union membership dropped by 14%, or 2.3 million members.
Dues revenue is typically tied to wages. But wages are only up about 75% (not 191%) since 2000.
Unions, like the businesses they are, also generate revenue from investments and real estate (and even private equity and hedge funds). These were probably not up 191% percent, either.
Unions are getting rich while losing members because they don't spend money on their membership. Unions spend less money on organizing and strikes than they bring in from dues and investments.
Unions used to want to organize new members. They used to spend over 50% of their budgets on organizing. Over 30% of the workforce used to be in unions. Unions also used to have more strikes and achieve greater wins for their members.
Enter “Financial Unionism” loosely defined as a union’s desire to grow its bottom line instead of organizing or improving wages and benefits of its members. In other words, increasing financial assets while maintaining the existing membership is their primary objective.
For example, while unions used to spend over 50% of their budgets on organizing, today, the Steelworkers and UAW devote a measly 3% and 6% of their budgets, respectively, to organizing. Unions also only allocate less than 3% of their revenue to strikes.
Unions, it seems, have realized they can make more money by investing in stocks and real estate than by increasing the number of dues-paying members.
Isn't that exactly what unions complain about with businesses: not caring for the employees (members)? Corporate greed and profits take precedent over employees (members)?
Unions Can't Organize the South Without the NLRB's Help
Another nugget from the union trends report a few months ago is that unionization rates in the South are stagnant at 4.5%. This is more than 8% below the national average.
And this is a time when support for unions is at the highest level in over 50 years, employees have leverage during a tight labor market, and the NLRB is trying everything possible to make union organizing easier.
Southern workers simply don’t want unions.
Unions say Right-to-Work laws are to blame for southern employees not being in unions. These laws allow employees to reap the benefit of collective bargaining agreements, but not pay union dues.
Why should employees be forced to pay for something they:
- didn’t vote for
- don’t want to be part of
- disagree with, and/or
- don’t believe is worth paying for?
People pay for what they value. Make your southern union valuable to workers, and they will join.
The recent Nissan micro-unit election is proof of this concept. The whole plant rejected the union a few year ago. The NLRB re-wrote the rules on who can vote. And a small unit of workers rejected the union, again.
Southern employees have rejected union membership thousands of times in similar fashion.
I’m interested to see what happens with the new electric battery facilities being built in Tennessee. They are co-owned by the Big 3 automakers.
The NLRB’s soon-to-be-released joint employer test will likely make those facilities union (if the Big 3 doesn’t invite the union to organize their workers like GM did at its Ultium electric battery facility in Lordstown, Ohio).
I’m also interested to see if a small union parts supplier to the foreign-owned, non-union automakers in the south is enough to satisfy the Board’s new joint employer rule. If so, it could be just what unions need to jumpstart organizing in the south.
Until then, unions are wasting their time – and their members’ dues money – trying to organize workers in the south.
NLRB Guidance on Confidentiality / NonDisparagement Clauses in Severance Agreements Needs Further Guidance
NLRB says all prior severance agreements with confidentiality and nondisparagement clauses are unlawful. Even if entered into freely years ago. And the NLRB wants (but can’t require) employers to call past employees and let them know that those parts of the agreements no longer exist.
Confidentiality agreements targeting dissemination of trade secrets based on “legitimate business justifications” and nondisparagement clauses that prohibit maliciously untrue statements are OK.
The NLRB GC also foreshadows finding the following clauses unlawful in severance agreements:
- Non-compete clauses
- No solicitation clauses
- No poaching clauses
- Broad liability releases and covenants not to sue that may go beyond the employer and/or may go beyond employment claims and matters as of the effective date of the agreement
- Cooperation requirements involving any current or future investigation or proceeding involving the employer as that affects an employee’s right to refrain under Section 7, such as if the employee was asked to testify against co-workers that the employee assisted with filing a ULP charge.
Ohio Sees a Rise in Union Membership
I call Ohio home. Though I seem to rarely be in Ohio. Still, following union trends of my home state interests me. And since many subscribers to this newsletter are in Ohio, it probably interests you, too.
Statewide union membership in Ohio grew in 2022 compared to 2021.
The percentage of statewide workers represented by a union rose from 13% in 2021 to 14% last year. This amounts to 52,000 more Ohioans belonging to unions.
The region has seen recent organizing efforts at various nonprofits, museums, and libraries (but none whose union organizing campaigns I defended ?? ).
Ohio's union membership still outpaces the national percentage of 10.1%, the lowest figure since the government began tracking membership in the early 1980s.
#MattAustinLaborLaw #LaborRelations #LaborLaw
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Matt Austin is a nationwide management labor lawyer. Labor laws govern virtually all private-sector employees regardless of union membership. Proactive management of labor relations is critical to maintaining flexibility and increasing profit.
Matt also runs Austin Legal's HR Legal Compliance Program that, for a small monthly fee, ensures HR decisions are protected by the attorney-client privilege.
Matt's experience is deeply rooted in helping manage many aspects of his clients' businesses. To effectively manage labor relations, he must also manage budgets, forecasts, new growth areas, and projected market corrections. High emotional intelligence is also critical to negotiating union contracts and to properly advise HR Legal Compliance members through the nuances of the law, its application to their companies, and how it will be received by employees.
You can reach Matt via email at [email protected].