Fifty years ago nearly a third of US workers were union members. Today it is one in ten. Union membership is falling, largely due to the Taft-Hartley Act enacted in 1947, today known as right-to-work laws. These laws impact labor rights issues and ultimately influence how companies approach labor issues in CSR. But how might the upcoming presidential election affect all this?
Right-to-work laws prohibit contracts requiring all employees to pay for union representation, even if they are not members. In states without right-to-work laws, unions often have contracts requiring all workers in a bargaining unit to pay a representation fee to the union that represents the bargaining unit.
This means in states with right-to-work laws, employees who don’t pay union fees still benefit from union collective bargaining agreements. The inevitable result of right-to-work laws: fewer members mean less union funds. Critics say that over the long-term right-to-work laws weaken the ability of unions to bargain on behalf of employees.
Why are these laws important this election cycle? This year all seats of the House, one-third of the Senate, and presidential seat are up for election. The results may contribute to how labor agreements are conducted between employee and employer.
There has been contentious debate between parties and political figures on the pros and cons of right-to-work laws. Republicans are likely to argue that right-to-work laws increase employment and raise wages, while Democrats tend to retort right-to-work laws decrease wages and have no positive impact on job growth. Right-to-work-laws now exist in 26 states. However, support of right-to-work laws varies state-by-state, as a Wisconsin judge recently ruled right-to-work laws violated the state’s constitution.
Presumptive presidential candidate Donald Trump has stated “We’ve had great support from [union] worker… but I love the right to work, I like it better because it is lower. It is better for the people. You are not paying the big fees to the unions… I like it because it gives great flexibility to the people. It gives great flexibility to the companies.” Historically Democrats have opposed right-to-work laws and tend to have more union support. Democratic candidate Hillary Clinton flatly opposed it tweeting, “‘Right to Work’ is wrong for America.”
These positions are not surprising given each candidate’s party history. As passage of these laws increase state-by-state and union membership further declines, this upcoming election cycle voters will signal to policymakers the role they wish unions to have in America’s future.
What do CSR standards and indices make of the union issue? The Dow Jones Sustainability Index (DJSI) requires companies to report performance indicators on freedom of association and average female and male salary at the managerial and non-managerial level. The Global Reporting Initiative (GRI) requests information on measures taken by the organization to support rights to exercise freedom of association and collective bargaining. Regardless of the presidential outcome, the socially responsible approach is one that acknowledges the right to collective bargaining, freedom of association, fair wages, and equal remuneration.
Finally, what does this mean for CSR? The election results may cause a shift in responsibility of who advocates for labor rights. If unions are not there to bargain, companies may have to independently conduct socially responsible labor contracts that also meet employee expectations.
Although the future of labor rights is in the US is uncertain, we can be sure the winning party will influence the situation in their favor. Companies should prepare for the responsibilities required of either circumstance.