The National Labor Relations Board’s (NLRB) Thursday decision to crack down on franchising is the first of many moves the Obama administration is making to help unions organize and grow, according to a new report.
Agencies such as the NLRB and Department of Labor (DOL) are also rewarding loyal labor groups with new overtime regulations and ambush elections, according the Competitive Enterprise Institute (CEI), a free market think tank.
The CEI reports that unions are facing decreasing membership rates and underfunded pension plans. Changing overtime regulation and the election time frame could boost membership, fund pension plans, and make it easier for unions to organize.
According to the CEI report, the Obama administration is calling for these changes because Democrats "owe organized labor, which consistently funds [Democrats’] campaigns." After failing to get legislation through Congress, the Obama administration is trying to pay unions back for their contributions through exercising executive control.
The first proposed change, the DOL’s overtime rule, revises the income requirement for overtime payments to salaried employees from $23,600 to $50,440.
This change would not significantly increase workers’ wages, according to the CEI. While Secretary of Labor Thomas Perez said "overtime pay regulation could add as much as $1.3 billion to workers pay in just the first year," CEI reports that this sum would average out to "a wage increase of only $260 a year per worker."
Changing overtime regulation would also pressure employers to reclassify their employees, threatening employer autonomy. Don Fox, the CEO of Firehouse Subs, told CEI that the rule would force him to change some salaried employees to hourly employees. He would also have to forbid some of his employees from working overtime.
"What’s a real shame is that I’m in a position of having to penalize someone because they’re doing something they judge is best for their career," Fox said.
The second proposed change, the NLRB ambush election rule, shrinks the time frame for union representation elections. Under the proposed rule, the allotted time between filing a petition and the date of an election would be 14 days.
According to the CEI, the ambush election rule is an affront to workers’ freedom of association and employer’s "protected speech on unionization prior to an election." Employees subject to the rule would have less time to learn about unionizing prior to an election. Similarly, employers would only have two weeks to respond to unionization campaigns that have been months or even years in the making.
CEI reports that employees facing a shorter time frame are more likely to vote for unionization.
"From 2004 to 2014, unions won only 60 percent of elections conducted in 36 to 42 days but won more than 86 percent of elections conducted in less than 21 days," the report says.
The new regulatory environment can only be seen as a handout to big labor, according to CEI. Rather than allow the Obama administration to enact these policy changes, CEI writes, "Congress, invested with the power of the purpose, should use that power to end the assault on workers and the economy."