Unions hate secret ballot elections. Conducted by the National Labor Relations Board (NLRB), such elections are the time-honored method for forming a union bargaining unit. Most companies say they are the only fair way to assess worker sentiment about union representation because employees vote in secret, shielded from potential peer pressure.

But unions contend the elections give the employers too much control–and that employers abuse their power by intimidating workers into voting against the union. So in recent years many unions have pushed an alternative–the card-check agreement. These agreements allow the union to solicit employees to sign authorization cards asking for union representation. If a majority of the employees sign, the employer agrees to recognize the bargaining unit. Buoyed by its success in getting employers to agree to card-checks, organized labor launched a massive effort this year to convince Congress to replace secret ballot elections with card-check agreements. Called the Employee Free Choice Act (EFCA), the legislation died in the Senate in June.

Union efforts to consign secret ballot elections to the archives of labor history then hit another roadblock. In a 3–2 decision released Oct. 2, the NLRB ruled that once a bargaining unit is formed through a card-check process, employees opposed to the union have 45 days to petition for a secret ballot election. It stated in no uncertain terms that secret ballots are the best way to ensure employee rights are protected.

But while the decision was roundly criticized by major unions, it may actually end up helping their cause by giving labor new ammunition for the battle to pass the EFCA.

“The irony is that the GOP-controlled board has given a pro-business decision, but the result down the road could be what the Republicans have fought tooth and nail–passage of the EFCA,” says Mike Mitchell, partner in Fisher & Phillips’ New Orleans office.

Agreements Undermined
Passage of the EFCA is a top priority for unions because they feel their survival depends on accelerating the pace of union organizing. Because the election process requires a time-consuming NLRB-certified election for each bargaining unit and allows employers to mobilize against the union, UNITE HERE and other unions are focused on implementing card-check agreements.

In some cases the unions agree to concessions in existing labor agreements in return for the right to solicit union authorization cards in the company’s departments or facilities that aren’t already organized. In others they coerce an agreement by undermining the corporation’s image with negative media coverage and lawsuits alleging employer abuse of its work force.

“Some employers [with card-check agreements] will tell you they have a robust, cooperative agreement with labor,” says Michael Lotito, partner in Jackson Lewis’ San Francisco office. “What you do not hear is people who say, ‘The unions’ corporate campaign against the company–attacks in the courts, the legislature–became so obnoxious that we gave into the blackmail.’ “

In conjunction with card-check agreements, unions usually seek neutrality agreements, where the company agrees not to try to convince employees to oppose the union. “Neutrality is essentially a gag order on the company,” Lotito says. “But the recent NLRB decision has the potential for substantially undermining those agreements.”

Reset Button
The case that generated that ruling grew out of separate card-check/neutrality agreements the UAW reached in 2002 and 2003 with Dana Corp. for a unionizing effort at a plant in Pennsylvania and with Metaldyne for a plant in Ohio. A majority of workers at both plants signed the cards, and collective bargaining commenced. Soon after, more than 35 percent of the employees at both plants filed petitions with the NLRB, asking for an election to decertify the union.

The matters first went to two NLRB regional directors with jurisdiction over the respective plants. In both cases the regional directors denied the employees’ requests citing the “recognition bar” doctrine. This doctrine, established by the labor board in its 1966 decision Keller Plastics Eastern Inc., barred decertification election petitions “for a reasonable period of time”–generally one year–after an employer voluntarily recognizes a bargaining unit based on a successful card-check campaign.

The Dana and Metaldyne employees appealed to the NLRB, asking the board to overturn the 40-year-old doctrine. The board agreed to consolidate the two cases and re-examine the doctrine “to strike the proper balance between … protecting employee freedom of choice on one hand, and promoting the stability of bargaining relationships on the other.”

The board majority ruled that where the unions and employers agree to bypass the election process through a card-check agreement, employees should have 45 days to demonstrate that 30 percent of the work force wants a secret ballot election. Employers are required to post notices informing employees of their right to petition the NLRB for an election.

“It definitely creates one extra hoop for the union to jump through,” Mitchell says. “It gives employees a 45-day window of opportunity to hit the reset button and say, ‘Yes, I signed a card, but now I want to withdraw my support.’ “

Unintended Consequence
While acknowledging that voluntary recognition of unions through card-checks is “undisputedly lawful,” the board majority voiced strong support for secret ballot elections as the best guarantee of employees’ freedom of choice.

It will take some time to see how often employees avail themselves of these new election rights, knowing that a majority of their colleagues have just signed cards supporting union representation.

“The jury is still out about whether the board decision will have an impact on nullifying card-check union recognition,” says Philip Rosen, managing partner in Jackson Lewis’ New York office. “But it does give employers confronted with the possibility of card-check recognition more factors to consider.”

The decision’s most immediate effect may come next year on Capitol Hill, where Democrats are expected to try again to pass the EFCA.

The board’s clear disdain for card-check agreements, which it describes as “inferior to the election process,” could backfire by igniting enough union furor to propel the controversial legislation through Congress, virtually eliminating secret ballot elections.

Lotito agrees labor will point to the Dana-Metaldyne decision as a new reason why the EFCA needs to be passed and predicts an effort to amend the legislation to specifically reverse the decision.

“To those who say, ‘This is the result we wanted from the labor board,’ my message is to watch what you wish for,” he says.