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Recent legislative initiatives by organized labor threaten employee freedom of choice and our federal labor regulatory scheme for resolving questions concerning union representation by depriving employees of their employer’s viewpoint when they are considering unionization. The National Labor Relations Act (NLRA) provides a secret-ballot election procedure. Part and parcel of that process is a pre-election opportunity for unions and employers to communicate their respective views directly to the employees who will be voting on whether they want a union. Traditionally, vigorous debate between labor and management in their respective employee communications has been promoted in the belief that a free exchange will provide employees with the information they need to make an informed decision. Safeguards exist: The overall pre-election atmosphere must be free of intimidating or coercive activity-including communications to employees-that would inhibit their freedom of choice. Organized labor strategy But for decades now, organized labor, whose membership has shrunk steadily as a percentage of the total work force since the post-World War II years, has sought to minimize the role of the secret-ballot election; that trend also tends to minimize employer communication with employees about unionization. While organized labor was unsuccessful in amending federal labor law to allow card checks as a mandatory substitute for secret ballots, those efforts were followed by a movement toward formalizing permissible voluntary recognition through advance agreements with employers. In those agreements, employers commit to allowing card checks as a basis for union recognition. Such cards are prepared by the union and usually presented to employees for signature without employer knowledge or information. Unions unable to secure card-check agreements have also sought neutrality agreements with employers that permit organizing activity without employer opposition. Card-check and neutrality agreements require employer approval. Accordingly, unions have been most successful in obtaining such “voluntary” agreements when they already have a collective bargaining relationship with an employer for a portion of its employees. That gives unions leverage with the employer with respect to the unrepresented segment of a work force. Employer opposition is recognized as the most significant impediment to unionization, and hence is an organized-labor priority. Toward that end, organized labor has turned to state legislatures for laws preventing employers who receive state money from using such funds to discourage unionization. Such legislation exists or is proposed in a number of states, including California and New York. Recently, the 9 th U.S. Circuit Court of Appeals struck down the California law as pre-empted by the NLRA in Chamber of Commerce of U.S. v. Lockyer. In New York, a similar challenge was made to state Labor Law Section 211-a in Healthcare Association of New York v. Pataki and a decision is pending in the U.S. District Court for the Northern District of New York. The pre-emption issue (in regard to the New York statute) also has been raised in an administrative proceeding before the National Labor Relations Board ( Independence Residences Inc., No. 29-RC-10030). New York law prohibits the use of state monies-which the New York attorney general has argued in Pataki includes federal monies, most notably Medicaid, that pass through the state for distribution-to discourage unionization. The law emphasizes three activities in particular: hiring lawyers or consultants, training managers and supervisors, and compensating employees, when the purpose is to discourage union organizing. Health care and social service employers generally receive the most state money, but any employer who does business with the state is affected. Compliance also requires maintaining audited financial records to prove on 10 business days’ notice that state monies have not been improperly used. Penalties are both civil and criminal. These laws clearly interfere with the free exchange of information contemplated by the NLRA for the benefit of employees in representation elections. They eliminate views opposing those of union organizers and therefore create a coercive bias toward unionization. A chilling effect The principal arguments against pre-emption cannot withstand careful scrutiny. To the argument that employer free speech is not prohibited because private monies can be used to communicate its message, there are two answers. First, there are employers, principally in the human or social services area, whose budgets are entirely or nearly entirely derived from state monies, making it impossible for them to do anything. Second, those employers who may have significant private funding still have to implement an elaborate accounting system in order to document their compliance. The accounting burden, penalty structure and the possibility of having to waive the attorney-client privilege in order to defend against a challenge that an attorney was engaged for a prohibited purpose have a chilling effect that will discourage engaging in any arguably prohibited activity. Such laws leave union organizers free to organize while prohibiting employers from effectively communicating with their employees about issues that will affect their work environment. This is clearly an impermissible interference with federal regulation of such activities and employee freedom of choice. Frederick D. Braid is a member of Holland & Knight’s labor and employment group and leads the firm’s New York office, which represents the employer in the NLRB case mentioned in this article.

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