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Union Organizing Bill Rancor Intensifies

Obama reiterates support for Employee Free Choice Act.

A coalition of retailers, shopping center owners and developers warned Thursday of major job losses if Congress passes a bill that would make it easier for workers to join a union.

This story first appeared in the March 6, 2009 issue of WWD.  Subscribe Today.

But President Obama and Vice President Joe Biden reiterated their support for the legislation that has become a political flash point pitting organized labor against the business community during the worst U.S. recession in decades.

“As we confront this crisis and work to provide health care to every American, rebuild our nation’s infrastructure, move toward a clean energy economy and pass the Employee Free Choice Act, I want you to know that you will always have a seat at the table,” Obama said in a videotape message played Tuesday at the opening session of AFL-CIO annual meeting in Miami Beach.

Obama was a co-sponsor of the bill when he was in the Senate.

The Alliance to Save Main Street Jobs, which includes the Retail Industry Leaders Association and the International Council of Shopping Centers, commissioned a study that projects job losses of as much as 600,000 in 2010 if 1.5 million union jobs are created.

The author of the study, economist Anne Layne-Farrar, said companies react to higher labor costs associated with unionization by relocating, sourcing more overseas, laying off workers and passing on price increases to consumers. The report contends that every 3 percentage points gained in union membership would result in a 1 percentage point rise in the unemployment rate in the following year. The unemployment rate rose to 7.6 percent in January and is expected to spike again in February.

The Employee Free Choice Act would allow a majority of workers who sign a card in support of a union to automatically certify it and would stiffen penalties against employers that illegally fire or discriminate against workers for union organizing. It would permit employers and employees to refer bargaining to mediation and, if necessary, binding arbitration should they be unable to agree on a first contract within 90 days. A federal arbitrator would then establish a two-year contract.

Business opponents said the proposal would eliminate management’s ability to argue against unionization by abolishing secret-ballot elections. Executives also oppose the provision that gives control of a contract to a third-party arbitrator in the event of an impasse.

In a speech at the AFL-CIO meeting on Thursday, Biden said: “The legal industry spends hundreds of millions of dollars exclusively in an effort to block workers from pursuing their legal rights, from unions being able to get collective bargaining agreements.”