Exclusive vs. Focused: Members-only Agreements

Many labor experts, from both ends of the political spectrum, are increasingly talking about a concept called “members-only agreements.” Members-only agreements are contracts in which unions only represent the actual members of the union, as opposed to representing all employees within a bargaining unit, as is typical. Workers who do not wish to be members of the union are not forced to be represented by the union, and likewise, unions are not forced to provide these employees with any services.

Members-only agreements appear legal under the current NLRA and NLRB rulings. In a review of a book by Charles J. Morris, a leading scholar advocating for members-only agreements, John M. True III, a superior court judge in Alameda County, Calif., wrote:

Nothing in the actual language of the NLRA, in its legislative history, in NLRB or court cases, in the constitution, in international law, or indeed in common sense or sound policy suggests that unions could not still use this "members only" bargaining approach. It is just that we have all forgotten about it.[9] [emphasis in original]

James Sherk, senior policy analyst in labor economics at the Heritage Foundation, agrees:

Federal law does not obligate unions to represent non-members. The National Labor Relations Act allows unions to sign “members’ only” contracts that apply only to dues-paying members. This is legally uncontroversial. In 1938, the Supreme Court expressly upheld union’s ability to negotiate only on behalf of members.[10]

William Gould, a President Clinton appointee to chair the National Labor Relations Board, also agreed, writing, “the law now permits ‘members-only’ bargaining for employees without regard to majority rule or an appropriate unit and without regard to exclusivity.”[11]

Still, members-only agreements are not mainstream, and as of yet, still amorphous. In part, this is due to unions holding on too tightly to their exclusive representation privileges.

Some unions are using a new concept known as “micro-unions” to form smaller, but still monopolistic union arraignments. Unlike members-only agreements, micro-unions allow unions to gain exclusive representation privileges over a minority of the workers in a unit.

Currently, a union must organize a majority of all employees at a workplace in order to be recognized by the employer as the exclusive representation of the workers. Under the micro-union concept, a union could try to organize just a small subgroup of workers (three of the five employees at a grocery store’s deli counter, for example) and win exclusive representation for that subgroup. The employer would then be compelled to negotiate with the union in good faith and all the employees in the subgroup would be forced to accept the union’s representation and contract.

Unions could use these micro-unions as just a stepping stone toward the ultimate goal of exclusively representing the entire workplace. These types of arrangements do not provide the same type of choice and accountability built in to members-only agreements.

A recent ruling by the Sixth Circuit Court of Appeals upheld an NLRB decision to allow for hyper-specific definitions of bargaining units in nursing homes. The Specialty Healthcare and Rehabilitation Center of Mobile ruling defined which workers could be included in a nursing home bargaining unit. The Sixth Circuit wrote of this authority, “Federal labor law gives the Board wide discretion to delineate the ‘bargaining unit,’ the term for the group of workers that will vote on union representation.”[*] This may give the NLRB the ability to redefine the size of other units in other industries.

Indeed, the NLRB recently used the Specialty Healthcare decision to justify allowing 41 cosmetics and fragrances employees in a Macy’s department store in Saugus, Mass. to petition to form a micro-union. The store employs 150 employees, 120 of whom are “selling” employees (sales people in similar positions to the cosmetics and fragrances employees).[†]

The decision allows the small group of cosmetics and fragrance employees to petition for an election. Even if every cosmetics and fragrances employee votes to unionize, it will only be 33 percent of all the selling employees in the store and 27 percent of all the employees in the store. If the union is formed by a slim margin in the election, 21 to 20, this will mean that only 17.5 percent of the selling employees and 14 percent of all employees voted for the union.

After the Specialty Healthcare ruling by the Sixth Circuit, Michael Lotito, a labor attorney in San Francisco, told the Wall Street Journal, “The [NLRB] is very well-positioned to give unions an enormous organizing advantage by determining these small units.”[12] The Journal continued:

By organizing a small group of workers, a union can gain a foothold among a company’s workforce, as well as access to company information during contract negotiations that can give it leverage and make subsequent organizing campaigns easier, Mr. Lotito said. “It lets the union get their nose under the tent.”[13]

The use and growing acceptance by the current NLRB of micro-unions demonstrates that changing the standard practice of unions to one that relies on members-only agreements may be difficult. Without forcing any employees or employers to join or recognize the union, members-only unions will only represent workers who want to be represented by that union. This should create stronger unions, where all the members of the union are there by choice, and unions have an incentive to provide valuable services to each worker. They are free from forcing workers to pay for or accept unwanted representation and they are also free from representing employees who do not want these services.

[*] Specialty Healthcare and Rehab. Ctr. Of Mobile, 357 NLRB No. 83 (2011), see also 356 NLRB No. 56 (2010).

[†] Macy’s, Inc. and Local 1445, United Food and Commercial Workers Union, 361 NLRB No. 4 (2014).