Today, both the federal and Michigan state governments have adopted the compulsory unionism approach. Under the National Labor Relations Act (NLRA), private-sector unions are granted special legal powers and privileges, including the privilege of exclusive representation and the power to extract dues and fees from all workers in a bargaining unit if the employer agrees to it. This latter power amounts to a private "tax" since it is levied against all workers, including those who voted against union representation, and the amount of the dues and fees is never subject to a vote.

The NLRA does not, however, apply to government employee unions, including military and school personnel, due to concerns that compulsory unionism for them would overpoliticize government, make it more expensive and inefficient, and cause public security problems.

Many states shared those concerns and have not established mandatory collective bargaining for their government employees. In Michigan, however, government employee unions are promoted under the Public Employment Relations Act (PERA), which was originally passed in 1947.

In 1965, the Michigan Legislature substantially revised PERA to establish mandatory collective bargaining and exclusive representation for state and local government employees, including those in schools. Since that time, the number of unionized government employees in Michigan has risen dramatically and affected state politics and government significantly.

The NLRA and PERA represent the statutory cornerstones of modern Michigan labor law. The NLRA is administered by the National Labor Relations Board (NLRB) in Washington, D. C. PERA is administered by the Michigan Employment Relations Commission (MERC), which is headquartered in Detroit.

The following section details the significant events that led the U. S. and Michigan away from a free market in labor representation and toward compulsory unionism, culminating with the passage of the NLRA in 1935 and subsequent amendments to it.