TO:               The Governor’s Panel on the Labor Dispute at 
                     Northern Michigan Hospital

FROM:         Paul S. Kersey

DATE:          July 31, 2003 

SUBJECT:    The Role of the State of Michigan

The Mackinac Center for Public Policy is a nonpartisan research and educational institute devoted to improving the quality of life for all Michigan citizens by promoting sound solutions to state and local policy questions. The Mackinac Center assists policy makers, scholars, business people, the media, and the public by providing objective analysis of Michigan issues. We are pleased to have the opportunity to offer the following observations on the ongoing labor dispute at Northern Michigan Hospital to this panel.

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Of course, the State of Michigan does have a very substantial interest in the health, safety, and welfare of its citizens. Given the potential for disruption of health services in the midst of a strike, it is understandable that the state would monitor the situation at Northern Michigan Hospital closely. This is the assignment before the panel, and it is a perfectly legitimate state function. However, for both legal and practical reasons, further state action should only be taken in the face of an imminent and serious threat to public health. We have seen no persuasive evidence that such a threat has arisen at this point.

Under the National Labor Relations Act, the federal government, in particular the National Labor Relations Board (NLRB), has primary responsibility to regulate private-sector labor relations, including those at private hospitals. From the recognition of unions through negotiations to the rights of parties during strikes, the authority of the NLRB is exclusive and exhaustive, leaving little for the state, as a regulator of labor relations, to do.

We would also caution state officials to avoid even the appearance of taking sides in this dispute should they chose to somehow intervene. The NLRB has investigated numerous allegations of unfair labor practices relating to this strike, but has yet to find that any have occurred. While it may be frustrating to see the parties fail to reach an agreement, there is little reason to believe that either side is acting in bad faith. The rights of all parties under federal law should at all times be respected. These include, but are not limited to: the right of the union to call a strike, the right of nurses to honor the strike or continue working as they see fit, and the right of the hospital to continue operations in the midst of a strike.

On the issue of “union shop”, which has been identified as a major sticking point in the negotiations, the state should also be mindful of the fact that a petition has been circulated among Northern Michigan Hospital nurses, calling for the removal of the Teamsters. Sufficient signatures have been collected to hold an election at which the Teamsters may be decertified as their collective bargaining representative. It would be particularly distressing to both workers and employers if the state were to pressure the hospital into accepting a union shop arrangement, under which nurses who oppose the union would be forced to financially support the Teamsters in the months leading to a decertification vote. This is properly a matter for the nurses to resolve among themselves and the state should remain neutral on this issue as well. By the same token, the state should avoid pressuring the union into making concessions on wages or management rights. To do so would undercut the union’s ability to protect the interests of nurses.

Given the limited legal role that the state has in labor relations at Northern Michigan Hospital, the state should intervene only after a compelling case has been made that citizens are being harmed, and should exercise patience and caution in any event. Premature intervention, especially by an authority lacking direct jurisdiction over labor relations at the hospital, is likely to violate the rights of one or more of the parties to the dispute. The state should also be aware that the NLRB may object to any state action interfering in the labor dispute.

We thank the Panel for the opportunity to offer our thoughts on this matter of extreme importance to the people of Petoskey and Michigan in general, and for the time and effort they have put into investigating the effect that this labor dispute has had on public health and welfare.