Unions Use Contract Wins to Make Up for Congress’ Long Inaction

A series of recent union wins that improved wages and working conditions for hundreds of thousands of workers remains undercut by congressional stagnation on federal labor laws.

The United Auto Workers, the International Brotherhood of Teamsters, and unions representing workers in industries ranging from hospitality to health care to Hollywood reached landmark contract deals that have reverberated through the economy. Wall Street executives are talking about unions more than ever, and organized labor is riding on a decades-high approval rating.

Organized labor’s momentum stands in contrast to Congress, which has been unable to update labor laws and workplace standards for decades. Despite a productive 2022 for workplace lawmaking, the federal minimum wage hasn’t increased for over a decade, and the US continues to be an outlier among industrialized nations in lacking a national paid leave policy.

That lack of action is muting the unions’ achievements, advocates say.

“Labor law remains so incredibly weak that it’s still a massive impediment to union organizing,” said Heidi Shierholz, president of the Economic Policy Institute. “Employers still have enormous power to crush union organizing.”

The situation especially presents an uphill battle for newly formed unions seeking to sign a contract. But it also threatens established organized labor, Shierholz said.

Employers say unions are actually having a much easier time under the Biden administration than in prior years. The president is one of the most pro-union leaders in history, and the National Labor Relations Board has been moving to ease the way for organized labor, said Michael Lotito, co-chair of the Workplace Policy Institute at the management-side firm Littler Mendelson PC.

The challenge for them instead is the decades-old decline in membership that has left only 6% of workers in the private sector belonging to unions, he said.

Back-to-Back Victories

This year was marked by several wins for unions, some of which followed high-profile strikes.

UAW stood out this year after securing 25% pay raises with Ford Motor Co., General Motors Co., and Stellantis NV.

The Teamsters also signed a contract with United Parcel Service Inc. in August to raise wages and benefits for delivery drivers to as much as $175,000. Las Vegas hospitality workers reached an agreement with some of the city’s high-profile casinos, and Kaiser Permanente workers also approved a labor deal that would significantly raise wages.

The Screen Actors Guild-American Federation of Television and Radio Artists and the Writers Guild of America also made inroads on better pay and guardrails on the use of artificial intelligence after a weeks-long simultaneous strike that upended Hollywood.

Teamsters President Sean O’Brien attributed unions’ successes to workers feeling “fed up” with record profits and stagnant wages.

“The general public, main street, recognize the fact that there’s a corporate greed that needs to stop,” O’Brien said in an interview with Bloomberg Law.

The unions say these contracts will help them expand their membership. O’Brien, for example, has expressed an interest in unionizing Amazon.com Inc. workers, while UAW President Shawn Fain is targeting Tesla Inc. and a dozen automakers to organize over 150,000 workers, particularly in the South.

Outdated Labor Laws

Labor leaders and advocates say the limits of current labor laws present a challenge for new and established unions alike.

Fain recently told lawmakers that unions still need a hand from Washington.

“We have no interest in being a private welfare state,” he said during a November hearing at the Senate Health, Education, Labor and Pensions Committee. “The working class needs this committee and the entire Congress to step up,” Fain added.

The National Labor Relations Act favors employers by allowing for a potentially multi-year process in which the company refuses to bargain with a new union, creating an unfair labor practice case that must go through an administrative process before going to a federal appellate court for a ruling. An employer’s cost for this strategy is relatively small, as the remedy for illegally refusing to bargain with a union is typically an order to bargain.

The NLRA dates back to 1935 and changes to the statute have remained a divisive issue for decades.

Democrats in multiple congresses have introduced the Protecting the Right to Organize (PRO) Act (S. 567 in the current Congress), to overhaul labor law.

The bill cleared a Senate committee this year, but it remains under water without full Democratic support—Arizona Sens. Kyrsten Sinema (I) and Mark Kelly (D) as well as Virginia’s Mark Warner (D) aren’t co-sponsors—and only minor Republican buy-in.

Most Republicans on Capitol Hill say the measure is too partisan, and would tip the scales too far in favor of unions. The bill would make it easier for workers to be classified as employees instead of independent contractors, override “right to work” laws that allow employees to opt out of paying fees in unionized workplaces, and ease union elections by allowing employees to use mail or electronic ballots.

Meanwhile, most Democrats have balked at Republican proposals to eliminate laws that mandate that workers pay fees if they’re represented by a union, require union elections to be conducted by in-person secret ballots, and other measures that pro-labor Democrats perceive as undermining labor organizing.

Minimum Wage, Paid Leave

Congress also remains stymied when it comes to other high-profile workplace issues.

The federal minimum wage has stayed at $7.25 since 2009, marking the longest time the benchmark hasn’t seen an increase since it was created in 1938 under the Federal Labor Standards Act.

There’s bipartisan agreement that the number is low. But progressives are reluctant to settle for something less than $15, and are pushing for an even more ambitious $17, citing rising costs of living.

Most Republicans and some Democrats say both figures would be burdensome for employers and could end up costing jobs. Proposals to reach a compromise somewhere in between haven’t gained much traction.

Guaranteed paid leave also historically has faced headwinds in Congress despite members of both parties introducing legislation and support from both unions and employers.

Democrats mostly argue for a comprehensive program that would provide paid time off for new parents, workers who are sick, or for those who need to care for a sick relative. Republicans say such a massive program that pays workers for their time off would be extremely costly for the US government, and lawmakers haven’t been able to find common ground on a way to pay for it.

Unions Fill Gaps

In light of congressional inaction, unions have started to become more proactive on these types of wages and benefits.

The UAW agreements with the Big Three, for example, include two weeks of paid leave to full-time employees, a new benefit that hadn’t previously been a priority for the union.

Hyundai Motor Co., Toyota Motor Corp., Honda Motor Co., and Nissan Motor Co. also announced pay hikes for some of their US workers in the wake of the deal.

Rail unions additionally were able to secure paid sick days after a fraught labor dispute that involved congressional intervention.

This year could be seen as a bookend to the era of union decline following President Ronald Reagan’s 1981 firing of striking air traffic controllers, Lotito said.

But he was skeptical that 2023 will be the start of a private-sector union resurgence.

“Are we going to look back on this 10 years from now and say this was the year when union membership was 6% of the private sector and started ultimately to climb up, four or five years from now, to 10%?” Lotito asked. “Well, that remains to be seen, but if you look at past behavior and history, the answer is probably not.”