Never Waste a Good Crisis

By Tim Murphy - Skoler, Abbott & Presser, P.C.

April 20, 2020

Hello All, it’s been a little while.  Fortunately, not much has been going on…

Organized Labor has long sought major federal labor law changes to reverse the steep decline in union membership.  “Union neutrality” by which employers would be prohibited from opposing unionization efforts is usually on this labor law reform wish list.  This “reform”  would require striking from the National Labor Relations Act (NLRA) the provision guaranteeing to employers the right to speak out in opposition to unionization so long as threats or promises are not involved.  Efforts to impose union neutrality have gone nowhere in Congress.  At least until now.

The recently enacted Coronavirus Aid, Relief, and Economic Security Act (CARES Act) is designed to provide much-needed money to workers and businesses to stave off a collapse of our economy as a result of COVID-19.  One aspect of the new law establishes a low-interest loan program for eligible employers with between 500 and 10,000 employees.  These loans will require no repayment for at least six months if the employers taking them certify that they:

- will maintain at least 90 percent of their current workforce;
- will not pay dividends or repurchase stock (or other equity securities);
- will not outsource or offshore jobs during the loan period or two years thereafter;
- will not break existing collective bargaining agreements with labor unions; and
- will remain neutral regarding current or future union organizing activity.

The Congressional friends of Organized Labor did not waste the COVID-19 crisis.  They seized the opportunity and inserted a union neutrality requirement for employers (with between 500 and 10,000 employees) for the life of these loans.  This may be more an example of skillful politics than good public policy.

Takeaways

The law does not define “neutral.”  Typically, it means an employer cannot urge employees not to unionize.  However, depending on guidance on the definition of neutrality, employers may be able to provide facts regarding union dues, union rules, risks of bargaining, and strikes.  Even still, I expect more union organizing and more union election wins.