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Card Check "Lite" Is A Non-Starter

Steven J. Law is chief legal officer and general counsel for the U.S. Chamber of Commerce.

The economy is still reeling and unemployment continues to soar. What is Congress' solution? A bill that would give unions and federal bureaucrats expansive powers over Main Street businesses.

Called the "Employee Free Choice Act" or "Card Check," it would strip workers of a private vote in union organizing elections and put government "arbitrators" in charge of dictating wages and working conditions for employers that don't agree to union demands.

Last week, a group of Senators reportedly hammered out a deal on Card Check to jettison the most radioactive part of the bill: the elimination of secret ballot elections. Not everyone is singing "Kumbaya," however. Andy Stern, president of the Service Employees International Union, issued a communiqué saying, "We expect a vote on a majority sign-up provision [eliminating secret ballot elections] in the final bill or by amendment in both houses of Congress." In other words, whatever backroom deal gets cut today will be undone by another backroom deal down the road.

However, even if Congress manages to fix the bill's worst political problem by preserving secret ballot elections, Card Check "Lite" would be no less dangerous for workers and jobs.

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The unions' non-negotiable bottom line is the second half of Card Check: forced government arbitration. Here's how it works: if a newly organized employer doesn't sign a contract with the union within 120 days, the federal government would appoint an arbitrator who would dictate the contract for them. Arbitrators unfamiliar with a particular company or industry could impose a contract completely incompatible with that employer's cost structure. Employers would face a stark choice: figure out how to live with an unworkable contract, move out of the country, or shut down.

For workers, forced government arbitration is even worse. The Card Check bill would deny workers the ability to vote on their own contract. So there would be no chance to hold unions accountable for the promises organizers made. Instead, employees would get just two choices: work under wages and conditions decided by a government bureaucrat, or quit and look for another job in a down economy.

But the real "poison pill" of forced government arbitration is the way it would spread union pension fund financial problems to healthy companies and workers. Many union-run pension plans are headed toward insolvency because of risky real estate deals and politicized investing. The Card Check bill would empower government arbitrators to force newly-unionized employers into these pensions - putting them on the hook for huge funding shortfalls. Under pension law, a business owner could be stuck paying benefits to people who never worked for them.

And because pension liabilities are included on company balance sheets, a previously healthy firm could have its credit rating ruined overnight by being dumped into a collapsing union pension.

Congress is desperate to defuse the growing political firestorm over Card Check legislation. But just erasing the provisions that deny workers' secret ballot rights won't fix the problem. With one out of ten Americans out of work and union-dominated states on the brink of bankruptcy, people are justifiably fearful of giving unions and the federal government vast new powers over Main Street workplaces. As one national newspaper recently put it, "Card Check under any cover is still a job killer." And forced government arbitration would spread the financial pandemic inside union pension funds to the rest of the economy.

Americans expect Congress to get the economy back on track - not make things worse through bad legislation. It's time to stop the backroom deal-cutting on Card Check and advance solutions that actually help workers and jobs.

By Steven J. Law
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