WASHINGTON - “Pay no attention to that man behind the curtain. The great Oz has spoken,” the actor Frank Morgan thundered in the famous 1939 movie, The Wizard of Oz.
That famous line provides an appropriate backdrop for a new Labor Department rule issued March 23, that opens up the curtain behind a company's union-busting efforts and lets everyone involved know who is actually doing the talking, and where monies are being spent.
Until now, a company seeking to bust its union(s) had to file with Department of Labor only if they directly opposed an organizing drive in their workplace. Now, in a rule that takes effect April 25, DOL’s Office of Labor-Management Standards wants to order them to file even if they’re indirectly involved, such as when outside "persuaders" give paid advice to employers on how to defeat unions. The union-busting industry is a multi-million-dollar enterprise.
“Workers should know who is behind an anti-union message. It’s a matter of basic fairness,” said Labor Secretary Thomas Perez. “This new rule will allow workers to know whether the messages they’re hearing are coming directly from their employer or from a paid, third-party consultant.
“Full disclosure of persuader agreements gives workers the information they need to make informed choices about how they pursue their rights to organize and bargain collectively. As in all elections, more information means better decisions.”
The 1959 GOP-passed Landrum-Griffin Act says unions, consultants and employers must file reports disclosing their spending. But “a longstanding loophole allows employers to hire consultants to create materials, strategies and policies for organizing campaigns – and even to script managers’ communications with employees – without disclosing anything, as long as the consultant does not directly contact employees,” DOL says.
The closure of that loophole is not insignificant for efforts of labor union organizers.
Paul Secunda, a professor of labor law at Marquette University Law School, told the New York Times that union-busting consultants tend to be extremely effective at creating an environment in which many workers fear for their job if they opt to form a union.
Employees, he said, should “understand that the employer is not just speaking generically in their best interest. They wouldn’t spend so much on persuaders if it wasn’t important to keep unions out of the workplace.”
In the same article, Marshall Babson, a management attorney, argued that the fee disclosure requirement would discourage law firms from providing advice to clients. “It’s something that tends to chill the seeking of legal advice,” he said. “How is that in anyone’s interest?”
While Congressional Republicans screamed in protest about the new rule, the Labor Department says it is, in effect, in everyone's interest. "This rule does not prohibit employers from hiring consultants or constrain them in what information they can provide; the rule simply ensures that employees are given more information about the source of campaign material, which helps them make a more informed choice in exercising their rights," the DOL said.
That loophole in the Landrum Griffith Act that's now being closed was one of the "enormous, gaping errors in the law that have left room for a sleazy billion-dollar industry to plod through," wrote Martin Levitt in his 1993 book, Confessions of a Union Buster. He added: "I never filed with Landrum-Griffin in my life, and few union busters do."
The AFL-CIO reports that while unions are required to file lengthy annual LM-2 financial disclosure reports that detail all receipts and expenditures of its activities, the LM-20 form that management consultants will be required to file is two pages, much of which simply requires checking boxes. But they say it's still a positive move.
Mike Lo Vuolo, a former American Airlines passenger agent, and his co-workers tried three times to form a union at American Airlines with the Communications Workers of America (CWA), under the company’s previous management, the AFL-CIO said. In 2012, despite having filed for bankruptcy, American Airlines spent hundreds of thousands of dollars on the law firm Sheppard Mullins. Mike recalls the distribution of glossy fliers and DVDs used to discourage and scare employees during organizing drives. The threats often include plant closures or worker layoffs if union organizing drives are successful.
“This rule is long overdue,” said Lo Vuolo. “Corporations and consultants should be required to report how much money they spend fighting workers.”
(Press Associates contributed)