In February, Indiana became the twenty-third state, and the first in the “Rust Belt,” to enact a “right to work” law. The Indiana law states:
A person may not require an individual to:
(1) become or remain a member of a labor organization;
(2) pay dues, fees, assessments, or other charges of any kind…
as a condition of employment or continuation of employment.
While conservatives hail “right to work” laws as a victory for workers, such laws are an attack on the rights of employers. While conservatives hail “right to work” laws as a means to curtail the power and influence of labor unions, those laws are founded on the very same premises as the laws that have given unions so much power and influence.
For example, the Clayton Act in 1914 exempted labor unions from anti-trust laws, which would have otherwise made unions illegal. In 1932, the Norris-LaGuardia Act gave unions further protections, such as prohibiting “yellow-dog contracts.” (A “yellow-dog contract” is an employment contract in which a worker promises not to join a Labor Union or promises to resign from a union if he or she is already a member.) The National Labor Relations Act of 1935 made it illegal for employers “to refuse to bargain collectively with the representatives of his employees.” These laws, and others like them, grant increasing power to union leaders, compel employers to negotiate with those leaders, and effectively prevent employees from contracting their labor as they judge best. “Right to work” laws are intended to counter the laws giving such power to unions.
Where the pro-union legislation forces the employer to negotiate with union leaders, regardless of his own judgment, “right to work” laws prohibit the employer from making union membership a condition of employment, regardless of his own judgment. In both instances, the law prohibits the employer from acting on his own independent judgment.
Morally, a business owner has a right to set whatever terms of employment he desires, including union membership, and employees have an equal right to accept or reject those terms. These are choices that should be left to each individual. Each individual has a right to act on his own judgment, so long as he respects the mutual rights of others.
Unions per se are not the problem. The problem is unions backed with the coercive power of government. Current labor legislation forces businesses to “negotiate” with the unions or be prosecuted for violating labor laws. This is akin to “negotiations” between a banker and a robber—one side can issue ultimatums punctuated with “or else.” And “or else” means the threat of force. America’s labor laws effectively prohibit business owners with unionized labor from operating as they judge best. Right to work laws are based on the same premise.
The power granted to unions by government intervention in the employer/employee relationship cannot be solved by more government intervention in the employer/employee relationship. The solution is to repeal all laws that interfere in the voluntary and consensual relationships between employers and employees.
If employees choose to bargain collectively, that is their right as individuals. Simultaneously, the employer has a right to refuse to bargain with a union or any other group of employees. Employees have a right to act on their own judgment. So do employers. Neither party can morally use government coercion to make the other act differently than he thinks is best. Government has no prerogative in the relationship between employer and employee, other than enforcing the contracts that are freely entered.
So what would happen if unions were stripped of the power granted to them by government? Wouldn’t employers take advantage of their workers? While this is a myth believed by many, history demonstrates otherwise.
In 1914, Henry Ford voluntarily raised the wages of his employees to the rate of five dollars per day—nearly doubling the prevailing wage. At the same time, he cut the work day from nine hours to eight hours. In 1914, there was no union nor were there laws governing the relationship between Ford and his employees. Ford was not motivated by altruism, but by what he called “enlightened self-interest.” What was the result? Years later, he explained what occurred after he raised wages and reduced the work day:
In 1914, when the first plan went into effect, we had 14,000 employees and it had been necessary to hire at the rate of about 53,000 a year in order to keep a constant force of 14,000. In 1915 we had to hire only 6,508 men and the majority of these new men were taken on because of the growth of the business.
Ford recognized that by paying employees a wage that was considerably higher than his competitors, he was able to attract better workers and dramatically reduce turnover. He created a win-win, as do all rational employers.
Similarly, George Westinghouse also provided superior working conditions for his employees:
Working conditions at the Westinghouse Air Brake Company (WA&B) were more than proficient and the company had many new developments in effect for its employees. In 1869 it was one of the first companies to institute a 9-hour work day and a 55-hour work week. [A ten-hour work day and six-day work week was common in most industries as late as 1900.] WA&B also got the reputation for being the first industry in America to adopt half holidays on Saturday afternoons. A series of welfare options were also instituted to better the working and living conditions of its employees.
As with Henry Ford, Westinghouse recognized that better conditions for his employees resulted in greater productivity, and therefore, improved profits.
Industrialists are not the only businessmen to recognize the benefits of “enlightened self-interest.” In 1842, a French house painter—Edme Jean LeClaire—instituted a profit-sharing program for his employees. Recognized as the “father” of modern profit sharing, LeClaire “was determined to challenge the assumption that profit sharing would not increase efficiency and productivity enough to justify the payments made. He was proved right. His business prospered.”
Will every business owner recognize these truths? Will every business owner pay his employees above-market wages and offer greater benefits than competitors? Obviously not. But when employees are free to contract their labor, they can seek better jobs. A rational business owner will seek the best and brightest employees he can find. Such employees are the means by which he will achieve greater profits. When the market is free of government intervention, a less rational business owner will suffer economically.
Both leftists and conservatives would have us believe that government must protect the rights of workers. But there is no such thing as “worker’s rights.” There are only individual rights, and they apply to all individuals, employers and employees alike.