The NLRA After Seventy Years: What Next?

This paper asks whether the NLRA can remain relevant in a competitive economy where nonunion employer discretion is the low-cost workplace governance form. We explore changes that would enhance worker participation and individual and collective voice in the nonunion (and possibly union) private sector. Examined are changing the labor law default to some form of a nonunion works council and narrowing the NLRA's restrictions against company-sponsored worker groups. The impact of either change would be modest. Neither is politically likely. Such legal innovations, however, might produce workplace outcomes preferable to those likely to evolve under the current legal framework. Prepared for the LERA/AEA session “The NLRA After Seventy Years: An Assessment,” Allied Social Science Association Meetings, Boston, January 7, 2006. Introduction The National Labor Relations Act (NLRA) of 1935 provided the legal framework that ushered in union organizing, collective bargaining, and a sharp rise in private sector unionism in the U.S. during the early and mid-twentieth century. Since that time, the role and relevance of the NLRA has narrowed as union density has eroded in the private sector. In today’s competitive environment, the dominant form of employee governance is one in which management has unilateral, albeit constrained, discretion with respect to most aspects of the workplace. Reforms in the NLRA will not resuscitate traditional unions. Designed for a different era and type of workplace, the bargaining relationship envisioned in the 1930s has limited relevance today. Left unmet is a desire by many nonunion workers for a cooperative exercise of individual and collective voice, but in a form different from that seen in union establishments. This paper explores changes in labor law and public policy that might promote value-added worker voice. Private Sector Unionism in Decline The decline in private sector unionism is widely recognized. Private sector union density was about one-in-three private sector workers the late 1950s and one-in-four by the early 1970s. Although private sector wage and salary employment climbed from 66.1 to 103.6 million between 1977 and 2004, union membership declined from 14.3 to 8.2 million. Union membership (coverage) density fell from 21.7% (23.3%) in 1977 to only 7.9% (8.6%) in 2004. Particularly sharp declines are seen in sectors highly organized in the past. Between 1977 and 2004, membership density fell from 35.5% to 12.9% in manufacturing and from 35.9% to 14.7% in construction. It is difficult to identify any large industry in which private sector union density has not declined. In contrast to the private sector, public sector union density rose during the 1960s and 1970s and has held relatively steady since the early 1980s. Nor has private sector unionization ended its decline. Union density is affected by “flows” in and out of “stocks” of union and nonunion employment. For density to remain constant, union organizing of nonunion jobs (existing and new) plus employment change in already-covered establishments must exceed the number of union jobs lost. Organizing since the early 1980s has fallen short of that necessary to maintain union density, the steady state private sector density being below the current 8%.