How the Employee Free Choice Act (H.R. 800)Will Affect Hispanics in the Southwest
American labor leaders are looking to Obama and the Democratic majority in the Congress to finally pass (H.R. 800), the Employee Free Choice Act of 2007 which passed the House but was held up in the 2007 Senate by a cloture vote. Labor leaders proclaim that change is needed in worker organization law because the current law is too skewed to management. Overall in the United States only about 12 percent of all American workers are unionized. They note that over the past 20 years in the private sector there has been a significant decrease from nearly a quarter of the private sector workforce being unionized to only about 9% currently. Real wages have decreased steadily while worker productivity has increased over that same period they maintain. Unionized workers make an average of 28% more in wages and have a sixty percent greater chance of having health insurance than unorganized workers.
Labor proponents complain that the Federal government has for some time hampered organization efforts through a weak National Labor Relations Board which has allowed thousands of illegal firings. Current law requires that any company with at least three employees and a gross income of three million dollars must have a majority vote by secret ballot to become a unionized work place. Under the new law, if a majority of employees sign a card favoring unionization then a mandatory negotiating process would immediately proceed within ten days. The law would provide for mandatory Federal arbitrators to oversee negotiations who have wide authority over company matters such as budget outlays, plant shutdowns, retirement funds, number of employees, elimination of subcontracting or outsourcing, and health care coverage.
Historically Hispanics and especially Hispanic women have had very low numbers in union organizations. Less than 10% of the Hispanic workforce is unionized in the United States. Many Hispanic political organizations and Hispanic legislators including Henry Cuellar and Rueben Hinojosa from South Texas voted in favor of H.R. 800.
While the Northeast and Midwest United States which have had traditionally high levels of union workers are suffering the most severe economic crisis the State of Texas which has very low levels of unionization has been much less affected by crisis. The highest concentration of Hispanics in the United States can be found in the region along the South Texas-Mexican border called the Rio Grande Valley(RGV).
The RGV like other areas of the old South has seen steady growth in jobs and their economy compared with the Northeast and Midwest. Competitive low wages, cheap land, very business friendly state and local governments, trade with Mexico, a local cultural tradition of working hard ethos, and minimal mortgage crisis debt compared with other parts of the country have allowed the area to have continued economic growth. Another important factor has been the symbiotic relationship that seems to occur between native Hispanic business owners and immigrant workers who share a cultural identity and values.
All is not perfect in the “Valley” as it is called by locals. Despite the tremendous growth in Hispanics who attend college and availability of advanced education in the region there is a major brain drain of young college graduates out of the area. Very low living expenses allow a working population to live better than they other would in other regions of the country but still they have overall comparatively low wages which are “unsustainable’ according to the Lower Rio Grande Valley Development Council. Most low skilled low wage employees work for small businesses. The region is extremely dependent upon current free trade agreements with Mexico to maintain the local economy which is in peril by the new administration.
The RGV will see significant and perhaps devastating changes if the Employee Free Choice Act becomes law. Hundreds of outside union organizers are expected to come to workplaces like local restaurant chains, automobile dealerships, construction companies, hospitals, school districts, grocery stores, and other businesses. Hispanic owners of businesses will not be allowed to advise or discuss unionization at all with their employees. There is a risk that rivalry between competing unions would allow coercion of workers whose employee cards would allow public scrutiny of not only whether they support a union but also which union they might want. The conservative Heritage Foundation reported documented cases of workers who suffered threats to their families when the card check system publicly revealed their opinion against unionization.
While it is unfair to say the unions demands for high wages and benefits is only cause for the economic downturn in the “Rustbelt” it was clearly a contributory factor. What will happen to the competitiveness of the Rio Grande Valley and other areas in the South if they have to immediately deal with wage increases of 28% or more? What will happen to the symbiotic relationship that has been instrumental in the advancement of Hispanics in the Southwest between Hispanic management and labor when it has a new outside labor mediator imposed?
The crucial issue of health care coverage has been a disaster when it has been handled by management-labor negotiations as evidenced by the General Motors dilemma. No doubt health care costs too much and is too little available to workers, but the solution to this problem will not come from this platform but instead must be solved by national legislation restructuring the health care system. Enacting this labor law reform before health care reform is a recipe for disaster.
Taking away the low cost labor advantage and especially in the environment of a mitigated free trade agreement while result in higher unemployment for the low wage low skilled Hispanics who make up the majority of the RGV workforce. Not only will existing businesses be affected but there will be placed a severe inhibition for new entrepreneurs to start new businesses in the area. The rare regional success in the current economic crisis will be turned into another “Rustbelt”.
Many in the Hispanic community are aware of the union corruption so virulent in our neighboring country to the South. The Democratic Party was so incensed at the lack of fairness to workers that in 2001 they sent a letter to Mexico demanding that secret ballot should be used in all union elections. How can it be possibly that American members of Congress believe that Mexican workers should have the right to secret ballot in union elections but American members should not?
The right to workers to organize is a cherished and essential tradition, however, at the same time America has seen fit that some aspects of the worker-employer relationship should come under general legal supervision such as minimum wage standards. American workers need more protections in their security of employment and health coverage but these should come under general employment law standards. Corporate transparency must be increased so that patterns of unfair labor practices are able to be found and punished. The founders of the Constitution intended that individual states would be laboratories of innovation in commerce and this concept would be crushed by the sledge hammer effect of the Employee Free Choice Act.
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Tony Magaña grew up in McAllen Texas, attended Texas A&M University, served as an officer in Army Reserve, and holds a doctorate from Harvard University. The co-founder of Contempo Magazine has participated in Valley business for over 20 years.He is a member of the National Association of Hispanic Journalists.
