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Abstract
Well known is that the National Labor Relations Act (NLRA, 1935) in the United States places a largely per se ban on nonunion employee representation (ER) groups which deal with employers over a term or condition of employment. Much less well known is that America’s other labor law, the Railway Labor Act (RLA, 1926), takes a different approach and permits employers to operate such councils and committees as long as they do not perform a collective bargaining function or interfere with workers’ free choice of a bargaining agent. Thus, under the RLA Delta Air Lines is able to operate what is today the closest living approximation to a 1920s-style ER plan while hundreds of other companies (e.g. Polaroid) under the jurisdiction of the NLRA have been forced over the years to disband similar groups on grounds they are a proscribed company union. No study to date has explored the history behind the RLA and NLRA’s divergent treatment of nonunion ER groups so this article takes a first look. The main part of the story covers the 1920–1935 period and examines the events, people, and experiences associated with company unions and ER in, respectively, the rail and manufacturing industries and why the legislative outcome in the former was a permissive stance on nonunion committees but prohibitive in the latter. The last part of the paper fast-forwards the RLA-NLRA story from the 1930s to contemporary law and practice in order to demonstrate how “history matters” when it comes to what employers can and cannot do with nonunion representation groups, such as works councils, participation and involvement committees, and dispute resolution forums.
Notes
1. Early studies include Devaney (1993), Leroy (1996), and Kaufman (1999); recent studies include Craver (2010), Estlund (2010), Dau-Schmidt (2011), Godard and Frege (2013), LeRoy (2014), and Kaufman (2014).
2. See “Volkswagen Vote is Defeat for Labor in South.” New York Times, February 14, 2014.
3. Thomas Perez, US Secretary of Labor in the Obama administration, said regarding the VW conundrum, “there needs to be more space in America for new forms of collaboration between workers and employers.” Quoted in TimesFreePress.com, October 23, 2014. More generally, see Freeman and Rodgers (1999), LeRoy (2006), and Estlund (2010) and, for an international perspective, Freeman, Boxall and Haynes (2007), Gollan, Kaufman, Taras, and Wilkinson (2014).
4. Bernstein (1950), 18–28; 40–1.
5. On Polaroid, see Commission on the Future of Worker-Management Relations (1994a), 60, and LeRoy (2014); on Delta, see Kaufman (2013, 2014).
6. Reported in Godard and Frege (2013), Table 1.
7. At a more general level, O’Brien (1998) provides a very useful labor history account of the events and competing ideas and politics behind the RLA and NLRA, and why and how they came to represent partially competing philosophies and regimes of labor relations regulation. An insightful, albeit not disinterested, “insider’s” account of the road to the RLA and NRLA is provided by Richberg (1936). Also Vadney (1970).
8. Also see Kaufman forthcoming, distinguishing prevalent attitudes about company unions in the 1920s into four philosophical frames of reference: individualist/open shop, unitarist/personnel management, pluralist/joint governance, and radical/class struggle.
9. For legislative histories, see National Labor Relations Board 1985 (NLRA) and Campbell and Brewer 1988 (RLA).
10. Estreicher (1994), LeRoy (1996), Kaufman (1999), Richardson (2010).
11. Noted in Estreicher (2000) and Taras (2000).
12. Nelson (2000); Churella (2009); Huibregtse (2010).
13. Lescohier (1935); Bureau of Labor Statistics (1937), Chap. 1; Nelson (1993).
14. La Dame (1930); Kaufman (2010), 58–63.
15. Balderston (1935): v, 141–54; also, “The Employer–Employee Plan that Won the $2000 Prize,” Forbes, November 1, 1931: 12–4.
16. Rees (2010), Kaufman (2010), Chap. 10.
17. Gitelman (1984, 1988), 191–2, 280; Ching (1973), 6–7.
18. Selekman (1924).
19. Taras (1997, 2006); MacDowell (2000).
20. National Industrial Conference Board (1922); Lescohier (1935); Gitelman (1988), Chap. 11.
21. Nelson (2000), 61.
22. Ozanne (1967); Jacoby (1989); Fairris (1997).
23. O’Brien (1998), 98.
24. Dunn (1926a); Nelson (2000); Churella (2009); Huibregtse (2010).
25. Sunstein (1987); Bernstein (2011).
26. Yale Law Journal (1930); Lecht (1955), 31–2; Zakson (1989), 358.
27. Lecht (1955), Chap. 1; Aaron et al. (1977), Chap. 1; O’Brien, Chap. 4.
28. Zakson (1989), 327–9.
29. Lecht (1955), 31–7; Huibregtse (2010), Chap. 3; Churella (2009).
30. O’Brien, Chap. 4.
31. Zakson (1989), 354–7; Huibregtse (2010), 31.
32. The Transportation Act is reproduced in full in McVeigh 1923.
33. Churella (2012).
34. Huibregtse (2010), 41–8.
35. See Bernheim and Van Doren (1935), 179–81.
36. Nelson (2000); Churella (2009).
37. Vrooman (1991), 79.
38. Marchand (1998), 118–29.
39. Atterbury (1924), 42.
40. Ibid., 45.
41. Atterbury (1923), 8.
42. Dunn (1926b), 15, 39, 59.
43. Dunn (1926a), 3.
44. McKillips (1936); however, Lecht (1955), 78, cites a PRR spokesman who said in 1934 the full operating cost of the company union was $300,000. Also, Dun (1926b); Churella (2009).
45. McKillips (1936), 48.
46. McPherson (1924), Table 1; Churella (2009), 12; O’Brien (1998), 107.
47. Lecht (1955); Huibregtse (2010), 67.
48. Federal Council (1924), 3, 9, 11.
49. McPherson (1924).
50. Ibid., 71.
51. Core (n.d.), 6.
52. Jones (1953), 92–3.
53. Federal Council of Churches, 10.
54. McNatt (1932), 165. His dissertation provides a particularly in-depth description of the structure, operation, and performance of a company union in the rail industry.
55. Richberg had great influence on the development and crafting of labor law beginning with the Transportation Act in 1920 and then continuing with the RLA, section 7(a) of the NIRA and its interpretation and enforcement, and ending with the NLRA. Although both Richberg and Wagner supported a strong independent labor movement, Richberg emphasized voluntarist self-government between employers and unions with allowance for workers’ free choice among alternative representational forms (including company ER plans and no representation) while Wagner advocated a more statist and social democratic ordering where collective bargaining is encouraged over other representational forms and government regulates the process with mandated standards of conduct (e.g. agency-enforced unfair labor practices). The differences between the two men came to a sometimes conflictive head in the NIRA period 1933–1935. On Richberg, see Richberg (1936); Vadney (1970); O’Brien (1998); on Wagner see Huthmacher (1968) and Barenberg (1993); and for their interplay through Roosevelt see Perkins (1946).
56. The text of the act is reproduced in Campbell and Brewer (1988). Also see Lecht (1955), Chap. 3.
57. Wolf (1927), 24; Huibregtse (2010), 43. Vittoz (1987), 99 also cites as an inspiration the Protocol of Peace negotiated in 1910 between the New York City shirtwaist employers association and the garment workers union.
58. Huibregtse (2010), 74.
59. Harvard Law Review (1928); Bernheim and Van Doren (1935), 179–80; Northrup (1950).
60. Campbell and Brewer (1988), 4, emphasis added.
61. Bureau of Labor Statistics (1937), 25.
62. Nelson (1982); Kaufman (2000a), Figure 2.1.
63. Marchand (1998), 98–101, 114–8.
64. Bruere (1926, 1927, 1928).
65. Carpenter (1928a, 1928b, 1928c).
66. Commons (1921).
67. Eisner (1967); Barenberg (1993).
68. Bruere (1926a), 27.
69. Leiserson (1928), 127.
70. Bureau of Labor Statistics (1937), 204, 205.
71. Freeman and Medoff (1984).
72. Leiserson (1919), 8 (emphasis added), 11.
73. Bernheim and Van Doren (1935), 324, 332 with emphasis added.
74. Commons (1919), Chaps. 1 & 2 and Chaps. 3 & 4.
75. Nelson (1982); Jacoby (1997); Kaufman (2008).
76. Kaufman (2003); Domhoff and Webber (2011).
77. Bureau of Labor Statistics (1937), 21.
78. Kaufman (2008); American Association of Railways (1947).
79. Jacoby (1983); Vrooman (1991).
80. Barenberg (1993).
81. Jacoby (1983).
82. Carver (1927–1928), 450.
83. National Labor Relations Board (1985), 92.
84. Texas & N.O.R. Co. v. Brotherhood of RY. & S.S. Clerks, 281 US 548 (1930); Bernstein (1950), Chap. 4; Zakson (1989).
85. Berman (1930); Lecht (1955).
86. Lecht (1955), 76.
87. Bureau of Labor Statistics (1937), 26–7.
88. Jacoby (1997); Moriguchi (2005); Kaufman (2008).
89. Witte (1934); Bernstein (1950), Chap. 2.
90. Bernstein (1950), 22.
91. Lecht (1955), 77.
92. Ibid., 78.
93. McNatt (1934); Bernstein (1970), 205–15; Campbell and Brewer (1988), 720–1021.
94. McKillips (1936).
95. Lecht (1955), 85; also Bernstein (1970), 205.
96. Aaron et al. (1977); Thoms and Dooley (1990), 9.
97. Farr (1959); Barenberg (1993).
98. Bernstein (1950), 1; Keyserling (1945).
99. Perkins (1946); Bernstein (1950), Chap. 9, (1970), 191; O’Brien (1998), 187–9.
100. Byrer (1937); O’Brien (1998); Morris (2005).
101. Bernstein (1950), Chaps. 2, 3, 8.
102. Farr (1959); Gross (1974); Gordon (1994); Kaufman (1996).
103. Bernstein (1950), Chap. 9.
104. Brissenden (1935); Mitchell (1984); Renshaw (1985); Kaufman (1996, 2012).
105. Hawley (1966); Himmelberg (1993); Gordon (1994).
106. Keyserling (1945), 8; also Kaufman (1996).
107. National Labor Relations Board (1985), Vol. 1, 501; Tomlins (1985), Chap. 4; Barenberg (1993).
108. National Labor Relations Board (1985), Vol. 2, 3270.
109. Barenberg (1993), 1394–5. He notes, “Indeed, the most politically potent unions, the Railroad Brotherhoods, opposed the NLRA” (1394).
110. Bernstein (1970), Chap. 3; Tomlins (1985), Chap. 4.
111. Young (1957); Bernstein (1970), Chap. 6, Zieger (1997).
112. Richberg (1936), 45 (claiming to be the author); Bernstein (1950), 32–3.
113. Yoder (1938), 477; Vittoz (1987).
114. Vadney (1970), 129.
115. Domhoff and Webber (2011), Chap. 3.
116. Bureau of Labor Statistics (1937), 27–8.
117. Kaufman (2000b).
118. Bureau of Labor Statistics (1937), Appendix II.
119. Bernstein (1950), 58.
120. Stated by Keyserling in Casebeer (1989), 335; also, Gross (1974).
121. National Labor Relations Board (1985), Vol. 1, 23.
122. Ibid., 25.
123. Wagner quotation in National Labor Relations Board (1985), 440, emphasis added. Wagner knew first-hand from NLB secret ballot elections held in 1934 that sometimes a majority of employees prefer the in-house ER plan over an outside union. See Lorwin and Wubnig (1935). Barenberg (1993) argues, however, that the workers’ pro-ER choice is indelibly tainted by management-created false consciousness. The widespread oligarchy, racketeering, and corrupt practices in many AFL local unions of this period are discussed in Kaufman (2001). He quotes economist Lyle Cooper (1932) who observes, “particularly in large cities, where unionism reaches its greatest strength, shady practice involving the racket and accompanying graft flourish,” and Thomas Elliot (1992), assistant to Frances Perkins in the Labor Department and self-professed New Dealer, who recalls, “While I was all for upholding the workers’ rights under Section 7(a), I was not automatically pro-union. Far from it. Frequently I wrote scornfully about the leaders of some A.F. of L. craft unions, especially in the building trades, calling them ‘a bunch of racketeers in league with a lot of building contractors.’… I’d like to see equality of bargaining power, but I doubt the efficacy of any program designed to increase the strength of the A.F. of L. as at present constituted.”
124. Domhof and Webber (2011) document that the corporate liberals associated with the Rockefeller network tried to negotiate this type of compromise with Wagner but failed because he resisted compromise and the pressure of events tipped in his favor.
125. Reproduced in National Labor Relations Board (1985), Vol. II, 2105–09.
126. Ibid., 2107, emphasis added.
127. National Labor Relations Board (1985), Vol. 1, 258.
128. Ibid., 268, 268, 264.
129. Ibid., 271, emphasis added, 272.
130. Ibid., 272, emphasis added.
131. Casebeer (1989).
132. National Labor Relations Board (1985), 16.
133. Cooper (2010); Domhoff and Webber (2011), Chap. 3. Henry Dennison, well known as one of the nation’s most progressive employers and also operator of one of the most successful ER plans, tried to distance the corporate liberals from the open shop anti-unionists and work with Wagner toward compromise. He said in his Congressional testimony (NLRB 1985, 436–7), “As to the attitude and practices of many employers, I have no illusions” and “I look forward to and favor the wider range of classical unionism” but then went on to say, “I can appreciate Senator Wagner’s natural desire … to use a scalpel on them [company unions] … [but] these companies who have established a basis of wholesome mutual business relationships between management and workers should be cultivated as seeding ground or laboratories from which we may learn, not dug up with the tares by these two paragraphs [Section 2.5].” However, many of the other industry spokesmen (e.g. James Emery for the National Manufactures Association) were not interested in ER compromise per se but rather in using it as a wedge issue to help defeat or emasculate the entire bill. Here again appear the two faces of ER.
134. National Labor Relations Board (1985), 1104.
135. National Labor Relations Board (1985), Vol. I, 1417; Vol. II, 494.
136. Ibid., 1320.
137. National Labor Relations Board (1985), 1417.
138. National Labor Relations Board (1985), 2267.
139. Jacoby (2000).
140. For example, Ozanne (1967); Bernstein (1970); Brandes (1976); Cohen (1990); Brody (1994); Morris (2005).
141. Freeman and Medoff (1984), 108.
142. Nelson (1982); Jacoby (1989); Fairris (1997); Kaufman (2000); Kaufman and Taras (2000); Pencavel (2003); Rees (2007).
143. Commission on the Future of the Worker-Management Relations (1994a, 1994b); for literature citations see Estreicher (1994); Kaufman (1999); Bellace (2002); LeRoy (2006); Dau-Schmidt (2011).
144. Lawler (1986), 3.
145. Devaney (1993); Finkin (1993); Leroy (1996).
146. For example, Morris (1994).
147. For example, Estreicher (1994).
148. Leslie (2001), 118.
149. Commission on the Future of Worker-Management Relations (1994b), 98–103.
150. Ibid., 102.
151. Morris (1994), 519.
152. Arouca and Perritt (1985); Morris (1999).
153. Kaufman (2013, 2014); also see Taylor (2003); Katz (2012).
154. National Mediation Board (2002), 122; also, Taylor (2003); Katz (2012).
155. National Mediation Board, 124.
156. Katz (2012).
157. Ibid., 3.
158. Ibid.
159. Kaufman (2013).
160. Kaufman (2014).
161. On workers’ preferences for a non-union and cooperative form of voice, see Freeman and Rodgers (1999) and Godard and Frege (2013).
162. Taras (2014). As was true in the 1930s in the USA (see Hogler (2001) for the case of steelworkers), Timur, Taras, and Ponak (2012) show with Canadian case study evidence that non-union representation councils can turn into a launch pad for union organization if employees become alienated by opportunistic or ham-handed management decisions. It is certainly possible that relaxing the NLRA’s ban on company unions might on balance help more than hurt American union growth and organizing success. For a Canadian union leader’s perspective, see Basken (2000).