Debate  |  Volume 157

Workplace Federalism

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Last updated: Oct. 1, 2008

Debate - Workplace Federalism






In Workplace Federalism, Professors Paul Secunda and Jeffrey Hirsch debate whether it is the federal government or the states who are best able to protect the rights of workers. Professor Secunda argues that the states should serve as laboratories to “engage in thoughtful, legislative experimentation” in labor and employment laws. Professor Hirsch counters that such a proposal would exacerbate the problems with the current underenforcement of workers’ rights and, instead, the federal government should be given exclusive control of the workplace, under a single system of enforcement and regulation.

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Opening Statement — Paul M. Secunda

The Ironic Necessity for State Protection of Workers

Associate Professor of Law, Marquette University Law School
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I.

There is a palpable irony in turning to the states for assistance in protecting workers in the workplace. Laws like the Railway Labor Act of 1926, the Norris-LaGuardia Act of 1932, and the National Labor Relations Act (NLRA) of 1935, were expressly enacted to take power away from management-friendly state courts. Historically, these courts, at a moment's notice and often ex parte, intervened in labor disputes and entered injunctions against unions and their allies based on the whims of the judge. Proponents of the NLRA saw its enactment as a way to overcome these anti-union state influences and to foster at the federal level the use of collective bargaining to promote the workplace rights of employees.

Nevertheless, some seventy-five years later, it is the federal government that has proven unwilling and unable to protect the basic rights of workers through exclusive federal regimes like the NLRA, the Employee Retirement Income Security Act (ERISA), and the Occupational Safety and Health Act (OSHA). In such an environment, it is time to "employ" state legislatures to see if they can find the necessary balm for what ills the American worker in areas where federal labor law remains silent. To borrow Justice Brandeis's federalism conception, by allowing states to operate as laboratories of experimentation today, workplace rights will not only flourish at the state level in the short term, but also gain traction at the federal level for years to come.

II.

In Taking States out of the Workplace, Professor Jeffrey Hirsch argues that for workers' best interests, states should play no role in regulating the workplace. 117 YALE L.J. POCKET PART 225 (2008), http:// thepocketpart.org/2008/04/01/hirsch.html. More specifically, he argues that in order to make federal workplace law enforcement more effective, state law should simply disappear, making regulation in this area less complex and, therefore, more enforceable. Hirsch paints with this anti-federalist broad brush, all the while conceding the current dire situation facing American workers.

For me, Hirsch's anti-federalist stance is theoretically appealing from a structural standpoint in that I agree that the federal government ideally would be best equipped to manage labor relations. But the idea lacks practicality because of the current inability of the feds to do anything of the sort. This skepticism of a benevolent, universal federal regime is further fueled by the history of labor and employment law in contexts as diverse as union-management relations, occupational safety and health, and employer-provided pension and welfare benefits. Courts, agencies, and employers have routinely operated together in order to stifle employees' rights to organize, to receive promised pension and health benefits, and to work in a non-hazardous work environment. State regulation to fill in the gaps in federal labor and employment is therefore vital to ameliorate the harshness of these existing regimes.

In this Debate, I argue that state law should be permitted to play a complementary role in all of these areas of workplace regulation where federal law is silent or absent. Of course, in a short essay it is not possible to explore the numerous state law initiatives that would complement current federal labor and employment law. Yet, a recent labor decision by the United States Supreme Court and a flurry of legislative initiatives by states in the labor relations context helpfully illuminate the dangers of an exclusive federal workplace regime and the advantages of allowing states to provide additional protections for workers.

III.

The workplace federalism debate has gained increased prominence in the labor-management world in light of the United States Supreme Court's decision last term in Chamber of Commerce v. Brown, 128 S. Ct. 2408 (2008). In Brown, the Court found that federal labor law preempted a California state law which prohibited the use of state funds by employers for anti- or pro-union expression. Justice Stevens, for the majority, relied on the Machinists labor preemption doctrine to find the California law preempted. That doctrine, based on a 1976 Supreme Court case, requires a court to strike down a state law that interferes with the free flow of economic forces between labor and management. Justice Stevens concluded that the California law impermissibly interfered with the free flow of economic forces in the organizing context and thus carried no force. Consequently, California employers may now use state funds to fight unionization efforts.

The likely outcome of Brown is that many California employers facing organizational campaigns will utilize these additional funds to make anti-union presentations, called captive audience speeches. In these meetings, employers force their employees during work to listen to their views on union, political, and religious issues. (Wal-Mart has recently been accused of engaging in these meetings with its employees for political purposes.) Employees in return usually cannot speak, leave, or offer a rebuttal, without risking termination for insubordination. The effectiveness of this tactic is illustrated by the fact that a recent government report studying four hundred union campaigns found that ninety-two percent of these campaigns included captive audience meetings and the average union campaign had eleven such captive audience meetings held by employers.

In an exclusive federal labor regime of the type Professor Hirsch favors, that is the end of the story for employees. Employees will simply have to put up with captive audience speeches by their employers in an at-will employment world and the likelihood of union representation will continue to dim with employers using state money to tilt the economic forces, discussed in Brown, even further to their favor.

IV.

The operative legal regime need not exist in this manner. The NLRA does not prohibit captive audience meetings, nor does it specifically include them within employee free speech rights under Section 8(c). This is because, since the National Labor Relations Board's (NLRB) Livingston Shirt decision in the early 1950s, captive audience meetings have been found noncoercive and therefore not subject to unfair labor practice proceedings. It is accurate to say that federal law does not regulate captive audience meetings at all.

But what if states could come in and fill this gap in labor law, providing employees protection against captive audience meetings? The answer depends on whether one thinks states should be able to enact minimum conditions legislation to support these rights of workers to organize.

I believe such action on a state's part would be consistent with the long tradition of states using their police powers to protect the "life and limb" of workers by regulating the workplace. States already do this to a large degree in such diverse areas as employment discrimination, child labor, wage payment and collection, and hours and wages. Consider that sexual orientation discrimination would not be outlawed but for state and local employment laws outlawing such behavior. Should we have waited for an amendment to Title VII to provide any protection? How about the fact that low-income employees in certain states have earned additional income through living wage legislation? Should those workers have had to endure endless political debates about raising the federal minimum wage before receiving relief?

The answer is: of course not. So why shouldn't states also be able to protect workers from being harassed and intimidated by employers at work through captive audience meetings as a minimal working condition? So what if not all employees will be able to obtain this protection at one time? Isn't it better to have some protection, as opposed to none at all, while waiting for federal laws to be enacted? And let's say that an Obama NLRB comes along and overrules Livingston Shirt and declares captive audience meetings coercive under Section 8(c)? Are we any worse off that states have provided protection from such practices in the meantime?

In fact, many states have already considered such legislation over the last few years. Such Worker Freedom Act (WFA) legislation would ensure minimum conditions for employees interested in forming a union by outlawing employers from holding captive audience meetings during the workday.

V.

Now, it may be argued that even if state laws of the WFA-type are a good idea, they are nevertheless preempted by the current federal labor law regime. Even in light of the Brown decision, however, I believe WFA legislation should not be found preempted by the NLRA.

On the one hand, Garmon preemption is inapplicable because such laws do not interfere with employee free choice under Section 7 because they may voluntary still choose to listen to their employer's views on unionization. See San Diego Building Trades Council v. Garmon, 359 U.S. 236 (1959). Nor do such laws permit what is impermissible for employers to do under Section 8. Although employers are permitted under Section 8(c) of the Act to freely speak in a noncoercive matter about a union's organizing campaign, that protection does not extend to forcing employees at the pain of termination to hear those same views.

Nor should the Machinists preemption of the Brown decision apply in the workplace captive audience speech context. Unlike the state funds issue at stake in Brown, there is little argument that the free speech rights of employers will be impacted by WFA laws. Again, employers have the right to inform employees of their views on unionization on a voluntary basis, not to hold a proverbial gun to their head and make them listen.

In all, WFA state legislation would add an important layer of protection to employee organizational rights.

VI.

Nevertheless, under Professor Hirsch's anti-federalist views, such legislation could not exist. He and others worry that if states can pass laws like the WFA in labor-friendly states, then current right-to-work states in the South and the West will pass legislation that will make things even worse for workers. There is also something to the notion that we as academics should not choose federal or state remedies for a problem just because it squares with our political agenda.

Yet even though I believe that the federal government and the NLRB should regulate private-sector labor relations through the NLRA, there is no reason why state law cannot be an interim fix. If an Obama Board later expressly prohibits such meetings under Section 8(c), the WFA laws would be Garmon preempted. Similarly, state laws in this venue would not make labor law more complex as Hirsch fears if a McCain Board moves specifically to permit such captive audience meetings, which would thereby also Garmon preempt WFA legislation. In other words, WFA legislation would act as a significant place holder while the federal government debates the proper course and signals to the feds that resolution of this issue is ripe.

Furthermore, the costs of state WFA enactment are relatively low because it is hard to imagine how the background norms animating state contract law (or property law for that matter) could be made much more employer-friendly than they currently are (especially given present federal and state minimum conditions legislation that already exists). Employees in the United States exist in a world where employers have nearly absolute property rights to exclude unions and others from their workplaces and the employment at-will doctrine gives employers maximum flexibility when it comes to hiring and terminating their employees.

This is not to say that the labor movement should not continue to search for a federal fix to this problem. Labor's allies in Congress have proposed in the last year alone a number of pieces of legislation to try to ameliorate the current situation and, like Professor Hirsch, I agree that with the "right" political results at the next election such labor reform may be in the offing. But again, neither a McCain Board or Obama Board decision, nor labor law reform of the NLRA itself, would be impacted by state WFA legislation in the long-term. Such state legislation would be preempted once the federal law is no longer silent on the topic.

So while we wait for federal labor law reform, states should be permitted to take up the mantle of workers' rights and engage in thoughtful, legislative experimentation. Such a move is an ironic necessity and, yes, perish the thought, consistent with notions of federalism.


Rebuttal — Jeffrey M. Hirsch

The True Irony of Workplace Law: Less is More

Associate Professor of Law, University of Tennessee College of Law
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Attempts to reform our current workplace regulatory scheme could move in two opposite directions: either add to today's byzantine system of workplace rules or dramatically simplify that system. One of the central fronts of this dispute is the states' role in governing the workplace. We could seek to expand the number of workplace rights by giving states more authority, but we should first ask whether workers would actually benefit from such a change. This question is important, for the true irony of workplace law is that increasing the number of workplace rights-particularly through state regulation-may make workers worse off.

Professor Paul Secunda and I agree on many things. Most importantly, we both believe that the law should do more for workers. Where we diverge is the solution. Professor Secunda would increase states' regulation of the workplace, allowing them to fill in gaps in federal workplace regulations. This approach would certainly create more rights for workers. But what good are those rights if workers are unable to take advantage of them? Today, many workplace rights are frequently left unfulfilled, a problem that an increased state role would exacerbate. Thus, I argue for an approach that would help employees actually enjoy the rights they have-an approach that would eliminate states' authority to regulate the workplace.

I.

The differences between our two approaches are perhaps less extreme than they first appear. In addition to sharing the same goal, I concede that my proposal is not a perfect one. As Professor Secunda accurately points out, some workers would be worse off if states no longer had authority to regulate the workplace. However, the costs to those workers would be outweighed by the benefits to other workers and the workplace regulatory system as a whole. These benefits would largely result from correcting serious deficiencies in the enforcement of today's workplace laws.

Many scholars-Professor Secunda and myself included-have decried the failure of a vast array of workplace laws to achieve their promise. For example, despite the explicit prohibition against employment discrimination in Title VII of the Civil Rights Act, many workers must still endure discriminatory acts at the hands of their employers. Similarly, the protections given to whistleblowers look good on paper, but amount to virtually nothing in practice. The same is true for numerous other workplace laws.

There are many causes for the deficiency of these laws, including the current presidential administration's resistance to workers' rights. But the problem is not one of politics alone. President Clinton's administration was much friendlier to workers, but our workplace laws still suffered many ills during his time in office. A more fundamental reason for this growing problem is that the sheer complexity of today's system of workplace laws makes compliance and enforcement of those laws extraordinarily difficult. Federal, state, and local governments all have a role in workplace regulation, each with its own set of laws. Moreover, these laws frequently cover the exact same type of conduct. At times, these laws are consistent, but far too often they are not.

So, why does this complexity matter? Imagine an employer that is faced with a dizzying array of statutes, administrative rules, and cases that may regulate its workplace. It requires a significant amount of resources to understand which laws apply and how to comply with them. Things are even worse for employees. It is not surprising, given employers' difficulty in understanding workplace laws, that employees are at almost a complete loss. This is particularly significant because most workplace rules require employees to initiate an action-a difficult requirement if they are not even aware of the rules or what they mean. Finally, if a dispute actually manages to result in litigation, the diverse set of workplace rules often requires multiple claims to be adjudicated in multiple forums. This duplicity is a waste of resources and, not surprisingly, creates judicial resistance to such claims. The result is a situation in which employers frequently do not comply with workplace rules, employees lack the resources to enforce their rights, and judges throw out good cases along with bad ones. In short, our workplace rules fail to accomplish their own goals.

Cutting down on this complexity is critical to the ultimate usefulness of workplace rights. Professor Secunda's proposal to increase state governance of the workplace runs directly counter to that goal. Although the marginal effect of a single new state rule is low, the aggregate effect of numerous state-promulgated rules is great. The system is already bogged down by an overabundance of overlapping rules and forums-adding to that burden makes little sense.

This burden leads me to argue for exclusive federal control of the workplace. Admittedly, the federal government has not always been the best enforcer of workplace laws, but such imperfection is still better than today's convoluted system. Moreover, eliminating state regulation could lead to further simplification because placing all authority within one form of government provides a greater opportunity to streamline rules.

II.

Professor Secunda, while conceding that federal control of an increasingly global workplace makes sense, argues that states still have much to contribute to workers' rights. Evidence of these contributions are fleeting, however. To be sure, states such as California have more progressive workplace regulations than could be realistically enacted by the federal government. But numerous states have far more regressive rules. Indeed, as bad as federal governance of the workplace has been at times, many states have exhibited substantially more hostility to workplace rights. Making matters worse, these regressive state rules often take the place of federal protections because pro-employer lawmakers can use the crutch of states' rights to resist federal reforms.

One way to address this problem would be to use a ratchet approach, in which the federal rules act as a floor that states could exceed. This approach would likely achieve the greatest level of workplace rights, although employees' ability to enforce those rights is questionable. Further, it is possible that if the federal government had exclusive authority over the workplace, it would provide more protection than it does now, as the theoretical possibility of state regulation would no longer exist. However, even if eliminating state governance would decrease the number of workplace rights, that decrease must still be weighed against the costs of a fragmented workplace regulatory system. Any one state law has a low cost. But aggregating those marginal effects greatly increases the impact.

III.

A possible benefit of state control is the classic experimentation theory of federalism, which suggests that the "best" policies will percolate in the states and be adopted nationwide. However, it is apparent that there is no such percolation with regard to workplace regulation, despite a long history of state governance. Although some bills first appear in the states, they typically address old questions. For example, the Worker Freedom Act (WFA) bills that Professor Secunda advocates are technically new, but they go to the legality of captive audience speeches-a question that labor law has struggled with for decades. Moreover, states generally pick from a menu of well-established regulatory options, rather than act as testing ground for truly novel ideas. The formulation of state workplace regulations looks like a typical struggle among political actors, not a laboratory experiment.

The importance of politics in determining workplace rules has long been a constant, both at the federal and state level. This reality is not only an impetus behind Professor Secunda's proposal, but an impediment to it as well. As he notes, the current presidential administration has been no friend to workers. Given the administration's stance, why would it give states more power to undermine its policy goals? Expanding state authority in an attempt to increase workers' rights is likely to succeed only where it is least needed-in a federal government where lawmakers are already welcoming of such rights.

Further, focusing workplace regulation in one system would give worker-side groups a better opportunity to sway the political debate, no matter which party is in power. Currently, only employers have the resources to maintain a significant lobbying presence at every level of government that enacts workplace rules. Employers will always have more resources, but focusing workplace regulations at the federal level would at least allow worker-side groups to be in the game.

Finally, Professor Secunda's reference to Chamber of Commerce v. Brown illustrates the danger of expanding state authority over the workplace. If he is correct that Brown and the NLRA's preemption doctrines do not foreclose state WFA statutes-and I am not sure that he is-then he is proposing to add significant complications to union organizing disputes. Currently, the NLRA's robust preemption means that the NLRB controls virtually all aspects of the organizing process. Thus, if the parties argue that the other side used improper tactics, such as retaliatory terminations or overly coercive captive audience meetings, the NLRB adjudicates all of those allegations in a single proceeding. To be sure, the NLRB adjudicatory process could be improved, as it often takes longer than it should and lacks remedies sufficient to deter much unlawful conduct; however, adding state laws to the mix is not the solution. Indeed, Professor Secunda's support for state WFA statutes runs counter to one view of the NLRB's unwillingness to proscribe captive audience meetings-that they are a normal and acceptable part of a union campaign. Although I do not agree with that view, allowing states to fill in this "gap" may be ignoring that there really is no gap to be filled. More significantly, state WFA statutes would make the resolution of union election disputes more difficult.

In contrast to the NLRB's current control over union elections, imagine the same campaign dispute in a state that passed a WFA statute (Professor Secunda's state of Wisconsin is a possible option, unlike my state of Tennessee which would be more likely to ban unions if it were given the authority to do so). For instance, imagine that a union lost an election and alleges that the employer used unlawful terminations or captive audience meetings to intimidate workers. However, this time, the dispute is split between two forums. The NLRB retains jurisdiction over the NLRA allegations, but now an entirely new claim exists. The parties must litigate that claim in a state forum, but how would that litigation fit with the NLRB case? The parties could easily be in a situation in which the state forum finds that the captive audience meetings violated the WFA statute, but the NLRB finds that the meetings did not violate the NLRA. From the employees' perspective, the WFA victory provides little solace because the NLRB would not overturn an election based on an action that violates state law but is permitted under the agency's interpretation of the NLRA. Therefore, unless the WFA statute has significant fines, what good is it other than to make election litigation more complicated?

IV.

Federalism is not a theory that requires adherence for its own sake. Devolving authority to states is intended to provide benefits. Where those benefits are unable to offset the costs involved with state governance of an area, federalism should take a backseat to a different form of policymaking.

Few areas illustrate the costs of federalism more than workplace law. The complexity and confusion caused by multiple sources of law undermines the very purpose of those laws. We should not, then, add to the problem by giving states more authority, even if the current political situation makes that strategy tempting. We should instead remember that political power is fleeting and devise a system of workplace governance that is focused on the government best situated to regulate that area and most likely to create a system that accomplishes its goals. The federal government's regulation of the workplace has been far from perfect, but it is a far better choice than fifty different state regimes.



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