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The short-sighted attack on collective bargaining

Posted by Alan Wirzbicki  May 28, 2011 03:30 AM

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Getting rid of collective bargaining rights for public sector unions may seem like a tempting strategy for state lawmakers seeking to solve their budget woes. Indeed, saving money was one of the reasons Wisconsin Governor Scott Walker offered for his controversial proposal to strip public unions of bargaining rights, a plan that sparked a nationwide outcry by allowing officials to unilaterally impose cost-saving measures without union consent.

But in the long term, the strategy is likely to backfire — and exacerbate the very fiscal woes that states like Wisconsin, Ohio, and Indiana, sought to solve by sidelining unions.

That’s because collective bargaining provides a structured way for governments to address the inevitable tensions that exist between any employer and employee. That friction is not going to simply go away in states that abandon collective bargaining. Instead, disputes will just become harder to manage, harder to resolve, and ultimately more costly. Governments and taxpayers, and not just union members, have benefited from collective bargaining — a point too often lost in the wave of attacks on public sector employees.

As circumstances and workplaces change over time, the expectations and needs of employers and workforces shift — which also inevitably results in disputes. Collective bargaining provides a means of resolving disputes and adjusting to changing conditions. Legislation creating modern collective bargaining, in fact, was drafted in order to serve this purpose.

The National Labor Relations Act (establishing collective bargaining in the private sector) was passed in 1935 in the midst of the Depression in recognition that the failure to create a mechanism to resolve the growing wave of workplace problems would result in widespread disruptions to a weakened economy. In the extreme, legislators worried that not providing a means to resolve workplace disputes could lead to even more radical ferment (at a time that even serious people worried about socialist revolution).

The passage of collective bargaining legislation for public-sector workers in the 1960s arose from recognition that the restive concerns of government workers needed a means of systematic resolution. For workers like police and firefighters, failure to resolve disputes could lead to disruptions that might endanger public safety. Simply banning strikes or work stoppages proved insufficient since it did not eliminate the inevitable frictions arising between municipal government and those high-stakes workers. Similarly, the rapid growth of the teaching workforce that accompanied the baby boom required some systematic means of dealing with the wide range of employment issues arising in public schools.

Collective bargaining is, at its root, an organized system for setting pay, benefit, and human resource policies. It is a process, not an inevitable set of outcomes. Any serious student of collective bargaining will certainly recognize that contracts agreed to by employers and unions at one point in time may no longer fit the economic environment of another period. Changing conditions may sometimes necessitate incremental alterations (the normal course of events for long stretches of time). But they may also require painful and far more substantial adjustments, as has been true in the automobile and steel industries.

It is clearly such a moment for the public sector. The fiscal capacities of state and local government make agreements on topics like health care and pensions negotiated in a very different era of public sector finances problematic today. In Wisconsin, Governor Walker argued that radically reducing the role of collective bargaining in setting workplace conditions was essential for dealing with the state’s budget crisis. Yet in the ensuing months, other states have managed to navigate even more difficult budget environments than Wisconsin’s through negotiations with unions.

Governor Dannel Malloy of Connecticut reached agreement that addresses the state’s $4 billion deficit via a combination of significant cuts for state workers (estimated at $1 billion per year) and tax increases. Governor Jerry Brown of California has carried on negotiations over the mother-of-all budget crises in a tough-minded way without challenging the basic right of workers to have a voice in their public workplaces.

Here in Massachusetts, the proposals currently being debated on changing the approach to negotiating over ballooning municipal health care costs provides an example of responding to new circumstances through revising rather than rescinding collective bargaining. Massachusetts legislators are debating a law that would provide local governments with greater ability to move their workforce into the state’s health care program or to develop plans that would lead to comparable local savings. The proposals would still provide for negotiations with unions over those changes, but grant the localities greater control if an agreement could not be reached. This appears a sensible way to handle rapidly growing health care costs for cities and towns without undermining the essential elements of collective bargaining.

The approaches embraced by Massachusetts, Connecticut, and California all share an unstated premise. They recognize that workplaces are complicated environments and that conflicts are an inevitable part of daily work life. Disputes range from the idiosyncratic (frictions between two co-workers) to the systemic (dealing with the impacts of bad supervision). They arise from differences in opinions (what is considered fair); disputes over facts (how many hours a person worked); or interpretation of expectations (is an assignment part of normal duties or not)?

Simply eliminating the collective bargaining process for the sake of near-term savings is dangerously shortsighted, and ignores the lessons of history. We need sensible approaches to resolving the inevitable and often difficult disputes that arise in tight fiscal times. As in many areas of life, that requires tough negotiations between the parties, not unilateral edicts imposed from one side on the other.

David Weil is an economics professor at the Boston University School of Management specializing in workplace regulatory policy.

Globe file photo: Governor Scott Walker, Republican of Wisconsin.

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ABOUT THE ANGLE Online commentary and news analysis from the Boston Globe. The Angle is produced by Rob Anderson and Alan Wirzbicki. You can follow Rob on Twitter at @rcand.

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