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The NLRB Targets the American Dream

Summary: The National Labor Relations Board is poised to scrap the long-held legal definition of a joint employer, which has allowed business sectors—including the franchise industry—not only to thrive in recent decades but also to bounce back more quickly from the Great Recession than other segments of the economy. Given the employee turnover in many franchises, unions see aggressive action by the NLRB as a chance to expand membership rolls and generate revenues from dues that will support unions’ activist political agendas. But an array of business groups warn that changing the meaning of joint employer could bankrupt many small businesses and imperil the creation of the very jobs that represent an entry point for millions of the country’s workers.

If you’ve taken your car to Jiffy Lube, stayed at a Choice Hotel, or ordered a pizza from Papa John’s, you’ve most likely patronized a business built on the franchise model. From KFC, Wendy’s, Arby’s, and Dairy Queen, to Planet Fitness, Ace Hardware, Supercuts, RE/MAX, and H&R Block, franchises are at the heart of small business in America.

Despite the strong national brand identification associated with these names, they are actually part of the small business mosaic of America. Franchisees are independent business people, running their own shops under the marquee of a brand customers that know and trust, often actually located on Main Streets across the country.

Franchises give small businesses, many of them family businesses—literally “mom-and-pop operations”—the opportunity to take advantage of national brand-name recognition and advertising, supply networks, business expertise, and other advantages that would otherwise be available only to the big guys. Many franchise operators are the first in their families to run businesses, and many are immigrants or members of minority groups.

20150416-UW_AgnewFor millions of Americans, franchise businesses are a path to success. Why is the National
Labor Relations Board putting a roadblock in front of small-business entrepreneurs?

There’s a world of difference between a local franchise business and a multinational corporation. The point seems so obvious it should hardly need to be made.

Yet a series of developments in federal labor law is lumping these two classes of businesses together in a way that could imperil some of the 8.9 million jobs the franchise industry provides in this country. In addition, the new rules could lump subcontractors in with the companies that hire them to perform such services as waste disposal and recycling, office cleaning, clothes cleaning, security, parking services, and photocopying.

What’s a “joint employer”?

The definition of “joint employer” is at the heart of separate-but-related rulings that have been issued, or are expected to be issued, regarding union-backed actions against the world’s largest restaurant chain (McDonald’s USA) and a Houston-based waste disposal company (Browning-Ferris). In the McDonald’s case, a majority of the five-member National Labor Relations Board is poised to comingle independently owned franchises with their corporate brands, linking them together as joint employers. In the Browning-Ferris case, the NLRB would apply that idea to subcontractors, linking them to the businesses that hire them.

Franchise owners say the NLRB’s action ignores the fact that the corporate brands have almost no influence or oversight on the locally owned franchise businesses’ day-today operations. They contend that initiatives by the NLRB and its General Counsel fly in the face of decades of laws, regulations, and court rulings on the definition of joint employer.

If those novel actions are upheld, it would be a great victory for unions, because it would make it easier for them to recruit millions of new members, to rake in badly needed fees and dues revenue to support their political agendas, and to facilitate organizing activities nationwide. Additionally, if the meaning of joint employer is changed, local franchise businesses could be treated as guilty-by association, as unions disrupt local businesses across the country in retribution for actions at a single, unrelated, independently operated franchise. This would also slow the growth of the franchise sector, possibly shutter existing locally owned franchisees, and eliminate many jobs.

Common law (the basic law we inherit from centuries of custom and precedent), statutory law, and regulations and legal rulings over the last-half century have clearly established who is an employer and when a so-called joint employer relationship exists. With regard to franchised businesses, the locally owned franchise business, not the corporate franchise brand, is deemed the employer.

In 1968, the NLRB issued a decision in a case involving the Southland Corporation, the parent company for 7-Eleven. In that case, the NLRB carefully considered whether the franchisee’s use of the trade name or operational system made the franchisor (the big national or international company) the joint employer. It held that a franchisor could be considered a joint employer only if it controlled labor relations and employment decisions by the franchisee. Because such decisions belong to the franchisee in the franchise model, franchisors were ruled to not be joint employers.

Over the past three decades, a number of subsequent cases related specifically to the franchise model have upheld this understanding.

The current standard was articulated in two cases from 1984, TLI, Inc. and Laerco Transportation. In a recent analysis on the website of Inside Counsel magazine, labor lawyer Marilyn A. Pearson explained that, in those two cases, the NLRB held that legally separate entities are joint employers only when they actually share the ability to control or co-determine the essential terms and conditions of employment (such as hiring, firing, discipline, supervision, and direction of employees). In order to qualify as a joint employer, the brand company’s control over these employment matters must be direct and immediate.

Most recently, the California Supreme Court declined to hold Domino’s Pizza LLC, the national company, liable in a sexual harassment case involving the employees of a Domino’s franchisee. The court ruled: A franchisor, which can have thousands of stores located far apart, imposes comprehensive and meticulous standards for marketing its trademarked brand and operating its franchises in a uniform way. To this extent, the franchisor controls the enterprise. However, the franchisee retains autonomy as a manager and employer. It is the franchisee who implements the operational standards on a day-to-day basis, hires and fires store employees, and regulates workplace behavior. Analysis of the franchise relationship for vicarious liability purposes must accommodate these contemporary realities.

These cases illustrate why the franchise industry, the National Restaurant Association, the National Retail Federation, the U.S. Chamber of Commerce, and a whole host of other employer groups are alarmed and dismayed by the NLRB’s recent steps to jettison the old definition.

Changing the definition

On December 19, the NLRB’s Office of the General Counsel, headed by Richard Griffin (former general counsel of the International Union of Operating Engineers), filed complaints that accused McDonald’s USA and some of its franchisees of labor violations. These formal charges had been expected since July 29, when Griffin announced his intent to name McDonald’s USA as a joint employer with the individual franchisees. The claims allege McDonald’s workers at locations across the country were fired or intimidated for participating in union organizing or in a well-funded national protest movement led by the Service Employees International Union (SEIU).

As noted by the International Franchise Association (IFA), a major trade group representing over 1,300 franchise companies and more than 780,000 locally owned establishments from various industry sectors, changing the “joint employer” definition could do great harm. The change could saddle tens of thousands, even hundreds of thousands of small businesses with uncertainty, threats of litigation, and additional costs that could make it harder for these businesses to succeed, and harder for many of the country’s most economically vulnerable people to enter and stay in the job market.

Referring to the December complaints, Robert Cresanti of the IFA said, “This isthe nightmare before Christmas for local franchise businesses. The [NLRB] has effectively legislated a change to the definition of who an employer is, which will impact hundreds of thousands of businesses.”

Michael J. Lotito, co-chair of the Workplace Policy Institute created by the law firm Littler Mendelson, told reporters: “What the [NLRB’s] general counsel seems to be suggesting is that when a franchisor provides a tool, when the franchisor provides a resource that might help the franchisee better undertake their business and become more successful as a small business owner, that that somehow equates to joint employment.” In fact, “[t]he NLRB’s decision in 1968 made very clear that the issue is notwhether or not you provide tools or support but the issue is whether or not the individual franchisor is making the decisions for their franchisees. So the general counsel is trying to upend decades of settled law that have been the foundation of the franchisor/franchisee relationship and finding suddenly that now, there’s a joint employment where none existed.”

Nowhere in the 13 complaints, which collectively span over 150 pages, does the NLRB’s Richard Griffin elaborate on what is meant by “degree of control,” according to Lotito. The 78 separate charges in these complaints involve allegations of discriminatory discipline, reductions in hours, discharges, and other “coercive conduct” directed at employees in response to union organizing activity.

These allegations are location-specific but Griffin, by declaring the corporate brand — McDonald’s — a joint employer, appears to have asserted that McDonald’s had a say in the alleged illegal or unfair practices at these sites. Yet, according to Lotito, Griffin failed to provide to the public any of the rationale that led to his decision.

Subcontractors, too

To make matters worse for employers, the NLRB is poised to rule in a similar manner in the Browning-Ferris case. In that dispute, a union is seeking to engage in wage-and-benefit negotiations with subcontracted employees at a recycling facility in Milpitas, California. The board invited amicus curiae (friend of the court) briefs, which allow people and organizations who are not direct parties to a case to provide their analysis of the issues. General Counsel Griffin filed such a brief and urged the NLRB to abandon its current analysis of joint employment to be replaced with a more expansive “economic realities” approach.

Browning-Ferris, paired with the McDonald’s case, would have a significant and likely very harmful effect for the franchise business model. It could also throw into chaos many other types of business arrangements. Should the NLRB formally adopt a more sweeping definition of joint employer, it could affect every business that subcontracts or outsources any function, which nearly all businesses do. “Browning-Ferris is incredibly pernicious,” said IFA’s Cresanti.

Griffin’s amicus brief in that case deals with whether a supplier could be considered a joint employer based solely on the volume of business a particular company does with those suppliers. This would have implications for practically any job that involves any form of subcontracting and vending arrangement. David French of the National Retail Federation noted that a retailer often operates a retail store within another retail store—a cosmetic counter inside a department store, for example. A decision in the Browning-Ferris case to throw out the longheld definition of joint employer could raise questions about whether the department store has a joint employer relationship with the actual owner of the make-up counter.

If, as expected, the NLRB formally adopts the new, more sweeping definition in Browning-Ferris, it would establish a new legal definition that would be applied by administrative law judges who hear related cases, such as the McDonald’s complaints.

Going after the little guy

It may be tempting for media outlets and commentators to frame this as a struggle between exploited workers and greedy corporations. After all, why should McDonald’s and other companies that make wide use of franchises and contract employers enjoy insulation from liability? But the real victim would be the franchisee—the little guy—not the big corporation.

In the franchise model, the national or regional corporate franchisor provides the hotelier, restaurateur, or other business operator with a brand, a logo, a product, or service standards, marketing, and tools such as a hotel reservation system. In exchange, the franchisor is paid a royalty, and the franchisee has the power to run the business the way he or she likes. The corporation does not micromanage the franchisee’s decisions about who will be the shift supervisor, who needs to cover for a sick employee, or when the floors get mopped.

“I have always been an entrepreneur at heart, but didn’t realize I could own a franchise with a growing brand that allowed me to capitalize on my passion for keeping things clean and organized until I found OpenWorks,” said Amina Redd, a franchisee who provides commercial cleaning and facilities services in the Phoenix area. “After more than 15 years as a franchisee, I am convinced that my passion for what I do and treating each customer and employee with the respect and personal attention they deserve has been the key catalyst for my success.”

Franchises make up a large and vibrant part of the U.S. economy, with nearly 800,000 franchise locations directly employing 8.9 million people across the country, according to the International Franchise Association. The franchise sector is playing an outsized role in an economic recovery that has been stubbornly slow and tentative. The industry is expected to create nearly a quarter-million new jobs in 2015 alone.

The number of new franchises could increase in the years to come as well. According to Matthew Haller of IFA, it has become common for younger people in middle management positions in large, nonfranchise companies to become frustrated by the lack of opportunities to move up the corporate ladder. Rather than wait for years for senior managers to retire, they decide they have the skills and experience in business decision making and staff management to run their own shops. So they grab hold of the opportunity to own a franchise business.

Stephen Duprey is an attorney in Concord, New Hampshire. A little more than 25 years ago, he was investing in and developing real estate and became intrigued by the hospitality industry. It occurred to him that the country was on the cusp of shifting from independently owned and operated hotels to the franchise model. The arrangement held a lot of appeal for would-be entrepreneurs and aspiring small business owners like Duprey, and he became a Choice Hotels franchisee. Today, he also operates two Marriott hotels.

The decision to become a franchisee involves a lot of personal fortitude and risk. Duprey and millions of others like him have put up their own capital, often their life savings, and years of “sweat equity” to get their foot in the door of running their own businesses. The franchise model is an ideal way for a would-be entrepreneur to reduce the risk to some degree while he or she learns how to run an independent business.

As a franchisee, Duprey does not personally pay for, say, an ad that Choice Hotels runs during the Super Bowl. His business gets the benefit of advertising that it would be impossible for him to buy as the owner/operator of an individual small business. At the same time, the entire Choice Hotels organization benefits from the high quality of the accommodations and service he provides his guests. It’s a mutually beneficial relationship. “The power of many always beats the power of one when it comes to marketing,” he said.

Typically, royalty costs in the franchise industry are three to five percent. Labor accounts for the vast majority of the franchisees’ costs and for most of the money spent on day-to-day management. Real estate and marketing account for the rest. These expenses must be paid before the local franchise can see a profit. In the restaurant sector, for example, profit margins are in the four to eight percent range, depending on the local market and other factors—a respectable profit, but achievable only with attentiveness to containing costs. The stewardship of resources is almost entirely in the hands of the franchisee.

It is the owner-franchisee who hires and fires, establishes wages, and sets the schedule.Locally owned franchise businesses often provide an entry into the workforce for many people. In fact, many franchise owners pride themselves on providing guidance to first-time workers on basic life skills such as punctuality, teamwork, and professionalism. Workers at franchise establishments, like all workers, are protected by numerous, multilayered laws and regulations governing the health and safety of workers. Franchise agreements explicitly state that franchise owners must follow all of these local, state and federal laws. Franchise owners must abide by minimum wage and overtime laws; provide paid sick leave and breaks; establish training to prevent and remedy harassment; and follow anti-discrimination laws governing age, race, gender, disability, and other classifications. They must also abide by building codes, zoning laws, and other local ordinances. Employees in franchise operations, as in other workplaces, are given ample opportunity to understand their rights, and they are instructed how to make sure their employers honor these rights. As any franchise employee can tell you, the “artwork” in the break room often consists of posters, bulletins, and publications, provided by the government, on how to sue your employer for violating workplace laws and on how to do so without cost or fear of retribution.

SEIU’s involvement—no surprise

What is the impetus for the federal government’s sudden reversal of policy on the definition of employer? It is part of a broader trend of organized labor flexing its muscles, with the support and encouragement of the Obama administration. You might say the unions have a symbiotic (mutually beneficial) relationship with the Obama administration, analogous to the relationship between franchisors and franchisees. With only two years left in the Obama administration, labor unions need to move quickly to capitalize on that relationship, and on the opportunity to increase their membership rolls and replenish their coffers.

There is a perception in some quarters that the protests against the quick service (“fast food”) industry over the past two years have been spontaneous. In this view, the protests came about because workers suddenly got fed up with being exploited, just as the Occupy Wall Street protests were supposedly spontaneous and up-from-the-grassroots. In fact, it’s the SEIU—often referred to as “Obama’s favorite union”—that has been behind the fast-food protests. The SEIU’s strategy has been to organize the protests systematically and methodically, and sometimes covertly. Skeptics point out that the unions themselves, not the workers, have the most to gain by taking on the quick-service restaurant industry.

SEIU membership has slipped by three percent since 2011, even though the labor force has grown by two percent over the same time. As Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor and now a senior fellow at the Manhattan Institute, noted in last month’s Labor Watch, the turnover at McDonald’s is some 157 percent annually. Most workers leave after three or four months.

When such a workplace is unionized, the union receives initiation fees, generally around $50 to $100 each, for each new worker. Because the typical worker is gone quickly, the union spends very little on services for that worker. In addition to initiation fees, unions collect dues amounting to two percent of paychecks. Furchtgott-Roth estimates that unions stand to gain about $155 million each year from unionizing half of McDonald’s workforce, $45 million of that from initiation fees alone.

As SEIU and other unions have lost members, they have begun to organize in new ways. They have set up so-called “worker centers”—sometimes called union-front organizations, or UFOs—to accomplish their goals. [See Labor Watch September 2013.]

Supposedly, worker centers are nonprofit organizations that offer a variety of services to their members, including education, training, employment services, and legal advice. According to Robert J. Grossman, a lawyer and Marist College professor, the number of worker centers across the country has risen from five in 1992 to at least 215 today.

These organizations have a tax-exempt status known as 501(c)(3), the status accorded to charities, churches, foundations, and other “public interest” institutions. But rather than serve the public, worker centers have a decidedly more narrow, self-interested purpose, namely, to support union organizing, which raises questions about the legality of worker centers’ tax status and their receipt of tax-deductible donations. No wonder these front groups have drawn scrutiny from business groups, tax and employment lawyers, and some members of Congress.

Last summer, the New York Times reported on what it said was the largest gathering of quick-service (“fast food”) workers calling for wage increases and various workplace regulations. The event was largely underwritten by the SEIU, which spent more than $15 million on the campaign.

Marching under the banners of Fast Food Forward, Fight for Fifteen, and other “charities,” workers in some 190 cities walked off the job in early December demanding wage increases and other concessions. The organizations were often described as independent, grassroots groups, but in fact the effort was put together by the SEIU. Some of the workers protesting, it was credibly alleged, were not even actual employees but stand-ins paid to represent workers.

Wages & hours

Another aspect of the Labor Department’s attack on small businesses, franchises in particular, comes from the department’s Wage and Hour Division, under the stewardship of David Weil.

Back when he was a Boston University economics professor, Weil wrote a book called The Fissured Workplace that has become the foundation for many of the attacks on the franchise industry and the quick-serve industry. The book is based on data he gathered for a study of the franchise model that focused on the quick-service restaurant and hotel industries. (The study was commissioned by the Labor Department and paid for by taxpayers.) Weil claimed in the book that businesses run by franchisees had more wage-and-hour infractions than those operated directly by corporations, in part because they are subject to additional costs from franchise fees, which they try to make up for by keeping wages as low as possible. This, according to Weil, allows them to enjoy larger profit margins.

Weil was confirmed to his Labor Department position only after then-Senate Majority Leader Harry Reid (D-Nev.) amended Senate rules and made it much more difficult for Republicans to block President Obama’s nominations. Not a single Republican voted for him. AFL-CIO President Richard Trumka tweeted that the 51-42 vote for Weil “is an important step toward putting a real cop on the beat to enforce our wage & hour laws.” In a profile published by the Boston Globe in June, Weil claimed he is not against franchises and subcontractors, and he acknowledged that many of these small business owners operate ethically and within the law. He said he wants to make sure that good businesses are not undercut by the bad ones. He added, “Parent companies specify a lot of what happens on the ground—down to the details of how a jelly doughnut is made or where a sign is hung, so why can’t they be held accountable for how their workers are treated? Can you really have it both ways, and specify things at a fine level in one respect, but in regards to compliance with workplace laws, say, ‘Well, they’re not our employees?’”

The answer is yes, franchisors can and should have it both ways. Franchisee Stephen Duprey has noted that this is the essence of what makes the franchise model successful. Even though Choice Hotels provides the tools he needs to run his enterprise, he said the decisions about how to recruit, hire, train, retain, and promote people, along with what to pay them, are his alone. “Not in my 26 years have they been involved in any work place decisions,” he said. “If that were true, I’d be working for them and not running my own business. I’d be an employee.”

The prospect of not being able to control a key expense such as wages is very unsettling to Duprey and other small business owners. He noted that hotel rooms in New York City can average $300-400 a night, in contrast to New Hampshire where rates can average in the $70-a-night range. Dictating corporate standards on wages and other workplace conditions that ignore these market realities would be counter to good business planning and could easily bankrupt him.

Duprey said he believes that it would make little sense to enter into a 10- or 25-year contract with a franchisor, which is typical in the industry, if the franchisee lacked control over the business, or if the franchisee faced unsustainable labor costs and the threat of legal action stemming from illegal or unfair practices of a franchisee in another state.

“My concern is not that I will be charged with any labor violations, but that my franchisor, in response to the NLRB’s changing long-standing joint employer standards, will take measures to protect itself that will end up reducing my autonomy as a franchise owner,” said Clint Ehlers, a FASTSIGNS franchisee in Pennsylvania. “If franchise owners have less independence and control, they can also expect lower profits. If profits are lower, there will be less demand from entrepreneurs to start franchised businesses. If fewer new locations open, the brand does not realize its growth potential. And that hurts each individual franchise owner in the franchise system.”

Bracing for a long battle

In her keynote speech at the union’s convention last summer, SEIU President Mary Kay Henry said that the CEO of McDonald’s and the CEO of Yum Brands (which owns KFC, Taco Bell and Pizza Hut) are each paid more than $10 million a year, and “A selfish few at the top are using their power to hold down wages, no matter how much that hurts families and communities across the nation.”

But it’s not the CEOs of big companies who would pay the price if the franchise model is weakened. The result would be fewer jobs for the people who need them, and economic losses in communities around the country.

Who would benefit from hurting the franchise model? Not workers, but unions. It’s a lot easier to unionize, and a lot easier to negotiate, if unions are dealing with a single corporate entity, instead of thousands of individual small businesses.

“Labor unions are not bad things. They have done good things for workers over the years,” Duprey said. “But in this situation, they are trying to make us all one employer—or to make me an employee—and this is not a good thing.”

What’s coming

The NLRB announced it has scheduled consolidated hearings on the McDonald’s case in three regional locations in the Northeast, Midwest, and West to address violations that, it asserts, require remedial relief as soon as possible. Absent the highly unlikely case of a settlement, the initial litigation will commence on March 30, 2015, and will involve allegations of unlawful actions committed against employees at McDonald’s restaurants in the jurisdiction of six Regional Offices of the NLRB. That hearing process could be lengthy and any administrative ruling will be open to appeals to the NLRB and the courts, ultimately even the U.S. Supreme Court. The entire process could take years.

In the meantime, businesses will be left hanging. Business decisions require a certain degree of certainty, and the mere chance that the SEIU and NLRB will win this fight is enough to burden franchise businesses.

Business groups have already begun to explore bipartisan legislative action to address the issue in the short run, possibly with stipulations on spending bills to block implementation of the policy. As the NLRB’s allegations make their way through the hearing and judicial process, Matthew Haller of the International Franchise Association assured, “We will fight these decisions by all means available to us. What’s at risk, across the country, are small businesses that often represent the life savings and the life’s work of their owners.”

David Agnew is the pseudonym of a writer/analyst in Washington, D.C. This article originally appeared in “Labor Watch,” a project of the Capitol Research Center, and is republished here with permission.

*   *   *

The NLRB Targets the American Dream

Summary: The National Labor Relations Board is poised to scrap the long-held legal definition of a joint employer, which has allowed business sectors—including the franchise industry—not only to thrive in recent decades but also to bounce back more quickly from the Great Recession than other segments of the economy. Given the employee turnover in many franchises, unions see aggressive action by the NLRB as a chance to expand membership rolls and generate revenues from dues that will support unions’ activist political agendas. But an array of business groups warn that changing the meaning of joint employer could bankrupt many small businesses and imperil the creation of the very jobs that represent an entry point for millions of the country’s workers.

If you’ve taken your car to Jiffy Lube, stayed at a Choice Hotel, or ordered a pizza from Papa John’s, you’ve most likely patronized a business built on the franchise model. From KFC, Wendy’s, Arby’s, and Dairy Queen, to Planet Fitness, Ace Hardware, Supercuts, RE/MAX, and H&R Block, franchises are at the heart of small business in America.

Despite the strong national brand identification associated with these names, they are actually part of the small business mosaic of America. Franchisees are independent business people, running their own shops under the marquee of a brand customers that know and trust, often actually located on Main Streets across the country.

Franchises give small businesses, many of them family businesses—literally “mom-and-pop operations”—the opportunity to take advantage of national brand-name recognition and advertising, supply networks, business expertise, and other advantages that would otherwise be available only to the big guys. Many franchise operators are the first in their families to run businesses, and many are immigrants or members of minority groups.

20150416-UW_AgnewFor millions of Americans, franchise businesses are a path to success. Why is the National
Labor Relations Board putting a roadblock in front of small-business entrepreneurs?

There’s a world of difference between a local franchise business and a multinational corporation. The point seems so obvious it should hardly need to be made.

Yet a series of developments in federal labor law is lumping these two classes of businesses together in a way that could imperil some of the 8.9 million jobs the franchise industry provides in this country. In addition, the new rules could lump subcontractors in with the companies that hire them to perform such services as waste disposal and recycling, office cleaning, clothes cleaning, security, parking services, and photocopying.

What’s a “joint employer”?

The definition of “joint employer” is at the heart of separate-but-related rulings that have been issued, or are expected to be issued, regarding union-backed actions against the world’s largest restaurant chain (McDonald’s USA) and a Houston-based waste disposal company (Browning-Ferris). In the McDonald’s case, a majority of the five-member National Labor Relations Board is poised to comingle independently owned franchises with their corporate brands, linking them together as joint employers. In the Browning-Ferris case, the NLRB would apply that idea to subcontractors, linking them to the businesses that hire them.

Franchise owners say the NLRB’s action ignores the fact that the corporate brands have almost no influence or oversight on the locally owned franchise businesses’ day-today operations. They contend that initiatives by the NLRB and its General Counsel fly in the face of decades of laws, regulations, and court rulings on the definition of joint employer.

If those novel actions are upheld, it would be a great victory for unions, because it would make it easier for them to recruit millions of new members, to rake in badly needed fees and dues revenue to support their political agendas, and to facilitate organizing activities nationwide. Additionally, if the meaning of joint employer is changed, local franchise businesses could be treated as guilty-by association, as unions disrupt local businesses across the country in retribution for actions at a single, unrelated, independently operated franchise. This would also slow the growth of the franchise sector, possibly shutter existing locally owned franchisees, and eliminate many jobs.

Common law (the basic law we inherit from centuries of custom and precedent), statutory law, and regulations and legal rulings over the last-half century have clearly established who is an employer and when a so-called joint employer relationship exists. With regard to franchised businesses, the locally owned franchise business, not the corporate franchise brand, is deemed the employer.

In 1968, the NLRB issued a decision in a case involving the Southland Corporation, the parent company for 7-Eleven. In that case, the NLRB carefully considered whether the franchisee’s use of the trade name or operational system made the franchisor (the big national or international company) the joint employer. It held that a franchisor could be considered a joint employer only if it controlled labor relations and employment decisions by the franchisee. Because such decisions belong to the franchisee in the franchise model, franchisors were ruled to not be joint employers.

Over the past three decades, a number of subsequent cases related specifically to the franchise model have upheld this understanding.

The current standard was articulated in two cases from 1984, TLI, Inc. and Laerco Transportation. In a recent analysis on the website of Inside Counsel magazine, labor lawyer Marilyn A. Pearson explained that, in those two cases, the NLRB held that legally separate entities are joint employers only when they actually share the ability to control or co-determine the essential terms and conditions of employment (such as hiring, firing, discipline, supervision, and direction of employees). In order to qualify as a joint employer, the brand company’s control over these employment matters must be direct and immediate.

Most recently, the California Supreme Court declined to hold Domino’s Pizza LLC, the national company, liable in a sexual harassment case involving the employees of a Domino’s franchisee. The court ruled: A franchisor, which can have thousands of stores located far apart, imposes comprehensive and meticulous standards for marketing its trademarked brand and operating its franchises in a uniform way. To this extent, the franchisor controls the enterprise. However, the franchisee retains autonomy as a manager and employer. It is the franchisee who implements the operational standards on a day-to-day basis, hires and fires store employees, and regulates workplace behavior. Analysis of the franchise relationship for vicarious liability purposes must accommodate these contemporary realities.

These cases illustrate why the franchise industry, the National Restaurant Association, the National Retail Federation, the U.S. Chamber of Commerce, and a whole host of other employer groups are alarmed and dismayed by the NLRB’s recent steps to jettison the old definition.

Changing the definition

On December 19, the NLRB’s Office of the General Counsel, headed by Richard Griffin (former general counsel of the International Union of Operating Engineers), filed complaints that accused McDonald’s USA and some of its franchisees of labor violations. These formal charges had been expected since July 29, when Griffin announced his intent to name McDonald’s USA as a joint employer with the individual franchisees. The claims allege McDonald’s workers at locations across the country were fired or intimidated for participating in union organizing or in a well-funded national protest movement led by the Service Employees International Union (SEIU).

As noted by the International Franchise Association (IFA), a major trade group representing over 1,300 franchise companies and more than 780,000 locally owned establishments from various industry sectors, changing the “joint employer” definition could do great harm. The change could saddle tens of thousands, even hundreds of thousands of small businesses with uncertainty, threats of litigation, and additional costs that could make it harder for these businesses to succeed, and harder for many of the country’s most economically vulnerable people to enter and stay in the job market.

Referring to the December complaints, Robert Cresanti of the IFA said, “This isthe nightmare before Christmas for local franchise businesses. The [NLRB] has effectively legislated a change to the definition of who an employer is, which will impact hundreds of thousands of businesses.”

Michael J. Lotito, co-chair of the Workplace Policy Institute created by the law firm Littler Mendelson, told reporters: “What the [NLRB’s] general counsel seems to be suggesting is that when a franchisor provides a tool, when the franchisor provides a resource that might help the franchisee better undertake their business and become more successful as a small business owner, that that somehow equates to joint employment.” In fact, “[t]he NLRB’s decision in 1968 made very clear that the issue is notwhether or not you provide tools or support but the issue is whether or not the individual franchisor is making the decisions for their franchisees. So the general counsel is trying to upend decades of settled law that have been the foundation of the franchisor/franchisee relationship and finding suddenly that now, there’s a joint employment where none existed.”

Nowhere in the 13 complaints, which collectively span over 150 pages, does the NLRB’s Richard Griffin elaborate on what is meant by “degree of control,” according to Lotito. The 78 separate charges in these complaints involve allegations of discriminatory discipline, reductions in hours, discharges, and other “coercive conduct” directed at employees in response to union organizing activity.

These allegations are location-specific but Griffin, by declaring the corporate brand — McDonald’s — a joint employer, appears to have asserted that McDonald’s had a say in the alleged illegal or unfair practices at these sites. Yet, according to Lotito, Griffin failed to provide to the public any of the rationale that led to his decision.

Subcontractors, too

To make matters worse for employers, the NLRB is poised to rule in a similar manner in the Browning-Ferris case. In that dispute, a union is seeking to engage in wage-and-benefit negotiations with subcontracted employees at a recycling facility in Milpitas, California. The board invited amicus curiae (friend of the court) briefs, which allow people and organizations who are not direct parties to a case to provide their analysis of the issues. General Counsel Griffin filed such a brief and urged the NLRB to abandon its current analysis of joint employment to be replaced with a more expansive “economic realities” approach.

Browning-Ferris, paired with the McDonald’s case, would have a significant and likely very harmful effect for the franchise business model. It could also throw into chaos many other types of business arrangements. Should the NLRB formally adopt a more sweeping definition of joint employer, it could affect every business that subcontracts or outsources any function, which nearly all businesses do. “Browning-Ferris is incredibly pernicious,” said IFA’s Cresanti.

Griffin’s amicus brief in that case deals with whether a supplier could be considered a joint employer based solely on the volume of business a particular company does with those suppliers. This would have implications for practically any job that involves any form of subcontracting and vending arrangement. David French of the National Retail Federation noted that a retailer often operates a retail store within another retail store—a cosmetic counter inside a department store, for example. A decision in the Browning-Ferris case to throw out the longheld definition of joint employer could raise questions about whether the department store has a joint employer relationship with the actual owner of the make-up counter.

If, as expected, the NLRB formally adopts the new, more sweeping definition in Browning-Ferris, it would establish a new legal definition that would be applied by administrative law judges who hear related cases, such as the McDonald’s complaints.

Going after the little guy

It may be tempting for media outlets and commentators to frame this as a struggle between exploited workers and greedy corporations. After all, why should McDonald’s and other companies that make wide use of franchises and contract employers enjoy insulation from liability? But the real victim would be the franchisee—the little guy—not the big corporation.

In the franchise model, the national or regional corporate franchisor provides the hotelier, restaurateur, or other business operator with a brand, a logo, a product, or service standards, marketing, and tools such as a hotel reservation system. In exchange, the franchisor is paid a royalty, and the franchisee has the power to run the business the way he or she likes. The corporation does not micromanage the franchisee’s decisions about who will be the shift supervisor, who needs to cover for a sick employee, or when the floors get mopped.

“I have always been an entrepreneur at heart, but didn’t realize I could own a franchise with a growing brand that allowed me to capitalize on my passion for keeping things clean and organized until I found OpenWorks,” said Amina Redd, a franchisee who provides commercial cleaning and facilities services in the Phoenix area. “After more than 15 years as a franchisee, I am convinced that my passion for what I do and treating each customer and employee with the respect and personal attention they deserve has been the key catalyst for my success.”

Franchises make up a large and vibrant part of the U.S. economy, with nearly 800,000 franchise locations directly employing 8.9 million people across the country, according to the International Franchise Association. The franchise sector is playing an outsized role in an economic recovery that has been stubbornly slow and tentative. The industry is expected to create nearly a quarter-million new jobs in 2015 alone.

The number of new franchises could increase in the years to come as well. According to Matthew Haller of IFA, it has become common for younger people in middle management positions in large, nonfranchise companies to become frustrated by the lack of opportunities to move up the corporate ladder. Rather than wait for years for senior managers to retire, they decide they have the skills and experience in business decision making and staff management to run their own shops. So they grab hold of the opportunity to own a franchise business.

Stephen Duprey is an attorney in Concord, New Hampshire. A little more than 25 years ago, he was investing in and developing real estate and became intrigued by the hospitality industry. It occurred to him that the country was on the cusp of shifting from independently owned and operated hotels to the franchise model. The arrangement held a lot of appeal for would-be entrepreneurs and aspiring small business owners like Duprey, and he became a Choice Hotels franchisee. Today, he also operates two Marriott hotels.

The decision to become a franchisee involves a lot of personal fortitude and risk. Duprey and millions of others like him have put up their own capital, often their life savings, and years of “sweat equity” to get their foot in the door of running their own businesses. The franchise model is an ideal way for a would-be entrepreneur to reduce the risk to some degree while he or she learns how to run an independent business.

As a franchisee, Duprey does not personally pay for, say, an ad that Choice Hotels runs during the Super Bowl. His business gets the benefit of advertising that it would be impossible for him to buy as the owner/operator of an individual small business. At the same time, the entire Choice Hotels organization benefits from the high quality of the accommodations and service he provides his guests. It’s a mutually beneficial relationship. “The power of many always beats the power of one when it comes to marketing,” he said.

Typically, royalty costs in the franchise industry are three to five percent. Labor accounts for the vast majority of the franchisees’ costs and for most of the money spent on day-to-day management. Real estate and marketing account for the rest. These expenses must be paid before the local franchise can see a profit. In the restaurant sector, for example, profit margins are in the four to eight percent range, depending on the local market and other factors—a respectable profit, but achievable only with attentiveness to containing costs. The stewardship of resources is almost entirely in the hands of the franchisee.

It is the owner-franchisee who hires and fires, establishes wages, and sets the schedule.Locally owned franchise businesses often provide an entry into the workforce for many people. In fact, many franchise owners pride themselves on providing guidance to first-time workers on basic life skills such as punctuality, teamwork, and professionalism. Workers at franchise establishments, like all workers, are protected by numerous, multilayered laws and regulations governing the health and safety of workers. Franchise agreements explicitly state that franchise owners must follow all of these local, state and federal laws. Franchise owners must abide by minimum wage and overtime laws; provide paid sick leave and breaks; establish training to prevent and remedy harassment; and follow anti-discrimination laws governing age, race, gender, disability, and other classifications. They must also abide by building codes, zoning laws, and other local ordinances. Employees in franchise operations, as in other workplaces, are given ample opportunity to understand their rights, and they are instructed how to make sure their employers honor these rights. As any franchise employee can tell you, the “artwork” in the break room often consists of posters, bulletins, and publications, provided by the government, on how to sue your employer for violating workplace laws and on how to do so without cost or fear of retribution.

SEIU’s involvement—no surprise

What is the impetus for the federal government’s sudden reversal of policy on the definition of employer? It is part of a broader trend of organized labor flexing its muscles, with the support and encouragement of the Obama administration. You might say the unions have a symbiotic (mutually beneficial) relationship with the Obama administration, analogous to the relationship between franchisors and franchisees. With only two years left in the Obama administration, labor unions need to move quickly to capitalize on that relationship, and on the opportunity to increase their membership rolls and replenish their coffers.

There is a perception in some quarters that the protests against the quick service (“fast food”) industry over the past two years have been spontaneous. In this view, the protests came about because workers suddenly got fed up with being exploited, just as the Occupy Wall Street protests were supposedly spontaneous and up-from-the-grassroots. In fact, it’s the SEIU—often referred to as “Obama’s favorite union”—that has been behind the fast-food protests. The SEIU’s strategy has been to organize the protests systematically and methodically, and sometimes covertly. Skeptics point out that the unions themselves, not the workers, have the most to gain by taking on the quick-service restaurant industry.

SEIU membership has slipped by three percent since 2011, even though the labor force has grown by two percent over the same time. As Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor and now a senior fellow at the Manhattan Institute, noted in last month’s Labor Watch, the turnover at McDonald’s is some 157 percent annually. Most workers leave after three or four months.

When such a workplace is unionized, the union receives initiation fees, generally around $50 to $100 each, for each new worker. Because the typical worker is gone quickly, the union spends very little on services for that worker. In addition to initiation fees, unions collect dues amounting to two percent of paychecks. Furchtgott-Roth estimates that unions stand to gain about $155 million each year from unionizing half of McDonald’s workforce, $45 million of that from initiation fees alone.

As SEIU and other unions have lost members, they have begun to organize in new ways. They have set up so-called “worker centers”—sometimes called union-front organizations, or UFOs—to accomplish their goals. [See Labor Watch September 2013.]

Supposedly, worker centers are nonprofit organizations that offer a variety of services to their members, including education, training, employment services, and legal advice. According to Robert J. Grossman, a lawyer and Marist College professor, the number of worker centers across the country has risen from five in 1992 to at least 215 today.

These organizations have a tax-exempt status known as 501(c)(3), the status accorded to charities, churches, foundations, and other “public interest” institutions. But rather than serve the public, worker centers have a decidedly more narrow, self-interested purpose, namely, to support union organizing, which raises questions about the legality of worker centers’ tax status and their receipt of tax-deductible donations. No wonder these front groups have drawn scrutiny from business groups, tax and employment lawyers, and some members of Congress.

Last summer, the New York Times reported on what it said was the largest gathering of quick-service (“fast food”) workers calling for wage increases and various workplace regulations. The event was largely underwritten by the SEIU, which spent more than $15 million on the campaign.

Marching under the banners of Fast Food Forward, Fight for Fifteen, and other “charities,” workers in some 190 cities walked off the job in early December demanding wage increases and other concessions. The organizations were often described as independent, grassroots groups, but in fact the effort was put together by the SEIU. Some of the workers protesting, it was credibly alleged, were not even actual employees but stand-ins paid to represent workers.

Wages & hours

Another aspect of the Labor Department’s attack on small businesses, franchises in particular, comes from the department’s Wage and Hour Division, under the stewardship of David Weil.

Back when he was a Boston University economics professor, Weil wrote a book called The Fissured Workplace that has become the foundation for many of the attacks on the franchise industry and the quick-serve industry. The book is based on data he gathered for a study of the franchise model that focused on the quick-service restaurant and hotel industries. (The study was commissioned by the Labor Department and paid for by taxpayers.) Weil claimed in the book that businesses run by franchisees had more wage-and-hour infractions than those operated directly by corporations, in part because they are subject to additional costs from franchise fees, which they try to make up for by keeping wages as low as possible. This, according to Weil, allows them to enjoy larger profit margins.

Weil was confirmed to his Labor Department position only after then-Senate Majority Leader Harry Reid (D-Nev.) amended Senate rules and made it much more difficult for Republicans to block President Obama’s nominations. Not a single Republican voted for him. AFL-CIO President Richard Trumka tweeted that the 51-42 vote for Weil “is an important step toward putting a real cop on the beat to enforce our wage & hour laws.” In a profile published by the Boston Globe in June, Weil claimed he is not against franchises and subcontractors, and he acknowledged that many of these small business owners operate ethically and within the law. He said he wants to make sure that good businesses are not undercut by the bad ones. He added, “Parent companies specify a lot of what happens on the ground—down to the details of how a jelly doughnut is made or where a sign is hung, so why can’t they be held accountable for how their workers are treated? Can you really have it both ways, and specify things at a fine level in one respect, but in regards to compliance with workplace laws, say, ‘Well, they’re not our employees?’”

The answer is yes, franchisors can and should have it both ways. Franchisee Stephen Duprey has noted that this is the essence of what makes the franchise model successful. Even though Choice Hotels provides the tools he needs to run his enterprise, he said the decisions about how to recruit, hire, train, retain, and promote people, along with what to pay them, are his alone. “Not in my 26 years have they been involved in any work place decisions,” he said. “If that were true, I’d be working for them and not running my own business. I’d be an employee.”

The prospect of not being able to control a key expense such as wages is very unsettling to Duprey and other small business owners. He noted that hotel rooms in New York City can average $300-400 a night, in contrast to New Hampshire where rates can average in the $70-a-night range. Dictating corporate standards on wages and other workplace conditions that ignore these market realities would be counter to good business planning and could easily bankrupt him.

Duprey said he believes that it would make little sense to enter into a 10- or 25-year contract with a franchisor, which is typical in the industry, if the franchisee lacked control over the business, or if the franchisee faced unsustainable labor costs and the threat of legal action stemming from illegal or unfair practices of a franchisee in another state.

“My concern is not that I will be charged with any labor violations, but that my franchisor, in response to the NLRB’s changing long-standing joint employer standards, will take measures to protect itself that will end up reducing my autonomy as a franchise owner,” said Clint Ehlers, a FASTSIGNS franchisee in Pennsylvania. “If franchise owners have less independence and control, they can also expect lower profits. If profits are lower, there will be less demand from entrepreneurs to start franchised businesses. If fewer new locations open, the brand does not realize its growth potential. And that hurts each individual franchise owner in the franchise system.”

Bracing for a long battle

In her keynote speech at the union’s convention last summer, SEIU President Mary Kay Henry said that the CEO of McDonald’s and the CEO of Yum Brands (which owns KFC, Taco Bell and Pizza Hut) are each paid more than $10 million a year, and “A selfish few at the top are using their power to hold down wages, no matter how much that hurts families and communities across the nation.”

But it’s not the CEOs of big companies who would pay the price if the franchise model is weakened. The result would be fewer jobs for the people who need them, and economic losses in communities around the country.

Who would benefit from hurting the franchise model? Not workers, but unions. It’s a lot easier to unionize, and a lot easier to negotiate, if unions are dealing with a single corporate entity, instead of thousands of individual small businesses.

“Labor unions are not bad things. They have done good things for workers over the years,” Duprey said. “But in this situation, they are trying to make us all one employer—or to make me an employee—and this is not a good thing.”

What’s coming

The NLRB announced it has scheduled consolidated hearings on the McDonald’s case in three regional locations in the Northeast, Midwest, and West to address violations that, it asserts, require remedial relief as soon as possible. Absent the highly unlikely case of a settlement, the initial litigation will commence on March 30, 2015, and will involve allegations of unlawful actions committed against employees at McDonald’s restaurants in the jurisdiction of six Regional Offices of the NLRB. That hearing process could be lengthy and any administrative ruling will be open to appeals to the NLRB and the courts, ultimately even the U.S. Supreme Court. The entire process could take years.

In the meantime, businesses will be left hanging. Business decisions require a certain degree of certainty, and the mere chance that the SEIU and NLRB will win this fight is enough to burden franchise businesses.

Business groups have already begun to explore bipartisan legislative action to address the issue in the short run, possibly with stipulations on spending bills to block implementation of the policy. As the NLRB’s allegations make their way through the hearing and judicial process, Matthew Haller of the International Franchise Association assured, “We will fight these decisions by all means available to us. What’s at risk, across the country, are small businesses that often represent the life savings and the life’s work of their owners.”

David Agnew is the pseudonym of a writer/analyst in Washington, D.C. This article originally appeared in “Labor Watch,” a project of the Capitol Research Center, and is republished here with permission.

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Beware Ambush Elections

The U.S. Senate HELP Committee recently contacted me about my experience with labor elections and my insight about how this ruling would harm businesses and employees across the country. This week, the points expressed in my original blog and documented in The Devil at Our Doorstep will be debated and voted upon, as reported in recent headlines “Republican-Controlled Congress to Vote to Repeal NLRB Rule.” Additionally, in a show of support the US Chamber Asks Judge To Nix NLRB’s Election Rule. Hopefully, Senate Democrats will stand behind movement, recognize the injustice, and provide enough votes to override an expected Presidential veto.

Employees and employers across the country need to be wary of the forced union ambush being promulgated by President Obama and his big labor “Gasping Dinosaurs” and the radicals the President has appointed at the National Labor Relations Board (NLRB). The President is utilizing Rule by Fiat to fundamentally transform America as he promised when he was first elected, while also paying back his political supporters.

NLRB Flexes Muscles” was definitely the theme this past week as the NLRB published its final rule making on “ambush elections,” and effectively reduced election periods from 41 to 21 days or potentially less (see Ambush,NLRB boosts unions’ organizing leverage, Elections, NLRB Issues its Ambush Election Rule, NLRB Representation Case Procedures Fact Sheet, Quickie Gifts to Big Labor, and NAM CEO Speaks Out ON NLRB Ruling). Even more damaging to both employees’ and employers’ rights and privacy is the fact that, in its rule making, the NLRB stated that employers must provide the names, e-mail addresses, home addresses and phone numbers of its employees to facilitate the “Quickie Elections.“ As described in The Devil at Our Doorstep, the current 41 day pre-election period is necessary, as employees are often coerced, intimidated and lied to by the organizers representing the labor unions. Often they are misled to believe that once they sign a union election card they must vote for the union when they go to the polls! While absolutely false, such conduct has been well established by the NLRB to be completely acceptable.

Unless the employer’s management team is well-versed on labor law and well-prepared to contradict these misrepresentations, their employees would never know the truth. The Quickie Elections rule making makes it virtually impossible for an employer to have the opportunity to refute the union’s misinformation and propaganda, particularly if the employer has not been faced with such organizing efforts in the past. In my own experience, if I would not have had the opportunity to meet and speak with our employees on several occasions — which would not be possible under the new ruling — they would have gone to the polls believing they had to vote for the union, despite the fact they had been intimidated into signing election cards.

As if that wasn’t enough, the NLRB boosts unions’ organizing leverage by allowing employees and union organizers access to employers e-mail systems so they can coerce, misinform, intimidate and misrepresent the truth about what is transpiring, and ignore big labor’s true goal, that It’s All About the Dues Money. In effect, what is happening is a rapid move towards “Card Check,” effectively allowing a union to force unionize an employer’s workforce behind the scenes virtually overnight.

These Quickie Gifts to Big Labor by the NLRB are A Death Penalty for Employees and Employers! They provide labor organizers great leverage to force employers to sign a Neutrality Agreement. This agreement is big labor’s current means of eliminating the secret ballot election by utilizing Death by a Thousand Cuts corporate campaigns to intimidate employers into signing it and achieving Card Check.

These actions are nothing more than political pay back by this Administration to the big labor bosses at the expense of the American people and the American economy.

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David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Big Labor's Conundrum

Over the past four decades, Big Labor has continued to see its membership shrink drastically as its leaders use the same failed tactics involving forced unionism. The argument that most workers are better off without unions today is supported by the fact that unions now represent approximately 11.3% of the total workforce and 6.6% of the private workforce, a steep fall from their heyday in 1945 when they represented about 35.5% of the workforce. Yet Big Labor has refused to change. Isn’t the definition of insanity, “continuing to do the same thing, but expecting different results?” The inability of Big Labor to generate new organizing strategies or to bring additional value to employees has put unions “between a rock and a hard place,” as succinctly described by pro-labor pundit Jack Rasmus, author of a 4-part essay on the Decline of Labor Unions. Mr. Rasmus’ work is worth reading, both to call attention to labor’s intransigence to make itself relevant to today’s workforce, and to read between the lines for potential strategy changes, if and when labor ever gets its act together.

A sample quote from part one of his essay:
“Had any other movement and its organizations produced so little, for so long, at such a growing financial and other cost to its membership, it would have undertaken a fundamental revision of its basic strategic approach long before now. However, union labor’s efforts to address its failing strategies over the last four decades have been token and tentative at best. Not much has been done to confront, or otherwise challenge and change, labor’s obviously failed strategies of the past four decades—neither at the ‘top’ among its national leadership nor at the ‘local level’ of local union membership. That fundamental strategic discussion is now long overdue.”

Despite its obvious failures, big labor continues, at great cost to its membership and reputation, to engage in ruthless tactics and pursue its own political agenda. It has maintained this course, despite the fact that people are moving away from forced-unionism areas and that membership is declining even in politically favorable locations (see Latest Census Data Show Families Continue to Flee Forced-Unionism States and Even in Liberal Minnesota, Labor Unions Are Losing Members. Big labor continues utilizing its political ties with the current Administration to focus on achieving Card Check, specifically thru rules and regulations recently implemented by President Obama’s National Labor Relations Board, the government agency charged with fairly administering the nation’s labor policy. The following articles outlining new rules and regulations recently handed down by the NLRB at the President’s direction accurately portray the reluctance of the unions to change their business model or otherwise reinvent themselves to serve modern America (see Reinventing America’s Unions for the 21st Century).

  • UNIONS: Focus now is on new laws, not new members
  • The NLRB’s New Election Rules: Quickie Elections and ‘The Mount Everest of Regulations’ to Trap…
  • Federal agencies spend millions on union business 
  • NLRB Opens Door for SEIU at McDonalds
  • NLRB General Counsel Announcement on Joint Employer Status for Franchisors Could Have Significant Implications
  • NLRB ratifies actions taken by unconstitutional labor board

Confounding big labor’s position is the fact that it must go along with the President’s goals of increasing the minimum wage and providing amnesty for undocumented aliens, in an effort to attract a larger base for the President and the Democratic Party in exchange for the pro-labor rules and regulations recently propagated by the Rogue NLRB. These political initiatives are, in fact, not in the best interest of the labor movement. Nevertheless, Big Labor continues to support them due to their need for political backing from the Democratic Party.

First, significantly increasing or doubling the minimum wage — as being pushed by the SEIU — would have devastating consequences on those least able to handle them. As succinctly portrayed by Phil Wilson from the Labor Relations Institute in a recent article:

“If you double the labor costs in these businesses you force these small companies to come up with new ways to operate their business that account for the increased expense. They will hire fewer people and try to make jobs as efficient as they possibly can. They will replace labor with technology everywhere they can (you see this in many restaurants and convenience stores today – you’ll be ordering off an iPad everywhere you go). They will raise prices or reduce selection to just the most profitable items. Remember, we are not talking about a minor adjustment in the minimum wage – this is a massive shift in labor costs that companies will be forced to deal with. For every lucky person who keeps their minimum wage job and rejoices in their doubled income there will be several who cannot find any work, period. You will significantly increase the class of people who are unemployable, along with all the other problems that creates. Be careful what you wish for. Also, these small units would divert attention away from the other bargaining units the unions already represent. If officials take the eye off the ball on these bigger, more stable units they risk losing those units to decertification, further reducing cash flow and profitability of the union. Be careful what you wish for.”

One more comment on the minimum wage increase. It is basically the same fundamental tactic the United Autoworkers and other unions utilized to increase wages in the American auto industry. The American auto industry and Detroit today are a foreshadowing of the affect significantly raising the minimum wage would have on the entire American economy.

Big labor also has been supportive of the President’s executive order, granting amnesty to up to 5.5 million undocumented workers, thereby giving them the ability to legally enter the workforce (see Unions launch recruiting push for immigrants protected by Obama actions). On the surface, this may seem to be a great opportunity for new union members as the big labor bosses would utilize information from the Administration and union foot soldiers to identify these people, help them assimilate into legal jobs, and then use pressure to help them force unionize the employers. However, many of these people will be utilized by companies as independent contractors (see Open Borders Costing American Jobs and Depressing Wages). Big labor will in effect spend a lot of time and money in an effort to force unionize these people at the risk of taking its eye off the ball and disenfranchising and losing a large part of its current membership.

Unfortunately, the big labor Gasping Dinosaurs seem incapable of changing and embracing the need for change. Instead they continue to expose the fact that It’s All About the Dues Money, by utilizing member’s dues as political donations to elect politicians thus expecting political favors in a desperate attempt to protect their lifestyles and reverse the decline of union membership (see Big Labor’s Top 100 and If This Is True, The Amount Of Money The UAW Uses On Politics Is Shocking). Combined with the President’s amnesty and minimum wage agendas reversing union decline is truly a conundrum for the big labor bosses who seem incapable of working legally and professionally within the parameters of the free market system to be successful (see The 2014 Union Corruption Report: A Year In Review). Instead of polishing its approach and providing a quality product people would embrace, Big Labor continues to utilize unsavory political favors and bully tactics in a futile attempt to rebuild its membership at the expense of its current membership. It is Time for Republicans to Go On the Offensive with its majority in both Houses. They need to come to the aid of Americans, defund the Rogue NLRB and stop the Death by a Thousand Cuts being perpetrated on American employees and employers. There is no doubt that Unions Face Challenges in 2015. It is time to add to big labor’s conundrum!

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David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Big Labor and Allies Escalate Tactics as Mid-term Elections Approach

Activity by the National Labor Relations Board (NLRB), Department of Labor (DOL) and Occupational Safety and Health Administration (OSHA), as well as several of the largest labor unions, over the past two weeks evidences the Obama Administration’s growing anxiety as the mid-term election approaches. The Administration, facing loss of the Senate and ultimate control in both houses, continues to direct its agencies to pass union-friendly regulations and to impose its interpretation of current law to favor accelerated forced unionism. The Administration and Democratic Party represent a typical symbiotic relationship where they are co-dependent upon each other for future survival. The Administration needs union contributions and union foot soldiers to have any chance of maintaining a senate majority and making gains in the house during the 2014 mid-term elections (see Union Money in Elections). Conversely, Big Labor is finally recognizing and admitting that their declining membership is a major problem and they need the Administration’s help (see AFL-CIO admits declining membership a major problem).

In order to get the ball rolling, several pro-labor steps have been taken by OSHA, the NLRB and the Department of Labor (DOL). First, OSHA has reaffirmed its position that union officials may accompany OSHA inspectors on safety inspections in non-union facilities. This issue was reported in a previous blog, OSHA Opens New Door For Big Labor, and was more recently presented by the CEO of PJS on the Greta Van Susteren Show this past week, in CEO: How union organizers are targeting my non-union company. The union involved – the SEIU – used such tactics as part of its ongoing Corporate Campaigns to force a cleaning company in Houston to sign a Neutrality Agreement and achieve forced unionization through Card Check, as described in SEIU Uses Federal Inspections to Target Houston Small Business. As if that wasn’t bad enough, the SEIU is buying votes in polls and gaining naive media attention, from media groups like the Los Angeles Times, to support its attack on fast food companies as chronicled in Beware SEIU, Especially Bearing “Polls”.

Not to be outdone, the General Counsel of the National Labor Relations Board is looking to limit the ability of business owners to relocate their businesses without approval of the union (see NLRB will limit ability of unionized business to relocate). This move is an obvious attempt to preserve union membership heading into the midterms while taking away the fundamental right of a free market society. On a bright note, House, Senate Leaders Introduce Legislative Response to NLRB Ambush Election Rule, which was approved by the House Education and Workforce Committee this past week

In a surprising move, the NLRB complains Walmart Black Friday protesters broke rules, went too far and must Cease and Desist! This decision was made by a local NLRB Region and is not expected to survive the pro-labor board in Washington D.C. Finally, the DOL, under the Administration’s direction, limited the reporting responsibilities of unions during the President’s first term. Labor unions, particularly the United Food and Commercial Workers continue to take full advantage of it by funding OUR Walmart, a “Worker Center” operation utilized to advance its Corporate Campaigns against Wal-Mart in an attempt to force Card Check and force unionize Wal-Mart’s workforce.

The UAW appears to be attempting to force Volkswagen into Card Check. This past week, an anti-union group said Volkswagen may ignore the election results and bring in the union, basically agreeing to Card Check. Additionally,Unable To Sell Unionization On Its Merits, The UAW Turns To Race, Rappers And An Actor For Aid, and the UAW Bosses Turn To Bovine Excrement Manufacturing. Despite the fact these tactics continue not to work for the UAW, the union has decided to continue to press the issue and to replace outgoing President Bob King with UAW Secretary Treasurer Dennis Williams who supports King’s tactics. Once again The United Auto Workers Promote Failure. Isn’t the definition of “insanity” to repeat the same things over and over again, with the same failed results?

Finally, the question must be asked, is the unionization of college sports spreading? The answer appears to be both yes and no. Recent reports indicate that the University of Notre Dame could be next (see Notre Dame could be next front in union battle). However, it appears any progress on this movement will take a long time as Northwestern University has filed an appeal on the decision made by the NLRB administrative law judge finding college athletes to be “employees” (see Northwestern University Appeals NLRB Ruling on Athletes as Employees). Contrary to the judge’s finding, an Ohio bill says college athletes aren’t employees.

Unions and the Democratic Party desperately need money as mid-term elections approach as discussed in It’s All About the Dues Money! Desperation is setting in despite the fact the Administration has aligned the federal labor agencies in big labor’s favor. The American people are beginning to wake up, and businessmen across the country are standing up to big labor’s Death by a Thousand Cuts Corporate Campaigns and saying “no” as chronicled by the PJS CEO and this Hilarious Car Dealership Outwitting Labor Union Tactics — And This Video May Just Be the Victory Lap where a Wichita auto dealership beat a union at its own tactics.

Desperation is setting in and it is only going to get uglier as the mid-term elections approach.

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

NLRB Unleashes Flurry of New Rulemaking Initiatives

After a period of relative quiet, a recent flurry of rulemaking initiatives by the the National Labor Relations Board evidences the current Administration’s intent on satisfying big labor leading up to the crucial 2014 mid-term elections.

Ambush Election Rules

The NLRB originally adopted this rule in 2011,  but the D.C. Circuit Court rejected the rule on procedural grounds, finding that the NLRB had improperly issued the rule because they did not have a quorum. Member Brian Hayes was active in office, but did not vote on passage of the rule. Initially, the NLRB appealed the Circuit Court’s decision.  In December 2013, however, the Board requested that the court dismiss the appeal. It was generally presumed by those following the NLRB that the reason for doing this was to clear the slate and “start over.” It appears that’s what is being done. On February 6, 2014, the NLRB issued a Notice of Proposed Rulemaking reissuing their proposed “Ambush Election” rules in substantially the same form as the 2011 proposal.

Among other things, the rulemaking: (i) narrows the scope of pre-election hearings (won’t consider campaign irregularities, eligibility to vote, etc.), (ii) shortens the timeframe prior to election, and (iii) gives the Board discretion over whether to hear post-election disputes (whether they would be heard at all).

The underlying goal of this rule is to achieve Card Check under the guise of an election process. In effect, big labor would indoctrinate employees through misinformation, propaganda and intimidation months ahead of petitioning for an election. Employers, under the new rule, would theoretically then have as little as 10 days to reverse the indoctrination, which based on my experience is almost impossible. This is just another step towards Card Check through Regulation vs. Legislation! Please read Obama’s NLRB deals big labor a winning hand: part 1 and National Labor Relations Board Pauses from Election Rules Amendments.

Revision of Arbitration Rules

The board is considering a proposal of radical NLRB General Counsel Richard Griffin to change the way the Board considers the decisions of arbitrators in labor matters under the NLRA. In essence, in a situation in which an employer and a union or employee had agreed to utilize an arbitrator to resolve disputes, the NLRB would be empowered to disregard the arbitrator’s decision if it disagreed with it. This would permit labor unions to have “two bites of the apple” (as used by former NLRB Board Member Ronald Meisburg), to challenge employer action. Part of the Employee Free Choice Act (see EFCA Through the Backdoor) a.k.a. Card Check this rulemaking would basically tilt the collective bargaining negotiations process heavily in favor of big labor. It is a part of the process to enact Card Check through Regulation vs. Legislation. As the President said he has a pen and a phone and he will act on his own. Obviously, he is also delegating this authority to his appointees like Richard Griffin. Please read NLRB Invites Input On Arbitration Award Deferral Standard.

Micro-Unions

Richard Griffin and his radical pro-union teammates are also intent on establishing “Micro-Unions.” Griffin recently commented that NLRB guidance on micro-unions is forthcoming. The concept of “micro-unions” is an NLRB creation, stemming from its decision in the Specialty Healthcare case. It is nothing more than a ploy to allow unions to establish a foothold in a business with a small segment of employees then turn it into full-scale unionization of all employees within the company (see NLRB General Counsel: Guidance on Micro-Unions is Coming). This particular rule shows just how desperate the big labors interests really are to rebuild dwindling membership.

Basically this all boils down to two things, money and political power. Both the President and the labor bosses need big labor to rebuild its membership so they can maintain political power. It has little or nothing to do with helping employees or the citizens of this great country the United States of America.

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Public Union Foes and Defenders

The basic premise behind public employee financed campaigns is that the election is now while the bills may be deferred for years, particularly if they take the form of pension promises. Eventually, however, the bills do come due. This is why Governor Mitch Daniels (R-Indiana) said he decided on his first day of office in 2005 322 to end public employee collective bargaining rights and to stop collecting union dues. Without the state collecting dues, only 10% of union members chose to stay enrolled by paying their own dues.

Governor Chris Christie (R-New Jersey) stood before 200 of his state’s mayors in 2010 and declared that the era of “Alice-in-Wonderland” budgeting is over: “Money does not grow on trees. . . . For New Jersey and any number of other states and municipalities, it’s useless to pretend. . . . We have no room left to borrow. We have no room left to tax.” Chris Christie went on to say that his treasurer had presented him with  possible budget deletions or freezes to balance the budget and that he had adopted . Almost all observers thought that this was the end of the Governor’s career. Instead it made him a national figure and even won approval from New Jersey voters.

Governor Scott Walker (R-Wisconsin) was elected in 2010 and immediately moved to restrict collective bargaining for benefits (excluding police and fire) and also to stop collecting union dues. This led to a firestorm of protest and a recall election, which the Governor won. Governor John Kasich (R-Ohio), also elected in 2010, restricted public employee collective bargaining, including police and fire, but his actions were overturned by voters in a 2011 referendum.

In retrospect, Kasich’s chief error was in not moving to end automatic state collection of all union dues. Scott Walker’s experience in Wisconsin in this regard is highly instructive. Walker’s position was that the state would continue collecting all dues until the end of the contract. After that, dues would only be collected with the consent of the public worker. What actually happened was that two-thirds of workers enrolled in AFSCME, the state’s largest public union apart from the teachers’ NEA, refused to give their consent. As in Indiana, the political power of the union took a major hit. As Jim Geraghty commented in the National Review: “Apply this across the country . . . and you’re talking about . . . a game-changer in so many states.”

Ironically, a federal court ruled in 1966 that a union did not have the right to use member dues for political purposes if a member objects. But few union members know about the right to opt out or, if they do, may feel intimidated in pursuing what are called their “Beck rights.” Moreover the unions make it very difficult by stalling on Beck rights requests, smothering them in endless red tape, and refusing to calculate what portion of the dues apply. If, however, the public employer refuses to collect full dues for the union automatically and instead asks the member whether dues should be used for political purposes, it is much easier for the worker to express a preference.

As we have noted, the rules governing state and local public unions differ from those governing federal workers. The former can usually engage in collective bargaining and go on strike; the latter seem to serve little purpose other than to collect dues and put a share of it at the disposal of the Democratic Party. Despite these differences, federal wages and benefits have also risen, so that taken together they now exceed what can be earned in the private sector for the same job. This is a remarkable reversal: fifty years ago, it was generally understood that federal workers would earn less in exchange for more days off, slightly better benefits, and almost total job security.

Studies purporting to compare federal with private work levels do not agree with one another, but the Congressional Budget Office has found that, comparing employees of comparable educational level, federal wages are higher at lower pay scales, similar at middle, and somewhat lower at the high end, with benefits much higher across the board. Taken together, the federal employee advantage is 16%. In addition, federal employees work three hours less per week on average and one month less per year. An earlier Labor Department study found that state and local workers make 46% more, so federal workers were not doing as well. Other studies, however, suggest all categories of government pay are more like twice as high as private, when the net present value of soaring retirement awards, often equal to final year pay, is taken into account.

The number of very highly paid federal employees has also increased, even during the years following the Crash of 2008. For example, in early 2008, the Labor Department had only one employee earning $170,000 or more. Eighteen months later, there were 1,690 such employees. Over the same period, all federal employees making more than $100,000 rose from 14% to 19%. One federal employee, working in a government green energy lab in Colorado, was reported in 2012 to be making just under $1 million, with two deputies making over $500,000 each, and nine others making over $350,000. The number of all jobs during the economic recession of 2008–2009 also rose in the federal government, unlike in the private sector, where over eight million disappeared. It is not at all surprising that by the end of 2010, seven of the ten richest counties in the US surrounded Washington, DC.

Having come into office on a wave of union support and money, the Obama administration literally opened its doors to union leaders. Andy Stern, the head of the powerful SEIU, visited the White House more often than any other political figure during the first six months. What he seemed to want most was “Card Check” legislation that would end the secret ballot in union organizing. President Obama and Democratic leaders strongly endorsed the bill, but it must have lacked some Democratic votes in the Senate, because it was never put forward for a vote, despite overwhelming Democratic majorities in Congress.

President Obama found other ways to reward labor. During his first weeks in office, he signed executive order 13502, which made union membership a requirement of anyone working on federal construction projects. He also opposed Senator Jim DeMint’s (R-South Carolina) National Right to Work bill, which would have ended compulsory union membership as a job condition in all states (23 states have their own versions of this law).

The President backed a decision by the Democrat controlled National Labor Relations Board (NLRB) intended to block Boeing’s plan to move 787 Dreamliner plane construction from unionized Washington to union-free South Carolina. He backed another highly controversial decision to force companies to turn over their employees’ private email addresses and telephone numbers without employee consent to union organizers. He also tried unsuccessfully to force companies doing business with the government to reveal all political activity or donations, a rule that would not have applied to unions. By early 2012, he had granted waivers from his Obamacare legislation to unions representing 543,812 employees (also to administration friendly companies with 69,813 employees).

Meanwhile the president kept subsidies flowing to the Post Office which, despite massive losses, reliably collects union dues from workers, which are then made available to Democratic campaigns ($3.6 million in the 2010 election cycle). Other countries have successfully privatized their mail delivery. The obstacle to doing this in the US is that postal workers, like other government employees, are deemed to be, for the most part, reliable Democratic voters, and their union is regarded as an indispensable political cash cow.

Crony-Capitalism-in-America

About the Author: Hunter Lewis is co-founder of AgainstCronyCapitalism.org. He is co-founder and former CEO of global investment firm Cambridge Associates, LLC and author of 8 books on moral philosophy, psychology, and economics, including the widely acclaimed Are the Rich Necessary? (“Highly provocative and highly pleasurable.”—New York Times) He has contributed to the New York Times, the Times of London, the Washing­ton Post, and the Atlantic Monthly, as well as numerous websites such as Forbes.com and RealClearMarkets.com. This post is an excerpt from Chapter 20 of his most recent book, Crony Capitalism in America: 2008–2012.

Unions Adopting New Strategies to Rebuild Membership

Big Labor bosses are facing the increasing realization that their organizations are rapidly facing extinction. A trifecta of difficulties, consisting of recent revelations of the impact Obamacare will have on union costs and membership, the weakening of support for “Card Check” legislation, and the increasing popularity and passage of “Right-to-Work” laws have the Gasping Dinosaurs very nervous. Union membership is at a 50-year low, representing a mere 11.3% of the total workforce and 6.7% of the private workforce. These statistics have Big Labor bosses fighting mad at the lack of return from their campaign investments for the President and desperate enough to attempt any and all options to rebuild declining membership.

With the exception of the Service Employees International Union (SEIU), which represents healthcare workers across the country and anticipates membership gains from the implementation of Obamacare, Big Labor bosses representing other unions now realize that their once-beloved President has sold them down the river (see The Devil is in the Details: Buyer’s Remorse over Obamacare, Except for SEIU).  The heads of the AFL-CIO, the Teamsters, and other major labor unions are now realizing that not only is Obamacare void of separate exemptions or favorable provisions for unions, but it places unions at an economic disadvantage when organizing new members. In fact, it is so bad that the Teamsters are Begging Congress for Relief from Obamacare and the Laborers International Union Fears Destructive Consequences from Obamacare. Even the President-friendly IRS Employees Union Members are in an Uproar after realizing that they too will be subject to Obamacare. The President may continue his rhetoric to intimidate Republicans and to push for Obamacare to become functional, but he does so at the risk of losing his most ardent supporters.

The next likely disappointment for the unions is that the President has failed to enact Card Check. Despite that the President’s recent radical appointees to the NLRB were approved by the U.S. Senate and the fact that President Obama Brought in Griffin to Fill Vacant NLRB Position, the Rogue NLRB still faces an uphill battle if they plan to achieve card check.  See “Card Check through Regulation vs. Legislation.”  President Obama previously attempted to achieve card check like provisions through his appointment of board members such as Craig Becker and Richard Griffin.  With the courts finding the President’s recess appointments to be unconstitutional, and thus their decisions invalidated, a delay in “union handouts” has resulted in further union membership deterioration and caused the Unions to Demand Payback.

Interestingly, this has resulted in an attempt by Big Labor to enforce desperate and creative measures to increase membership. The AFL-CIO Seeks Answers in Crisis by targeting Hispanics, NAACP, Sierra Club and other groups, and by Winning Back Other Unions into their fold, thereby increasing membership, revenues and power.  Not to be outdone, the Desperate SEIU Resurrected the Persuasion of Power and is leading the charge by attempting to organize Home Health Care Workers and immigrants as discussed in the recent blog The Senate Immigration Law Hurts All Americans.  Additionally, a new Worker Center Scheme crafted by the SEIU is in the works, utilizing organizations outside the auspices of the National Labor Relations Act (NLRA) to attract and organize prospective members, which could be devastating to businesses attacked by these type organizations.

Meanwhile, the SEIU has once again embraced the Living Wage Argument to unionize workers. This tactic, described in The Devil at Our Doorstep, is now being used against McDonalds and other service/food providers under the veil of the “Fight for Fifteen” campaign, fighting to shift wage rates to $15 an hour for these workers.  McDonald’s is now feeling pressure from the typical Corporate Campaign tactics, including threats to Contaminate Food. These threats will directly impact McDonald’s revenues, a standard focal point of the SEIU’s campaigns.  Of course, all of their actions are being pushed in the name of Social Justice.

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Putting “Teeth” in Right-to-Work

Having been involved in discussion regarding Right-To-Work legislation in Indiana and Michigan, I can attest to the tireless efforts of grassroots movements – by local businesses in Indiana and concerned United Auto Worker employees in Michigan – to achieve the goal of protecting worker freedoms. Statistical data shows that the implementation of a Right-To-Work law is positive, as such states see statistical growth in both population and jobs. Right-To-Work laws are important guarantees of the freedom of choice and the assurance of a lack of intimidation in the organizing process, but there is growing evidence that workers and management in RTW states are still subjected to union intimidation.

A recent article by Diana Furchtgott-Roth of The Manhattan Institute, suggests not.  Ms. Furchtgott-Roth points out that RTW states not only have the highest employment growth over the last 4-5 years, but they also have the highest growth rate for union membership! The statistics she presented were absolutely astonishing, but few people have picked up on the significance and logic behind the union growth in these states. The truly frightening part is the number of cases recorded, since Card Check is virtually unregulated and therefore untraceable.

“Why Union Growth: According to data from the National Labor Relations Board (NLRB), in 38% of all union recognitions in 2009, the latest year for which data is available, unions bypassed secret ballot elections and instead used card checks to unionize employees. Specifically, the NLRB reports that unions won 794 single-union representation elections. During that period, the NLRB recorded 485 notices of card check union recognition.”

Unfortunately, Big Labor’s “Gasping Dinosaurs” are a resourceful lot. Their political contributions have bought them the support of President Obama and his Administration, who has, in turn, appointed a Rogue NLRB. The NLRB is currently lead by heavily pro-union favored board members, many of whom were unconstitutionally appointed by the President (see Appeals Court Nixed Obama’s Recess Appointments). The result of this support is that Big Labor bosses see RTW states as a shining new opportunity to rebuild its declining membership. Unions understand that with the support of the indebted President and pro-labor support from the NLRB, they can achieve membership without an election through Card Check by utilizing their insidious campaigns of “Death by a Thousand Cuts.”

Once they have infiltrated the masses, Big Labor can then use the same type tactics against the newly forced unionized employees to ensure that they don’t exercise their right not to pay dues (or in some cases, belong to the union) under RTW laws. This can be accomplished by making sure that the uneducated are not advised of these rights, or by the specific targeting of persons who choose not to pay dues.  This can be accomplished because, unions are legally allowed to broadcast a list of those individuals who choose not to pay dues (see Worker’s Allege Improper Collection of Union Dues).

This raises concern, as it is unclear how the “dues-paying” union membership will choose to use this list. Membership who view non-payers as “freeloaders,” may be inclined to use unlawful force, threats, and/or intimidation in an attempt to alter a non-member’s decision. Unfortunately, most members ultimately cave, as employees subject to such intimidation have few options.  While this type of activity is unlawful, the sole oversight of these actions belongs with the National Labor Relations Board, a partisan governmental “agency” whose devotion to labor unions is well-documented and unquestioned. The process is timely, difficult to understand, and expensive – as it generally includes the involvement of an attorney to represent ones interest. With little oversight, Big Labor can continue to grow its membership in RTW states through a combination of employee and employer intimidation, with no government regulation to hinder its actions.

Although RTW has been a Godsend for many states, employees and employers, RTW laws need more “teeth” in order to truly protect employees and employers from ruthless forced unionization tactics. The following changes would eliminate the “behind the scenes” intimidation and allow for fair representation in union elections. Additionally, these changes would impose collective bargaining restrictions that would allow members to make decisions free of coercion as to whether they wished to remain part of the bargaining unit.

1. Reinstate Secret Ballot Elections:  Uphold the long standing belief in allowing people to vote their conscience through a “Secret Ballot Election” by inserting language that requires all union representation be achieved by secret ballot conducted under the auspices of the National Labor Relations Board (NLRB). Currently Indiana State Senator Jim Banks has introduced such an Amendment to the Indiana state constitution and Virginia has already passed such a law (see New Employee Privacy and Union Voting Rights Laws in Virginia Go Into Effect July 2013).

2. Eliminate Check Off Clauses:  Such clauses in collective bargaining agreements require unionized employers and government entities to deduct union dues from member paychecks and forward them to the union. These clauses are utilized by Big Labor through intimidation to force employees to remain part of the bargaining unit in RTW states. Unions should be required to be their own accountants and collect dues directly from the employees without third party involvement. In essence members would then have the ability to decide, just like in the free market, if the services/products they are receiving are worth paying for directly. This is no different than a person paying when satisfied for legal, real estate, investing, or other services/ products. It only makes sense, but is often a non-starter for Big Labor in contract negotiations (see Teachers Silenced by Teachers Union).

3. Eliminate Monopoly Representation and Outlaw Neutrality Agreements:  In The Devil at Our Doorstep, I presented the following as the first two points in my “Ten-Point Plan to Battle Big Labor.”

a) Replace the current union monopoly representation with a secret ballot election every three years, so unions have to justify their actions to the employees. Unions must obtain written consent from every dues paying member before using money on anything other than collective bargaining activities.

b) Institute a new regulation that outlaws neutrality-type agreements, which allow card check in lieu of secret ballot elections.

4. Rewrite State Extortion and Blackmail Laws:  James Sherk of The Heritage Foundation accurately proposed that we should modify state extortion and blackmail laws to include unions, which are currently not implicated under labor law. This would prohibit pressure campaigns which are designed to force an employer to surrender, rather than trying to persuade the employees to unionize.

Leveling the Playing Field through these changes and passing a National Right-To-Work Law are necessary steps to improve the economy and continue to create jobs absent the threat of Big Labor intimidation! It is imperative for this great country and the freedom of its citizens that new “teeth” are introduced to support and assure the success of the recently passed Right-To-Work laws.

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

OSHA Opens New Door for Big Labor

Last week, OSHA joined the ranks of the National Labor Relations Board (NLRB), the Department of Labor (DOL), and the Equal Employment Opportunity Commission (EEOC) in furthering the Obama Administration’s push to implement “card check” as pay back for Big Labor’s political contributions and ground game support during the past two Presidential Elections (see past blog, Card Check through Regulation vs. Legislation).

OSHA’s latest published “Interpretation Letter,” permitting non-union employees to utilize union reps as their representatives during an OSHA inspection is absolutely frightening (see ALERT – L&E_OSHA Interpretation Letter Non-Union Employees Representative). Just as frightening, is that this interpretation has not been widely reported by the mainstream media.

Perhaps the silence is the result of the media’s view that the provisions contained in the “interpretation letter” amount to nothing more than harmless, common sense provisions designed to assist employees who feel exposed to potential unsafe working conditions. On the surface this would seem reasonable. However, this provision has been part of OSHA regulations for years. Never before has it been interpreted to allow non-union employees to utilize a third-party union to act as their representative.

So why now? Despite the Administration’s best attempts, Big Labor continues to lose hundreds of thousands of members as they have lost all relevance and no longer deliver a product of value.  This action by the Obama Administration through its Chief Safety Regulator opens a huge opportunity for unions to enter non-union facilities under the auspices of government approval, and to begin organizing the employees. The unions have become enabled with recent Rogue NLRB decisions allowing unionization of small groups of employees, or “micro-units” within a business.  These actions are nothing but blatant Administration attempts to provide Big Labor the opportunity to get its foot in the door of non-union facilities where they previously had no chance to organize the workforce.

During the SEIU’s Corporate Campaigns against my company (EMS), the SEIU actually utilized this tactic in order to defame and intimidate the company into signing a Neutrality Agreement thus eliminating the secret ballot election and imposing Card Check, as chronicled in The Devil at Our Doorstep. The SEIU was, ultimately, unsuccessful. However, had these two decisions been in place at the time, the SEIU might very well have been successful in organizing a small unit of employees within EMS’s workforce. The union would simply have to convince, by any means necessary, a couple of employees to join the union cause. They would then allege “safety violations” to OSHA, who would then likely appear for an inspection, generally encompassing not just the complained of activities, but any potential safety concern, no matter how large or small. This, of course, poses substantial risk, both financially and to the reputation of the targeted company.

The SEIU took these actions against EMS in Cincinnati and Indianapolis. If the SEIU would have been allowed to represent these misguided employees the outcome most likely would have been much different from what is related in the following excerpt from The Devil at Our Doorstep. The SEIU would have had even more access to our employees as their representative:

“When I believed the war could not become more bizarre, it did. Without warning, SEIU filed an OSHA complaint in Cincinnati against EMS. This government agency, the Occupational Safety and Health Administration, establishes and enforces protective standards designed to prevent work-related injury, illnesses, and death. 

The complaint charged that EMS employees were forced to carry human body parts out in bags at a Cincinnati university, that there were hazardous chemicals and dust in the bio lab, and that people were getting nosebleeds from the poor conditions. Then SEIU sent out handbills and letters alleging that EMS was being investigated for OSHA violations at the university. The word “investigated” had its obvious repercussions, a crafty move by the union. Predictably, when the truth was revealed, it became known that the lab in question was a regular biology lab anyone in college might use. There was no dust found and no hazardous materials of any kind. Animal parts from dissections existed, but no EMS employees touched or disposed of them. Human body parts were nonexistent, a figment of some SEIU organizer’s imagination.

The university’s own investigation confirmed these facts, and its independent report was forwarded to OSHA, who promptly dismissed the charges. Regardless, SEIU had used an inflammatory allegation to file trumped-up charges against EMS to defame our company and the university.”

By taking these actions, the union accomplished their first objective – get in the door and commence the pressure against the targeted company.  The stage is then set for the union to achieve Card Check by offering to have the charges withdrawn if the company would simply sign the Neutrality Agreement. As a practical matter, this would eliminate the secret ballot election. The union would no longer have concern about whether or not they would be voted in by the employees. Overnight the company would be unionized.

What makes the timing of the OSHA interpretation so questionable is the fact that the President’s recent recess appointees to the NLRB have been found unconstitutional and all of their decisions over the past year have been placed on hold until constitutional appointments can be made and the decisions revisited (see National Labor Relations Board or NBLR – National Big Labor Resuscitation and Tip of the Iceberg). These decisions were extremely pro-labor and designed to allow Big Labor to bypass Corporate Campaigns and achieve Card Check. Once again, it begs the question When Will the Mainstream Media Wake Up?

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Big Labor Opposes Employee Incentives

Control.  It is the most pressing priority for the leadership of Big Labor. They need to control the masses, and in order to do that they most control the terms of employment, and they must control the benefits of employment. For this reason, the Big Labor bosses oppose employee incentive raises. They create discord and jealousy, and thus, the union’s ability to control its membership.  But such incentives also create ambition, initiative, and increased productivity.  While important to the employer, these traits are potentially damaging to the union. Complacency, mediocrity and sameness benefit the union, as the results are that it takes more employees to produce the end product, translating into more union members and more union dues, which is the ultimate objective.

As has been documented in previous blogs, unions have been on a steady decline since 1947 when Congress, following more than a decade of union corruption, passed the Taft-Hartley Act. Of the many important provisions of the Act, perhaps none was more so than the guarantee of the secret ballot election which, for all intents and purposes, eliminated Card Check.  Since its peak, union membership has dropped from approximately 35-40% of the workforce to a low of 11.3% today. Per statistics gathered by the federal Bureau of Labor Statistics, included in this trend is a drop of approximately 400,000 members in the last year alone.

It is no surprise then that the Big Labor bosses are opposed to any initiatives that would, in their minds, result in decreased membership and would eliminate traditional union “selling points.”  Characterization of ambition and incentive has often been that such persons are “being taken advantage of” or “overworked,” and that such companies are “sweat shops.” These traditional arguments, however, do not necessarily reflect the truth of the modern work environment, and the protections of our modern laws.  At one time unions served an important purpose in defending employee rights. However, Big Labor has fallen victim to the money, lifestyle and political power realized from increased union membership, and has lost their way and forgot their responsibility was to serve the membership and not vice-versa. Their greed, inability or resistance to compete in a free market society, and the advent of government agencies such as the NLRB, EEOC, and DOL unions in effect became obsolete.

Facing extinction, Big Labor has yet to face reality and change its model to one that truly benefits productive employees and its membership in general. Instead they continue to attempt to impose their outdated and ineffective tactics of control, intimidation, coercion, and misinformation in a frantic effort to survive. Instead, they continue to wish to return to the days of Card Check where they forcibly unionize employees then keep them under their thumbs by negotiating oppressive contracts that control employee rights instead of expanding them. They firmly believe this outdated approach is their only means of rebuilding their once vast empire.

Unfortunately for American employees, Big Labor does not realize time has passed them by; that the United States is a republic, not a socialistic country where people are controlled and herded like sheep. Hence Big Labor’s propensity to control and promote sameness at every juncture, and to prevent businesses from doing the right thing by rewarding productive employees through incentive programs, which drives American Exceptionalism  by rewarding those who are the most productive, safe, innovative, and cost-effective team players. This philosophy is illustrated by Big Labor bosses like Andy Stern (see The Drama Queen is at it Again), who were never successful in the free market, because they lacked the exact attributes they strive to suppress. They admittedly only became successful when they became part of an environment where they could use the Persuasion of Power  over employees and employers to achieve their goals. AFL-CIO President Richard Trumpka summed it up succinctly in a speech this past week when the bellicose mouthpiece of the AFL-CIO, confirmed the Big Labor survival doctrine: “forget the workers – focus on politics.” This statement tells you everything you need to know about Big Labor’s agenda and why we need Congress to pass laws to allow employers and government agencies restrained by outdated collective bargaining agreements to incentivize employees.

How Republicans Can Fight Against Forced Unionism

During my recent trip to Washington D.C. I was asked to speak to the Republican Whip Committee, a group of approximately 50 Republican U.S. House members charged with the responsibility of preparing and securing support for passage of “priority” legislation. I used this time to provide the Whip Committee with the background of my battle against the SEIU and the tactics the SEIU utilized against my company, employees, customers and family, and then drew the parallel to the tactics utilized by the current Administration and the Democratic Party to push forward their progressive agenda.  I concluded by encouraging the Committee to adopt the tactics that led us to victory — to go on the offensive; to make the opponent defend its lies; and to expose the misinformation, propaganda, coercion, intimidation and diversion tactics utilized to achieve their goals.

After briefly explaining my background and providing a short history of the SEIU’s use of thuggish tactics through a Corporate Campaign in attempt to force unionize my employees by means of Card Check, I then laid out our successful strategy. We were able to turn the tables by utilizing the SEIU’s very tactics, but did it in a manner which did not sacrifice our integrity or professionalism. We went to the press, and exposed that the unions representations about how we mistreated employees were not true, but simply SEIU fabrications. In fact, we took out an advertisement, not only challenging the SEIU’s misinformation campaign, but challenging the SEIU to “put its money where its mouth is.”  We publicly agreed to a secret ballot election where employees could vote their conscience without fear of intimidation or retaliation, knowing that they would wilt at the challenge.

We also accumulated significant evidence of SEIU engaging in conduct in violation of the National Labor Relations Act, and filed 33 “Unfair Labor Practice” charges (ULP’s) against them in one day.  By doing this, we confronted them with their own deplorable tactics, and forced them to defend their actions. Most importantly, we made a concerted effort to meet with all of our employees and our customers on site to explain our position and the reality of the SEIU propaganda, misinformation and its goal of elimination of their rights to a secret ballot election to decide if they desired SEIU representation. In essence, we developed a “big tent” approach to the problem — and it worked.  The people listened, they understood, and the SEIU disappeared.

I implored the Committee to take the same “big tent” approach with the Obama Administration. The President’s tactics are learned from his days as a community (a.k.a. union) organizer. They are learned directly from the SEIU (as explained in Time to Connect the Dots).

The time has come to expose the Rules of Obama Power War, which, like the SEIU tactics misinformation, misdirection, intimidation, coercion and diversions, are all designed to put the Republicans on the defensive. Instead, the Republicans should stand tall and go on the offensive by burying Obama with investigations into his unconstitutional conduct (see Strategy: Bury Obama In Investigations). Utilize the same strategy that EMS used when it filed the 33 ULP charges against the SEIU in one day.

I explained that just as Ralphie learned in the movie “A Christmas Story,” the bully only understands and responds to the punch in the nose. Finally, the Republicans need to reach out to traditionally non-Republican groups, and to explain the reality of the President’s socialist designs and its impact upon their prosperity and freedom. They must do this again and again until the message resonates.

I sincerely hope I made an impact with this gracious and attentive group, as I truly believe that the future of this great nation is at stake and we must have representatives who are willing to stand up and fight for our survival; people who are willing to stand up to the abuse and be prepared for the political and financial cost it will take to save America by going on the offensive. In the days following my speech I began to notice an momentum towards and offensive, and then this past week an article in the Wall Street Journal GOP Issues Scathing Self-Analysis attracted my attention and the attention of the nation. I was happy to see that the underlying theme and tactics proposed during my speech were entwined within the new direction laid out by the RNC. Now, we need our representatives to have the intestinal fortitude to take the fight to the Administration and its socialist cronies like the SEIU and other far left organizations and individuals who only care about themselves. It is time to take the offensive and save this great nation for our children, grandchildren and future generations.

David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

U.S. Senate Fails to Stop New NLRB Regulations Allowing “Ambush” Unionization

The “Taking of American Freedoms,” as chronicled in my new book The Devil at Our Doorstep, reached a new high under the Obama administration this past week, but the mainstream media continues its refusal to report on this administration’s continued march toward socialism. Over the past week, the U.S. Senate  and the Department of Labor have gang tackled the American people in order to protect and benefit their beloved source of campaign funds – Big Labor and their “bosses” who continually funnel money into their election coffers (see Gasping Dinosaur’s). These actions beg the question Will the NLRB Decide the 2012 Presidential Election and the ultimate fate of America?

Last week, the Senate Rejected Effort to Overturn Union Rules as they struck down Joint Resolution 36, a bill designed to stop the “Quickie Election”  regulation changes that would have allowed the Rogue NLRB to reduce the time for union representation elections from the current 42 days to two weeks or less! The vote on the resolution mostly followed party lines, with only Republican Lisa Murkowski crossing over to vote against the resolution. The bill establishing the “Quickie Elections” is nothing more than an attempt to achieve Card Check under the guise of a secret ballot election. The resolution, that should have been supported by both sides of the political aisle, was defeated during this 2012 election year to assure that Big Labor can increase it’s forced unionization campaigns and subsequently pour union members dues into political campaign coffers at the expense / loss of American Freedoms. Rejection of the Resolution serves no purpose except to support re-election efforts of the politicians who put their own careers ahead of the American people and will ultimately be A Death Penalty for Employees and Employers  alike.  In rejecting the resolution, our political representatives have shown their worst side – sacrificing the good of American, its citizens, its business, and its economy, for their own selfish motives.  We can only hope that Americans recognize this action for what it is, and take action when these individuals are next up for re-election.

Perhaps more astounding is the Department of Labor’s continued attempt to press absurd regulations that would prohibit owners’ of farms and ranches from using their own children to work on the farm/ranch (see Rural Kids Parents Angry About Labor Department Rule Banning Farm Chores). Not only would the rule dramatically hinder the way of life of America’s farmers and agricultural workforce, it also requires the replacement of efficient 4-H and FFA training programs run by experienced people with an inefficient and costly 90 hour Federal training program.  Does the word “insanity” come to mind? The government, assuming the role of “father knows best,” strikes again! The very epitome of American exceptionalism, the family business, and a way of life that emphasizes core values including personal responsibility, work ethic, work skills, economic and business sense, would be replaced by big brother! What’s next? Will the Obama administration require our children not be allowed to mow the family yard or to perform household chores?

Of course, these regulations benefit the Gasping Dinosaurs as well, since farmers and ranchers will have to hire employees and will then be at the mercy of big labor organizers force unionizing the workers, because decisions like the Senate made last week allow Card Check through Regulation vs. Legislation.  This brand of Social Justice (Welfare) Breeds Complacency, Dependency and Sloth, Exactly what the elitist want in their effort to make everyone, except for them, the same.

These two frightening examples of Rule by Fiat and this administration’s drive to socialism should serve to wake up all Americans regardless of their political bent! This is not America! This is not what made America great! This is sacrificing the future of our children and grandchildren and the greatest hope the world has ever known for the continued existence and power of a few, Big Labor Bosses and their political lackeys!

In my previous blog Congress Fights Back! Recent NLRB Power Grab Takes the Center Stage… in Court! I held out hope that Congress was awakening, but it is obvious predictions in my earlier blogs are becoming frighteningly true in a short period of time!

Fortunately, enough American’s paid attention this past week as thousands of calls were made to Washington, which apparently in the short term stopped the excessive overreach by the Administration and its puppet the Department of Labor (DOL) (see Administration Backs Down on Child Labor Regs for Farms).

I emphasize the short term as it would be wise to remember  President’s Obama’s comment to Russian President Dmitry Medvedev – which was picked up by a microphone unbeknownst to either leader – that Obama would have “more flexibility” after the election.. Unfortunately his Freudian slip was not just about foreign policy , but also his idealistic march towards domestic socialism.

If Obama is re-elected this November he will bypass the constitution and congress and begin implementing rules and regulations such as the above at a frenetic pace in an attempt to destroy the republic and take away American Freedoms with help from his big labor buddies.

About the author: David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.

Congress Clashes with NLRB

President Obama’s Rogue NLRB, driven by Chairperson Mark Pearce and the President’s radical recess appointees, have encountered serious roadblocks the past several weeks as they continue their quest to achieve EFCA Through the Backdoor (see Labor Board Chief to Push Union Organizing Rules). This past week, the GOP Senators pushed back when they announced they are Suing Obama Over Sham Labor Board Nominees. It is clear that the GOP has tired of the Obama NLRB’s attempted run around of Congress through the creation of regulations such as the “Posting Rule” – requiring employers to post notices of employee rights under the NLRA in the workplace, and “Quickie Elections”– substantially reducing the time frame during which elections are conducted for the purpose of eliminating the employer’s ability to educate its workforce. Further push back has come in the form of a joint senate resolution currently pending which seeks to overturn the NLRB’s “Quickie Election” rule,while simultaneously sending a message to the President to stop attempting to bypass Congressional authority (see Will Senate Stand Up to Obama’s Union Strongmen? and New NLRB rule that allows labor unions to foist surprise “ambush elections” on businesses and employees).

The purpose of the NLRB’s proposed regulations is to accomplish the Obama agenda of assisting Big Labor in executing Corporate Campaigns, such as the one crafted against my company, chronicled in The Devil at Our Doorstep, and ultimately increasing membership. Corporate Campaigns are no more than an onerous attempt to force employers to sign a Neutrality Agreement, and bypass the secret ballot election process for employees.

Despite the fact that NLRB statistics show unions win 70% of these elections, Big Labor’s ongoing problem is that currently, there are very few elections being held. This is primarily because a decreasing number of employees are interested in signing union cards to petition for an election. Consequently the “Gasping Dinosaur’s alternative is to force unionize employees through Card Check,a process fraught with danger from intimidation, in which the labor union could avoid an election and be recognized simply upon the execution of union cards and without an election by the employees.

Thankfully, the separation of powers among the three branches of the U.S. government, so diligently established by our nation’s forefathers, is working to save what otherwise would have been A Death Penalty for Employees and Employers. Over the past few weeks, several important events have occurred. First, within the legislative branch, the U.S. House of Representatives passed the Workplace Fairness Act, which, if enacted, would restrict the NLRB’s overreach and in the process eliminate the “quickie” election process (see Workplace Fairness Act Set to Move to the House Floor). Then, 44 Senators Challenged NLRB’s Ambush Election Rules, which further delayed implementation of the “quickie” election process. The most encouraging news came recently, when it was announced that the Senate will be voting this week to overturn the NLRB’s onerous Ambush Election rules. Businesses around the country are counting on them to do the right thing and hoping they have the intestinal fortitude to defeat these overreaching regulations!

Even more encouragement came last week, when the separation of power structure further proved the sagacity of our founding fathers. In the judicial branch, a South Carolina federal court judge struck down an NLRB proposed rule requiring employers to post notice of employee rights to unionize, finding that the board lacked the congressional authority to implement such a rule. Thankfully, the “Posting Rules” are now postponed indefinitely! The decision went a step farther than a previous decision by a federal district court judge in the District of Columbia, who recently ruled that the penalty portions of the “Posting Rule” would be blocked (see the NLRB Notice Posting Rules were Partially Blocked).The decision by these courts are an important victory.  While posting alone would be no more than an annoyance to employers, the penalty portions of the law, if upheld, would have been a field day for Big Labor! That would mean that Big Labor bosses could organize Corporate Campaigns with impunity to force employers to sign a Neutrality Agreement and achieve Card Check. Just as the SEIU did against my company, EMS, Big Labor bosses would have union thugs file multitudes of  ULP’ s in an attempt to bring the employer to its knees and sign the Neutrality Agreement.

The filing of ULP’s against an employer forces the employer to expend significant amounts of money and time to defend itself, with the result being that many employers eventually cave to union demands in order to avoid the vast expenditure of time and resources. Increased regulations and associated penalties just make it easier for Big Labor bosses to succeed in their “organizing” attempts. An imposition of increased regulation as a gift from the present administration through the auspices of the Rogue NLRB  is the only chance the “Gasping Dinosaurs” have of avoiding extinction, unless of course they change their ways and actually provide true benefits and service to their members (see Card Check through Regulation vs. Legislation). What a novel idea, Big Labor acknowledging that they are there to serve the members and not vice versa, and realizing that each employee should have the right to decide if they wish to be a member.

Unfortunately, despite the fact Obama and NLRB Continue to Cost Union JobsBig Labor has not realized that the President has no loyalty to anyone but himself. Perhaps they will finally get a wakeup call when Obama decides whether to pass or veto the Keystone XL Pipeline bill approved by Congress! Obama’s Keystone Delay Flouts the Law and his narcissism allow for the continuation of Rule by Fiat and put his Political Aspirations & Payback Ahead of American Jobs. No matter the outcome of the Keystone XL Pipeline, Big Labor will continue to push its selfish agenda and utilize Obama’s coattails to prosecute its Persuasion of Power at the cost of American freedoms, the American economy and American jobs.

Big Labor bosses will attempt to keep anyone from standing in their way, but it appears that Congress has finally recognized their tactics and knows that President Obama will continue his rule by fiat if he is not held accountable for his actions, including Constitutional violations and an overreach of the separation of power within our government. America is at a tipping point and the decisions made in the next week, combined with the upcoming November election will determine if America will go with the ways of past democracies, or if in fact, American Exceptionalism will be revived.

About the author: David A. Bego is the President and CEO of EMS, an industry leader in the field of environmental workplace maintenance, employing nearly 5000 workers in thirty-three states. Bego is the author of “The Devil at My Doorstep,” as well as the just released sequel, “The Devil at Our Doorstep,” based on his experiences fighting back against one of the most powerful unions in existence today.