Anti-Union Advocates Look to Anti-Bribery Law to Undermine Organizing

January 29, 2007

Anti-union attorneys have recently brought several lawsuits aiming to prohibit "neutrality agreements" between management and labor -- on the basis of an anti-bribery law enacted in 1947.  Neutrality agreements require a union and a non-unionized employer, in the event of a union attempt to organize its workers, to forgo the potentially costly and contentious NLRA elections process and instead agree to an expedited "card-check" method of determining whether or not the shop will be unionized.  In these recent cases, anti-union advocates claim that Sec. 302 of the Taft-Harley Act, an anti-bribery law intended to prevent management from bribing union leadership in exchange for management friendly union contracts, forbids neutrality agreements.

Sec. 302 renders it illegal for an employer to deliver any "money or other thing of value" to a union or union official.  Anti-union advocates claim that contractual neutrality agreements constitute such "things of value" forbidden by federal anti-bribery law.  Previsouly, federal courts have been largely unsympathetic to this argument.  According to the majority opinion of then-Judge Michael Chertoff (who was appointed as Secretary of the Department of Homeland Security by President Bush) in the 2004 Sage Hospitality case:

Not surprisingly, Sage is unable to provide any legal support for the remarkable assertion that entering into a valid labor agreement governing recognition of a labor union amounts to illegal labor bribery. There are many reasons why this argument makes no sense, including the language of section 302 itself, which proscribes agreements to “pay, lend, or deliver ··· any money or other thing of value.” The agreement here involves no payment, loan, or delivery of anything. The fact that a Neutrality Agreement-like any other labor arbitration agreement-benefits both parties with efficiency and cost saving does not transform it into a payment or delivery of some benefit. Furthermore, any benefit to the union inherent in a more efficient resolution of recognition disputes does not constitute a “thing of value” within the meaning of the statute.

Nevertheless, similar cases are being litigated in other Circuits.  In Patterson v. Heartland Industrial Partners, for example, the Sixth Circuit will consider whether a coalition of employees may repudiate a neutrality agreement negotiated between a union and an employer that believes in "treating organized labor as an economic partner rather than an adversary."  In this case, Heartland negotiated with multiple unions, agreeing not to interfere with any attempts to organize their workers if, in return, the unions agreed to only make one 90-day attempt to organize a new shop each year.  Acting within the terms of this agreement, a union successfully organized several of Heartland's shops and negotiated contracts which increased the wages and benefits of represented workers.

(ACS Board of Directors Member Stephen Berzon is one of the attorneys in Patterson)