Canadian Academics Weigh In on American Employee Free Choice Act Debate

I have done numerous posts on the ongoing debates about labour law reform in the U.S. and the proposed Employee Free Choice Act, which would re-introduce a card-check based certification system and include a new first contract arbitration requirement.  The basic components of the proposed legislation are familiar to Canadians, as we have had both of these requirements in different forms at different times in Canada over the past half century.  Card-check is still the method used in a number of Canadian jurisdictions, and tends to appear and disappear depending on the political party in power.  In other words, the union certification process is highly politicized in both countries.  But if you listen to the opponents of the legislation in the U.S., you’d think the Employee Free Choice Act would mark the end of human civilization.  See my earlier post on the opponents’ hysterical responses.
A disturbing aspect of the American debate is how opponents of the legislation are misusing and misrepresenting how the Canadian laws work and what the effects are of our higher unionization rates.  I noted one small example a while back when one of my own posts was used by a conservative website as evidence of the havoc the new laws would cause.  They were referring to the York University strike as evidence of the problem with a card-check system.  Trouble is, we don’t have a card-check in Ontario (outside of the construction sector) and, in fact, Canadian strike laws are more restrictive than American strike laws.  So the York strike has absolutely nothing to do with the debate.  But never let the facts get in the way of a good argument, right?
More controversial is a study prepared by a management consultant named Anne Layne-Farrar, who claims that the expected increase in unionization that would result from the Employee Free Choice Act would cause unemployment at a rate of 1% for every 3% increase in unionization rate.  To come to this surprising conclusion, she relies on previously available statistics from Canada!  When I first saw a story about the study, I noted that the findings and methodology sounded very suspect.  But I am not an empirical scholar. Interestingly, though, a number of empirical scholars have now examined Layne-Farrar’s methodology and have found serious flaws with its methodology.   Some of these studies will be published in a forthcoming special edition of the on-line journal, Just Labour, dedicated to an examination of the misuse of Canadian law and statistics in the U.S. debate.  The project is spear-headed by York’s Centre for Research on Work and Society (“CRWS”).  I will report when the volume is out, which should be a very interesting contribution to the American debates.
CRWS is also circulating a letter to Canadian academics that expresses concern about the misuse of Canadian information to influence the American debates, and noting that, in fact, although the Canadian unionization rate is much higher than the American rate, the empirical literature does not show a statistically significant effect on employment rate in either direction.  Moreover, Canada enjoys a better employment rate overall, lower unemployment, lower poverty, and lower income inequality than the U.S.  Check out this interesting chart comparing Canada and U.S.
Here is the open letter.  I will post a signed version after names have been attached and released.  If you are an academic interested in adding your name to this letter, contact:  gsran@econ.yorku.ca