If you could receive all of the government’s services–health care, education, roads, garbage collection–without paying taxes, would you voluntarily pay taxes?
If you could receive all the benefits of collective bargaining–higher wages, better health and pension benefits, free legal representation if you are disciplined or dismissed–without having to pay any union dues, would you voluntarily pay union dues?
This is the question involved in Indiana this week, where the government seems poised to pass a package of legal reforms the 
Americans like to call “Right to Work” laws. That’s a nice name, but the laws have nothing to do with a “right to work”. The laws prohibit collective agreement clauses that require every employee who receives the benefit of a collective agreement and receives union representation to pay union dues. The result is that paying union dues becomes a voluntary measure, which makes it very difficult for unions to collect the funds they need to hire lawyers, organizers, economists, pension experts, et cetera.
Here is an earlier draft of the Indiana legislation. I’m not sure if revisions were made to the final version. The key operative sections say this:
Sec. 8. A person may not require an individual to:
(1) become or remain a member of a labor organization;
(2) pay dues, fees, assessments, or other charges of any kind or amount to a labor organization; or
(3) pay to a charity or third party an amount that is equivalent to or a pro rata part of dues, fees, assessments, or other charges required of members of a labor organization;
as a condition of employment or continuation of employment.
Sec. 9. A contract, agreement, understanding, or practice, written or oral, express or implied, between:
(1) a labor organization; and
(2) an employer;
that violates section 8 of this chapter is unlawful and void.
Indiana becomes the first state in over a decade to introduce this anti-union law. Here is a chart of the states that have the laws, and the date they introduced them:
The entire point of this type of legislation is to cut off resources from unions so that they become weak and ineffective. Proponents argue that it creates jobs, on the theory that there are a bunch of antiunion employers who will flock to whatever state passes the law. That is what Indiana Republicans are promising. Opponents dispute that claim, and argue that all it does it allow employers in those states to pay workers less and give them fewer health and pension benefits. They claim it is part of the race to the bottom that corporations encourage and that Republicans politicians are more than happy to implement in exchange for the huge political contributions to their campaigns.
In fact, there is no persuasive evidence to prove either side correct. As is often the case when stats are used in workplace law debates, you can find “evidence” to support whatever position you feel like supporting. There are dozens of studies “showing” that “right to work” laws decrease wages and benefits and have no positive effect on employment levels (e.g. Economic Policy Institute) , and dozens showing the exact opposite (see the corporate-funded National Right to Work studies). You can usually predict what the outcome of the ‘independent’ study will be by looking at the ideological bent of the authors.
Thus, it should surprise nobody that Canada’s own corporate lobby voice, The Fraser Institute does its own studies that “prove”–Surprise!-that a Right to Work law in Canada would solve Canada’s economic ills. It’s all utterly incompressible, value-laden, voodoo statistics, in my opinion. I can’t make any sense of it, and I can guarantee you that no politician can. Just ask yourself why the right to work states don’t all have booming manufacturing sectors and extremely low unemployment if simply making it harder for unions to collect dues attracts investment like a moth to a flame. Some of these states are among the most depressed in the U.S. But the fact that the evidence confirms nothing about the effects of these antiunion laws doesn’t stop politicians (and other advocates of laws that undermine collective bargaining) from making grandiose claims about how the studies support this position or that.
If you don’t like collective bargaining, you will like a law that makes it difficult for unions to collect dues; if you think collective bargaining benefits society, you will be against the law. It is a completely ideological argument, not an economic one.
In Canada, we have followed the Rand Formula for decades, which says that a union can bargain a clause requiring everyone covered by a collective agreement to pay an equal share of the dues that pay for the union’s services. In Ontario, the law that permits this is found in Section 47 of the Labour Relations Act. In exchange for paying dues, the law imposes a duty of fair representation on unions to represent everyone that is paying dues, even those people who hate the union and have not become members (Section 74). The U.S. laws turn this basic tradeoff on its head: workers don’t have to pay dues, but the union still has a legal duty to represent everyone the same.
While there are always rapid antiunion groups like The Fraser Institute arguing that somehow this is unfair, no political party, not even the Conservatives, have to date seriously considered banning mandatory dues contract clauses. However, watch carefully for that rhetoric to begin from folks like Tim Hudak (Ontario Conservatives) and maybe even Lisa Raitt (Federal MOL) if Caterpillar in London decides down the road to move the work from London to Indiana (which many think is the plan), where they already have a factory full of dirt cheap employees. Wanna bet some politician will claim that the move was due to our “labour laws” and the Rand Formula in particular?
If the Tories take up the argument in favour of banning mandatory union dues, would you support them? Why or why not?