Right to work laws: a leftist assault on capitalism
September 26, 2013 by Paul McKeever
Tim Hudak, leader of the Progressive Conservative official opposition in Ontario, is pinning his electoral hopes on a proposal to introduce “right to work” legislation: a law that makes it illegal to make employment conditional on the employee’s membership in a union. Union talking heads – especially Ontario Federation of Labour chief Sid Ryan – as well as many in the media refer to right to work laws as an instance of “union bashing” or “union busting”. What almost never gets mentioned is that right to work laws also bash employers. Far from being a capitalist tool, right to work laws are just another leftist assault on capitalism.
The essence of capitalism is that a person – be that person a human being or a corporation owned and directed by one or more human beings – is free to choose with whom, and on what conditions, he will trade his property or labour (more broadly, “services”) for another person’s property or services. The essential characteristic of a capitalist jurisdiction is that, in such a jurisdiction, no property or service can be taken from someone without his consent.
Capitalism requires government to use force, or the threat of physical force, in an attempt to ensure that no one’s life, liberty, or property is taken from him without his consent. That implies that when two persons agree to terms of an exchange of property or services, the government uses force, or the threat of physical force, in an attempt to ensure that the two persons honour their agreement.
Moreover, because government is comprised of human beings, capitalism requires that government itself not take a person’s life, liberty, or property without the person’s consent. Consequently, in a capitalist system there is a complete separation between economics and government: economic concerns such as “creating jobs” or “fighting poverty” are entirely immaterial to and unrelated to the decisions or function of government.
In a capitalist system, a person who wants to purchase the services of a human being is free to decide whether to enter into a contract with each individual separately, or to enter into a single collective agreement with two or more employees. For each of the parties involved, there are both advantages to each option.
Consider first some of the advantages of collective bargaining. When the employer deals with a single representative (i.e., a union representative) representing hundreds or thousands of employees, and when all of the employer’s employees are bound by a single employment agreement (i.e., a collective agreement), the employer does not need to deal with hundreds or thousands of employee representatives (e.g., lawyers); it does not have to have the staff necessary to deal with all of those representatives; it does not have to face the potential of having to negotiate, on an ongoing basis, the various different terms of hundreds or thousands of employment contracts; and it does not face the spectacular cost of being drawn into hundreds or thousands of breach of contract (e.g., wrongful dismissal) lawsuits, each costing the employer thousands or tends of thousands of dollars. When an employee bargains collectively with other employees for a single collective agreement, the employees can bargain for a system of seniority to deal with temporary slow-downs and lay-offs in a way that rewards long-term loyal employees by way of making them the last to be temporarily laid off.
Consider also some of the disadvantages of collective bargaining. If the union management is motivated by communist ideology – and that’s a big and important “if” – there is an increased risk that a mutually beneficial system – collective bargaining – will be characterized as a tool in a class war pitting “labor” against “management”, or the proletariat against the bourgeoisie, or the unions versus the capitalists. Such a characterization typically results, in the long run, in demands that – if agreed to – would end the profitability of the business, cause the closure of the business, and leave employees on the street jobless. So, in a capitalist jurisdiction, employers and employees who choose to bargain collectively need to scrutinize the aims and habits of any union with which they choose to associate. Also, employees who bargain collectively have no power individually to change their terms of their employment because, technically, no one individual has a employment contract with the employer when a collective agreement is in place. It follows that employees who bargain collectively have no power to sue their employer for breach of contract (e.g., wrongful dismissal). As a result, employees who bargain collectively with other employees are at the mercy of the other employees, and the representatives of the union: the union must act in the best interests of the union, even when the interests of the union conflict with the interests of one of its members. The union member is a dispensable cog in a big labour machine that concerns itself first and foremost with the survival and fortune of the “greater good” of the union.
Just as collective bargaining has its advantages, so does individual bargaining. For example, both employers and employees have greater freedom to amend the terms of their employment agreement when the parties to the agreement include only the employer and one employee. Neither party requires the approval of other employees: the contract between a given employee and the employer can be amended with the consent of only the given employee and the employer. Employees who are more productive than their colleagues, and who know it, can sometimes negotiate higher wages, better fringe benefits, longer paid vacations etc.. And, if an employer breaches the employment contract in a fundamental way – for example, failing to give sufficient notice of when the contract will end – the employee has the right to sue the employer; the employee is not at the mercy of his fellow employees, and the interests of those employees are immaterial.
There are disadvantages too. For example, employers who terminate employees without giving sufficient notice may find themselves facing numerous lawsuits, each costing the employer tens of thousands of dollars in legal fees and lost productivity. Employees in negotiations with an employer will not have, as bargaining leverage, the power of the strike: the bargaining power inherent in all employees withholding their services from the employer until a collective bargain is struck between them and the employer.
Right to work laws
Right to work legislation does not provide anyone with a right to work: it entitles nobody to a job. To the contrary it takes away from a person the freedom to decide with whom to contract for the provision of employees. Specifically, to one extent or another, right to work laws make it illegal for an employer or union to make union membership a condition of obtaining or maintaining employment with an employer.
There is a false assumption implicit in the conservative left’s advocacy of right to work legislation. Specifically, the false assumption is that employers and employees both dislike unions and collective bargaining; that that dislike is causing employers to find right to work jurisdictions in which to hire labourers; and that, if there were a ban placed on making union membership a condition of employment, employees and employers would rush at the chance to bargain individually (i.e., a separate employment contract for each employee).
The truth, as indicated above, is that each employer, and each employee, is different. For some employers, and for some employees, the advantages and disadvantages of collective bargaining overall will be preferable to the advantages and disadvantages of individual bargaining. For other employers, and other employees, the reverse will be true.
It follows that a law that prohibits making union membership a condition of employment attacks the freedom of persons to determine on what terms they will consent to trade their own property or services. Such a law turns government from an entity that ensures that no person deprived of his life, liberty or property without his consent, to an entity that takes, non-consensually, the liberty or property of parties to an employment agreement. It takes from employers the liberty to decide whether they want separate contracts with each employee, or a single collective agreement with numerous employees. It takes from employees the liberty to negotiate a collective agreement pursuant to which the employer agrees to hire only union members. It also takes from employees the liberty to decide whether or not to accept an individual as a member of their union. At the same time, in situations where an employer would like to bargain collectively with employees (and vice versa), right to work legislation gives individual employees who opt out of joining the union the power to undermine the benefits, to employees, negotiated as part of a collective agreement, such as seniority rights, terms concerning the timing of contractual negotiations, et cetera. It gives such employees the right to violate the liberty or property of the employer and their fellow employees alike.
But what if right-to-work laws increase employment?
Advocates of right-to-work legislation, such as Tim Hudak, claim that the economic impact of right-to-work legislation will be positive. Right-to-work laws, they claim, will result in more jobs and, therefore in economic growth and larger tax revenues. The truth or falsity of such claims, however, is morally and politically immaterial. For example, if the government created a law requiring all unemployed people to work for the government, employment would (until the inevitable bankruptcy of the state) be increased. However, it would be utterly evil, and a violation of the liberty of individuals, to impose slavery.
So it is with right to work legislation. Whether unemployment would increase or decrease; whether wages would increase or decrease; whether the economy would grow or shrink; whether tax revenues would increase or decrease; the fact would remain that it is utterly immoral, and a violation of liberty and property, for the government to interfere with negotiations among employers, employees, and unions.
The moral system of labour negotiations
No party – neither employers, nor employees, nor unions – should have any legislated right to unilaterally dictate the terms of an employment agreement, be it an individual contract, or a collective agreement. Employers, employees, and unions each must be free to choose whether or not to enter into individual contracts or collective agreements. Employers, unions and potential employees all must be free to propose that employees will, or will not, be required to be union members or to bargain collectively. There must be no legal bar to accepting such proposals. The government must refrain from being a player in labour negotiations, and confine itself to being a referee.
The impractical is the immoral. If one’s hope is to free people to prosper, neither union-bashing nor employer bashing nor employee bashing is practical. All that is needed – all that is practical and moral – is capitalism.