Union Provision Was Secretly Slipped Into COVID-19 Relief Bill

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Business interests have labeled it a stealth attack by pro-union forces. Most would-be GOP opponents of it on Capitol Hill were in the dark until it was too late – many still are. A provision in the sprawling $2.2 trillion relief legislation, which lawmakers rushed through Congress to help workers and employers in an economy cratering from a global pandemic, would impose a gag rule on mid-sized businesses when it comes to union efforts to organize workers.

Businesses with between 500 and 10,000 employees that take a government loan under the Coronavirus Aid, Relief and Economic Security Act would be forced to remain neutral when a union tries to organize their workers.  

The language was part of Speaker Nancy Pelosi’s and Senate Minority Leader Chuck Schumer’s pro-union wish list for the stimulus bill. Most of their other pet priorities fell by the wayside as Senate Republicans pushed back in the furious final negotiations to get the bill out the door and $1,200 checks into the hands of struggling Americans as quickly as possible.

But the neutrality mandate managed to get slipped in without much GOP scrutiny – to the chagrin of free-market groups who argue it will impinge on businesses’ First Amendment rights to speak to their workers about union organizing efforts.

“The gag rule has been something that the unions have been fighting to enact for a long period of time, and it has nothing to do with the virus or the economy,” David McIntosh, president of the Club for Growth, told RealClearPolitics. “Shame on Republicans for not catching it.”

“What does a company surrendering their First Amendment rights have to do with the health and economic safety of Americans?” complained F. Vincent Vernuccio, a senior fellow with the conservative Mackinac Center for Public Policy. “It doesn’t.”

The neutrality language is one of several pro-labor laws that “couldn’t get passed in normal times so they are trying to pass it now,” Vernuccio added, pointing to the failed effort to pass a $15 federal minimum wage and the push to give one airline board of directors seat to an elected worker. Unions have remained quiet about the legislative victory in the days since the stimulus bill was passed and signed into law. The AFL-CIO and SEIU did not respond to RCP inquiries.

Schumer’s office readily acknowledged the neutrality language and cited it as a big win for American workers.

“From day one Democrats said our plan would put workers first and despite Republican opposition, we did just that in a number of key areas,” Schumer’s office told RCP. It’s unclear what type of last-minute horse-trading led to the provision being included. Treasury Secretary Steven Mnuchin played point man in the negotiations, as he tried to engineer more flexibility and fewer restrictions for the loans the Federal Reserve is poised to hand out to businesses.

Mnuchin worked directly with Schumer, shuttling between the Democratic leader and Majority Leader Mitch McConnell’s office over the course of two harried days. Schumer at the time said he was consulting closely with Pelosi throughout the process. At one point, President Trump sent a late-night tweet slamming Democrats over their demands in the rescue package, but Mnuchin said it was not directly related to his talks with Schumer. Exactly which Republicans knew about the neutrality provision’s inclusion also remains unclear. Spokesmen for the White House, Treasury and McConnell’s office did not comment for the story.

Meanwhile, a GOP aide told RCP that Sen. Lamar Alexander, the Tennessee Republican who chairs the committee with jurisdiction over labor law, “does not support the [neutrality] provision as it is an inappropriate intrusion by federal officials into the operation of business.”

Just how big a boon the provision will be to organized labor remains to be seen. The neutrality language is vague in the bill, Vernuccio and other experts point out, but most similar state statutes contain card check provisions that nullify an employee’s right to a secret ballot in unionization elections.

“The law already significantly limits what an employer can say when it comes to union organizing. They are really muzzled, and this law could mean they can’t say anything,” National Right to Work President Mark Mix told RCP. Far from being pro-worker, Mix argues the provision is just the opposite because it limits the amount of information employees can receive.

“It’s really, really unfortunate that [Schumer] and union officials would take advantage of an emergency situation to try to increase their power over workers and benefit the labor unions,” he said, noting that his group plans to challenge the statute in court “on behalf of employees.”

McIntosh said the Club for Growth and others will work to overturn the neutrality language in any Phase 4 stimulus or relief bill aimed at further shoring up the economy. The Club for Growth is also lobbying Trump to sign an executive action that would suspend a number of federal rules that could make it harder for businesses to start up and rehire employees. The Office of Management and Budget would review the suggested list of regulations and determine how many to suspend until the coronavirus crisis is over, McIntosh explained.

“This was a sneak attack and let everyone understand that when a sneak attack works, you probably will see it again, maybe in a little different way,” said Michael Lotito, a shareholder with Littler, an employment and labor law firm, and co-chair of its Workplace Policy Institute. “The fact that [this language] got into statute is very troubling. … To my knowledge the Senate has never passed a statute with a neutrality provision in it.”

Lotito called the provision’s inclusion “a big heads-up” to policymakers to put the brakes on major legislation, even for 24 hours, to allow senators and key staff to read it and bring such concerns to light. As Congress prepared to pass the mammoth relief bill at the end of March, a handful of GOP senators, including Lindsey Graham, Tim Scott and Ben Sasse, sounded an 11th hour alarm on the generous unemployment insurance provisions they argued would create an incentive for Americans to quit their jobs.

Although McConnell allowed the senators to air their grievances in an amendment, it went down in flames in a Senate determined to pass a stimulus bill passed quickly.

But Richard Manning, president of Americans for Limited Government, said that short-circuiting the legislative process in the name of speed means purposefully cutting out the real subject-matter experts – with inevitable surprises.

“Our committee system exists for a purpose,” he said. “Congressmen become experts on subject matter – and passing emergency legislation that directly impacts very specific subject matter such as labor law without full consultation of the elected experts is a mistake.”

Susan Crabtree is RealClearPolitics' White House/national political correspondent.

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