Legislation passed by the U.S. House of Representatives would overturn Arizona’s right-to-work law that has been in place for 75 years, stirring alarm among business groups here and in other states with similar laws.
Advocacy groups like the U.S. Chamber of Commerce are calling on the Senate to reject the anti-jobs proposal, saying it would hurt employees, employers, independent contractors and freelancers.
“The PRO Act would, for all practical purposes, eviscerate Arizona’s right-to-work law, which would mean that workers in the state who happen to be in a union work setting would have to pay dues or they would be at risk of losing their jobs, said Glenn Spencer, senior vice president of the Employment Policy Division at the U.S. Chamber in Washington, D.C., the world’s largest business federation representing the interests of more than 3 million businesses.
“Their employers may well be forced to terminate them if they don’t wish to pay dues in that setting,” said Spencer, who spoke with Chamber Business News (CBN) about the implications of the proposed law.
Sweeping proposal would set dangerous precedent
The PRO Act, which stands for Protecting the Right to Organize Act of 2021, would enact dozens of sweeping changes to current labor law in favor of unionization. Labor unions like the AFL-CIO are backing the measure. President Joe Biden has promised to sign the bill if it gets to his desk. Meanwhile, Arizona’s two senators, Kyrsten Sinema and Mark Kelly, are current holdouts preventing the bill from moving forward. But the pressure is on.
Of concern to businesses are a long list of new provisions, from requirements limiting freelancers’ ability to have flexibility over their own hours to allowing union organizers to engage in coercive tactics long held to be illegal.
Simply put, the proposed law would strip employees’ right to decide if they want to be in a union, disrupt the thriving gig economy, and hurt employers’ bottom line, Spencer said.
Protect or harm workers’ rights?
The U.S. Chamber and hundreds of business advocacy groups are calling on senators to say “no” to the proposal. In Arizona, at least 20 chambers of commerce, including the Arizona Chamber of Commerce & Industry, are joining the U.S. Chamber in opposition.
Proponents of the PRO Act contend the measure would restore fairness to the economy by strengthening the federal laws that protect workers’ right to join a union. But what they fail to mention is the number of measures that could have damaging consequences for employees and job creators, Spencer said.
Here are some of the key reasons business groups oppose the measure:
Elimination of right-to-work laws
Currently, Arizona and 26 other states have right-to-work laws, which give workers the choice of whether to join a union. States without right-to-work laws require employees to pay union dues and fees as a requirement for employment.
“The bill represents a pretty dramatic intrusion into state laws,” Spencer said. “States since 1947 have been authorized to pass right-to-work statutes. Courts have ruled on those statutes, and this bill would essentially wipe all that out without any action by the state legislature.”
The Act would allow coercive tactics long held to be unlawful
Another concerning provision in the PRO Act would be the ability for workers of a company to picket companies that their employer conducts business with, called “secondary boycotts,” Spencer said.
“Most people aren’t aware of that concept and that’s for a very good reason because secondary boycotts and pickets have been illegal since 1947. For more than 70 years it’s been against the law to engage in that kind of activity,” he said. “Congress outlawed it specifically because it was so disruptive to the free flow of commerce.”
Under current law, union organizers can talk to an employer and employees where they are trying to unionize. If secondary boycotts are allowed under the PRO Act, union organizers could target any businesses the company does business with, occupying their parking lots and disturbing their customers.
“So you can see how widely disruptive a labor dispute at a single company could become. A whole range of neutral third parties that have nothing to do with a labor dispute suddenly get drawn into it,” Spencer said. “Just because you’re providing services as a third party, suddenly that could make you the subject of labor protests and pickets around something you really have no part of.”
Strips independent contractors of their classification
Another concerning aspect of the PRO Act is the redefining of independent contractors and freelancers similar to the controversial AB 5 bill that was passed in California in 2019.
Under AB 5, when a hiring entity claims that the person it hired is an independent contractor, the law requires the application of the “ABC test” to determine if workers are employees or independent contractors. For many independent contractors, the PRO Act would mean they would be considered employees for purposes of federal labor law, giving them the right to unionize.
In California, the penalties for businesses that “wrongly classify an employee as an independent contractor” are civil penalties of $10,000 for a first violation, $30,000 for “repeat or willful” violations, and 1 percent of net profits if “widespread.”
Given the penalties, it could severely limit independent contractors and freelancers’ ability to get hired, forcing them out of business.
Independent contractors could end up in union without knowing it
Independent contractors tend to be dispersed, so if a union patches together a bargaining unit of independent contractors, it typically has to occur by mail, Spencer said.
“What we’ve seen in other contexts like this is that a lot of these workers don’t even realize there’s any kind of union campaign going on and these campaigns are won by a majority of those who actually vote,” he said. “So if you have a hundred independent contract workers, if only 10 voted, six of them would constitute a majority of voters and that would be enough to impose a union on all 100.
“So you’d wake up one morning and suddenly discover you’re a member of a union and you have to pay union dues because right to work is gone.” he said.
Economic growth would likely be hampered
Research by the U.S. Chamber shows that right-to-work states tend to have higher rates of economic growth, higher rates of job creation and lower rates of unemployment, Spencer said.
“So there’s certainly a personal cost to workers, but there’s a larger economic cost to the states as well,” he said.
Sinema and Kelly key players in the debate
For the most part, Democrats are leading the charge on the PRO Act. There are currently 47 Democrats co-sponsoring the bill in the Senate. Majority Leader Chuck Schumer (D-New York) said he will bring the bill to the floor if he can get 50 co-sponsors.
So far, Arizona’s two Democrat senators, Kyrsten Sinema and Mark Kelly have not co-sponsored the bill. One reason given for their reluctance is the lack of bipartisan support for the bill. They also have a large cadre of constituents who support the state’s right-to-work status.
“Senators Sinema and Kelly have not co-sponsored this bill. That’s a good thing. People in Arizona should thank them for standing up for workers and right-to-work and employers,” Spencer said.
Large opposition from business community
Business leaders and advocacy organizations across the U.S. are sending letters to Congress, calling for an end to the PRO Act, including the Coalition for a Democratic Workplace (CDW), composed of hundreds of organizations representing millions of businesses that employ tens of millions of workers nationwide in nearly every industry.
Arizona chambers calling on Congress to vote “no”
In Arizona, at least 20 chambers of commerce oppose the measure:
- Arizona Chamber of Commerce & Industry
- Buckeye Valley Chamber of Commerce
- Chandler Chamber of Commerce
- Carefree Cave Creek Chamber of Commerce
- Coolidge Chamber of Commerce
- Glendale Chamber of Commerce
- Greater Phoenix Chamber
- Greater Flagstaff Chamber of Commerce
- Green Valley Sahuarita Chamber of Commerce
- Lake Havasu Area Chamber of Commerce
- Marana Chamber of Commerce
- Nogales-Santa Cruz County Chamber of Commerce
- Peoria Chamber of Commerce
- Prescott Chamber of Commerce
- Prescott Valley Chamber of Commerce
- Queen Creek Chamber of Commerce
- Southwest Valley Chamber of Commerce
- Surprise Regional Chamber of Commerce
- West Valley Chamber of Commerce Alliance
- Wickenburg Chamber of Commerce
To read more about why business and industry oppose the bill, visit: Stop the PRO Act.