Thursday, December 13, 2012

RTW4Less: Unconstitutional over-regulation?

Thanks to Pro Labor Alliance for the photo
The government tells employers they must treat all employees equally, union and non-union alike. So the government forces employers to pay the same level of wages and benefits to all employees, whether they belong to a union or not.

The government forces unions to bargain for and represent all employees, whether they belong or not. But at least the union can charge a fee to cover the expense of representing the employees who don't join. (And no, they can't charge for member activities or political contributions.)

In right-to-work-for-less states, the government prevents unions from charging fees for representing non-members.

Beverly Mann at Angry Bear thinks that's unconstitutional. She cites Article I, Section 10 of the Constitution of the United States:
No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
Why the Constitution? highlight the prohibition against states’ enacting a law impairing the obligation of contracts—which the Supreme Court has interpreted as a guarantee of the right to freely enter into contracts.  
That guarantee does have exceptions, of course, none of which includes the type of contract that state so-called ‘right to work’ laws bar.  Including the ones passed today by the Michigan legislature, after springing out of nowhere last week... 
But as Slate’s Matthew Yglesias points out today, what these bills do is use the force of law—state law—to interfere with the right of contract between two private parties: labor unions and private employers.  In Michigan, the legislature actually passed two separate laws today: one pertaining to labor contracts between labor unions and private employers, the other pertaining to contracts between labor unions and public employers (i.e., state and local governments).  But as a constitutional matter, this doesn’t matter.
Gary Chartier, a libertarian, agrees. Writing in The Freeman after Indiana passed a right-to-work-for-less law earlier this year, he argued,
They violate freedom of contract. 
If employers choose to conclude union-shop contracts with unions, what gives the Indiana legislature the right to interfere? 
Employers own the wages they will pay and the sites where work will be performed under such contracts. So it’s their right to dispense the wages and make the sites available specifically to union members, just as it’s their right, more generally, to trade with anyone they choose. 
When a legislature interferes with voluntary employment contracts, it infringes people’s freedom to bargain with their own labor and possessions. Treating this kind of interference as acceptable means licensing arbitrary interventions into the market by politicians, who are ill-equipped to second-guess the decisions made by the real people making work agreements with one another. 
And there’s no principled way to draw a sharp line here: Once it’s okay for a legislature to interfere with bargaining in this way, there’s no stopping politicians from setting wages and prices, or requiring or prohibiting the hiring of particular people. 
Supporting a free society means embracing people’s freedom to form unions. And it means acknowledging that unions—and union-shop agreements—can offer both workers and employers something valuable.