Freedom to Contract: Blacks and Labor Organizations

Takes a critical look at the realtionship between organized labor and blacks. This article, reprinted with permission by the Lincoln Institute for Research and Education, is especially relevant at the moment in view of the coalition between the AFL-CIO and various minority organizations which found expression on Solidarity Day in Washington, DC, September 19.

Labor Unions and the Concept of Public Services

Prior to 1959, the idea of organized labor in the public service was barely conceivable. George Meany, late president of the AFL-CIO, had said: "It is impossible to bargain collectively with the government." The Bureau of Labor Statistics of the U.S. Department of Labor had not even bothered to record the negligible amount of work stoppages in the public sector separately. Not a single state had a law on the books concerning public sector collective bargaining or employee union representation until Wisconsin passed such a statute.

The article "Labor Unions and the Concept of Public Service" by Roscoe Pound, former Dean and Professor Emeritus at Harvard University Law School, reprinted in this issue in its entirety, was first published by the American Enterprise Association, which is now the American Enterprise Institute. Although Dean Pound mainly refers to organized labor within public utilities corporations (surely because unionism in governmental service was inconceivable then) his reasoning and philosophy apply even more strongly to labor unions as we have them today in the public service: teachers, police, fire fighters, transportation workers, sanitation workers, etc. Four legal principles should apply to labor unions in the public service, according to Pound. These are: (1) each side of the employer-employee relationship has a duty to assure the maintenance of the health, safety, comfort and convenience of the public by performing what is immediately required (i.e. no work stoppages) and also by allowing public service agencies to function effectively; (2) as long as these duties are carried out, both sides should continue to enjoy the advantages and privileges they have; (3) legislation needs to be adopted to enforce these first two points, to define and limit the monopolies and immunities enjoyed by both parties, particularly with respect to the relation of the parties to each other and the public; and (4) this particular body of labor law should be based on well-reasoned principles rather than consist of particular rules applying to rigidly defined facts. In sum, Pound states that labor unions have been given advantages and immunities without corresponding duties and responsibilities.

Discussion Paper in Political Economy #6, Some Further Reflections on Syndicalism.

Some 35 years ago, the Great Chicago School classical liberal Henry C. Simons published an academic essay entitled 'Some Reflections on Syndicalism.' That essay stands as one of the great landmarks in the tradition of classical liberal political economy of this century.

In this 'Reflections' essay, Simons predicted the emergence of an "awful dilemma" in democratic societies such as America and Britain, that had allowed-and indeed fostered-the emergence and growth of a large and powerful labor union movement. My purpose here is to examine, to criticize and to refine Simons' thesis in the light of both more recent experience and recent developments in economic analysis.

HABIT 6: REFORM COLLECTIVE BARGAINING* by Kirk A. Johnson and Elizabeth Moser Mackinac Center for Public Policy

The sixth and final habit of fiscally responsible public school districts is collective bargaining reform.45 Michigan’s compulsory union law, the Public Employment Relations Act (PERA) requires collective bargaining where employees have unionized, but many of these collective bargaining agreements restrict school administrators’ ability to do their jobs, and therefore unnecessarily block fiscally responsible reforms.

This is not to say that individual employees should not be free to associate in any organization they choose. At the same time, school boards should not necessarily be forced to negotiate collective bargaining agreements and should be free to negotiate individually with teachers, if they so desire.

Every school day, the current widespread collective bargaining regime makes a financial difference in school’s operations, educational environment, and the ability of children to learn. School districts therefore have a fiduciary interest in assuring that collective bargaining is not so burdensome that it diverts precious resources from student learning.

From a 1998 analysis of more than 500 collective bargaining agreements, seven improvements (not already suggested in previous sections) are recommended to assure that these agreements allow effective school management. Many of these problems may be avoided by demanding well–worded contract language. Implementing the seven improvements will dramatically enhance the ability of public school districts to enact needed reforms.

Improvement #1: Strengthen Management Rights Clauses

Every collective bargaining agreement should specifically detail the rights and responsibilities that remain vested in the school board. As elected officials, school board members form the only public body with the legitimate responsibility and authority to operate a school district; neither teachers nor school employee unions have been granted authority by the electorate to undertake this responsibility.

The management rights contract language, or “rights of the board of education,” is the contract provision that establishes school board control over the operation of the school district. School districts should adopt strong management rights clauses that explicitly designate the specific, exclusive rights reserved to the school board, administrators and management.46

Improvement #2: Limit Exclusive Bargaining Representative Clauses

When a public employer recognizes a collective bargaining representative as the agent representing the employees in a defined bargaining unit, PERA grants exclusive recognition to that agent to act for those employees in issues involving wages, hours, and terms and conditions of employment.47 In addition to including such recognition, more than 500 contracts contain a separate provision by which the school board agrees not to negotiate with any other teacher organization.

In other words, if a school board wished to contract with a math, science or professional teacher organization for the purposes of professional development for its staff members (a term of employment), it would first require the union’s permission. School boards should remove exclusive bargaining representative clauses that require such permission before employees can explore opportunities with other professional organizations.

Improvement #3: Remove Mandatory Support Clauses

Many school board members and other citizens mistakenly believe that union membership is required for all teachers working under a collective bargaining agreement. The truth is that there is no statute that requires teachers to either become union members or pay union dues in the absence of a contractual agreement between a school district and a union.

The mandatory support clause (sometimes called a “union security” clause), if included in a collective bargaining agreement, is what forces school employees to pay union dues. School boards that agree to such a clause become union financial enforcers, often by agreeing to fire any employee who fails to pay dues.

School boards should negotiate mandatory support clauses out of their collective bargaining agreements. The coercive and unfair nature of such clauses negatively affects school employees’ morale, productivity and professionalism. Unions that excel in representing their members will have no difficulty attracting and keeping the voluntary support of those members.

Improvement #4: Limit Just Cause” Discipline and Discharge Clauses

“Just cause” refers to contractually established standards of conduct that an employee must breach before he can be disciplined or discharged. Due process is the legal procedure instituted when an employer wishes to discipline or discharge an employee who has breached the “just cause” standard.

“Just cause” is distinct from an “at will” employment arrangement. “At will” means either party may terminate the employment relationship at any time for any reason. The “just cause” standard, on the other hand, is typically applied to employees who have a property interest in the employment relationship. Teachers who have received tenure status, for example, enjoy property rights in their employment relationships.

The “just cause” standard and the resulting due process proceeding for employee discipline or discharge is a burdensome and time–consuming process for districts that wish to remove ineffective, unproductive or even criminal teachers from the classroom. Under this standard, a school board can face increased and unplanned expenses in processing employee discipline and discharge matters, including substantial liability for teacher re–instatement or back pay in the event of an unfavorable arbitration or tenure ruling.

School boards should limit the “just cause” standard to include only tenured teachers and provide a less rigid standard for probationary teachers, who are still being evaluated for their competence. Boards are legally obligated to provide “just cause” employment only to tenured teachers, so they should carefully review their collective bargaining agreements for any language that makes a “just cause” standard applicable to probationary teachers.

School boards and administrators should carefully follow the established seven–point test when building a case for the “just cause” discipline or discharge of a tenured teacher. The seven points include:

• Did the employer forewarn the employee of possible disciplinary consequences of conduct?
• Was the rule or directive involved reasonably related to the orderly, efficient operation of the business?
• Before administering discipline, did the employer properly investigate to determine that the employee did violate or disobey the rule or directive?
• Was the employer’s investigation done in a fair and impartial manner?
• Through the investigation, did the employer obtain enough evidence to prove the employee was, in fact, in violation of the rule or directive?
• Was the rule, directive, and penalty applied fairly and without discrimination?
• Was the discipline applied reasonably related to the gravity of the offense and was the amount of discipline reasonable given the employee’s overall record?48

Arbitrators are unlikely to uphold the discipline or discharge of an employee if the school district does not properly follow and document the steps showing “just cause.” School boards and administrators who adhere to the requirements for “just cause” will avoid unnecessarily costly and unfavorable arbitration rulings.

Improvement #5: Strengthen Teacher Evaluation Clauses

The teacher evaluation plays an important part in a school’s ability to effectively educate its students. School officials must be able to evaluate the competency and performance of each teacher in order to judge how well he or she uses professional skills to help students learn and achieve.

Because each evaluation is part of a continuum that builds over time, a proper teacher evaluation must go beyond the mere “performance” of an instructor in the classroom and address a teacher’s overall ability to establish and maintain a positive learning environment for students. School boards and administrators must keep this focus in mind as they bargain over contract language that affects these evaluations.

Collective bargaining agreements in Michigan, with few exceptions, place more restrictions on school administrators’ rights to evaluate their teachers than do any statutory requirements. Former NEA President Bob Chase acknowledged that, “The heart of education is this: the daily engagement between teacher and pupil, and the commitment that both parties bring to the task.”49 Yet unions such as the MEA (the NEA’s Michigan affiliate) often demand uniformity in the teacher evaluation process, a cookie–cutter approach that ignores the differences in goals, objectives, standards and style between elementary and secondary teaching.

School board members and administrators should use the five points established under the Michigan Teacher Tenure Act when evaluating a teacher’s competency. Unsatisfactory performance in any one of these five points is sufficient to determine that a particular teacher is not competent:

• knowledge of the subject;
• ability to impart the subject;
• manner and efficiency of discipline over students;
• rapport with parents, students, and other faculty; and
• physical and mental ability to withstand the strain of teaching.50

The course of action pursued by the school district with regard to a poorly performing teacher must be based on the extent or severity of the poor performance.

School boards should also remove from their collective bargaining agreements any language that allows teachers grievance rights over the content of a teacher evaluation. The content of teacher evaluations should be left to the sole discretion of school administrators, not to arbitrators in lengthy and expensive grievance proceedings. By making evaluation content a grievable matter, school boards wind up placing the judgment of arbitrators, who do not work with or see the teachers being evaluated, above the judgment of the school administrators, whose responsibility it is to observe and evaluate the teachers’ abilities.

Improvement #6: Replace Seniority-Based Salary Schedules with Performance-Based Pay Scales

Most public school teachers in Michigan are paid according to a seniority–based salary schedule, which awards compensation according to a teacher’s years of experience and level of education. This is in contrast to most other areas of commerce and industry, where employees working under a “merit–based” schedule receive compensation that is commensurate with their job performance and productivity.

Under a seniority–based, or “single salary schedule,” system, individual teachers have a reduced incentive to innovate or excel in the classroom since their level of compensation is not tied to their performance. Most collective bargaining agreements in Michigan establish teacher salary schedules based solely on a teacher’s level of education and years of experience.

These salary schedules are organized into a “grid” which provides for automatic pay increases based upon the number of years a teacher has spent in the district and the kind of college degrees or number of additional academic credit hours he or she has accumulated or both (commonly referred to as “step” increases).

In most school districts, entry level teachers with only a bachelor’s degree and no prior teaching experience receive the base negotiated salary; few districts reserve the unrestricted right to establish the starting salary for a teacher on any step of the pay scale. This makes it difficult for schools to hire high–demand positions such as special education, math or science teachers.

School districts attempting to establish performance–based pay schedules for their teachers have invariably met with union resistance. However some districts, such as Saginaw, have been successful in bargaining a portion of their teachers’ salaries based on the requirement that teachers meet certain district–wide goals adopted by the school board.51

The Michigan Legislature strengthened school districts’ right to create performance–based salary systems when it passed Public Act 289 in 1995, which states in part that, “A school district or intermediate school district may implement and maintain a method of compensation for its employees that is based on job performance and job accomplishments.”52

Improvement #7: Eliminate Class Size Limitation Clauses

The number of students per teacher in a classroom has been an issue in collective bargaining since the first contract negotiations began in Michigan more than 30 years ago. Unions maintain that smaller classes allow teachers to spend more time with each student, thus boosting educational achievement. Consequently, many of Michigan’s school districts have negotiated language that affects class size into their bargaining agreements.

Over a third of collective bargaining agreements in Michigan currently establish a maximum number of students for each class and provide for mandatory teacher salary bonuses any time this maximum is exceeded.

Negotiating smaller class sizes has proven to be a costly arrangement for school districts, especially those with growing student populations. Further, there is little good evidence suggesting that small classes predictably and systematically yield higher student achievement.53 Establishing class size requirements within a collective bargaining agreement restricts the school administration’s decision–making about the most effective use of staff, space and scarce financial resources.

In short, every school district now has the ability through careful collective bargaining to effect reforms that will help meet the demands of parents, taxpayers, students and teachers. School board members in all of Michigan’s school districts must seize the opportunity to transform the bargaining process from an adversarial one into one more focused on cooperatively improving the educational product, increasing value, and protecting the rights of all concerned.

* This text is part of the larger publication: The Six Habits of Fiscally Responsible Public School Districts. Copyright © 2002 by the Mackinac Center for Public Policy. Posted on the Mackinac web site on Tuesday, December 03, 2002. Republished here in the Government Union Reviewby permission. 


45 Much of this section is adapted from La Rae G. Monk, “Collective Bargaining: Bringing Education to the Table” Mackinac Center for Public Policy Report, August 1998.Back to Text

46 Ibid., pp. 23-24.

47 MCL 423.211.

48 Grief Brothers Cooperage Corp, 42 LA 555 (1964).

49 Bob Chase, “Running on Empty: Why Our New Unions Must Put Teacher Quality First,” Education Week, Jan. 21, 1998, p 14.

50 MCL 38.101, et. seq.; MSA 15.2001 et seq.

51 Saginaw Public School Master Agreement, 1995-1998, Appendix A, p 70.

52 1995 PA 289, MCL 380.1250.

53 See, for example, Kirk A. Johnson, Ph.D., “Do Small Classes Influence Academic Achievement? What the National Assessment of Educational Progress Shows” The Heritage Foundation CDA Report #00-07, June 9, 2000 at and Eric Hanushek, “Some Findings from an Independent Investigation of the Tennessee STAR Experiment and from Other Investigations of Class Size Effects,” Educational Evaluation & Policy Analysis, Vol. 21 (1999), p. 144.

The Sovietization of the American Health Care System. Troy, Leo.

President Clinton's proposal to nationalize America's health care system, under the guise of reform, has run into a fire storm of opposition. To salvage it, and perhaps Clinton's presidency, Senate Majority Leader George Mitchell (D-ME) and House Majority Leader Richard Gephardt (D-MO) have introduced cloned proposals that, like their predecessor, would impose a government-run health care system and its attendant bureaucracy upon a reticent American public.

That the plans would socialize medicine and require the nationalization of an additional 14 percent of the country's Gross Domestic Product is a reality so obvious it scarcely merits debate. But what Dr. Leo Troy finds equally disturbing, is the structure which must be imposed in order to deliver health care if any of these plans are enacted. In "The Sovietization of the American Health Care System," Troy maintains that the structural change is as much an ideological one as a technical necessity.

While the Clinton proposal and its offspring have been variously described as socialistic or collectivistic, Troy sees the bureaucratic structure as requiring a system of administration analogous to that which operated the former Soviet Union. After proposing his case, Troy goes on to analyze the problems it would entail.

The Clinton-Reich Labor Relations Program: What It Is and Will It Work?

Even more dangerous is the Clinton-appointed, 10-member Commission for the Future of Worker-Management Relations that will attempt, under the guise of reviewing American labor law and collective bargaining practices, to find means of reducing labor-management conflict and to neuter those statutes opposed by organized labor. The commission, according to Dr. Leo Troy, in "The Clinton-Reich Labor Relations Program: What Is It and Will It Work?", will not serve the country well by endorsing plans to facilitate unionization. It can only foster a growth in public sector unionism that will mitigate against American business interests and the free market system that is the cornerstone of the American economy.

Permanent Striker Replacements Should Not Be Banned. Irving, John

President Clinton's most staunch support during the 1992 presidential campaign came from organized labor. It is a debt that he began to repay immediately upon assuming office by appointing union favorite Robert Reich as secretary of labor. It is a debt he, through his administration, continues to repay by: proposing to lift the hiring ban on air traffic controllers fired in 1981 for illegal strike activity, rescinding executive orders prohibiting union-only labor agreements on federally-funded construction and requiring federal contractors to inform workers of their rights under the Beck decision, postponing implementation of the new LM-2 and LM-3 union finance reporting forms that would force an accurate accounting of how union money is spent, suspending the rules permitting the use of helpers on government building projects, backing congressional legislation that would ban the hiring of permanent striker replacements and appointing a union-biased commission to rewrite American labor law.

The realization of all these endeavors could dramatically effect labor management relations in this country. In "Permanent Striker Replacements Should Not Be Banned," former National Labor Relations Board general counsel John Irving presents a focused argument detailing how a lifting of the replacement workers ban will destroy the existing balance in union-management relations and precipitate strike activity.

A Balanced Approach to Residency Rules for Local Government Employees. Postuma, Richard.

A Balanced Approach to Residency Rules for Local Government Employees, offers a summary of judicial treatment of residency rules under the federal and state constitutions, Title VII of the Civil Rights Act, estoppel and state labor relations laws. Its author discusses attempts by public employee unions to outlaw residency rules and urges state legislatures to reject union efforts to ban such rules. He concludes that the decision to adopt residency rules should be left up to local officials.

On Strikers and Their Replacements. Baird, Charles W.

In On Strikers and Their Replacements, Dr. Charles W Baird examines the nature of this new legislation in light of the Court's rulings and the 1935 Wagner Act. He follows up a discussion of what some describe as a worker's "natural" right to strike with a critical examination of unionists' arguments favoring passage of the legislation, before presenting his own for retaining the status quo.

As a rule, strikes are called to win wage concessions and nowhere has this been more characteristic over the last three decades than in the labor relations of school districts and their teacher unions. According to the U.S. Bureau of Labor Statistics, teachers' salaries have been rising more rapidly than any other generic group of employees, to an average annual income of $33,015. Still, the usual refrain of union negotiators is that teachers' pay is lower than that of comparably employed workers in the private sector. Yet never, until now, has any factual evidence been brought to bear on that assertion.

Drug and Alcohol Testing in the Workplace: A Public Sector Overview Since Skinner and Von Raab. Kelly, Matthew

Domestically, perhaps there is no more controversial issue confronting management/employee relations in America today than that of the random testing of workers for drug and alcohol use. The moral dilemma it raises in a democratic society attempting to balance the requirements for public safety with an individual's rights to privacy is a profound one. The precise point at which a citizen's inalienable, constitutional guarantee to freedom is infringed upon by forced testing is still being litigated in the courts on a case by case basis.

In Drug and Alcohol Testing in the Workplace: A Public Sector Overview Since Skinner and von Raab, Dr. Matthew A. Kelly, an arbitrator, and Randall M. Kelly, an attorney, provide a status report on the issue in light of the U.S. Supreme Court's two rulings on drug testing. The authors do not involve themselves with an exposition of the moral debate swirling about the topic, but simply provide the reader with a concise analysis of the decisions and their possible ramifications.

Double Breasting and Pre-Hire Agreements in the Construction Industry. Schulman, Stuart.

Since 1983, allies of the construction trades unions have been attempting to maneuver legislation through the U.S. Congress that would prohibit a single employer from simultaneously operating both unionized and nonunionized subsidiaries. In June 1987, the House of Representatives passed a bill that would have banned double breasting or "dual shop" operations, only to see its measure fail to be acted upon by the Senate.

Undaunted by the setback, Senator Edward Kennedy (D-MA) and Representative William Clay (D-MO) have already reintroduced the measure, in the guise of companion bills S. 807 and H.R. 931, in the 101st Congress. In Double Breasting and Pre-Hire Agreements in the Construction Industry, Stuart Schulman provides a history of the controversy, tracing its evolution through various stages of legislation and legal decisions to where it rests today.

Developing a Comprehensive Employee Relations/Human Resources Management Program for Government Agencies. McGinnis, William.

Although the last decade has seen a national decline in the percentage of the American work force that is unionized, public sector unions have continued to make recruitment gains. In the opinion of management consultant William J. McGinnis, Jr. government agencies themselves are partially to blame because deficiencies in, or the nonexistence of, their employee relations programs are forcing many of their workers to seek outside representation by labor unions. The author offers government managers some "how to" advice in Developing a Comprehensive Employee Relations/Human Resources Management Program for Government Agencies for correcting that oversight and maintaining a nonunion work environment. 

Academic Bias in Public Sector Labor Relations.

Dr. Myron Lieberman, long-time member of the National Education Association and the American Federation of Teachers and a major critic of collective bargaining in the public sector, in his acerbic style now attacks the leading academic centers on labor relations in the United States. In "Academic Bias in Public Sector Labor Relation," Dr. Lieberman charges the centers with a pronounced bias in favor of public sector bargaining.

By "bias," he means these centers do not raise questions or conduct research which would challenge the major assumptions of, or the rationale for, public sector bargaining. Me says they generally avoid critical issues concerning the implementation of state bargaining laws. Dr. Lieberman says: "In my opinion, the major reason for this situation is the fact that the professors who teach and conduct research on public sector labor relations frequently have strong professional financial incentives for avoiding such issues."