The Employee Free Choice Act (EFCA) or "Card Check" contains several provisions that would be harmful for both workers and firms. Perhaps most disconcerting is the provision for mandatory, or binding, arbitration. This requirement would disrupt the current balance of power in our labor market by depriving workers and firms of common law rights, appointing government lawyers to step in and take control, and imposing binding contracts through a process that is likely unconstitutional.

Mandatory arbitration would rob workers of basic rights

In current labor law, once a firm is unionized, the firm and the workers must negotiate in "good faith." This good faith bargaining process moves forward because of economic pressures to secure contracts efficiently and quickly. Firms and workers must compromise because of the threat of strikes, lockouts, or worse. If they fail to reach a decision in a timely manner, the National Labor Relations Board can prosecute the firm for unfair labor practice.      

Under the mandatory arbitration principle set forth in EFCA, firms would face a 120-day time table in negotiating a first contract with newly-unionized workers. If the 90 days of bargaining (followed by 30 days of mediation) do not produce a contract, the Federal Mediation and Conciliation Service will appoint a government arbitrator to create a contract that is binding for two years.

This contract could not be reviewed by any court, and workers would not have the chance (as they do now) to vote on it. Furthermore, the contract could not be broken for two years, making it more difficult for workers to get rid of a union if they later chose to do so.

Mandatory arbitration takes away the incentive to compromise

With a 120-day deadline looming, neither firms nor workers would feel pressure to work together during the negotiation period. Instead, their demands would become polarized, because both sides would expect the government arbitrator to come soon and force a deal.

Government-appointed arbitrators should not make fundamental business decisions

The collective-bargaining process works best when those closest to the business (that is, the workers and the firm itself) can handle decisions without the influence - or complete takeover - of outsiders. Outsiders are not aware of the nuances of each business dispute, the competitive positioning of each firm in the market, or other factors relating to each case.

Mandatory arbitration is constitutionally suspect

Mandatory arbitration was rejected in the Wagner Act (1935) and Taft-Hartley (1947). Additionally, when Congress passed the National Labor Relations Act (NLRA), mandatory arbitration was declared incompatible with collective bargaining. The Supreme Court also noted that had mandatory arbitration been a part of the NLRA, it would have been unconstitutional because it infringes upon the right to contract.

The mandatory arbitration provision in EFCA is not good for workers, not good for firms, and not good for the American economy. It takes power away from businesses and puts it in the hands of the government.