Business News

For Immediate Release          Contact: Monica Stewart

                                                       (703)-242-5840                                                                 

Small Business Group Warns States on Union "Card-Check" Legislation

Oakton, VA -- Today, the Small Business & Entrepreneurship Council (SBE Council) warned state lawmakers across the nation that passing state-level versions of a labor union "card-check" bill would raise costs for businesses, and be a negative for their states' competitiveness and economies. This will be reflected in the forthcoming 2008 edition of SBE Council's "Small Business Survival Index."

Specifically, if states pass a "card-check" bill it will be counted as a negative on the 2008 edition of the "Small Business Survival Index." The Index, which is an annual report compiled by SBE Council, ranks the states according to their public policy climates for entrepreneurship and small business.

SBE Council President & CEO Karen Kerrigan explains: "Card-check, which eviscerates the current right employees have to cast a private vote regarding whether they want union representation or not, enables abusive organizing tactics.  This mandated approach to union organizing - where everyone in the workplace would know how each individual feels about union representation - will only serve to establish an environment that is ripe for harassment and underhanded tactics. This unfair, turn-key approach to forced unionization will be especially burdensome and costly for small businesses."

At the federal level, the U.S. Congress is debating the so-called "Employee Free Choice Act," H.R. 800, which not only replaces the employee's right to a private vote with the card-check scheme, but also imposes binding arbitration on small firms.  If a small business owner cannot agree to contract terms within a 90-day window with their employees' new union representatives, government will be called in to help fashion the agreement - or, dictate the terms of the contract. The agreement would be binding for two years, which ties the business owners' hands regarding cost and other operational decisions. Of course, business owners need flexibility and control in making critical decisions in the fast-moving and uncertain global economy. (H.R. 800 passed the U.S. House in mid 2007, but is tied up in the U.S. Senate.) 

SBE Council chief economist Raymond J. Keating added: "The ‘card-check' bill would boost the level of unionization, increase costs, and restrain productivity. That, of course, means that businesses become less competitive. Of course, in the long run, both business owners and employees would suffer."

The "Small Business Survival Index" is perhaps the most comprehensive gauge available of how state and local policymakers treat entrepreneurs and small businesses.  The measurements covered include taxes, various regulatory costs, government spending, property rights, health care and energy costs, and much more. The 2007 Index considered 31 major government-imposed or government-related costs affecting small businesses and entrepreneurs.

Some governors have had the opportunity to act on state card-check bills involving private employers, and the outcome has been generally positive for small business.

"California Governor Arnold Schwarzenegger and Hawaii Governor Linda Lingle deserve credit for their vetoes of state-level versions of the labor union ‘card-check' bill.  Both these Governors understand what the bill would do to harm worker privacy and their states' competitiveness," said Kerrigan.

She also noted that Minnesota Governor Tim Pawlenty wisely vetoed a state legislative resolution urging Congress to pass the ‘Employee Free Choice Act.'

SBE Council can be contacted at 703-242-5840. SBE Council is a nonpartisan, nonprofit small business advocacy and research organization.  The organization has worked to protect small business and promote entrepreneurship for fourteen years.  For more information, please visit http://www.sbecouncil.org/.

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