National Clothesline

The new Secretary of Labor, Hilda Solis, addressed the AFL-CIO Executive Council early in March. The Executive Council runs the largest association of unions in the country.

She actually used the phrase “new sheriff in town.” Well, this new sheriff has decided that the federal government has picked on corrupt unions long enough, and now is the time to start regulating employers with greater fervor.

Secretary Solis made it a point to tell her audience that her parents were staunch union members. It appears that the Department of Labor’s “new sheriff” wants to make it clear to big labor that she is no friend of business.

In a related development, President Obama has renewed his support for the Union Affirmative Action Bill, known more commonly as the Employee Free Choice Act. Under this law, employees lose the protection of the secret ballot election in deciding the critical question of union representation.

“Free choice” apparently means choice in front of union business agents and other employees, not choice in the privacy of a voting booth. The US Chamber of Commerce has budgeted $10 million to fight against the bill, which in my opinion, is not nearly enough.

Nothing coming out of Washington, DC, is good for business. Even the economic stimulus stuff, laden with earmarks and Democratic Party pork, does not help small business in any significant way. Instead of making it easier for businesses to operate and create jobs, this administration appears committed to making over this country into an anti-employer, pro-union economy. Rewarding failure and punishing success cannot be good for the economy.

I expect that 2009 will be the year that my practice, which is strongly concentrated in management-side labor and employment law, undergoes dramatic changes. At a time when companies will need to reward good employees and get rid of bad ones, they will not have the money to do the former, and federal and state laws will hinder their ability to do the latter.

Unions try to protect the worst employees, and they hate compensation schemes that differentiate between employees based on skill and ability. So, if unionism increases under the Employee Free Choice Act, we could see more companies weighed down by dead-weight employees.

If discrimination laws are made more onerous for employers, the problem of dead-weight employees will be multiplied. Discrimination laws are frequently used by poor employees to keep their jobs; they understand that employers do not want to spend thousands of dollars defending discrimination claims.

President Obama has already signed legislation making it easier for employees to sue for discrimination that occurred years ago, reversing a Supreme Court case that said employees have to sue when the alleged discrimination occurred.

The key to surviving the coming shift to a pro-union, anti-employer government is to start making changes now. First, make your organization as efficient as you can, eliminating the kind of employees who would favor more job protection because they need it (or would benefit from a union committed to protecting the worst employees).

Second, make sure your best employees are properly rewarded, including the best supervisors.

Third, make sure your employees know the company’s position on unionization, and the reasons why you believe a union would not be good for you or them.

Imagine how easy it would be for a union to organize a company filled with marginal employees, whose better employees have no idea what unionization means or whether the company favors or opposes it. Besides, it’s always a good idea to have regular communication with your employees. There is no reason why unions can’t be a topic you cover.

Getting back to the new sheriff, Hilda Solis, you need to audit your wage and hour practices. If you are not paying people properly, seek advice on how to come into compliance without opening up a whole can of worms with your employees.

All you need is one employee to complain to the Department of Labor to start an audit; plus, there are many do-gooder organizations that provide legal services to employees who claim that they are being compensated improperly, including employees paid in cash under the table.

Secretary Solis also oversees the Deputy Secretary of Labor in charge of the Occupational Safety and Health Administration. I assume she intends to step up enforcement of the nation’s safety laws, which were enacted under a Republican President for those of you keeping count. In fact, Nixon signed OSHA in 1970, and George H.W. Bush in 1991 signed one of the most liberal enhancements to the Civil Rights Act in 25 years. The same Bush signed the Americans With Disabilities Act.

If Republicans can be so anti-employer, imagine what the Democrats are now capable of doing.

Do not wait for more bad news from Washington to pay attention to your labor and employment situation. The time to act is now, before the government has the chance to tell you exactly what you can and cannot do.