Ted Boettner: Nothing ‘Free Market’ about Right to Work

Charleston Daily Mail - The Legislature is looking to end free bargaining in West Virginia by adopting a so-called “right-to-work” law.

The result would be cutting wages and benefits for the state’s working families. West Virginia already has the highest share of low-wage jobs in the country.

The principle aim of right-to-work laws is to diminish the ability of workers to collectively bargain freely without the interference of government. This is precisely why Milton Friedman, the godfather of “free market economics,” adamantly opposed right-to-work laws.

Under right-to-work, it would be illegal for a union and a business to freely enter into a contract that requires every employee to pay for the benefits they are receiving under the agreement.

This means that if a worker who does not pay a union representation fee is fired, the law requires that the union represent that worker through an appeals process. Non-dues paying workers would also receive other substantial benefits like workplace protections and higher wages and benefits.

Right-to-work laws have nothing to do with forcing people to join a union or contribute to political causes they don’t support — that’s already illegal under federal law. The only freedom workers would receive is the ability to get something for nothing.

The requirement to pay a representation fee as a condition of employment is nothing unique to collective bargaining agreements.

For example, if an attorney wants to appear in court in West Virginia, he or she has to pay dues to the West Virginia Bar Association. Or if you want to work for United Parcel Service, a condition of your employment is to wear a brown uniform. No one is talking about banning employers from these practices.

What tends to happen in right-to-work states is that non-union members who get a “free ride” — while receiving all of the benefits contained in the collective bargaining agreement — opt out of becoming union members. This results in less money through dues and a weaker union, which ultimately strengthens the employers’ hand in bargaining for lower pay and benefits.

A case in Kentucky further illustrates this “free-rider” problem with RTW laws. Several years ago, the local Building Trades Council in Owensburg, Ky., asked the local Chamber of Commerce if it could withdraw its membership and still receive all of the benefits. The Chamber responded by stating: “It would be against Chamber by-laws and policy to consider any organization or business a member without dues being paid. The vast majority of the Chamber’s annual revenues come from member dues, and it would be unfair to the other 850 plus members to allow an organization not paying dues to be included in member benefits.”

The one thing proponents and opponents of right-to-work laws agree on is that these laws are intended to lower wages and benefits, decrease unionization, while aiming to encourage outside investment in the state. While this might make West Virginia a cheap place to do business, it doesn’t make it a good place to do business if there is less consumer demand in the local economy and additional need for public assistance.

Instead of using the power of the state to reduce the power and income of workers, policymakers should be focusing on moving more people into the middle class.

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