WARREN BUFFETT IS AGAINST CARD CHECKS

In a recent interview on CNBC, Warren Buffet categorically came out against card checks. He said that he is in favor of secret ballot elections, for it has been a traditional aspect of our American democracy.

Now, Berkshire Hathaway, Mr. Buffet’s multifaceted enterprise, owns many companies that are unionized. Though he claims that unions play an important role in Corporate America, a position with which I have serious disagreements, Mr. Buffet nevertheless understands the damage that would occur if the Employee Free Choice Act  (EFCA) becomes law.

Indeed, the EFCA would result in significantly increased labor costs, thus reducing corporate profitability, which would be reflected in the diminished value of the stocks of companies unionized under the undemocratic rules imposed by the EFCA.

THE END OF COLLECTIVE BARGAINING

Should the Employee Free Choice Act (EFCA) become law, and it seems to be headed in that direction, then Corporate America will be deprived of the kind of collective bargaining that has been an integral part of the labor relations formula since 1935.

The EFCA not only does away with secret ballot elections, but it also mandates binding arbitration when collective bargaining does not produce an accepted in result for a first contract after 120 days of negotiating.

 Unions will have no incentive to make concessions during collective bargaining if they can play out the clock and know that an arbitration panel will take over and produce a result favorable to its interests. For example, an arbitration panel could dictate that companies pay salaries that they can not afford; it can also mandate the amount of union dues and impose stiff penalties for non-payment.

Collective bargaining has always been a process of give and take, where a balance is achieved between competing interests.

There are sufficient laws in place that address the interests of both management and labor. Binding arbitration will obviate those laws and open the door for unions to achieve injurious results that will eat away at the substance of Corporate America.

UNIONS EXPECT EMPLOYEE FREE CHOICE ACT

TO BECOME LAW THIS SUMMER

Andrew Stern, president of the country’s largest union, says he believes that the Employee Free Choice Act (EFCA) will become law by this summer. He believes that here are sufficient votes in both houses of Congress to pass EFCA, also known as Card Checks.

The balance of power between unions and management that has been in force since 1935 as a result of secret ballot elections will have been eliminated.

And if Stern is correct, and we believe that he is, then Corporate America will find itself facing numerous new organizing efforts, driving up labor costs and driving down profits. In fact, some companies may be driven out of business, thus adding to an already dire recession.

Corporate America must learn new and effective techniques for dealing with Card Checks. Such techniques include new strategic communications plans that result in ending the adversarial relationship that often exists between management and workers.