To the Congress of the United States:
I am transmitting to Congress proposals to make the laws which govern labor-management relations work more efficiently, quickly and equitably.
I have pledged to make Federal regulatory agencies more responsive to the people they serve. Government regulation only works well if it is fair, prompt and predictable. Too often this has not been the case with the regulatory process that governs collective bargaining and labormanagement relations. Our labor laws guarantee employees the right to choose freely their representatives, and to bargain collectively with employers over wages, fringe benefits and working conditions. But legal rights have limited value if many years are required to enforce them.
The National Labor Relations Board (NLRB) administers our labor laws. In recent years there has been growing agreement that those laws should be amended to ensure that the Board can function more effectively to protect employees rights. While the great majority of employers and unions have abided by the labor laws, a few have unfairly abused the procedures and practices under which the Board must operate.
As a result, the American Bar Association, many Federal courts, and the NLRB's own Task Force each recently suggested ways to improve the Board's procedures. The NLRB's internal report, which proposed a number of administrative changes, has already produced some beneficial changes. But it seems clear that legislation is actually needed to enable the Board to administer the labor laws properly.
Unnecessary delays are the most serious problem. In even the simpler cases, the NLRB typically takes almost two months to hold an election to determine whether workers want union representation. The enforcement of Board decisions is also subject to unnecessary delay: lengthy proceedings before the Board and extended litigation can sometimes delay final action for years.
The problem of delay has been compounded by the weakness of the Board's remedies. One of the reasons the regulatory process has worked so slowly is that a few employers have learned that, because of the problems the Board has in enforcing its decisions, delay can be less costly than initial compliance with the law. In one case, for instance, workers who were illegally fired for their union activities in 1962 are still awaiting payment for lost wages.
Because of these problems, workers are often denied a fair chance to decide, in an NLRB election, whether they want union representation. The same problems often deny employers the predictability they too need from the labor laws.
To help reduce the problems of delay, and to cure a number of related problems with our labor laws, I am today recommending to the Congress a set of reforms for the National Labor Relations Act. These reforms are designed to accomplish three important goals:
--To make the NLRB procedures fairer, prompter, and more predictable.
--To protect the rights of labor and management by strengthening NLRB sanctions against those who break the law.
--To preserve the integrity of the Federal contracting process by withholding federal contracts from firms that willfully violate orders from the NLRB and the courts.
I believe these goals can be met through the following changes in our labor laws:
• An election on union representation should be held within a fixed, brief period of time after a request for an election is filed with the Board. This period should be as short as is administratively feasible. The Board, however, should be allowed some additional time to deal with complex cases.
• The Board should be instructed to establish clear rules defining appropriate bargaining units. This change would not only help to streamline the time-consuming, case-by-case procedures now in effect, but would also allow labor and management to rely more fully on individual Board decisions.
• The Board should be expanded from five to seven members. This change would enable the NLRB to handle better its increasing caseload.
• The Board should establish procedures that would allow two members of the Board to affirm summarily the less complex decision of its administrative law judges. Similar procedures have already been adopted by the Federal courts of appeal.
• All appeals of Board decisions should be required to be filed within 30 days of the Board's decision. If no appeal is filed, the Board should refer its orders to the courts for enforcement without further delay. This procedure is similar to that used by such other Federal regulatory agencies as the Federal Trade Commission.
• When employers are found to have refused to bargain for a first contract, the Board should be able to order them to compensate workers for the wages that were lost during the period of unfair delay. This compensation should be based on a fixed standard, such as the Quarterly Report of Major Collective Bargaining Settlements published by the Bureau of Labor Statistics (BLS). Workers would be entitled to the difference between the wages actually received during the delay and those which would have been received had their wages increased at the average rate for settlements reported during that period, as recorded in the BLS index.
• The Board should be authorized to award double back-pay without mitigation to workers who were illegally discharged before the initial contract. This flat-rate formula would simplify the present time-consuming back-pay process and would more fully compensate employees for the real cost of a lost job.
• The Board should be authorized to prohibit a firm from obtaining Federal contracts for a period of three years, if the firm is found to have willfully and repeatedly violated NLRB orders. Such a debarment should be limited to cases of serious violations and should not affect existing contracts. This restriction could be lifted under two conditions: if the Secretary of Labor determines that debarment is not in the national interest, or if the affected Federal agency determines that no other supplier is available.
• Under current law, the Board is only required to seek a preliminary injunction against a few types of serious union unfair labor practices, such as secondary boycotts or "hot cargo" agreements. The Board should also be required to seek preliminary injunctions against certain unfair labor practices which interfere seriously with employee rights, such as unlawful discharges.
There are related problems that should also be reviewed by the Congress in this effort to ensure that our labor laws fulfill the promise made to employees and employers when the Wagner Act was passed 42 years ago-that working men and women who wish to bargain collectively with their employers, in a way fair to both, shall have a reasonable and prompt chance to do so. In that way, the collective bargaining system, which has served this country well, can be strengthened for the benefit both of American workers and employers.
I have asked the Secretary of Labor to work closely with the Congress in the months ahead to explore these and other possible ways of improving our labor laws.
I ask the Congress to move promptly to pass legislation implementing the reforms I have recommended.
The White House,
July 18, 1977.