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^ TEAMWORK FOR EMPLOYMENT AND
MANAGEMENT ACT OF 1995





HEARING

OF THE

COMMITTEE ON

LABOR AND HUMAN RESOURCES

UNITED STATES SENATE

ONE HUNDRED FOURTH CONGRESS

FIRST SESSION



PERMITTING LABOR MANAGEMENT COOPERATIVE EFFORTS THAT IM-
PROVE AMERICA'S ECONOMIC COMPETITIVENESS TO CONTINUE TO
THRIVE, AND FOR OTHER PURPOSES



FEBRUARY 9, 1995



Printed for the use of the Committee on Labor and Human Resources



l__^£C 2 8 2,




U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON : 1995



For sale by the U.S. Government Printing Office /
Superintendent of Documents. Congressional Sales Office. Washington, DC 20402
ISBN 0-16-047077-3



TEAMWORK FOR EMPLOYMENT A^



S. Hrg. 104-20

AND




MANAGEMENT ACT OF 1995




HEARING

OF THE

COMMITTEE ON

LABOR AND HUMAN RESOURCES

UNITED STATES SENATE

ONE HUNDRED FOURTH CONGRESS

FIRST SESSION



PERMITTING LABOR MANAGEMENT COOPERATIVE EFFORTS THAT IM-
PROVE AMERICA'S ECONOMIC COMPETITIVENESS TO CONTINUE TO
THRIVE, AND FOR OTHER PURPOSES



FEBRUARY 9, 1995



Printed for the use of the Committee on Labor and Human Resources







For sale by the U.S. Government Printing Office
Superintendent of Documents. Congressional Sales Office, Washington, DC 20402
ISBN 0-16-047077-3



.^^ATii^



*



COMMITTEE ON LABOR AND HUMAN RESOURCES

NANCY LANDON KASSEBAUM, Kansas, Chairman
JAMES M. JEFFORDS, Vermont EDWARD M. KENNEDY, MaasachuBctts

DAN COATS. Indiana CLAIBORNE PELL, Rhode Island

JUDD GREGG, New Hampshire CHRISTOPHER J. DODD, Connecticut

BILL FRIST, Tennessee PAUL SIMON, Illinois

MIKE DeWINE, Ohio TOM HARKIN, Iowa

JOHN ASHCROFT, Missouri BARBARA A. MIKULSKI, Maryland

SPENCER ABRAHAM, Michigan PAUL D. WELLSTONE, Minnesota

SLADE GORTON, Washington

Susan K. Hattan, StafT Director
Nick Littlefield, Minority Staff Director and Chief Counsel

(II)



CONTENTS



STATEMENTS
February 9, 1995



Page

Kassebaum, Hon. Nancy Landon, a U.S. Senator from the State of Kansas 1

Pell, Hon. Claiborne, a U.S. Senator from the State of Rhode Island 2

Skiba, Don, plant manager, Julie Smith, team advisor, John Albertson and
Angie Cowan, team members, TRW, Cookeville, TN; Kevin King and Lori

Garrett team members, Eastman Chemical, Kingsport, TN 8

McCammon, Chester, team member. Universal Dynamics Corp., Woodbridge,
VA; Harold P. Coxson, Coleman, Coxson, Penello, Fqgleman & Cowan,
Washington, DC; David M. Silberman, director, AFL-CIO Task Force on
Labor Law, Washington, DC; and Bema Price, Electromation, Inc., Elkhart,
IN 28

APPENDIX

Statements, articles, publications, letters, etc.;

Don Skiba 51

Julie Smith 51

Johnny Albertson 52

Angie Cowan 53

Kevin King 54

Lori Garrett 55

Chester McCammon 56

Harold P. Coxson 57

David M. Silberman 61

Gloria T. Johnson 64

"Workshop On The Potential Impact Of Alterations to Section 8(aX2)

On Unions And Union Organizing Campaigns", by Charles J. Morris .... 66

National Association of Manufacturers 75

Howard V. Knicely 77

"Restoring the Promise of American Labor Law", by James R. Rundle 88

Letter to Senator Kassebaum, from Kathleen K. Brickley, Barnes &

Thomburg 105

(in)



TEAMWORK FOR EMPLOYMENT AND
MANAGEMENT ACT OF 1995



THURSDAY, FEBRUARY 9, 1995

U.S. Senate,
Committee on Labor and Human Resources,

Washington, DC.
The committee met, pursuant to notice, at 9:37 a.m., in room
SD-430, Dirksen Senate Office Building, Senator Nancy Kasse-
baum (chairman of the committee) presiding.

Present: Senators Kassebaum, Frist, DeWine, Gorton, Kennedy,
Pell, Simon, Harkin, and Wellstone.

Opening Statement of Senator Kassebaum

The Chairman. The hearing will please come to order.

There are going to be other Senators coming — I am not going to
be the only one here — but Senator Kennedy has said please go
ahead and start. He is on his way, as are other Senators.

Before I call the first witnesses, let me just give an opening
statement which will give a little background on the legislation
that we are going to be discussing today.

We are going to be hearing testimony on the cutting edge of
human resource practices. It is always hard for us to begin to tnink
anew of ways that we can work in the workplace or work in the
Congress; we have a hard enough time just thinking about ways
to change our committees. But I think that if we really want to get
ahead and make a constructive effort wherever we are, that we
have to be willing to think anew.

Employee involvement programs have grown steadily over the
last several years, and I think it is important that the committee
listen to employees, management, and organized labor as they de-
scribe what is happening in the American workplace.

I believe that both labor and management must take a fresh ap-
proach to worker-management relations. The old, adversarial ap-
proach squanders resources and increases worker and management
frustration with the system.

In the private sector more and more these days, we are seeing
that cooperation is taking the place of confrontation. Both workers
and supervisors are beginning to realize that they are on the same
team; they are fighting for a higher standard of living, greater mar-
ket share, and improved productivity. Both workers and manage-
ment need to cooperate if they are to enjoy mutual prosperity.

One tool that workers and supervisors need to meet the chal-
lenge of economic competition is employee involvement. Workers

(1)



have an important contribution to make, and often they know more
than their supervisors do about how to get the job done.

Employee teams now tackle problems that only corporate execu-
tives would have dealt with in the past — quality control, budgets,
scheduling, and hiring decisions.

I think it is very important for us to be able to encourage this
kind of involvement. In my mind, it takes nothing away from the
work that unions have done; it takes nothing away from employees
who have performed these functions in the past. But we must be
willing to consider new ways of doing things.

Regrettably, Federal labor law establishes a significant legal bar-
rier to worker-management cooperation and employee involvement.
In the National Labor Relation Board's Electromation decision, the
board invalidated one company's worker-management committee.
The decision has called into question the legality of all employee
involvement programs.

Along with Senators Jeffords, Gregg and Gorton, I have intro-
duced the Teamwork for Employees and Management Act, which is
Senate bill 295, which would permit workers to meet with super-
visors to address issues of mutual concern, including quality and
productivity issues, without running afoul of Federal labor laws.

This bill is not a new Federal program. It is not designed to give
employers free rein over employees. Instead, it simply removes the
legal barriers to private sector employee involvement programs and
allows the flexibility for a variety of different employee team efforts
to move forward.

This morning, we will hear fi-om members of worker teams at
TRW, Eastman Chemical, Universal Dynamics and Electromation,
as well as experts in labor law. I look forward to hearing the testi-
mony of the witnesses this morning.

Senator Pell, welcome. Do you have an opening statement you
would like to make?

Opening Statement of Senator Pell

Senator Pell. Yes. Thank you very much, Madam Chairman,
and thank you for holding this hearing.

As some of you know, I have had a longstanding interest in what
we can do to establish better relations between labor and manage-
ment. Before coming to the Senate, I became familiar with the sys-
tem of labor-management relations in various technologically ad-
vanced nations in Europe. In many of those nations, employee rep-
resentation on the various company boards is mandated by law.
While not directly transferable to the United States, I do think we
can learn from the European experience and their "co-determina-
tion," which is what it is called when you have an equal number
of labor and management on boards of directors. It can work and
can produce better labor relations peace than is otherwise the expe-
rience.

In the past, during the heyday of the assembly line, a worker
performed the same procedure hour after hour, day after day. The
old view of manufacturing — thank goodness, the old view — was
"Check your brains at the door." Employers were interested in two
hands and ten fingers, and that was about it.



That philosophy is no longer valid. Our work is becoming more
and more high-tech, with integrated circuits replacing vacuum
tubes, and we no longer compete with each other but with other
nations. It is no longer acceptable just to produce in quantity; now
we must make goods with quality, and that is most important.

To meet these demands, we need all our players on the field, not
just the ones with the white collars. The men and women in the
production plant know, through experience, things about the prod-
ucts they produce that the engineers, the accountants and the man-
agers can never know. They know how to produce better, smarter,
faster, and cheaper; vital information for any enlightened, competi-
tion-minded company.

With these ideas in mind, I introduced legislation in the 103rd
Congress that would amend the National Labor Relations Act to
permit employers and employees to join together to form workplace
committees, with everyone bringing their concerns and their solu-
tions to the table.

Senator Kassebaum's TEAM Act I think places too much control
of the workplace committees in the hands of employers, with little
protection or guarantees for the employees. Language of this kind
resurrects thoughts of the "company unions" of the past, which I
know is not what the Senator from Kansas means, but it could
move in that direction.

So I just want to throw out on the table this thought of co-deter-
mination, which has worked in keeping labor-management peace in
Germany and the countries of Europe, because you have a board
of directors evenly divided between labor and management. In our
own country when the idea is floated, you fmd both labor and man-
agement are afraid of co-determination and do not want it, and I
hope that this hearing might enlarge on that.

Thank you.

The Chairman. Thank you very much, Senator Pell. I appreciate
it, and know that you have a keen interest in addressing these
changes in the workplace as do I, and I look forward to seeing what
we can come up with. Before we begin I have statements from Sen-
ators Harkin, Mikulski, and Wellstone.

[The prepared statements of Senators Harkin, Mikulski, and
Wellstone follow:]

Prepared Statement of Senator Harkin

I appreciate having the opportunity to express my strong opposi-
tion to S. 141 which would repeal the Davis-Bacon Act. Repealing
this act will have serious impacts on our nation. Over 500,000 con-
struction workers earn the prevailing wage because of the Davis-
Bacon Act. Do they deserve to earn less than other construction
workers in their area simply because they work on a project sup-
ported by the Federal Government?

The people that build our highways, bridges, and federal build-
ings ought to receive a fair and decent wage. Many will claim that
the hourly wage for construction workers is already too high, but
they fail to give the full picture. Construction work is seasonal and
sporadic at best, many of these workers must earn enough to sup-
port their families on one third fewer hours than most other work-
ers.



A 1993 study by the Bureau of Labor Statistics showed that the
average annual wage in the construction industry is well below
that of many other major industries.

I would hate to think what the repeal of Davis-Bacon would do
to that average and what effect that would have on the families of
construction workers. These workers ought to be able to raise their
families, feed and clothe them, and educate them. They are the
people that build this country and we can accept no less than that.

We can also accept no less than the best quality work for our tax
dollar. Without the Davis-Bacon requirements it would be far to
easy for a contractor to use less skilled, less experienced workers.
And frankly, as a taxpayer, if I am going to be paying to build
something under the auspices of the Federal Government, I want
it to be built well. I want it to be built to last by quality, skilled
labor. Cheaper is not necessarily better. Shoddy construction will
cost more in repairs and replacement in the long run than building
it right the first time. Repealing this act would be bad policy and
unfair to America's workers, it would have serious and expensive
consequences for our country.

Prepared Statement of Senator Mikulski

Madam Chair, I am here today to oppose the repeal of the Davis-
Bacon Act.

The Davis-Bacon Act requires contractors who are getting paid
under a Federal public works contract to pay their workers the pre-
vailing wage in the local area.

What's this mean to people in their day-to-day lives? It means a
liveable wage and a decent job for a hard-working American — that
is the heart of the Davis-Bacon Act and goes to the core of my val-
ues. I stand strong by these values and by the values in the Davis-
Bacon Act.

Millions of Americans are facing fiscal crisis. The middle class is
playing by the rules, working hard at their jobs, at raising their
families, and at contributing to their communities. But they feel
like they are going nowhere because of wage stagnation.

Building trades have been especially hard hit in recent years.

The men and women who work in the building trades don't own
stock certificates. But they've invested in America. They have in-
vested their sweat equity. But the promoters of "the Davis-Bacon
Repeal Act" wants to take workers' sweat and keep the equity.

I believe that is wrong.

I believe we need to create more good jobs with a liveable wage,
not decimate decent jobs.

The essence of Davis-Bacon is Federal funds will be used to pay
workers a wage that is fair in their community.

I am a blue collar Senator, and I believe that Davis-Bacon is an
act of basic fairness to blue collar workers across the United
States.

Madam Chair, that is why I stand sentry against any effort to
repeal the Davis-Bacon Act.



Prepared Statement of Senator Wellstone

Our hearing today is designed to explore a matter that's critical
to American working men and women. It goes to the very core of
Federal labor laws that are supposed to protect workers' rights to
organize and bargain collectively in a free and democratic work-
place. It goes to the central right to be represented by an independ-
ent labor organization.

Contrary to the claim of its proponents that it's a harmless clari-
fication of existing law, the bill proposed by Senator Kassebaum
would further impair the right of workers to freely choose their
representatives. At least in principle, if not always in practice, that
right is supposed to be protected in this country under our labor
laws. By permitting the unilateral creation by an employer of an
employee committee, this bill violates the fundamental principle
that in bilateral relationships, each party must be free to choose its
own representatives and to decide those issues about which it
wants to negotiate. Otherwise, instead of bringing two sides to the
table for real negotiations, employers end up being on both sides
of the table at once. To combat that problem, labor organizations
must be free of employer control or interference.

I don't think I need to rehearse the long and sorry history of
labor relations in this country in the 1920's and '30s to illustrate
the problems with sham company unions. In attempting to meet
employers' desires for greater flexibility, we must not overlook dec-
ades of American workers' struggles to secure and maintain legiti-
mate collective bargaining rights.

As former Senator Wagner observed on the Senate floor many
years ago, when the Wagner Act which is named after him was
first passed, one of the central tenets of labor law is that workers
and employers must be able to deal with each other on an equal
footing. I'm all for flexibility and international competitiveness and
high-performance workplaces, and my state has led the way in
some of these areas. But not at the expense of workers' rights. As
former union president Douglas Fraser observed in the Dunlop
Commission report, real participation and cooperation means demo-
cratic participation and cooperation between equals.

The National Labor Relations Act (NLRA), which this bill would
amend, at least creates a mechanism — the selection by workers of
a bargaining representative — through which American workers can
establish independent trade unions that are key to real representa-
tion and collective bargaining. It was carefully designed to prohibit
employer-dominated unions, and it has stood the test of time very
well.

Proponents of S. 295 claim that it is necessary to "clarify" the ap-
plication of the NLRA to workplace employee involvement pro-
grams in a new climate of labor-management cooperation. They
claim it is necessary to address ambiguities raised by a 1992 Na-
tional Labor Relations Board (NLRB) decision in the Electromation
case which involved a firm in Elkhart, IN. Frankly, I am not sure
what they're talking about. I haven't seen much evidence of an im-
proved labor-management climate, and I haven't seen any evidence
of the need for this legislation. In fact, in a political environment
in which workers cannot even come close to getting a permanent



6

ban on the replacement of striking workers enacted into law, when
workers are afraid to exercise their most basic employee right of
all, the right to withhold their labor, the claims about a "new cli-
mate" of labor-management cooperation ring hollow.

In the Electromation decision, the NLRB ruled that certain types
of workplace organizations commonly referred to as "employee par-
ticipation committees," "action committees," or "quaHty circles"
may be illegal unless these committees are free of employer domi-
nation, and unless employees have the right to choose their own
representatives on the committees. The NLRB — including those
members of the board who were appointed by Republican Presi-
dents — applied a traditional interpretation of the labor laws, and
concluded that this was a clear case of a company-dominated em-
ployee organization that was basically thrust upon workers under
the guise of an employee participation scheme.

It was thrust on them, not coincidentally, at about the same time
that a union organizing drive was getting underway in the plant —
a familiar pattern in these disputes. We'll hear about that situation
from the perspective of a worker involved later today, and I look
forward to her testimony. Following the NLRB decision, a Federal
court in the seventh circuit then upheld the NLRB ruling in a
unanimous decision.

In politics, perception is often more important than reality, and
I think that is the problem we are faced with today. In looking over
the evidence, I see a troubling contradiction. On the one hand, pro-
ponents argue that there are over 30,000 employee involvement
programs across the country right now, and more being created
each month. On the other, they claim that the law needs to be
changed to allow these committees to flourish. What seems clear to
me is that the practical result would be to allow committees to get
into all sorts of areas of mandatory bargaining — including wages
and working conditions — that they're prohibited from addressing
now.

Current law certainly does not prohibit all employee involvement
committees nor other mechanisms to enhance employee-employer
communication. The Electromation decision merely interprets the
law to ensure that employee involvement programs are structured
so that they don't infringe upon the legitimate rights of employees
to select their own representatives to committees, and don't in-
fringe upon legitimate collective bargaining procedures. The prohi-
bition in current law against employer-dominated sham unions
should not affect legitimate efforts to encourage employee-manage-
ment cooperation in the workplace.

This bill is a solution in search of a problem. That's why Con-
gress should avoid hasty legislative actions to amend the NLRA to
overturn decades of carefully-crafted NLRB decisions and Federal
court rulings in this area. In reality, the Electromation decision is
very narrow in its scope, addressing a particular set of facts and
circumstances at a particular workplace.

In fact, it is fairly easv for companies to structure employee in-
volvement programs so that democracy in the workplace and work-
er choice are protected, and many have. Prominent management
attorneys, one of whom was a former chairman of the NLRB, testi-
fied to this in a paper he presented to the Dunlop Commission. In



fact, he even had the candor to observe that "while I represent
management, I do not kid myself. If section 8(a)2 of the NLRA
were repealed, I have no doubt that in not too many months sham
company imions would again recur."

That's not a labor union official making that claim — that's a dis-
tinguished management attorney. When you consider that S. 295
would effectively repeal the prohibition on employer dominated
committees, or at least make the standards so vague as to be inef-
fective, you begin to see the real problem, and the real agenda of
some who are supporting this bill. In fact, I suspect that one real
reason the management community has pushed this bill so hard is
that some of them are worried that many existing employee partici-
pation programs could not withstand scrutiny of the NLRB under
current law.

Today many companies around the country are using many and
varied forms of employee involvement structures, not all of which
could or should be addressed in legislation. Electromation and
other subsequent NLRB decisions have not significantly impeded
these efforts. In fact, a recent study found that the NLRB had
acted against only 17 such employer dominated committees in the
last eleven years — less than two per year — and that most of those
were in workplaces where other unfair labor practices had been
discovered and documented, including interrogations, threats to
shut down and lay off workers, surveillance, and discriminatory
firings. I know of no instances where the NLRB has recently ruled
against employee participation programs in the absence of other il-
legal practices. I ask unanimous consent that studies by Mr. James
R. Rundle and Mr. Charles J. Morris be reprinted at the end of my
statement.

Of course, some of these employee committees provide useful
channels of communication between employees and employers, and
should be encouraged. But as the Electromation decision warns,
companies should be careful in how they structure committees so
that legitimate bargaining and other rights of employees are pro-
tected.

This bill is not only unnecessary, but it could do serious harm
to workers throughout the country. I've heard from numerous Min-
nesota workers concerned about this bill, but frankly I've not heard
from many Minnesota employers who are unhappy about the guide-
lines for employee involvement set by current law. Minnesota em-
ployers have been living with this law for decades.

I had thought conservatives generally liked to be in the wait-just-
a-minute category when it comes to changing the NLRA. Not on
this issue, apparently. We should not attempt to change the law in
this area unless and until a clear body of evidence is developed
that legitimate employee involvement programs that deal with is-
sues incidental to collective bargaining matters are being con-
strained, and that is not the case. In fact, they are growing rapidly.
The guiding maxim here should be: "If it ain't broke, don't fix it."

If we are going to talk about amending the National Labor Rela-
tions Act, then we should start by considering all of the numerous
suggestions offered by the Dunlop Commission to make it easier for
workers to organize and bargain collectively, to get recognized
without long and painful battles, and to gain first contracts quickly



8

once recognized. And we might even broaden the debate to consider
some more innovative approaches that were not put forth by the
Commission. We need comprehensive reform of the rules covering
organizing efforts. But whatever we do, let's keep in mind the Com-
mission's recommendation that we must carefully maintain the cur-


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Online LibraryUnited States. Congress. Senate. Committee on LaboTeamwork for Employment and Management Act of 1995 : hearing of the Committee on Labor and Human Resources, United States Senate, One Hundred Fourth Congress, first session, on permitting labor management cooperative efforts that improve America's economic competitiveness to continue to thrive, and → online text (page 1 of 16)