Labor & Employment Law

Business Professors: Employee Free Choice Act Good for the Economy

By Seth Michaels

Two top business experts have taken to the pages of Business Week to make the case for the Employee Free Choice Act. 

Paul Adler, a professor at the Marshall School of Business at the University of Southern California, and Donald Palmer, an associate dean and professor at the University of California-Davis, say corporate hostility to the Employee Free Choice Act and to workers’ freedom to form unions is short-sighted because communities with well-paid workers have economic advantages for business. 

Adler and Palmer cite training, job satisfaction and the healthy communities that come from economically secure workers as reasons why businesses benefit when their employees can form unions and bargain.

They write in the op-ed: 

When unions raise the wages of the lowest-paid workers, this increases savings and reduces income inequality, which has beneficial effects on a nation’s economic growth and investment, not to mention its health and social cohesion. 

Adler and Palmer say the inability of workers to form unions has real consequences, not only for individual workers but also for communities and the entire economy. The failure to allow workers the freedom to bargain has put us in a “low-performing state,” they say: 

Once unions are radically weakened, as they have been in the U.S. over the past few decades?and in no small measure as a result of the business community’s hostility?a race to the bottom starts. The whole economy slides to a lower-level equilibrium where workers earn less and have less influence in the workplace, where firms pay less for labor but get less qualified and less committed workers, and, where, as a result, society gets less output from its available resources. 

Adler and Palmer say passing the Employee Free Choice Act will “secure a better future”?not only for today’s workforce, but also for tomorrow’s businesses and workers. They authors are among dozens of business and management scholars who share this view. 

Read the op-ed here.

Full post as published by AFL-CIO NOW BLOG on June 26, 2009 (boomark / email).