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Wednesday, January 2, 2013

Right to Work Laws: Legislative Background and Empirical Research

Benjamin Collins
Analyst in Labor Policy

The National Labor Relations Act (NLRA) establishes most private-sector workers’ rights to unionize and collectively bargain over wages, benefits, and working conditions. Enacted in 1935, the NLRA also permits collective bargaining contracts between employers and labor organizations that require every individual covered by the collective bargaining contract to pay dues to the negotiating labor organization. These contract provisions are known as union security agreements. Since the NLRA was amended by the Taft-Hartley Act in 1947, individual states have been permitted to supersede the union security provisions of the NLRA by enacting laws that prohibit union security agreements. These state laws are known as right to work (RTW) laws.

Currently, 24 states have RTW laws. Of these, 12 states passed RTW laws prior to 1950 and another six passed them prior to 1960. The two most recent states to adopt RTW laws are Indiana and Michigan, both of which enacted legislation in 2012. Several other state legislatures are debating RTW laws.

Recent legislative proposals, with substantial numbers of cosponsors, would expand RTW policies nationwide. Advocates of national RTW laws claim that they would enhance personal freedom and employer flexibility. Opponents argue that such laws would weaken workers’ abilities to collectively bargain for more favorable compensation and working conditions. Proposals aiming to expand RTW policies typically strike the provisions of the NLRA that permit union security agreements.

National RTW proposals are often discussed in the context of the economic performance of states that have adopted them. However, research that compares outcomes in RTW and union security states is inconclusive. The recent data trends between RTW and union security states are relatively distinct, but the influence of RTW laws in these trends (if any) is unclear.

  • Unionization rates in RTW states are less than half of what they are in union security states. It is ambiguous what portion of this difference is attributable to RTW laws and what portion is due to diverse preferences among the states regarding unionization. 
  • In the past decade, aggregate employment in RTW states has increased modestly while employment in union security states has declined. It is unclear if this growth is attributable to RTW, other pro-business policies (which tend to be concentrated in RTW states), or other factors. 
  • Wages are lower in RTW states than union security states. Historical research has suggested that RTW laws have little influence on these differences. More contemporary scholarship has come to diverse conclusions, depending on the researchers’ methodology. 

Difficulties associated with rigorously studying the relationships between RTW laws and various outcomes are likely to continue to make it difficult to generate definitive findings about these relationships. As such, the ongoing debate on RTW may be driven by factors other than rigorous empirical evidence.

Date of Report: December 14, 2012
Number of Pages: 17
Order Number: R42575
Price: $29.95

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