Labor Issues

The Employee Free Choice Act's (EFCA) misleading name represents an effort by organized labor to grow union representation. The legislation contained a number of measures that would have negatively affect dealerships and businesses around the country.

In recent years organized labor attempted to push the Employee Free Choice Act (EFCA) through Congress. However, in 2010, when Republicans regained control of the House of Representatives, organized labor realized the legislation would be unable to gain a majority vote.

Organized labor changed its tactics. Instead of fighting its battle in Congress, it turned its efforts to the regulatory process and the National Labor Relations Board (NLRB) – the federal agency tasked with enforcing and interpreting the National Labor Relations Board Act. Enacted in 1935, it established the right of employees to choose to join a union and oversees interactions between private businesses and unions. Many of the board members appointed by President Obama have accepted a number of cases and decisions that work to enact portions of EFCA.

Three decisions recently promulgated by the NLRB pose a threat to business across the country:

First, in June 2011, the Department of Labor (DOL) proposed radical changes to the regulations that interpret Section 203 of the Labor-Management Reporting and Disclosure Act (LMRDA), which contains federal reporting and disclosure requirements regarding individuals and entities hired by employers “to persuade employees to exercise or not exercise or persuade employees as to the manner of exercising, the right to organize . . .” (Labor-Management Reporting and Disclosure Act; Interpretation of the “Advice” Exemption, 76 Fed. Reg. 36178). Employers and “persuaders” are obligated to file public reports with DOL, disclosing finances and other information if they engage in covered activity.

Since LMRDA was enacted, however, attorneys, trade associations, and other third party advisors and their clients (employers) have been exempt from these reporting requirements when they discuss union organizing with an employer as long as they do not directly interact with employees. DOL’s proposed rule would eliminate this “advice” exemption, and in doing so trample on rights to confidential legal advice. Furthermore, employers will likely be required to start filing persuader reports if they seek assistance on general workplace policies. Advisors could become persuaders merely by hosting conferences or meetings with a focus on labor relations. These changes are alarming, particularly considering that criminal penalties could be imposed for non-compliance.

The second and most significant of the Board’s recent actions is its August 26, 2011 ruling that sets the stage for the gerrymandering of elections and the organization of “micro-unions” (Specialty Healthcare and Rehabilitation Center of Mobile and United Steelworkers, District 9, 357 NLRB No. 83, 2011). The Board’s decision radically changes the standard for determining an appropriate bargaining unit for all of the estimated six million workplaces covered by the National Labor Relations Act.

The NLRB has historically applied a clear set of standards in determining a unit appropriate for bargaining. The Specialty Healthcare decision turns those standards upside down. Businesses now face the possibility of having to manage multiple, small units of similarly situated employees with increased chances of work stoppages, as well as potentially different pay scales, benefits, work rules, and bargaining schedules. Micro-unions will greatly limit an employer's ability to cross-train and meet customer and client demands via lean, flexible staffing because employees will no longer be able to perform work assigned to other units. Employees also will suffer from reduced job opportunities, as promotions and transfers will be hindered by organizational unit barriers.

Finally, in December 2011, the NLRB issued a new rule which would amend the election case procedures in what is known as the “Ambush Election Rule.” The rule shortens the election timetable and limits employees’ opportunity to hear from employers before making a crucial workplace decision. Shortening the timetable also eradicates the employers right to engage in free speech.

Bills to nullify the various NLRB rules under the Congressional Review Act were introduced in both the House and Senate but never made it out of committee. AIADA continues to work with Members of Congress to pursue counter measures to the recent regulatory efforts. Additionally we work with the business coalition to fight these measures.

Read More on AIADA's Position 

To learn more about the business coalition efforts, visit

AIADA's Work on Labor:

AIADA EFCA Press Release 

CDW Letter on the 2013 House Appropriations Bill

CDW Letter on the 2013 Senate Appropriations Bill

CDW Letter Asking for Senate Support of the Nullification of the Ambush Election Rule

CDW Asking for Support of the Workforce Democracy and Fairness Act

CDW Letter Urging Senate Support for the Job Protection Act

CDW Coalition Letter to Senate Urging a "No" Vote on Cloture and Final Passage

AIADA President's Letter to the Editor

Letter Urging Congress to Block Rail Strike

Coalition Letter to 111th Congress

Fast Facts on Labor

  • For over 70 years, workers have exercised their fundamental right to privacy in deciding whether to unionize.
  • Current law requires union organizers to collect signatures from at least 30 percent of an employee base. Once signatures are collected, the National Labor Relations Board holds an election to determine whether to certify the union. Employees are able to cast their votes by secret ballot.
  • Election statistics from the National Labor Relations Board (NLRB) suggest that the bulk of union organizing targets small business. For the fiscal year ending September 30, 2005, the NLRB conducted 2,649 representation elections. More than 20 percent of these secret ballot elections involved bargaining units of fewer than 10 employees and a full 70 percent of these elections involved bargaining units of fewer than 50 employees.

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