U.S. House Passes Bill That Aims to Speed Up Collective Bargaining

Quick Hits

• The U.S. House passed a bill that would impose a one-size-fits-all timeline on collective bargaining, which now heads to the U.S. Senate for consideration.
• The bill would mandate an accelerated bargaining timeline and a mandatory process that can result in the imposition of first-contract terms.
• The bill has some bipartisan support, though businesses have largely come out against it and argue it goes against the Trump administration’s efforts to reduce government bureaucracy.

Under the bill, H.R. 5408/S. 844, once a prescribed time for bargaining (120 days) expires, government officials would impose nonreviewable contractual terms on the parties that will be binding for two years.

Proponents of the bill forced the vote through use of the House “discharge” process to circumvent Republican leaders’ control of the legislative agenda. Twenty Republicans joined with Democrats to ensure passage of the bill. The FLCA now heads to the U.S. Senate, where it is supported by approximately one dozen Democrats, as well as Republican Senators Josh Hawley (MO), Roger Marshall (KS), and Bernie Moreno (OH).

Background on the Proposal

The FLCA is pulled directly from the Employee Free Choice Act and the Protecting the Right to Organize (PRO) Act, big labor-supported bills that have been rejected by the U.S. Congress. A coalition of nearly 400 business organizations wrote that FLCA “runs counter to President Trump’s effort to rein in the federal bureaucracy, threatens the economic viability of businesses, forces contract terms without the consent of employees or employers, and amounts to an unconstitutional taking.” Critics also note that, because an arbitration panel would set the terms, employees would lose the customary right to ratify—or reject—the first contract that governs their wages, benefits, and working conditions.

The bill is one component of Senator Hawley’s broader labor reform framework, which would also limit employers’ rights to communicate with employees about the pros and cons of unionization, enact civil penalties for unfair labor practices, and resuscitate the Occupational Safety and Health Administration’s (OSHA) ergonomics regulation that Congress rejected in 2001.

What Employers Need to Know

Currently, the law requires an employer and a newly certified union to meet at a reasonable frequency to bargain in good faith over a first contract, but it sets no deadline for reaching an agreement and forces neither side to accept any particular proposal nor make any particular concession. In short, the law requires a bargaining process, but explicitly does not require any substantive outcome as to whether an agreement is reached or, if so, what terms it will contain.

The FLCA would change that by adding an accelerated bargaining timeline and a mandatory process that can result in the imposition of first-contract terms. Bargaining would have to begin within ten days of a union’s written demand. If the parties did not reach agreement within ninety days, the union could request the involvement of the Federal Mediation and Conciliation Service (FMCS), triggering thirty days of mediation. If mediation did not produce an agreement, the dispute would proceed to binding interest arbitration, and the resulting first-contract terms would bind the employer for two years.

Key Takeaways

For employers, the practical concern is that binding interest arbitration would shift first-contract decision-making from the bargaining table to an arbitrator applying statutory factors that may not capture the company’s business model, competitive strategy, or long-term investment plans. The arbitrator would be directed to consider the employer’s financial status and prospects, the size and type of its operations, employees’ cost of living, employees’ ability to sustain themselves and their families, and the wages and benefits provided by other employers in the same business. Those factors could lead to contract terms based on industry comparisons or perceived ability to pay, rather than the employer’s particular operating model, budget, staffing needs, or business plan. The arbitrators making these decisions need not have any experience operating a business or any familiarity with the employer’s industry.

The bill also would shift bargaining leverage. A union could run out the ninety-day bargaining period, request FMCS mediation, and then move the first contract to binding interest arbitration, leaving the employer with less ability to hold the line on terms that do not fit the business. That shift could also affect organizing campaigns, because employees may feel they have less to lose when a first contract is all but guaranteed within months, and any resulting terms would bind the company for two years.

Ogletree Deakins’ Traditional Labor Relations Practice Group will continue to monitor developments and will provide updates on the Governmental Affairs and Traditional Labor Relations blogs as additional information becomes available.

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