Wage Boards for American Workers: Industry-Level Collective Bargaining for All Workers

Source: David Madland, Center for American Progress, April 9, 2018

…. The United States needs a different kind of collective bargaining that responds to the changes in the economy over recent decades. In this modernized bargaining system, virtually all workers would be able to collectively bargain; bargaining would occur primarily at the industry level; and workers would have sufficient power to negotiate with employers. This new kind of bargaining can be created through a national policy of bargaining through wage boards, where employers, workers, and the public negotiate collectively. Wage boards would represent a significant change from the current bargaining process, but they have a proven track record in several U.S. states as well as in other countries.

Wage boards raise compensation for all types of workers, whether they are contracted temp workers or employees of a dominant firm; whether they are in a union or not; and regardless of race, ethnicity, gender, and sexual orientation. Rather than allowing potentially arbitrary or discriminatory factors influence workers’ pay levels, wage board panels set minimum pay levels based on measurable indicators such as the work and required skills. Furthermore, because wage boards raise minimum standards for wages and benefits across an industry, they help reduce firms’ incentives to try to cut labor costs by discriminating, contracting out work, or fighting unions.

Wage boards would also help boost productivity by ensuring that similar work receives similar pay. This enables a more efficient allocation of resources and encourages more cooperative firm-level relations between workers and their managers.11 Wage boards would help high-road businesses compete on an even playing field, as low-road employers would face new minimum standards for pay and benefits. ….

….In order for bargaining above the firm level to function properly, workers must be able to take collective action without fearing retaliation from their employer. Not only does current law fail to protect actions necessary for firm-level bargaining, but it also provides fewer protections for the kinds of actions—such as boycotting and striking—needed to make industry-level bargaining work. This is why policymakers must broaden and enhance worker protections.

Additionally, wage boards create a free-rider problem because workers will benefit from higher standards even if they do not pay the costs of achieving them. As a result, wage board policy reforms will need to establish new ways of joining unions and other worker organizations that do the work necessary for industry-level bargaining…..