June 28, 2018. The following op-ed about the Supreme Court ruling on Janus vs. AFSCME written by FPI’s senior economist, Brent Kramer; deputy director, David Kallick; and chief economist, Jonas Shaende, was featured in the NY Daily News. 

The recent Supreme Court ruling in Janus vs. AFSCME poses a real threat to public sector unions. Traditionally, in New York — as in many other states — everyone covered by a union contract was required to pay either dues or an “agency fee” to support the union’s work on behalf of all employees. In the Janus decision, the Supreme Court ruled that public-sector employees can’t be compelled to pay for the union’s work, even though they benefit from it.

What the Supreme Court effectively offers public-sector employees is a self-defeating choice: stop paying union dues, but still expect the benefit of union representation. Or, to put it another way: weaken the union, but hope it will still have the leverage to negotiate a good contract and protect workers from unfair management actions. That’s a choice public employees shouldn’t be fooled into making.

Unions play a vital role in protecting and improving the conditions of work, including pay, safety, health, and — most importantly — fair and respectful treatment. Members pay dues to support their union, and in turn they see real benefits. They gain a voice in their workplace, and have a recourse if they are treated unjustly by their employers.

Unions in New York make a concrete difference: union-represented workers earn 13% more than those not represented by unions if median earnings are compared. There is an even bigger advantage for lower-wage workers. At the low end, the “union advantage” is 19%; unionization places an effective price floor on workers’ wages above the legal minimum wage. It is important to note, too, that in New York even among non-union members earnings are higher than they would be in states with weaker unions.

The advantage does not stop there. Wages are just one part of the total compensation package that unions negotiate for workers. In many cases, health insurance and pension benefits are just as important, and union-represented workers are substantially more likely to have health coverage or pension coverage at work.

Among employees represented by a union, 81% are offered a health insurance plan, compared to only 60% of non-union workers. Similarly, 76% of workers represented by a union have a pension plan offered, compared to 50% of workers not represented by a union.

The quality of both health insurance and pension plans is often far better for people represented by a union; indeed, defined-benefit pension plans — ones that send a predictable monthly check for the remainder of a retiree’s life — have become a rarity outside of union-represented workplaces.

In addition to their role in the workplace, unions are also an important force in the wider public debate. Unions that represent public employees — teachers, public-safety workers, municipal administrative workers, and others — have come to represent a much larger percentage of such workers (34%) than private-sector unions’ membership among private-business employees (7%), and have a substantial influence on public policy in many states, including defending vital public services against budget cuts. For example, New York’s unions were an important driver in the effort to get the recent increases in the state’s minimum wage.

The unions’ progressive voice has also been relevant in other spheres concerning important policy issues from inequality to health care, and from education to public safety. The clout unions have added to these issues is one reason conservative foundations and political donors have for years sought ways to constrain unions; the Janus case is a milestone in that multi-million dollar effort.

New Yorkers have a lot at stake. New York has long had the highest union membership rate among the states, at 24% in 2017, while the national average is 11%. That’s why leaders in New York, including Gov. Cuomo and Mayor de Blasio, worked out some protections for public workers in anticipation of Janus that shield them from aggressive anti-union campaigns while trying to make unions’ work easier. This story is far from over, but it will be a critical moment for public employees to understand why it’s in their best interest, and in the interest of the public interest they serve, to keep the unions strong.

Despite what may seem like a temptation for individual union members to try “free-riding,” it makes good long-term economic sense for public employees to stay in their union and pay the dues that support its work against the erosion of job security and deterioration of working conditions. That’s good for workers, and good for all New Yorkers.

Here is the link to the article in the NY Daily News.