SUNDAY EDITION | Kentucky unions begin new era under right-to-work law
WDRB.com business reporter Chris Otts looks at the impact Kentucky's new right-to-work law may have on unions.
LOUISVILLE, Ky. (WDRB) -- When the union factory workers at Louisville’s Appliance Park overwhelmingly rejected a new four-year labor contract in November, they forced GE Appliances back to table and ultimately ended up with a better deal -- one that workers approved by a wide margin earlier this month.
But by holding up the contract for those six weeks, the GE workers inadvertently subjected their union to another challenge: Kentucky’s new right-to-work law.
Appliance Park is likely the first union shop in Kentucky where workers now have the legal right not to provide money to the union representing them, even while receiving the wages, benefits and job protections that come with collective bargaining.
Dana Crittendon, president of the IUE-CWA Local 83-761, said he doesn’t think any of his roughly 3,800 members will stop paying dues or fees to the union – even the new hires who, according to the just-approved contract, will start at $12 an hour while everyone else at Appliance Park makes at least $15.51.
“I just hope everyone understands that having a union gives them a voice but also enhances their pay, their benefits and protects their rights,” Crittendon said.
But one Appliance Park worker – who insisted on anonymity for fear of retaliation from the union or GE Appliances – said she’s considering withdrawing her financial support for the union.
“I believe in unions, just not our union,” said the worker, who voted against the labor contract because of meager raises and rising healthcare costs.
Appliance Park is one of the earliest test cases for right-to-work’s impact in Kentucky because the law – which Gov. Matt Bevin signed Jan. 8 -- applies only to new or extended labor contracts.
Existing labor contracts – like the one covering some 13,000 United Auto Workers members at Ford’s two Louisville plants through 2019 – aren’t subject to the right-to-work law until they are renewed.
Union leaders claim the law is meant to weaken their organizations and point out that they still have to represent any employees who chose not to pay – whom they label “free riders.” In the long run, right-to-work will drive down wages and decrease workplace safety for union and non-union workers alike, they say.
Republican lawmakers who fast-tracked right-to-work’s passage earlier this month say workers should decide whether any of their paycheck goes to a union and that Kentucky has lost out on new factories and jobs because it did not have a right-to-work law.
Those on both sides of the debate agree that the law will challenge unions to ensure their members are satisfied with what they get for their dues.
“When we have unions that are accountable to their members, and providing good services, they are going to be strengthened,” said Julia Crigler, Kentucky state director for Americans For Prosperity, a pro-right-to-work group that has become active in the state.
“I guess it’s going to be like, everyday, it’s a sell-job because they can … drop in the union and turn around and drop right back out,” said John Stovall, president of Teamsters Local 783 in Louisville.
Stovall predicts the law will eventually have a “devastating” effect on the finances and bargaining power of his union, which represents about 5,000 local workers evenly divided between public jobs (Jefferson County school bus drivers) and private jobs (line workers at the Louisville Kellogg Co. plant that makes Girl Scout cookies).
“It’s going to be hard” Stovall said, to represent members who can choose not to pay, “but that’s what we are tasked with doing, and we will do our best.”
Local unions gaining strength in recent years
Louisville-area unions are confronted with right-to-work just as they have enjoyed a resurgence in recent years, mainly due to the general economic recovery.
IUE-CWA Local 761, the GE Appliances union, had 3,865 members and took in $916,116 in dues in 2015 – more than twice its members and dues in 2011, according to federally required disclosures. GE Appliances has ramped up hiring and added product lines at Appliance Park.
Other big, local unions have enjoyed solid gains in headcount and financial support in the last five years:
And the percentage of union workers in Kentucky has grown slightly over the last decade, bucking a national trend, federal data show.
In 2015, 11 percent of Kentucky’s workers belonged to a union, up from 9.7 percent in 2005. Nationally, the union share declined from 12.5 percent to 11.1 percent over the same decade.
Even before Kentucky adopted right-to-work, no one was forced to join a union. But under federal law, those workers who did not join could be charged so-called “fair share” fees in place of union dues.
The fees are usually a little less than dues and are meant to cover only the cost of collective bargaining representation for employees and not other union expenses, like political contributions.
Federally required disclosures show that few Louisville-area workers have opted to pay fair-share fees instead of full union dues.
Of 4,624 workers covered by Teamsters Local 783 in 2015, only 223 were fee payers. That represents about 5 percent.
Only 45 of 17,497 workers covered by Teamsters Local 89 – which represents package handlers at UPS Worldport, among others – were not full members, according to its latest disclosure.
But those figures aren’t necessarily an indication of the number of workers who would drop their union support entirely when given the chance under right-to-work.
Dave Roger, president of JayStar Group, a Connecticut firm that helps unions with back-office functions, said workers who pay fair-share fees only save 10 or 15 percent on full dues and usually lose the ability to vote on labor contracts and to elect union leaders.
“Since they still have to pay that much in dues anyway, why not also have a voice and a vote in the local, and just pay the full amount?” Roger said in an email.
Stovall, of Teamsters 783, said it’s inevitable that some workers will choose not to pay once they are able under the new Kentucky law.
“You will have people who will drop out. If they can get a service for free, they’re going to get it for free,” he said.
Yet one Louisville union has managed to thrive for years under what are essentially right-to-work rules that it imposed on itself.
Under its contract with Jefferson County Public Schools, the Jefferson County Teachers Association is allowed to charge fair-share fees to teachers who opt not to join the union – but the JCTA has never charged those fees.
Meanwhile, JCTA is “at or near an all-time high” in membership, with roughly 5,900 of the district’s 6,300 fulltime, active teachers joining the union, said Brent McKim, the union president.
JCTA doesn’t bother to charge the roughly 400 that decline to pay but still get the salaries, benefits and job security the union negotiated with the district, he said.
McKim said it’s not worth the union’s effort to “document very tediously” how staff time is allocated among different activities, a requirement to charge fair-share fees.
Even so, McKim still opposes Kentucky’s right-to-work law because it’s “wrong to require a union to provide services to non-members without giving the union the option to charge a reasonable fee.”
Muted impact in Indiana
During debates in Frankfort earlier this month, right-to-work advocates often argued that the policy brings faster job growth, which leads to more union jobs.
Since Indiana enacted its own right-to-work law in 2012, the state has slightly outpaced Kentucky in job growth.
Indiana jobs have grown by 6.9 percent since February 2012, compared to 6.3 percent in Kentucky, according to Anna Baumann of the Kentucky Center on Economic Policy, a research group that opposes right-to-work.
Neither state matched the national job growth of 8.7 percent over the same period.
But Indiana also added union members at twice the rate of Kentucky from 2012 to 2015, and Indiana’s percentage of union members rose during the period along with Kentucky’s, according to figures provided by KCEP.
Crigler, of Americans for Prosperity, said the fact that Indiana has more union jobs than when it adopted right-to-work shows how the policy can help unions.
Brett Voorhies, president of the Indiana AFL-CIO, a union umbrella group, said the increase in union jobs has more to do with laid-off union workers being called back – like at the Fiat Chrysler transmission plant in Kokomo – than any big factory Indiana has landed thanks to the new law.
“We haven’t seen any good-paying jobs come into Indiana; we are seeing a lot of service jobs come in,” he said.
Baumann said peer-reviewed studies that attempt to isolate the effect of right-to-work laws from all the other factors in the economy show that, over the long run, the policy has no impact on employment, but it does reduce the percentage of workers that are union members.
Voorhies he has “no idea” how many unionized workers have chosen to stop paying dues since the law went into effect, but it’s not been “a major issue.”
“It’s probably been more a negative than a positive, but I am not going to go as far saying it’s been a drastic negative on our facilities,” he said.
Among the 25,000 members of the Louisville-based United Food and Commercial Workers Local 227 are about 3,500 that work in Southern Indiana at places like Kroger and Meijer stores.
“We have not seen any huge exodus” of Southern Indiana workers from the union, said Caitlin Lally, communications and political director for UFCW Local 227. “We have been working really hard to have one-on-one conversations with new hires and all our members about the value of our union membership.”
Correction: A previous version of this story misstated the percentage of workers in Teamsters Local 783 that are fee-paying members.
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