Thursday, June 9, 2011
The States’ legal action was filed in response to a proposed NLRB enforcement action that threatens job creation at a time when the nation’s unemployment rate is 9.1 percent and the country is still struggling to recover economically. On April 20, the NLRB’s acting general counsel proposed an enforcement action against The Boeing Company for building a new final production line for its Dreamliner 787 and creating 1,000 new jobs in South Carolina, which is a right-to-work state. The NLRB incorrectly claims that Boeing retaliated against its unionized employees in Washington State which is not a right-to-work state because the aircraft manufacturer exercised its business judgment to create new manufacturing capacity in South Carolina. Further, the NLRB is considering an enforcement action despite the fact that Boeing has created 2,000 new jobs in Washington, does not plan to eliminate any union jobs, and only proposes to create new jobs in South Carolina.
The NLRB has misconstrued federal law in its complaint, Attorney General Wilson said. In fact, the federal government’s actions contradict federal law, which allows states to enact right-to-work laws without fear of retaliation from the NLRB. Unless deterred, the NLRB’s unprecedented proceedings against a company’s private business decisions will cause irreparable harm to the business climate in every state and will undoubtedly create an exodus of jobs from our country.
The brief, authored by Texas and South Carolina, was joined by the following states: Alabama, Arizona, Colorado, Florida, Georgia, Idaho, Kansas, Michigan, Nebraska, Oklahoma, South Dakota, Utah, Virginia and Wyoming.
In right-to-work states like Texas, workers cannot be forced to join a union or pay union dues as a condition of employment. Workers in states that have not enacted right-to-work laws, however, do not have a choice to join or not join a union. All employees at unionized facilities must join the local union and pay union dues even if the employee prefers to not join a union or risk losing their jobs.
The States’ brief explains that the NLRB’s proposal violates federal labor law, ignores states’ discretion to enact right-to-work laws, and harms all states by discouraging employers from opening new manufacturing facilities anywhere in the U.S. where the NLRB has enforcement jurisdiction. According to the brief, states that have not enacted right-to-work laws will be harmed by the NLRB’s proposal because newly established employers will be discouraged from basing their operations in unionized states because they could face a federal enforcement action if they decide to create new facilities or jobs in right-to-work states. Similarly, the NLRB poses a threat to right-to-work states because its enforcement action could discourage existing employers from exercising their discretion to build new facilities in states that protect workers from compulsory union membership.
A federal administrative law judge is scheduled to hold a hearing on the NLRB’s proposed enforcement action against Boeing on June 14. Legal documents filed in that case indicate that surging global demand for the 787 Dreamliner led Boeing to conduct a geographical and economic cost-benefit analysis before deciding whether to expand operations in Washington or construct a second final assembly facility in Charleston, South Carolina.
More than a year after Boeing invested hundreds of millions of dollars constructing its South Carolina facility and only weeks before the new assembly line was scheduled to begin operations the NLRB’s general counsel filed the proposed enforcement action against Boeing. If the legally baseless proposal survives the federal administrative process, NLRB could be empowered to micromanage private sector business decisions and improperly force Boeing to close its South Carolina facility.
The States’ challenge to the NLRB’s proposal explains that the general counsel has not only misapplied the National Labor Relations Act, but has threatened economic development and job creation across the U.S. Newly established businesses will be discouraged from building their manufacturing facilities in unionized states and pre-existing employers will be prohibited from expanding operations to right-to-work states. Worse, because employers can avoid NLRB enforcement actions and federal micromanagement by simply creating new manufacturing facilities in foreign countries, the NLRB’s proposal creates a perverse incentive for employers to move their operations overseas.
Further, the brief explains that the NLRB is pursuing its job-killing enforcement action just days after the federal Bureau of Labor Statistics announced that 13.9 million Americans are still unemployed. Despite the nation’s 9.1 percent unemployment rate, the brief argues, the NLRB continues to pursue an enforcement action that will further undermine job growth and threaten the United States’ economic recovery.
According to The Boeing Co., the airline manufacturer has more than 5,000 Texas-based employees. In San Antonio, a Boeing facility performs maintenance and modification work on the 787 Dreamliner. A wholly owned Boeing subsidiary, Aviall, is headquartered in Richardson. Boeing also has facilities in El Paso, Killeen, Corpus Christi, Austin, Abilene, Wichita Falls, Del Rio and Kingsville. If the NLRB successfully prosecutes Boeing for establishing a new production facility and creating new jobs in a right-to-work state, the federal enforcement action could discourage the company from expanding its Texas operations.