Massive $3.5 Trillion Spending Bill Includes Big Breaks For Labor Unions

As Speaker Nancy Pelosi struggled this week to find a path forward for Joe Biden’s $1.2 trillion infrastructure bill in the House and a way to cobble together a temporary measure to keep the federal government funded, new details are emerging about the massive $3.5 trillion budget reconciliation spending bill also up for debate.

James Sherk, who worked as a labor policy advisor to the president during the Trump administration, has a report that reveals some huge giveaways for big labor unions in the package. 

The new law provides increased funding for the Department of Labor to enforce “misclassification” of independent contractor’s penalties under federal law. The large and growing “gig economy” includes freelancers and independent contractors who work the hours they prefer without a fixed schedule. Because independent contractors cannot unionize as average employees can, the pool of potential union members is decreasing. The change would take away much of the freedom enjoyed by workers in the gig economy.

The bill bans “all-staff” meetings long opposed by unions. When employees discuss unionizing a company, it has been expected for management to call an all-staff meeting. The meeting provides an opportunity for discussion of potential disadvantages presented by unionizing. The new rule would place a roadblock for companies that want to meet with employees.

The spending bill provides a tax credit for electric vehicles, but only those produced by unionized corporations. Sherk finds that the discrimination in favor of unionized producers undercuts the claim that the tax credit promotes environmentally-friendly consumption since electric vehicles have the same emissions impact no matter what kind of labor force builds them.

The bill also prohibits companies from using lockouts during negotiations. Unions will still have the legal authority to strike, of course, further shifting the playing field towards big labor.

The provisions of the spending bill cannot change the reality that the need for labor unions in the U.S. is continuing to wane. Most workers in the modern economy do not realize a net benefit from joining a union. 

Sherk writes that the entire net decline in manufacturing jobs in America between 1974 and 2019 was driven by union job losses and that nonunion manufacturing jobs increased during the same period.

Unions remain a central source of funding for Democrat election campaigns, and the more than 2,400 pages of yet another massive Democrat-sponsored bill is the perfect place to tuck away some goodies for donors.