The Big Picture
The Fair Labor Standards Act (FLSA) established minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in federal, state, and local governments. First enacted in 1938, the FLSA has been amended only 20 times over 80 years–and most of these amendments were to raise the minimum wage.
Congress’ failure to address issues arising from modern workplace arrangements has resulted in a vacuum, which the U.S. Department of Labor has filled. Changes in administrations–from Democrat to Republican and back again–result in significant changes in policy rules. This instability makes it difficult for businesses to grow and for workers to choose a nontraditional way to earn a living–as a small-business franchisee or an independent contractor, for example.
In introducing the ERA, Sen. Scott noted that “[t]he complexities of our modern economy demand creative, forward-thinking legislation that gives workers and small business owners stability and flexibility. The Democrats continue to push for legislation that prioritizes politics over people by protecting labor unions at the expense of workers. The Employee Rights Act puts workers back in the driver’s seat by giving them basic protections and the power to choose how to make a living for themselves and build a future for their families.”
The legislation enhances employee rights:
- Guarantees a federally-supervised secret ballot election on whether to unionize, preventing unions and employers from denying employees the right to vote in private.
- Provides employees the right to opt out of sharing their personal information to prevent union organizers from showing up at employees’ homes to exert pressure.
- Requires a majority vote of all affected employees in order to certify a union, not just a majority of those voting. A majority vote of all affected employees (by secret ballot) would also be required to call a strike.
- Protects employees’ political views and paychecks by requiring union members to opt in to allowing unions to use their dues money for purposes other than collective bargaining. Current law allows union members only to pursue a refund (or resign from the union) to prevent their dues from supporting candidates or causes with which they may disagree.
- Criminalizes union violence and threats aimed at intimidating employees into supporting unionization. This is necessary to overturn a Supreme Court decision, United States v. Enmons (1973), which held that strike-related violence “used to gain legitimate union objectives” could not be prosecuted under the Hobbs Act.
The legislation enhances worker choice:
- Promotes small business ownership by adopting common-sense rules on the franchisor-franchisee relationship. For many Americans, owning a franchise is the first step toward economic independence; yet the far left wants to eliminate the franchise model by making the franchisor responsible for the franchisee’s employees (“joint employment”). Destroying the franchise business model would be a gift to Big Labor, which could organize at the national (or regional) level rather than at individual, local franchises.
- Allows businesses to offer independent contractors retirement incentives and other fringe benefits without making the independent contractors “employees.” Many workers enjoy the flexibility that being an independent contractor provides, yet the far left wants to deprive them of that choice and force them into government-knows-best, one-size-fits-all employment.
The legislation ensures that regulators must consider job losses:
- Mandates that any regulatory or executive action specify whether it will result in job losses. This will force regulators to consider the economic impact on workers as well as other factors.
Why It Matters
As our economy continues to recover from the impact of COVID lockdowns, providing workers options to earn a living other than traditional employment is crucial. Some want the freedom and flexibility that being an independent contractor provides. Others dream of owning their own business as a franchisee. And those in traditional employment relationships do not want to be coerced into joining a union or having their dues used to support candidates or causes they oppose. Government should be promoting flexibility and choice for American workers, not eliminating their options through regulation. If enacted, this legislation will rein in the regulators–protecting workers’ choices and providing the certainty essential for businesses to invest and grow.