Skip Navigation

The Leaflet: Right-to-Work Is Right for America

August 24, 2017

This week's Leaflet celebrates National Employee Freedom Week and examines how states can reform their workforce climate with right-to-work legislation.

This week is National Employee Freedom Week (NEFW), an annual effort started by the Nevada Policy Research Institute and the Association of American Educators to highlight the benefits of giving employees the freedom to opt out of union membership. The Heartland Institute is one of many participating organizations in NEFW.

Currently, there are 28 states with right-to-work (RTW) legislation, which gives workers the right to refrain from joining a union, including not having to pay union dues or fees, without being penalized.

A newly released NEFW study compares the attitudes, performances, and management of union employees in RTW states compared to those in non-RTW states. When asked about contract negotiations, working conditions, job security, fringe benefits, and number of hours worked, union members in both RTW states and non-RTW states rated these factors highly, with no significant differences between their ratings. 

Opponents of RTW say union members in non-RTW states are significantly disadvantaged, but the study found members in both RTW and non-RTW states “expressed broad support [above 70 percent] for the opportunity to regularly vote on whether to keep representation from their current union (a process often called ‘recertification.’)”

RTW policies also have been proven to have a positive economic impact on state economies. A survey of CNBC’s Global CFO Council members shows two-thirds believe RTW laws are “important” or “very important” when it comes to business location or expansion. States with these policies have attracted more businesses, experienced greater job growth, and increased union membership compared to states without RTW laws, such as Illinois.

As Senior Policy Analyst Matthew Glans describes in a recent Research & Commentary on the subject, “States enacting RTW policies have experienced positive economic progress across the board. Regionally, Indiana, Iowa, Kentucky, Michigan, Missouri, and Wisconsin have passed RTW and experienced far greater job growth than Illinois has over the same period.”

Ball State University professor Michael Hicks concluded in his 2016 study on the effect right-to-work laws have on worker productivity: “We estimate a Cobb-Douglas production function for manufacturing industries at the state level and find that total factor productivity in non-RTW states was about 57 percent of the level in RTW states. … Furthermore, our firm-level analysis from the 2007 Survey of Business Owners found that RTW states achieved higher productivity (sales per employee) than firms in non-RTW states.”

Additionally, a 2014 Gallup poll found a majority of Americans, Democrats and Republicans alike, approve of RTW laws. Seventy-one percent of respondents said they would vote for such laws and 82 percent said they believe “no American should be required to join any private organization, like a labor union, against his will.”

Union membership rates are at all-time lows, and RTW law adoptions are at all-time highs. State legislators should consider carefully this trend toward embracing employee freedom and implement right-to-work legislation in their own state.

What We're Working On

Education
Research & Commentary: Existing Accountability Laws for Milwaukee Parental Choice Voucher Program Working as Designed
In this Research & Commentary, Policy Analyst Tim Benson writes about a new report from the Wisconsin Institute for Law and Liberty that found the accountability provisions for the Milwaukee Parental Choice Program, an important school choice policy, are working as intended, helping to remove low-performing and unsafe schools from the program and allowing high-quality schools to grow. Read more

Energy & Environment
Fossil-Fuel Divestment Could Cost Public Pensions Big Bucks, Study Finds
In this article for Environment & Climate News, Managing Editor H. Sterling Burnett writes about a new study compiled by Compass Lexicon that shows fossil-fuel divestment is costly to investors. According to the report, university endowments and public employee pension funds that bow to environmentalists’ demands that they divest their holdings from companies involved with the fossil-fuel industry could suffer significant losses, or at a minimum, have their endowments, portfolios, and retirement funds grow by substantially less than they otherwise would. The report notes environmental groups have already pressured more than 1,000 universities and state and city retirement funds to divest their holdings of stocks and bonds in companies that finance, produce, transport, or burn fossil fuels to produce electricity, which they blame for numerous alleged environmental problems and climate change. Read more

Budget & Tax
Research & Commentary: Reducing COLAs to Bring Pension Costs Down
In this Research & Commentary, Senior Policy Analyst Matthew Glans examines state pension reform and the effects of changing cost of living adjustments. “Taxpayers cannot afford for states to continue overpromising and underfunding their pension plans. States should consider reducing COLAs or ending automatic COLAs outright,” wrote Glans. Read more

Health Care
Heartland Daily Podcast: Only Liberty Can Loose the Gordian Knot of Health Care Reform
In this edition of the Heartland Daily Podcast, host Michael Hamilton argues in his final broadcast of the Health Care News Podcast Congress should learn from Alexander the Great: Health care reform is the Gordian Knot that Republicans and Democrats alike will never untie as long as they continue granting the faulty premises of the Affordable Care Act. Listen here

From Our Free-Market Friends
‘Legalized theft’ Continues in Clark County
Earlier this month, the Nevada Policy Research Institute released a study examining the controversial civil-asset forfeiture program used by the Las Vegas Metropolitan Police Department. Policy Analyst Daniel Honchariw analyzed seizures and forfeiture data from the 2016 report, which Nevada law enforcement agencies must file annually with the state’s attorney general. “[M]ost forfeitures were for amounts less than $1,000 — making it cost-prohibitive for innocent parties to contest the seizure” and “occurred mostly in low-income, minority neighborhoods,” Honchariw wrote. Read more

Author
Arianna Wilkerson is a government relations speciialist with The Heartland Institute.
awilkerson@heartland.org