State-Based Escapes from Restrictive National Labor Laws

The free market works. The top safest, most prosperous nations in the world employ some variant of a free market system, and the United States’s success is often held up as symbol of the success made possible by economic liberty. However, there are a few flies in the soup of American prosperity, one of which is federal labor regulation.

What’s wrong with federal labor law?

The regulations surrounding labor enacted in the 1930s before and as part of the New Deal are far too many to summarize here, but include provisions such as wage and overtime requirements. Most importantly, they include a plethora of strict rules regarding collective bargaining and union power. While many of these infringe on the right of employers and employees to make whatever arrangements they see fit, the worst part is mandatory union membership. This is bad for businesses because it limits hiring arrangements that may be necessary for the company’s business model, such as keeping costs low by hiring inexperienced, elderly, or disabled workers in order to keep prices low (Walmart, for example, which actually shut down a store to avoid unionization in order to preserve their model). It can be even worse for workers, who can be forced to pay dues, face layoffs or hiring freezes by an employer no longer able to afford to pay them under new conditions, or be forced to support and contribute to political causes that they may personally find reprehensible.

Unfortunately, if you live in one of 22 US states that have not enacted right-to-work laws, forced unionization passed down from the federal government is a sad reality. Fortunately, there’s a few potential ways of dealing with this issue.

1: Passing right-to-work legislation

Enacted in 1947, the Labor Management Relations Act, better known as the Taft-Hartley Act, provides an out from this forced unionization rule in Section 14(b), which exempts states that have passed legislation prohibiting collective bargaining agreements that mandate unionization. These are called right-to-work laws, and they provide a welcome escape from forced union membership and agency fees, allowing a freer market in labor.

Pros: Removes the worst aspect of US labor regulations. Has significant precedent. Ample information and studies available, making arguments for a piece of cake. Many established advocacy organizations exist ready to support its passage. Is the only state-based solution acknowledged by the federal government, making right-to-work the most sure-thing option available.

Cons: Only gets rid of forced union membership, still leaving the rest of labor regulation intact.

2: Nullifying federal labor law

Another theoretical approach is to pass state-level legislation expressly nullifying federal-level labor regulations. This would essentially say that state law overrules federal law in this regard.

Pros: Theoretically able to be much more comprehensive than a standard right-to-work law, allowing more bad federal regulations to be bypassed.

Cons: By definition not supported by the federal government. No current precedent, including comprehensive research, studies, and written arguments. Only as valid as your trust in state-level and local authorities to stand in force against federal agents. Creates legal uncertainty where employers and employees have no idea which laws they must follow, and usually opt for compliance with the most stringent regulations potentially applicable… in other words, they will likely act as if the nullification law was not passed to begin with.

3: Independence

Finally, a great way to opt out of US labor law is to exit the US entirely. The advantage of this approach is that it provides a clean break with existing regulations, and removes the possibility of new ones arising from outside the state level in the form of national law on the subject changing. However, it barely has to be mentioned that this is the “nuclear option” of the available choices.

Pros: Definitively removes all federal labor regulations.

Cons: Too extreme of an option to be passed without a multitude of justifications well beyond labor law. Historical precedent indicates that this may end badly, and violently. Not realistic in the near future, and therefore should not be used as a first approach to a freer labor market.

As far as realism in targeting the most egregious part of federal labor regulations, right-to-work laws make the most sense by far. However, that’s only the first step towards finding true economic freedom, and while an attempt to nullify federal regulations entirely has the potential to provide some further relief, only a sovereign state can truly consider itself fully in control over its own prosperity. A state weary of being forced to limit its economic potential to the whims of the national government should strongly consider independence.

Joël Valenzuela
Joël Valenzuela
Joël Valenzuela is the editor of The Desert Lynx. He is also the founder of the Rights Brigade, a mover for the Free State Project, and a martial art instructor.