The Capitol Hill

President Joe Biden’s $2.25 trillion infrastructure plan includes new workplace protections, along with $100 billion to train American workers. The plan also calls on Congress to pass the Protecting the Right to Organize Act, or PRO Act, which would boost workers’ ability to organize unions and collectively bargain.

The House passed the PRO Act (H.R. 842) last month and sent it to the Senate as a stand-alone bill. Majority Leader Schumer has said if he gets 50 members co-sponsoring the act he would bring it to the floor for the vote.  While the PRO Act has the support of most Senate Democrats, including Senator Joe Manchin (D., WV), Senators Kyrsten Sinema (D., Ariz.), Mark Kelly (D., Ariz.), and Mark Warner (D., Va.) have not yet backed the legislation, so 47 co-sponsors. But without the elimination of the filibuster rule, which would ensure 60 votes to pass any controversial legislation through the Senate, the bill would not pass the Senate on its own. With both Sinema and Manchin stating that would not support eliminating the filibuster this is not likely.

The House infrastructure legislation will likely include elements of the PRO Act and maybe all of it, according to the influential chair of the House Education and Labor Committee, Rep Bobby Scott (D-Va.). Part of the legislation will include broader workplace protections at companies receiving federal infrastructure funds. Chairman Scott stated that, “If you’re dealing with federal funds, it’s not unreasonable to expect worker protections. Wages and benefits are part of those,” he said. 

Congressional Democrats have triggered budget reconciliation, a complicated process that disallows filibustering for certain tax and spending legislation, to pass coronavirus relief and certain progressive priorities and will likely attempt to pass the infrastructure bill via budget reconciliation rules that allow the Senate to approve legislation via a simple majority, rather than a filibuster-proof majority of 60 votes. Budget reconciliation rules include limitations that prevent the passage of certain pieces of legislation, potentially including parts of the PRO Act and other reforms advocated by labor that are currently being considered by the House.

The Scope of Budget Reconciliation and the PRO Act

The scope of budget reconciliation is chiefly constrained by the “Byrd Rule”. Under the rule, any senator may move to strip “extraneous” provisions from reconciliation bills absent a 60-vote override. A provision is deemed “extraneous” under the Byrd Rule if:

  1. It does not alter government revenues or spending;
  2. Its effect on spending or revenues conflicts with the instructions of the initial budget resolution (what initiates reconciliation);
  3. It was beyond the scope of the Senate committee that inserted it;
  4. It produces changes in revenues or spending that are “merely incidental” to the provision’s non-budgetary components;
  5. It increases the deficit beyond the years that the budget is slated to cover; or
  6. It changes Social Security.

While most of the rule’s limitations are relatively straightforward, some—most notably subparagraph (D)’s “merely incidental” test—leave room for debate. While technically the presiding officer—normally the Vice President—has final say over these questions, she invariably defers to the Senate parliamentarian, a congressional employee. Parliamentarians generally render these decisions through informal discussions or, in more contested cases, quasi-adjudicatory proceedings known as “Byrd baths,” where both sides argue for or against a provision.

Since parliamentarians are bound to an especially rigid form of precedent, past rulings strongly indicate what to expect in future Byrd-Rule decisions. Based on past decisions, a variety of Labor pundits have identified the following labor reforms could likely survive a Byrd-Rule challenge (Some are in the PRO Act and some are just on labor’s wishlist):

Making strike funds tax-deductible: In order to promote the right to strike, labor proposes making strike fund contributions tax-deductible. This proposal easily passes the Byrd Rule; reconciliation has been used often to create and expand tax credits and deductions, most recently with the 2017 Trump tax cuts.

Requiring that unemployment insurance cover striking workers: Already, Democrats are talking about using reconciliation to boost unemployment benefits. They could also expand UI coverage to economic strikers, which would directly increase fiscal outlays. 

Beefing up federal labor law enforcement: DOL is noted for having a lack of enforcement resources, particularly amidst the pandemic. Since Congress has repeatedly used reconciliation to alter departmental funding, legislators could invoke precedent to expand and extend DOL’s enforcement budget.

Giving tax credits to employers who grant workers paid leave to participate in union activities: To promote worker organizing, labor proposes tax credits to compensate employers who offer paid time off to workers participating in certain forms of collective action. Again, tax credits like this are generally acceptable under the Byrd Rule.

Making NLRB orders self-enforcing (maybe): The PRO Act proposes to speed up NLRB adjudications by granting Board orders legal effect unless a circuit court denies enforcement (currently, the Board must petition an appellate court to enforce its own decisions) . While a related precedent is lacking, this measure could potentially pass Byrd-Rule scrutiny if projected to reduce legal costs. Other, more ambitious laborreforms would probably survive a Byrd bath if tweaked or reframed.

Limiting NLRA preemption: Given the limited prospects for broader reform, allowing state labor-law experimentation is perhaps the most consequential laborproposal available. A relevant precedent was set during the 2017 Obamacare repeal fight, when the parliamentarian upheld one Republican proposal allowing states to impose Medicaid work requirements, which would have reduced outlays, but rejected another enabling state-level healthcare experimentation that had no fixed fiscal impact. Drawing from this precedent, Democrats could write a provision allowing states to assume some portion of the NLRB’s operating costs—directly reducing outlays—in exchange for enabling states to experiment with a list of labor reforms. Tying state experimentation to cost reduction directly would make the measure more analogous to the 2017 work-requirements provision.

Punitive fines for unfair labor practices: The NLRB currently lacks the power to order punitive damages, an important tool to deter employer misbehavior. Fortunately, lawmakers have raised and lowered civil penalties through reconciliation before. Moreover, thanks to precedent set through a 2017 Artic oil drilling program, revenue-generating programs created through reconciliation can split collections between the federal government and other entities, so long as at least some funds go to Washington. Taken together, Congress could pass a fine on employers who violate the NLRA and direct the spoils to be split with grievants—creating, in essence, a punitive damages remedy.

Enabling co-enforcement: Unions have alsoproposes shifting from a complaint-based model of labor-law enforcement to one of co-enforcement, in which DoL contracts with on-the-ground labor organizations to conduct worker outreach and investigations on its behalf. There’s some unfavorable precedent from the 1996 welfare reform debate, when an analogous provision was stripped for having no impact on outlays or revenues. To pass the Byrd Rule, therefore, an enabling statute would likely have to make co-enforcement agreements contingent on reductions in federal spending—likely by reducing DoL’s administrative costs.

Incentivizing card-check, collective bargaining, and other pro-union agreements: Many union proposals seek to promote unionization and labor peace by expanding organizing rights and speeding up negotiations for a first contract. While these reforms as proposed would likely fail the “merely incidental” test, a substantial deduction in corporate taxes for businesses that sign CBAs or card-check agreements, or that agree to hire preferentially from union halls, would likely survive a Byrd-Rule challenge and significantly promote organizing. 

While this list is far less ambitious than what the Pro Act stands for now in its current form, it is still significant. As a final Byrd-Rule caveat, moreover, any proposals listed here that would increase the deficit—namely, the pro-labor tax credits, expanded enforcement funding, and striker access to UI—would likely have either to sunset after the allotted budgetary window (usually ten years). Regardless, passage of these proposals would amount to the largest change in federal labor law in decades. 

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