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Susan Wilson Solovic

Susan Wilson Solovic

Posted: January 4, 2010 10:35 AM

Unions and Small Business Are Like Oil and Water

What's Your Reaction:

Anyone who understands the reality of what it takes to run a successful small business knows that unions and small business are like oil and water. But the politicians in Washington DC don't get it. Why? Because they've never had to make payroll. Allow me to share a brief story and I'll explain.

My mother's family owned a small furniture manufacturing company in a rural southern-Missouri town. When union organizers appeared on the scene, the employees were told if they chose to vote for the union, the business would close down, and they'd all be out of jobs. Unfortunately, no one believed the owners would really lock the doors so they voted in favor of the Union. The next day when the employees arrived to work, the doors were locked ... never to re-open again.

When I was a child, my mother took me to visit that old plant. As I stood on my tiptoes peering in the windows of the dilapidated building, I saw furniture pieces in various states of completion, sitting just where the workers had left them - eerily waiting for their return.

I was far too young to understand the reasons why my family decided to lock the doors of their business instead of working with the union. But now as a small business owner, I bristle at the thought of what unionization would do to my small firm. In fact, I would be tempted to do the same thing my family did in the 1940s: Lock the doors and move on.

You would think in this day and age, that unionization would be a remote concern for a small business owner, but thanks to the Obama Administration, it is real and imminent. Leaders of unions spent $450 million electing President Obama and Congressional Democrats so now that the health care legislation is near completion, union leaders expect to see action on the Employee Free Choice Act (EFCA), commonly known as the card-check law, early this year. Briefly, the legislation makes it easier for unions to organize, and experts predict that it will pass this year.

A small business faced with unionization would be seriously impacted by higher wages, higher business operation/legal costs, and the loss of flexibility over employee selection based on business needs. All of this at a time when small businesses are struggling to keep their doors open and their staff employed.

If the government truly believes that small business is the engine that will drive this country out of a recession, then why in the world would they consider placing yet another cumbersome, costly, deterrent in its way?

My recommendation is to ask the President and members of Congress to walk a mile in our shoes - the shoes of small business owners who are just trying to survive. Give these politicos the opportunity to experience what it feels like to risk your life-savings on a business venture; to do without so your employees will be paid; to work 24/7 with no guarantee there be anything to show for your efforts; to be unable to access the capital you need to grow; and to pioneer innovations that give the U.S. a global competitive advantage.

Small business is the American dream. But if the government continues to ignore the realities small business owners face, it will successfully extinguish the dream.

 
 
 

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10:11 AM on 01/05/2010
The assertions made in this article are as simplistically one-sided and credible as those made my chambers of commmerce all over the country; in the end, the only concern involved is for company owners' profit margins and, ultimately, blanket continuity on the issue of resisting unions at all cost within Corporate America.

Corporate America can reasonably be seen as a criminally-minded association perpetually opposed to even the most basic rights of workers; while it is true that such is not true with many who would fall under that broad characterization, even those that do not give lip service to the status quo real opinion that no union is a good union, and that workers should be satisfied with what they any employer offers, no matter how paltry.

And so we see--regardless of the notion that actual downward economic pressures should exist within a specific business environment--employers suppressing wage growth when specifics for their industry still allow growth, and uniformly working to decrease wages for US workers in a time when economic suffering for those workers is the most dire since the Great Depression.
09:51 PM on 01/04/2010
Great article!! I am a small business owner and my reaction to impending unionization of my business would be exactly the same. Unions take away most flexibility in wage differentiation, job duties, firing decisions and benefit funding. There are several reasons why the auto, airline, steel and rubber industries have gone bankrupt, however, the biggest reason is the existence of intractable unions. If you want to see the logical conclusion of forced, universal unionization, just look at the inefficient mess that was the Soviet Union and other eastern bloc nations. Just look at our most unionized states, New York, Michigan, California, Illinois, New Jersey---they are all uncompetitive and failing. A lot of union members I know will go to the lowest priced consumer goods available and leave the overpriced union made goods laying on the shelves. Unless we shut down free world trade, an economy can only afford about a 10% unionized workforce. That will not happen, so it looks like the 90% of us who are non unionized will have to continue to subsidize our protected union brothers.
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07:02 PM on 01/04/2010
Many small business owners offer no benefits, and uncompetitive wages.

It comes down to employees being conditioned that they should just be grateful for being taken advantage of by any employer.

"You are lucky you even have a job, because I can replace you tomorrow with someone willing to take this BS....."

Unions aren't the monsters they are made out to be. And small businesses aren't necessarily the best employers.

I have worked as a unionized worker under a union contract, on the management side of a union contract, and with no union.

My vote is for union representation. Everytime, all of the time.
07:47 PM on 01/04/2010
Small businesses that pay what they can afford to workers who want the jobs are not taking advantage of them. In a small business, each and every worker is much more important than an individual worker is in a large company - if you don't treat them right your business will suffer much more.
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08:02 PM on 01/04/2010
In theory, this is true. In reality, it often times, is not. Why do restaurants pay less than minimum wage? Because they can get away with it. It is legal to underpay their workers. Wouldn't it be better to pay servers a living wage and skip expecting people to tip?

Small businesses are bought up by large corporations and then franchised or leased back to the owners - all of the time. The owner has lower risk but the workers don't gain much, if anything.

Privatizing school bus drivers, custodial staff, kitchen staff, office workers....so they can have better wages and benefits? No.......so the benefits and wages are reduced to the point the workers pay out of pocket for every benefit they get, from health and life insurance to retirement accounts.

I did income taxes for years...years. You know what the small business (a franchise of a large corporation, owned and operated locally) I work for paid per hour? $7.50 per hour, no benefits, year after year, having to requalify (take the current tax classes) to work for him every year. The job actually cost me money to do, and last year was the last for me.

I know the owner was making out like a bandit. We got pizza on April 15.
03:32 PM on 01/04/2010
In my 35 years as a stagehand, I've worked for over 100 employers. the overwhelming majority of those have been small businesses, formed for a specific project or show. My only access to continuing benefits has been through my union. Thanks to the union, my family has the security to live a middle class life. This security does not come from forcing me on any employer, on the contrary, it comes from not requiring any individual employer to be responsible for me.
The biggest ideological hurdle facing health care reform is the question of government involvement. Co-ops are one of the ideas that the conservatives love to bandy about. Since 1979, I have been a member of such a co-op, taking payroll contributions negotiated with employers (both for profit and non) and providing health and pension benefits for its members. This is a completely free market system and yet is demonized because we call it a union.
My union also provides worker training and has the ability to maintain a skilled professional workforce through fluctuations in business cycles because we do not depend on individual employers, a fact that actually lowers long term risk for them.
Small business owners claim to be the innovators our economy needs. I find that they have pronounced blind spots when it comes to employee relationships. Unions are simply a response to a desire for security and continuity. If embraced properly, they can provide both for employees and employers.
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06:51 PM on 01/04/2010
Fanned and cosign
10:34 AM on 01/05/2010
Excellent insight and comment; thanks.
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shocktreatment
Just barely standing it
12:16 PM on 01/05/2010
Yes, thank you for your concise, accurate words. I have been a union construction electrician for many years, my experience mirrors yours.

The notion that a small business does better by conducting hundreds of interviews, background checks, etc. to hire skilled workers, only to lay them off at project's end, is short sighted.
01:28 PM on 01/04/2010
People should be more worried about the cost of unionization of government workers. Especially since this is the largest growing area of jobs for now and until the collapse.
06:18 PM on 01/04/2010
One of the main reasons why so many of our governments are broke. Unions get raises and more jobs for workers, get higher dues, pay part of those dues to politicians who protect them. Everybody wins except the taxpayer.
08:38 PM on 01/04/2010
Jobs proliferate in large organizations, not just government, because a manager's pay is based on how many people they supervise. Workers do not hire or fire, management does.
12:20 PM on 01/04/2010
Wow, what a bad example!
Give a thought what that business did on just the fear of a union, in
closing before the union could start:
-to risk your life-savings...
left everything to rot, not reclaiming any investment?
on a business venture...
Left employees, customers, suppliers, and the community in limbo?
- to do without so your employees will be paid...
locked the doors?
-work 24/7 with no guarantee there be anything to show for your efforts...
locked the doors .. and walked away?
-to be unable to access the capital you need to grow...
leaving orders half completed and undelivered?
-and to pioneer innovations..
folding before anything actually happened?

This is an example of a feudal overlord, not a modern business owner.
11:36 AM on 01/04/2010
A labor union will work with management. If management feels that closing the business is the thing to do then it was not much of a place to work anyway. I have no sympathy for Solovic. she seems to really not care about her employees only herself. It takes two sides to reach an agreement, maybe management should listen to what labor is asking. Solidarity forever.