Lynn Rhinehart, senior fellow at the Economic Policy Institute, joined the America's Work Force Union Podcast to discuss her post on the OnLabor blog titled “Building Toward Sectoral Bargaining—Yes We Can!”
Rhinehart explained how sectoral bargaining differs from the worksite-by-worksite model behind most American labor relations. She described why it covers more workers and pointed to forms of it that already exist in the U.S., such as multi-employer and pattern bargaining.
She also discussed efforts in Massachusetts, Illinois and California to extend state-level collective bargaining to rideshare drivers, who are classified as independent contractors under federal law. Rhinehart called it an exciting experiment in sectoral bargaining. She warned, however, that the Trump administration’s appointees to the National Labor Relations Board (NLRB) could try to block it.
Finally, Rhinehart addressed wage boards as a useful but inadequate substitute for unions and explained the two-edged problem of changing federal preemption rules. She argued that the conditions for winning real labor law reform are better now than they have been in decades, with union support more than 20 points higher than when labor law was last seriously debated.
- Sectoral bargaining sets wages and working conditions for an entire industry or sector, covering all employers and workers in that sector, regardless of whether individual workplaces are unionized. It is common across much of Europe and results in much broader collective bargaining coverage than the worksite-by-worksite model that governs American labor relations. Analogs in the United States include the multi-employer bargaining in the building trades and on Broadway, and pattern bargaining used by the UAW, UFCW, hotel workers and others to pull employers up to a common standard.
- Massachusetts, Illinois and California have established state-level frameworks allowing rideshare drivers, who are not considered employees under federal law, to select a union and bargain collectively with rideshare companies over terms that apply to all drivers statewide. Rhinehart described this as an example of sectoral bargaining at the state level led by the IAM Union and SEIU. She said the initiative is only possible because these workers are not considered employees, which creates room for states to act without being preempted by federal law, and that the Trump NLRB could attempt to block it.
- On the broader question of changing federal preemption rules to give states more room in private-sector labor law, Rhinehart argued that preemption cuts both ways. She stated that changing it would open the door for states to strengthen workers' rights, but would equally open the door for anti-worker red states to do significant harm. She said if Congress wants states to do more, it should legislate a floor of federal protections that states can strengthen but not weaken, rather than simply lifting preemption across the board. She said the conditions for that kind of congressional action are better now than at any point in decades.
The Problem Sectoral Bargaining Is Designed to Solve
Lynn Rhinehart opened with a statement of the underlying problem: millions of American workers say they want a union on their job, and the law, as it currently stands, makes it too hard for them to get one. Workers do organize and win, and union membership ticked up last year in a way that surprised many labor observers, but the system is built against them.
The fundamental limitation of American labor law is that collective bargaining happens worksite by worksite. A union organizes one facility, wins an election and negotiates a contract with that employer. To get to the next facility at the same company, or to any facility at a competing company, the whole process starts over. The result is that union coverage can remain low even in industries where workers are clearly interested in organizing. This is because the mechanism for extending coverage is slow, expensive and easily defeated by employers who have far more resources to resist than workers have to organize.
Sectoral bargaining is a different model, as bargaining occurs at the level of an industry or sector rather than at a single workplace. Employers and unions negotiate, and the resulting terms apply to all businesses and all workers in that sector, whether or not they are unionized. Workers get the benefits of the bargain without each individual workplace having to fight through the certification process separately.
What Already Exists in the United States
Rhinehart said the United States is not starting from zero. Multi-employer bargaining already exists in industries such as construction and entertainment. Broadway theaters, for example, are all covered by a single Collective Bargaining Agreement regardless of the specific production or venue. The building trades negotiate agreements that cover multiple signatory contractors rather than one at a time. These are broader than single-worksite bargaining, though they still only bind employers who are parties to the agreement.
Pattern bargaining goes further in practice, Rhinehart explained. She said the UAW, for example, picks a target employer, negotiates a strong agreement and uses that agreement as a template to pull other employers in the industry up to the same standard. Hotel workers and UFCW grocery workers have used the same approach. It has been effective for decades at broadening the reach of collective bargaining without changing the law, she said.
What the United States lacks is a mechanism to bind employers to a sectoral agreement, regardless of whether their particular facility is organized. That requires a change in law that currently does not exist.
Rhinehart Advocates For Reform
Rhinehart's blog argues for a specific legal change: workers who want to bargain on a multi-employer basis should be able to do so unless an employer can demonstrate it is impossible, not merely inconvenient or unwanted. Right now, employers can simply decline to participate in multi-employer bargaining, and most do when given the choice. Rhinehart said shifting the burden from workers having to persuade employers to join to employers having to justify why they cannot would meaningfully change the dynamic.
She emphasized one reason she favors this approach over more comprehensive top-down sectoral bargaining: it builds unions. Workers organizing for multi-employer bargaining build membership and worker power as coverage expands. She said she worries about models that extend collective bargaining coverage without building unions, because unions are what workers and the country need.
Three States and Rideshare Drivers
The most active current example of sectoral bargaining at the state level involves rideshare drivers. Rhinehart explained that Massachusetts, Illinois, and California have each established frameworks allowing Uber and Lyft drivers to select a union and collectively bargain with the rideshare companies over terms that would apply to all drivers in the state. The initiative is led by the IAM Union and SEIU.
She noted that states have room to act because rideshare drivers are classified as independent contractors under federal law rather than employees. Federal labor law and its preemption of state action apply to employees. Since these drivers are not classified as employees, states can step in with their own frameworks without being blocked by federal preemption.
Rhinehart called the initiative exciting and innovative. She hopes it works so that drivers recognize the value of what the union has won and join up. She also flagged the risk: the Trump administration's NLRB appointees have already moved to block some state-level labor law initiatives in other contexts. If they decided to take an aggressive posture toward the rideshare frameworks, they could try to get them blocked. It has not happened yet with rideshare drivers, and she hopes it does not.
Wage Boards: Useful but Not a Union
Wage boards are government-run panels with labor and business representatives who negotiate a Prevailing Wage for a particular sector and make a recommendation to the government, which then decides whether to implement it. Minnesota and California have used them to raise wages for workers in specific industries. Rhinehart said they work and they help workers.
Her concern is that some advocates treat wage boards as a substitute for unions. They are not. A wage board produces a government-implemented wage floor. A union produces a worker-driven contract with grievance procedures, job protections, benefit standards and a continuing relationship between workers and their employer. Both are worth having, but one is not a replacement for the other.
The Preemption Problem: It Cuts Both Ways
On the question of changing federal preemption rules to give states more latitude in private-sector labor law, Rhinehart urged caution. She said the frustration driving that argument is completely understandable: Congress has not passed labor law reform, the NLRB is stacked against workers and states are looking for room to act. However, preemption not only prevents states from harming workers, but it also prevents states from harming unions. Lifting preemption broadly creates room for worker-friendly states to strengthen collective bargaining rights and for anti-worker states to do harm that preemption rules have so far prevented.
Her preferred approach is for Congress to legislate a floor: federal labor law sets minimum standards that states can strengthen but cannot weaken. That is not the current law, and it is not achievable without congressional action. She stated it is the right framework rather than simply lifting preemption and hoping the bad actors in state legislatures behave themselves.
The Moment Is Now
Rhinehart closed with a call to action. She said the conditions for winning real labor law reform are better right now than they have been in decades. Public support for unions is more than 20 points higher than it was when comprehensive labor law reform was last seriously debated. Public frustration with corporate power is high. Workers are organizing at rates that have surprised even optimistic observers. The conditions are there.
She stressed the need for unions and workers to organize and mobilize now so that, when worker advocates regain political power, they can quickly take action. Rhinehart hears people say labor law reform is impossible. She said the best response to that argument is that making it impossible is exactly what happens when people stop trying.
More information on the Economic Policy Institute is available at epi.org. Lynn Rhinehart's post Building Toward Sectoral Bargaining is available at onlabor.org.
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