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Local Tech Community In Uproar Over Labor Rights Bill

By Kim Hart
Monday, March 16, 2009

A labor rights bill backed by President Obama has become one of the most hotly contested issues in local technology circles.

The Employee Free Choice Act, which would make it easier for unions to organize, was reintroduced last week on Capitol Hill. The legislation has been introduced in the past three Congresses, but never won the 60 votes needed to pass in the Senate.

Now that the bill seems to have a better chance at passage, the Northern Virginia technology community is in an uproar about it.

"There is no meeting that I go to that this subject does not come up," said George Newstrom, chief executive of Lee Technologies and former secretary of technology under Virginia Gov. Mark R. Warner. "In board rooms, this is the number one thing that's being talked about."

The bill, commonly referred to as the "card-check" bill, would allow employees to form unions by getting a majority of workers to sign cards -- without having to hold a secret ballot. Currently, employers can decide whether workers must hold an election for union representation or organize via a "card check."

And, according to the bill, if employers and workers do not agree on a contract in 120 days, a government-appointed arbitrator will intervene.

Some workers argue that the bill would level the playing field for labor unions, whose memberships have reached all-time lows in the past decade. The bill, proponents say, would prevent employers from intimidating workers before elections and stalling contract negotiations.

Employers, on the other hand, say the bill would leave workers vulnerable to intimidation from union organizers, and not requiring a secret ballot would allow peer pressure to interfere with the election process.

Local executives say the bill's implications are especially dangerous to technology companies, which stay competitive by being able to shift strategies quickly to meet ever-changing consumer demands and industry trends.

The Northern Virginia Technology Council, which rarely takes a stance on federal policy debates because it tends to focus on state issues, is actively lobbying against the bill. The legislation would undermine efforts to attract businesses to Virginia, which is a right-to-work state, NVTC's executive director, Bobbie Kilberg, said.

"If card check passes, it will embolden unions to try to overturn right-to-work laws," she said.

S. Bradford Antle, chief executive of McLean-based SI International, which provides information-technology services to the government, said the bill would "place the government in the middle of negotiations between employees and management."

"A lot of the work we do is very team-oriented," he said. "If all of a sudden you have a layer of bureaucracy that has a different set of rules for hiring, firing and rewarding employees, that's going to stifle creativity and our ability to innovate."

Proponents of the bill say it would help smaller companies weather the economic downturn. American Rights at Work, a nonprofit advocacy group, says that strengthening union organizing would help prevent layoffs.

"Data shows that union members are better suited to handle the recession because they have a mechanism to work with their employers to cut wages and benefits instead of cutting jobs," the group said in a statement. "By allowing more workers the ability to bargain for better wages, benefits and retirement security, the Employee Free Choice Act will put more money in the pockets of consumers so they can purchase needed goods and services from companies on Main Streets across our nation."

Though labor unions have a relatively small presence in the technology sector, less than 5 percent of the workers by some estimates, nearly 20 percent of private-sector employees in the telecommunications industry are union members, according to the Bureau of Labor Statistics. Many of them are represented by the Communications Workers of America.

CWA President Larry Cohen said the introduction of the bill in Congress means "millions of working families are a step closer to gaining real bargaining rights that will enable them to have a better life and will help move our nation along the road to economic recovery."

But many local tech employers point to problems that have come from union dominance in the auto, steel and textile industries, in which salaries have, in some cases, risen to unsustainable levels.

"It starts a spiraling process -- wages just gradually rise and then eventually you aren't competitive anymore," said Bradford Schwartz, chief executive of Blue Canopy, a Reston-based IT consulting firm. ''Given the current economic climate, this could be the worst thing that could happen."

He added that tech worker salaries and benefits are among the most competitive. The average information-technology pro made $78,035 last year, a 4.6 percent increase from 2007, according to a survey of nearly 20,000 visitors to tech job site Dice.com.

The Arlington-based Consumer Electronics Association, whose members include Intel, Microsoft, Best Buy and Sony, also is forcefully pushing against the bill. Executive Director Gary Shapiro said some of his members have said they will be forced to move some or all of their manufacturing operations overseas if the bill is passed. Smaller companies likely will be most affected by the legislation, he said.

"Small companies need to be more flexible," he said. "If they want to change an assembly line, do research, give Christmas week off, they'll have to go through a union to do it."

The bill has majority support in the House and the Senate. But it needs 60 Senate votes to survive a filibuster.

Young Entrepreneurs Connect

About three dozen young entrepreneurs paid a visit to the White House earlier this month to meet with economic advisers and share ideas about how start-ups can spur economic development.

The group was part of Summit Series, an organization for young entrepreneurs formed by 23-year-old Elliott Bisnow. He's the son of Mark Bisnow, former employee of business intelligence firm MicroStrategy who now runs Bisnow Media, a collection of publications about local news and happenings.

Summit Series began a year ago when Elliott Bisnow wanted to meet other young entrepreneurs to hear their stories. He organized a ski trip and then an excursion to Mexico as settings for chief executives -- their average age is 28 -- to make connections. A group of 125 will make a similar trip to Aspen, Colo., in a few weeks.

Thirty-five of them were among the White House visitors March 6. The group included Michael Chasen, chief executive of District-based Blackboard; Mark Ein, chairman of Kastle Systems; Aaron Patzer, founder of Mint.com; Ivanka Trump of the Trump Organization; Evan Williams, founder of Twitter; and Catherine Levene, chief operating officer of Daily Candy.

The group spent nine hours at the White House, Bisnow said.

"The goal was to bring entrepreneurs with deep economic impact to listen and come up with ideas," he said.

Kim Hart writes about the Washington technology scene every Monday. Contact her at hartk@washpost.com.

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