A Small Business Administration staff report highly critical of Carter administration-backed labor law revisions was withheld by the SBA for three months and released only after the Labor Department had written an accompanying rebuttal.
The SBA report claims the proposed changes in union organizing laws now being considered by Congress "would trip the delicate balance which exists between small business and labor in favor of the latter."
The report notes that labor unions in 1976 won 58.6 percent of their organizing elections in firms with 10 or fewer employes, compared with 50 percent of the votes in firms with up to 500 employes.
Describing proposed deadlines for action on labor organizing efforts as "quickie elections," the report calls other parts of the bill "patently discriminatory," and says "small firms will be most vulnerable" tothe changes in labor laws.
The report was written by SBA's Office of Advocacy, a small bureau created by Congress two years ago to assess the impact of government policies on small business and to act as a voice for small firms.
The Office of Advocacy in late January gave SBA Administrator A. Vernon Weaver its analysis of the labor law revisions that passed the House last session and now are the subject of a Senate filibuster.
The report was considered so sensitive that its authors made only six copies, carefully coding each of them so leaks could be traced, then locked up the computer tape used to reproduce the reports on automated typewriters, according to SBA sources.
The SBA document remained secret until a few days ago, when - after more than two weeks of cajoling - Weaver turned over a copy to Sen. Orrin Hatch (R-Utah) a leading opponent of the labor law overhaul.
Accompanying the eight-page report - which carries two separate disclaimers stressing it "does not represent the official position" of the SBA - was a nine-page response from the Labor Department.
Along with both reports came charges from Hatch and SBA career employes that the White House Office of Management and Budget and the Labor Department tried to make Weaver keep the report secret and to intimidate its authors into changing their assessment of the bill.
OMB and Labor spokesmen yesterday denied they sought to surpress the report.
Recounting a series of phone calls to Weaver and lengthy delays in getting the report, Hatch said, "I don't think any United States senator should have to go through this much pain just to get information like this."
One of the authors, attorney Michael Cawley, left the SBA recently after his temporary assignment ended and he was not reappointed.Another, Steve Mollett, director of the Office of Advocacy, has told coworkers he fears he will lose job in an SBA reorganization now under way.
Mollett yesterday termed the report "a hot potato" that "certainly does not reflect the administration position" on the labor law revisions.
"If they had just released the goddamn paper back in February, I don't think it would have been as volatile as it is otday," said Mollett.
He confirmed that the Office of Advocacy was asked to rewrite the report, but declined to do so, apparently leading backers of the legislation to get the Labor Department to write a rebuttal.
SBA chief Weaver could not be reached for comment. Describing the flap as "an embarrassing situation," a spokesman for Weaver said he had sought labor Department advice to get a more balanced picture of the impact of the bill.
"Weaver is on record supporting the bill," said the SBA press officer. Privately, however, Weaver is said to have defended his staff and expressed misgivings about the legislation.
SBA sources said Weaver feared making the critical report public because he had already been called on the carpet at the White House for another Office of Advocacy report. The office last year published a study saying the then-proposed consumer protection agency would harm small businesses. Under orders from the White House, Weaver wrote letters to members of Congress saying the SBA supported the consumer agency legislation, which died in Congress.
The author of the consumer agency report, a GS15 named Barbara Dunn who had worked for the government for less than a year, was later fired.
An aide to Labor Secretary Ray Marshall said that department prepared its response to balance an unfair report by SBA's Office of Advocacy. "Every time a piece of social legislation like this comes down the pike, this group at SBA does something like this," he complained.
Mollett responded that his nine-member office is supposed to represent the position of small businesses, adding that "95 percent of small businessmen are opposed to this bill."
The SBA study says that if the measure becomes law "a largely unorganized management (will be) pitted against an efficient and effective union effort."
It criticizes "equal access" provisions of the law which would allow union organizers to talk to workers on the job if management decides to address workers on the job. While the Office of Advocacy says this would "penalize employers for utilizing the only available forum," the Labor Department response contends it would put labor and management on an equal footing.
Also criticized is a provision of the law that would allow companies found guilty of willful violation of orders of the National labor Relations Board to be denied government contracts. The report contends this will make union organizing easier at many small companies that operate under SBA's 8A program for minority firms. The small firms will give in to unionizing efforts rather than risk losing the government contracts on which they depend, the study predicts.
The Labor Department counters that the threat of losing government contracts is used as a penalty in enforcing equal opportunity and other laws and does not single out small business.
The Labor Department responds that "employers have an overwhelming advantage" in telling their side of the story to employes, requiring changes in the law.It contends that deadlines for holding elections on union representation are needed to keep employers from stalling indefinitely to avoid a vote.