Constitutional Law

Professor Epstein Responds to Professor Gottesman on EFCA

Richard Epstein, a University of Chicago professor of law and one the nation’s leading libertarian scholars, has responded to an ACS guest blog post challenging the professor’s claims that the Employee Free Choice Act (EFCA), which is pending in Congress, poses serious constitutional problems. In December, Epstein, in an opinion piece for the Wall Street Journal, contended that EFCA, if enacted, would prove an affront to the First Amendment and the Constitution’s Takings Clause.

Yesterday, Georgetown University Law Center Professor Michael H. Gottesman, in a guest blog post for ACS, examined Epstein’s claims surrounding EFCA and concluded that debate on the proposed measure “can comfortably remain on the terrain of policy, uncomplicated by concerns of unconstitutionality. For Epstein’s imagined constitutional difficulties haven’t the remotest chance of gaining judicial acceptance.” Gottesman’s entire analysis of Epstein’s arguments is available here.

Epstein responded at length to Gottesman’s blog post:

I have just had the opportunity to review Michael Gottesman's attack on my Wall Street Journal editorial on why there are serious constitutional difficulties with the proposed Employee Free Choice Act. This reponse will only touch on the issues. A fuller account of the many defects of this dreadful statute can be found in the book that I have prepared for the Alliance to Safe Main Street Jobs, which is the vanguard of the opposition to the bill. The url for that book is http://papers.ssrn.com/so13/papers.cfm?abstract id=1337185.

See Epstein’s entire response after the jump.

I think that the odds are overwhelming that Gottesman supports the Act, or some close variation of it on political grounds, and that this assessment must surely color his analysis of my position. But a close examination of what he says, I think, reveals the exact opposite conclusion. If he has made the strongest arguments for the adoption of the statute, the case for its unconstitutionality is even stronger than I initially proposed. Let us look at the claims in order.

On the first amendment question his point is that the government should never be required to give notice to a party so that its political speech can have some degree of effectiveness. The most that it offers to individuals is the right to rant and rave as they will “so long as they refrain from threats or coercion.” Ordinary readers might treat this last phrase as an innocuous limitation on the right to speech. But within the peculiar universe of labor law it imposes a powerful restriction on the ability of the employer to voice his views about the desirability of unions. It is now unlawful to say that an employer will close down or move overseas if the union comes into play. At it is impermissible to promise any benefit to workers if they stay out of a union. The union is subject to no parallel restriction, but can promise or threaten within the common law limits to its heart’s content.

The success of employer speech within these rules depends of course on knowing who it is that it has to deal with. Under the current system of secret ballot elections, an employer need not content itself with abstract denunciations of union, but can actually say something intelligent about the performance of that union when it has unionized or tried to unionize other shops. Gottesman does not deny that secret campaigns can take place. And he does not explain how one can object to a union about which the firm is ignorant before it is too late. Nor does he give the slightest consideration to the simple point that all workers who participate in this important decision might have an interest in hearing the positions that are urged on the other side. The omission shows that he thinks that they are really inconvenient ciphers whose preferences to hear and to speak and to vote count for naught if the secret blitz can work. 

Nor does he strengthen his case with the preposterous comparison that says that an employee does not have to give notice to an employer to bring suit. Or the reverse. But the obvious rejoinder to this point is that bringing suit is bringing suit not winning a final judgment. There is an institution known as notice pleading that requires the plaintiff let the defendant know the suit has begun before the final judgment has been entered. But with EFCA the brutal truth is that once the card check wins, the litigation is over without an opportunity to defend. The next step is lockstep negotiations that can lead to an arbitral decree binding on the firm, fresh from government arbitrators. The simple point is that all of civil procedure gives notice between the filing of a complaint and a final judgment. Gottesman defends a process that gives no notice at all. It is hard to see how this unilateral suffocation of all speech is consistent with any notion of union democracy or fair play. The first amendment claim can easily withstand this grotesque example.

Gottesman fares no better in his caricature of takings law. The central distinction in takings law is that between the regulation of use and the occupation of property. A lot turns on that distinction. In land use regulation cases partial takings are par for the course and the government has a lax burden of justification. But with occupation cases, small occupations generate a per se obligation to compensate. Gottesman chooses only to deal with the land use regulation cases, where it is correct (if sad) to say that only rarely is a regulation so comprehensive that it generates a per se obligation to compensate. But he does not explain why the occupation side of the line is not the better parallel.

The point really matters because the arbitral system is not nearly as benign as Gottesman would have it. His major contention: “It would be a taking only if it awarded the employees 100 percent of the employer’s assets or was so draconian that it qualified for the “goes too far” condemnation not met even in the zoning and historic preservation cases described above.” So an arbitral award that demands that 90 percent of the common stock be turned over to the workers would appear to be just fine. The key point here is that he only cites the regulation cases and never discusses the occupation cases that work by a different rule. Nor does he mention, let alone explain, the key difference between the minimum wage law, which leaves the opportunity not to hire and EFCA which leaves no exit rights at all, but forces an employer to enter into a transaction from which he is certain to lose.

To soften the blow he describes arbitration in glowing terms, wholly misguided. “For one thing, the system employed by the Federal Mediation and Conciliation (FMCS) for selection of arbitrators – furnishing a list from which each party strikes names until only one name is left – virtually guarantees that the lunatic arbitrator Epstein envisions will not be chosen.” This justification should put shivers down the spine. The first point is that there has to be a panel of arbitrators, which means that this device cannot be used. But worse, it ignores the obvious question of who prepares the list. If it is FMCS, then an Obama administration can give a list of all pro union arbitrators to act utterly without guidance or appeal. We may not have “lunatics” but it is certainly clear that we will have a stacked deck of arbitrators chosen by a populist administration, without any required input by the employer who is bound by the decree on all matters of mandatory bargaining. The system is not saved by the false comparisons to interest arbitration in the public sector. There the state has consented to arbitration, and the parameters for the award are set out, which is not the case here. Let us hope that nonlunancy is the standard of constitutionality. A bit of notice, hearing, neutrality and review seem required. The due process violations of the current scheme are palpable even if the FMCS decided to go out of its way to appoint” fair arbitrators. 

Members of the ACS should care deeply about fair deliberations and fair processes. The EFCA supplies neither.

Full post as published by ACS Blog on February 05, 2009 (boomark / email).