Industry, labor groups at odds over financial penalties in spending package

A major union is hailing new labor violation penalties in the Democrats’ social spending legislation as the greatest pro-worker reform in almost a century, while a powerful business group says the provision has no place in the reconciliation bill. 

The contrasting positions between the AFL-CIO and U.S. Chamber of Commerce highlight a dispute over the financial penalties for labor violations as the Build Back Better Act awaits passage in the House and likely more changes in the Senate. 

The proposal from House Democrats includes segments of the Protecting the Right to Organize (PRO) Act focused on civil monetary penalties for employers who have committed unfair labor practices. The draft bill would impose fines up to $700,000 for repeated safety violations, and lesser penalties for initial offenses. 

It will also increase funding for the National Labor Relations Board, the Department of Labor’s Wage and Hour Division as well as the Occupational Safety and Health Agency to identify violators and hear cases. 

Sean Redmond, the vice president of employment policy at the Chamber of Commerce, noted the bill includes civil penalties that have not been in the National Labor Relations Act since it was passed in 1935. 

“Adding brand new penalties would be a major substantive change to the NLRA that is not budget-related and thus has no place in a reconciliation bill,” he said. 

Democrats are planning to pass the spending package through the budget reconciliation process, which allows them to pass legislation with 50 votes and therefore bypass a Republican filibuster in the Senate. 

However, using reconciliation also means provisions must have a budget impact, and the Senate parliamentarian has already nixed immigration reform proposals that don’t meet that test. 

Democrats first need to pass the bill in the House, which leadership is hoping to do before Thanksgiving. The legislation is expected to undergo major changes once it gets to the Senate. 

Rep. Bobby Scott (D-Va.), who chairs the House Education and Labor Committee, which drafted the proposal, did not respond to a request for comment on its budget relevance. 

In a statement in July, he called for the PRO Act to be passed in its entirety, but noted the penalties were a positive step. 

“Under current law, the fine you pay for a parking ticket is greater than the fine companies pay for violating workers’ right to organize a union,” Scott said in the statement. 

“Creating financial penalties for unlawful anti-union activity will finally deter employers from violating the law and will better protect workers’ rights,” he added. 

A spokesperson for the AFL-CIO, one of America’s largest unions, told The Hill that it was pleased to see the penalties included in the Build Back Better Act. 

“While only one piece of the PRO Act, this provision would represent the most pro-worker labor law reform since the National Labor Relations Act was passed in 1935,” it said. 

President Biden unveiled his framework for the $1.75 trillion spending plan on Oct. 28, highlighting investments in combating climate change, educating young Americans, caring for the elderly and expanding affordable housing. 

Biden has billed himself as the most pro-labor president in decades, and has expressed his support for the full PRO Act, which also includes provisions making it easier to form a union and repealing “right to work” laws that allow unionized employees to not pay dues. 

“We should all remember that the National Labor Relations Act didn’t just say that we shouldn’t hamstring unions or merely tolerate them. It said that we should encourage unions,” Biden said in a statement encouraging the House to pass the PRO Act in March.

“The PRO Act would take critical steps to help restore this intent,” he added. 

And although it is unlikely to get any Republican support in Congress, the public is in favor of the full PRO Act. A poll administered by Data for Progress in June showed that 59 percent of likely voters are in support of the bill, including 40 percent of Republicans.