States with Right-to-Work laws require union contracts to cover all workers, not just the ones who are members of the union.
Contrary to what proponents of Right-to-Work legislation have said in the past, non-Right-to-Work states do not force employees to unionize; this is strictly prohibited by federal law.
Currently, 28 states have Right-to-Work laws. Note: if your state is not listed, it does not currently have a right-to-work law, but this area is constantly changing, so please consult with an attorney in your state for additional information.
Right to work laws vary from state to state but generally most employees working for private employers are covered along with public-sector unions. Workers in the railroad and airline industries are not covered. Opponents of Right-to-Work laws consider those laws to enable workers to be freeloaders, to enjoy the benefits of being a union member such as higher wages and job protections, but without paying any of the costs of collective bargaining.
In a recent case, Janus v. AFSCME, the Supreme Court ruled that public-sector employees do not have to pay union fees to unions to cover the cost of collective bargaining. The coefficient of As with worker characteristics, the industry and occupation mix in the state could affect the average wage.
Again, controlling for these differences allows us to better isolate the relationship between RTW status and wages. As expected, the coefficient on the RTW indicator moves closer to zero as shown in the second column of Table 2 , and wages in RTW states are found to be 8.
Again, these results are in line with previous research. Following Gould and Shierholz , the third column of Table 2 includes additional state-level variables pertaining to the economic conditions—measured by the state unemployment rate—and differences in the cost of living across states. Averages for these continuous variables are found at the bottom of Table 1.
In addition to the cost-of-living variables, the wage regressions reported are quite standard, using controls race, gender, five education categories, industry, occupation, experience, union status, hourly status, part-time status, marriage status, and unemployment rate that are very common in labor economic research examining the determinants of wages Blanchflower and Oswald Using the same full set of controls used in Gould and Shierholz , we find a similar result where wages in RTW states are significantly lower, in both statistical and economic terms, than in non-RTW states.
On average, RTW laws are associated with wages that are 3. As with the earlier regressions, this result is consistent with the findings of Gould and Shierholz , which, using data, also found a wage differential of 3. As compared with model three, this change leaves the RTW penalty essentially unchanged it falls from 3. In his recent paper, Sherk critiques the Gould and Shierholz methods. Since this paper serves as an update to their methods, we use the most recent data presented here to test some of his criticisms.
Primarily, we defend our methods against the idiosyncratic empirical model choices Sherk uses. Secondarily, we explore some suggestions Sherk makes regarding the cost-of-living methodology to control for possible measurement error. As shown in Table 3 , and as will be discussed in detail below, in all cases we find that his suggestions do not change, in a statistically or economically significant way, the estimated RTW wage differential.
All of the models in Table 3 should be compared against the final model in Table 2. Full regression results are reported in Appendix Table A2. Labor market controls include variables for full-time status, hourly status, union status, state unemployment rate, occupations, and industries. Second-stage results are displayed; first-stage results are available upon request.
Here, we address the question of possible measurement error first before moving on to concerns over our model specification. Sherk suggests that simply putting cost-of-living variables on the right-hand side of a regression may produce inaccurate estimates. It is clear that our earlier findings are robust to using the instrumental variable regression, and we therefore find that extra step unnecessary. More broadly, Sherk makes several claims in justifying his idiosyncratic regression specification that finds no RTW wage penalty.
We find most of these claims unconvincing. In the remainder of this section, we address these model specification issues. Sherk suggests that Gould and Shierholz over-control for labor market features that could have been impacted over time by states being either a RTW state or not. Specifically, he asserts that labor market controls used in Gould and Shierholz —occupations, industry, unemployment, full-time status—bias results downward for RTW states because when controlling for these variables, Gould and Shierholz eliminate some of the positive effects of RTW laws on wages through indirect economic benefits.
Among these, only the exclusion of occupations has any reasonable rationale in standard wage equations, though even that is questionable in this context. Some labor economists have argued that occupations do not belong in wage equations because they are too co-determined and statistically collinear with educational attainment to provide useful information i.
Furthermore, the objective here is to compare similar workers, not examine the returns to education, a common use of a log wage model. We exclude occupation from our regression as a reasonable robustness test. The exclusion very slightly reduces the estimated RTW wage differential, as shown in the second column of Table 3.
While we maintain that occupation should be included, it is also important and relevant to include control variables such as industry, unionization, and full-time status in our regressions because we are trying to compare wages between RTW and non-RTW states for similar workers with similar types of jobs. Ideally, we would have two workers with exactly the same set of characteristics, except for one—the fact that one lives in a RTW state and the other does not. Then, when we compare their wages, we are isolating the RTW effect.
Controlling for job and economic conditions is the best way we can estimate the relationship between wages and RTW status. It is also standard practice in the analysis of wages using individual workers as observations Blanchflower and Oswald While we think it is important to include these labor market controls, we explore whether or not removing any one of these variables dramatically reduces the RTW coefficient, which could indicate that our results are not robust.
Sherk relies on a theory that RTW laws affect the industry composition of states. Empirically, these are mostly moot arguments. There has been no research showing a clear causal relationship between RTW status and attracting manufacturing jobs, and when we examined the relationship between the manufacturing share of employment in a state and RTW status we found no evidence to support his claim.
Right-to-work laws view union and non-union employees who share a workplace as having similar interests when it comes to their working conditions. What this means for you as an employer is that you have to treat union and non-union members equally in regard to the conditions of their employment. All employees are entitled to enjoy the same benefits. Right-to-work laws do not guarantee employment for individuals who apply to work in a union workplace.
According to the Federal Labor Relations Authority FLRA , exclusive representation gives union officials, even in right-to-work states, the ability to represent all employees in negotiations over wages and working conditions. They can generally represent their employees even if they are not members of the union. In states without right-to-work laws, employees can choose whether they want to join a union, and union members have the right to resign from their union membership.
They cannot be required to pay for fees until the costs associated with the fees are clearly stated. They also have the right to challenge costs. Please note that we are not your career or legal advisor, and none of the information provided herein guarantees a job offer. Post a job. Find resumes.
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