Thursday, February 23, 2017
Many thanks to Matthew Dimick for contributing this guest post:
A few weeks ago, OnLabor.org featured a post I wrote about the Ghent system and progressive federalism. At the end of that post, I referred to “other avenues for Ghent-type experiments” beyond the main one discussed in the article, which would require changes in the current federal-state cooperative system of unemployment insurance. Mentioning these “other avenues” prompted several queries from readers, and I will use this opportunity here at the Workplace Prof Blog to talk about those.
First, some background. To remind readers, the Ghent system is a form of union-administered (but government paid-for) unemployment insurance that has a substantial, positive impact on the rate of union membership in the countries that have it. What makes the Ghent system a prospect for union revitalization in the US is the system of unemployment insurance we have here, which basically incentivizes states to adopt, finance, and administer their own unemployment-insurance systems subject to federal guidelines and oversight by the Secretary of Labor. It also helps that states are given more latitude under federal labor law preemption when it comes to the design and administration of unemployment insurance.
I originally wrote about the Ghent system for a law review article in 2012, after Democrats had lost control of Congress, which had effectively ended any prospect of passage for the Employee Free Choice Act. Yet as long as a Democrat remained in the White House, a reform like the Ghent system at the state level didn’t need approval from a Republican Congress. I doubt Obama’s tenure is the last we will see of divided government, so I still think it is worth thinking about a progressive-federalist reform like the Ghent system. Yet since a Trump administration probably forestalls that avenue for now, it is also worth dwelling on “other avenues,” as I suggested in my other post.
One alternative is take a purely private route to a Ghent system. Despite its weakness in terms of union density, the US labor movement still has vast resources and expertise gained through administering health and pension funds. Can these resources be leveraged to create a subsidized and supplemental system of unemployment insurance for workers? Without the government subsidy and because it wouldn’t be a worker’s exclusive source of unemployment insurance, this proposal certainly wouldn’t have the impact of a full-blooded Ghent system. Yet historically, unions have filled this function, and it played an important part in the origins of the Ghent system, which was created when a municipal government came to the rescue of a union unemployment insurance fund depleted by an economic downturn.
A private option need not supply unemployment insurance. The Freelancers Union has had notable success in providing health, dental, life, and disability insurance to workers who join the union. The main difference between the Freelancers Union and a traditional labor union is that the former does not collectively bargain. It is understandable why the Freelancers Union has made this choice. At the same time, a labor organization that combined both mutual aid and bargaining functions is a powerful ideal.
Moving even further from the insurance realm, union-administered and employer- or government-funded job training also seems like a possibility. Workforce development is a goal the business community can get behind. And unions already have a template in the highly successful Culinary Academy of Las Vegas, a consortium of local hotel casinos and unions that provides job training to union members. Working closely with the union’s hiring hall, the CHA does many things the Ghent system does in terms of cultivating union membership.
In short, there are indeed many other avenues available for experimenting with Ghent-type institutions that worker advocates should consider—even with a Trump in the White House.