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Guest Commentary: Can unions survive the implementation of Affordable Care?

Fri, May 10th, 2013
Posted in All Commentary

Jeff Erding

By Jeff Erding, Wykoff, Minn.

Democratic candidates enjoy overwhelming support from labor unions of all types. It is doubtful President Obama could have been elected without the votes and financial contributions of the unions. Unions may be small in the actual percentage of workers, but carry enormous political clout and have been extremely supportive of the Obama Administration. However, as the details of the Affordable Care Act are gradually coming to light, it appears a severe strain on this heretofore solid relationship is inevitable.

The situation is spelled out very clearly in an article by James McGee in the March 18th on- line issue of Labor Notes {}. Labor Notes is a union advocacy website and is highly regarded as a reliable source of information for union workers. I’ll try to summarize the problem here, but for a more detailed account it would be best to visit the site and read the complete article.

At the heart of the matter is the existence of multi-employer (sometimes called Taft-Hartley) health insurance plans. This is the type of plan that covers many union workers including construction, theater, longshore, hotel, transportation, and food service. These plans are affordable and effective and are governed by a joint board consisting of union and employer managers. Workers retain coverage as they go through short periods of unemployment or move between employers. Coverage is often quite good and dental and eyeglass coverage is usually included. Union workers were told they would be able to keep their present plan and that the implementation of Affordable Care would save them money. This does not appear to be true.

Instead, the ACA puts multi employer plans at a disadvantage by permitting competitor [non-union] employers access to the new health care exchanges while denying the multi employer funds the same access. ACA calls for a 40% surcharge on the multi-employer plans, making them unaffordable and virtually forcing employers to abandon the plan when the union contract expires. Many union employees are very angry and feel betrayed by the sponsors of ACA, myself included.

Since union membership is relatively low, you may ask why any of this really matters. It matters because unions are now and always have been the standard bearers for wages and working conditions for all other workers. Every improvement in wages and working conditions in America has been advocated and fought for by union tradesmen. Without unions, working conditions for everyone would be much different than they are today.

The main selling points for convincing someone to join a union are: 1) multi employer health funds and 2) retirement plans or pensions.

Surprisingly, these items are also very important to signing up contractors . They provide a level playing field in the bidding process when bidding against other union contractors and a consistent means of providing health, welfare, and pension plans to their employees.

How many union contractors will be able to survive the implementation of the Affordable Care Act? Does ACA spell doom for the unions and multi-employer funds? Will the Democratic leadership be able to “kiss and make up” with angry and confused union workers in time to avoid disaster during the mid-term elections? Is ACA, touted as the “Holy Grail” of accomplishments by liberals, going to turn into a complete train wreck” as one of its authors recently stated?

I hope I’m wrong folks, but this looks like another expensive black eye for the Obama administration. Unfortunately, American workers will be paying a heavy price for this one.

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