The Representation/Participation Gap:
© 1999 John Perkins
Worker-Management Cooperation in the
Today, the buying public's preferences for quality products and timely
courteous service delivery has made an impact on the people who own and
manage the workplaces of this country. The effort to increase quality,
waste, and streamline operations has sparked a wave of workplace
with procedures and methods for utilizing the intelligence of the
in the organization most knowledgeable about how the work is done: the
who do it. Under slogans and banners proclaiming the importance of
and cooperation, many in management now profess to want to work
with employees in order to achieve organizational success in the
This paper will look only at the issues raised by the Wagner Act in
workplaces. It has three parts. This first has three sections: a brief
of the theory behind the original Wagner Act and what it wanted to
a look at the Electromation case, the most significant recent case in
law and the detonator of the explosion in legal, legislative, and
branch interest in "clarifying" (amending) the Wagner Act; and
the final part looks at workers' preferences as revealed in the Worker
and Participation Survey.
The middle part of the paper will be a review, in table form, of twelve
significant laws and decisions. The last part will be a review of
for addressing issues raised by the Electromation case.
The workplace dominates the lives of most adult Americans. Most workers
spend more time at work than with their families and friends. To be
work is to be without legitimate sources of money and thus becomes a
crisis for any self-supporting adult.
Yet, how many workers today know that the typical workweek-eight hours
day, five days a week-has been squeezed out of the owners and managers
capital through long and bloody struggles by workers? How many are
that the nice benefits packages they are offered-paid vacation, sick
medical benefits and such-often mimic benefits unions win in collective
bargaining agreements? How many are aware that the issues of
and participation have become the focus of a raging policy debate at
At the same time, and often within the same companies, companies are
"downsized," which means lay-offs, and, sometimes, entire plants
employing thousands of workers being closed. Lone workers who do speak
and try to exercise their rights to unionize are sometimes intimidated,
fired and even blacklisted, which hampers their ability to find other
Workers may be reluctant to fully participate with management if it
lead to a loss of employment for themselves or co-workers. How can
be sure they are being fairly treated and not misled? How can
secure greater participation from their workers?
These issues have been crystallized in what the Worker Representation
Participation Survey calls the Participation/Representation Gap. In a
involving 2400 people, including people in management positions, this
sought to answer the question of what workers wanted, and which modes
workplace governance they felt comfortable supporting. I will take a
at the conclusions of this survey later in this section.
This section will take a brief look at a thread of labor history
around the 1935 National Labor Relations Act (Wagner Act). I
that this arbitrary starting point sweeps past the bloody, heroic
of working people to win basic concessions from their employers. It
may present government in a more positive light than a longer history
reveal. Governments at all levels actively supported industrialists and
suppressed workers' struggles for the right to unionize and for better
conditions. Still, 1935 provides a good starting place because it is
The National Labor Relations Act (Wagner Act or the Act) became law.
In attempting to unwind this thread of labor history, I acknowledge up
that I may be oversimplifying so that key issues stand out. Labor law
enacted laws of Congress, rulings by administrative agencies such as
National Labor Relations Board (Board), and circuit and Supreme Court
Non-statutory opinions expressed by legal scholars and recommendations
blue-ribbon commissions also play a part. In addition, the experiences,
attitudes and opinions of workers and management in the workplace has
effect on labor law.
Robert Wagner and His Act
Senator Robert Wagner from New York, the labor policy advisor to
Franklin Roosevelt, seized an opportunity created by the relative
of business during the Great Depression to craft legislation which
a way for labor and management to grope its way towards a cooperative
Many people wanted to end the angry and violent confrontations between
and management which had characterized industrial relations from the
nineteenth century up to the early 1930's. Business, however, did not
Wagner's ideas and launched the largest lobbying effort in history, up
that time. Organized labor, best represented by the American Federation
of Labor (AFL), actually opposed the legislation initially, and, in any
case, had little influence.2 That Wagner succeeded is a testimonial to
tenacity and the public's weariness with the violence associated with
rights and union organizing efforts.
Mark Barenberg at Columbia Law School has provided a valuable public
by reconstructing the vision Wagner and his allies had of community,
economy, and workplace governance practices. I will not try to
the subtleties and nuances of an article which runs to 117 pages. I
though, discuss the two sections of the Wagner Act pertinent to modern
involvement plans and their symbolic and consciousness shaping origins
explicated by Barenberg.
The Electromation case, the most important case which has dealt with
governance issues in recent years, turned on how the National Labor
Board (Board) interpreted two sections of the Wagner Act: Section 2(5)
defined what the Act meant by "labor organization," and Section
8(a)(2) which prohibits companies from dominating a labor organization.
The exact texts read:
Section 2(5): The term "labor organization" means
any organization of any kind, or any agency or employee representation
or plan, in which employees participate and which exists for the
in whole or part, of dealing with employers concerning grievances,
disputes, wages, rates of pay, hours of employment, or conditions of
Ultimately, these two sections reflect Wagner's view that workers
to give their genuine consent to workplace authority, and this could
be secured through their ability to express their collective will,
than through individual contracts between a lone employee and the
Wagner understood that success for the firm depended on workers
their intrinsic (uncoerced) group cooperation in exchange for
commitment to norms of group fairness in decisions affecting job
and distributive share.4
Section 8(a)(2): It shall be an unfair labor practice for an employer
dominate or interfere with the formation or administration of any labor
organization or contribute financial or other support to it: Provided,
subject to rules and regulations made and published by the Board
to section 6, an employer shall not be prohibited from permitting
to confer with him during working hours without loss of time or pay.3
These sections maximize the symbolic pressures contained in this Act on
workers to recognize the need for, and to create for themselves, a
"voice." When a worker sees the need for workplace dissent leading
to reforms, a classic choice confronts her, conceptualized as Exit and
"Exit refers to leaving an unsatisfactory setting, and voice refers
to attempts to improve the situation."5 Voice means "participation
in the democratic process, through voting, discussion, bargaining, and
like."6 Workers also have two less active choices: to quietly endure
the suffering or to so narrowly limit their expectations about work
they perceive "larger" governance issues as none of their concern.
Section 8(a)(2)'s prohibition against the company dominated union, also
called the "company union" or sham union, can be viewed as Wagner's
attempt to block companies from creating seemingly representative labor
organizations which, in fact, do nothing of the sort. Wagner saw that
scale of modern mass production required group, rather than individual,
consent and cooperation.7 A company union, by being so close to genuine
representation, might damage the pre-conditions for free group
and choice more than a non-union workplace.8
There are two reasons that collective rather than individual bargaining
are important in the workplace. First, within a given workplace, many
of the job transcend the individual worker. Hardworking workers seeking
to make a change will face a daunting task, and if they succeed their
get to benefit without doing any of the work of achieving the change.
workers will hesitate to reveal their true feelings to their employer
fear of being fired or hurting their careers. The risk of losing a job
the expression of voice too risky for the individual worker.9
According to Barenberg, Wagner felt that independent unions could
with the company-union like structures of shop committees and similar
labor-management bodies" to create the ideal workplace governance
If necessary, Wagner would place a higher priority on fairness in the
contests between labor and management (owners) than efficiency
Once cleansed of power disparities, norms of fairness, shared
and mutual trust would be nurtured by the new institutional
The Electromation Case 12
This case, because it faithfully followed the Wagner Act, especially
8(a)(2)'s prohibitions against company unions, has ignited an explosion
of legal opinion, legislative bills and executive branch activity.
Barenberg explicitly credits this case with motivating his review of
purposes and intentions behind the Wagner Act, because even Board
failed to understand how the Wagner Act supported cooperation between
Because this case touched upon many of the assumptions and expectations
involved in modern workplace practices, the Board recognized its
and permitted oral arguments. The Board framed the pertinent issues as:
(1) At what point does an employee committee lose its
as a communication device and become a labor organization?
(2) What conduct of an employer constitutes domination or interference
the employee committee?13
The Board found that "Action Committees" as established by
were not simply communication devices but constituted labor
within Section 2(5) of the Act, and Electromation's actions towards
Action Committees constituted domination and interference, thus
Section 8(a)(2) and (1) of the Act.
The Facts of the Case.
Electromation makes electrical components and related products. It
about 200 people who were not represented by any labor organization at
time of the events of this case. Late in 1988, Electromation was losing
money, and decided to cut expenses by altering an existing employee
bonus policy and replacing a wage increase in 1989 with a lump-sum
based on length of service. In January of 1989 (all following dates are
in 1989), 68 employees signed a petition expressing displeasure with
changes and presented it to Electromation. John Howard, the president
Electromation, met with the supervisors and then, on January 11, he met
directly with a selected group of eight employees and discussed with
a number of issues including wages, bonuses, incentive pay, attendance
and leave policy.
After another meeting with the supervisors, Howard concluded that
had a serious problem with employees. Howard testified that they
that unilateral action would fail to make everyone happy and the best
of action would be to involve employees. Howard met with the same group
of eight on January 18 and explained management's plan for dealing with
the problems. He said management had distilled the list into five
and proposed the creation of Action Committees to meet and try to
the problems. He told them that if the Action Committee made proposals
could fit into Electromation's budget, and the employees generally
them, they might be tried. Howard told the Board that the employees at
meeting (the select group of eight) did not receive the idea of Action
At this meeting this select group of employees and Howard agreed to
workers to sign-up to be on Action Committees. On January 19, the
posted a memorandum to all employees explaining the Action Committee
Features of Action Committees included:
Six employees and two members of management
In addition, employees were paid for their time, and the company
necessary supplies. After several people tried to sit on more than one
Electromation told them that an employee could only be on one Action
Employees on the Action Committees were expected to discuss with their
workers the proposals the Action Committees generated. The Employee
Manager facilitated the discussions.
Coordination of all Action Committees by the Employee Benefits Manager
Goals and Responsibilities of each Action Committee entirely drafted by
On February 13, the Teamsters made a formal demand for recognition,
management had not known about until then. A week later, on February
management withdrew from the Action Committees but told the employees
could continue to meet if they wanted to. Two committees continued to
one disbanded, and one wrote up a proposal and did not meet again. This
committee had submitted a previous proposal which the controller, a
of this particular Action Committee, had overruled because of its
The proposal was not presented to President Howard because of the union
On March 15, Howard told employees that the company could not continue
participate in the Action Committees until after the election. On March
31, the union lost the election by a vote of 95 to 82. A switch of
votes would have changed the outcome. The administrative law judge who
heard this case noted that the company had said, in effect, that it
continue the committees after the union vote.14 Would those seven
have changed their vote had they known that Action Committees could not
legally be continued?
As noted, the Board ruled that Electromation had indeed created "labor
organizations" and then dominated them. Given the facts of the case,
the Board could draw no other conclusion. Though Electromation's
had concluded unilateral action would not resolve the problem, it then
to set up committees exactly how it wanted them. The structure, size,
and facilitation of these committees firmly remained in the control of
The employees who chose to participate did so voluntarily, which means
had not been a democratic means for workers to select who represented
As Board Member Devaney said in his concurring opinion:
The Respondent (Electromation) itself chose the Action Committee
and charged them with representing their fellows, overriding employee
as to how the representatives would be chosen. By these acts, the
substituted its will for that of a majority of employees and usurped
right to choose their own representativeIn essence, the Respondent
for purposes of collective bargaining a labor organization that did not
represent a majority of its employeescurrent binding precedent under
8(a)(2) requires an approach sensitive to the damage to employee
7 rights [rights to self organization] that sham bargaining agents
and to the realization, present both in Congressional deliberations and
in Board law itself, that genuine employee involvement is in no way
to the free exercise of the right of employees to choose a bargaining
if one is desired.15
From the facts reported in the case, I agree with the Board.
had, in effect, created and then dominated labor organizations. What is
surprising is that a case which clearly falls within the area of sham
company unions that Wagner sought to outlaw would raise such a chorus
changing the law. Even Board Member Raudabaugh, in his concurring
argues that Wagner built an adversarial relationship into the Act: "The
adversarial model, upon which the Wagner Act was based, is at odds with
a cooperative model of labor relations. In the adversarial model, there
is an inherent conflict between management and labor which may lead to
strife and unrest."16 Member Raudabaugh misunderstood what Wagner
according to Barenberg. Barenberg, from his research into Wagner's
in writing the Act, suggests that the Act attempts to answer this
What legal regime can best encourage collaborative,
workplaces, and simultaneously empower and safeguard workers against
understood as illegitimate instrumental coercion and endogenous shaping
workers' preferences and interests?17
Words like "adversarial" and "cooperative" describe
the climate mutually created and shared by management and workers. But
which represents the owners of capital, has more than half of the
for the climate through its rights to hire and fire. By permitting
to have legal protections for creating or voting to join an independent
organization which would speak for them, as a group, in negotiations
management, Wagner sought to create parties more closely matched.
as noted before, a lone worker would be overwhelmed. So if a climate is
adversarial, a major share of the responsibility for changing that must
be management's.18 Management's stiff opposition to the rights of
to have a voice had not been Wagner's making-it existed long before his
legislation-and unfortunately, it has continued since.
In an uncoercive workplace, what type of workplace governance do
support? Has the Wagner Act succeeded in helping workers understand
need for an independent, collective voice when dealing with management?
In the next section we will see how workers have answered these
Worker Representation and Participation Survey
The Teamwork for Employees and Managers Act of 1995 (the TEAM Act) had
"findings" which I will summarize:
1. Global competition has "compelled" changes in workplace
Can management be trusted to organize "collaborative" employee
involvement programs which genuinely represent the interests of
as workers themselves perceive their interests? Is the workplace more
today to workers freely speaking their minds, and actively seeking
they can trust to deal with workplace issues? Have conditions changed
2. such changes has increased "employee involvement" in workplace
3. Employment Involvement programs exists in unionize and non-unionized
workplaces, have been adopted by 80 percent of the largest employers,
exist in over 30,000 workplaces;
4. Employment Involvement programs positively impact employees by
enabling them to reach their potential in the workplace;
5. Congress has encouraged Employee Involvement through such incentives
as the Malcolm Baldrige National Quality Award;
6. employers using "legitimate Employee Involvement programs have not
done so to interfere with collective bargaining rights guaranteed by
laws, as was the case in the 1930's when employers established
sham 'company unions' to avoid unionization;" and
7. "Employee Involvement is currently threatened by legal
of the prohibition against employer-dominated 'company unions.'"19
The Worker Representation and Participation Survey (Survey) set out to
these types of questions. It provides the best current data on workers'
attitudes about workplace governance issues. Richard Freeman and Joel
led the project and private foundations sponsored it. Though Freeman
as a member of President Clinton's Commission for the Future of
Relations (the Dunlop Commission), formed in response to the
decision, the Survey and Commission have no formal or direct links.
In total, the Survey interviewed 2,408 adults, 18 years old or older,
worked in private companies or non-profit organizations with 25 or more
employees. The Survey reached all levels from "low-level" service
workers to "knowledge" workers and middle management. An additional
omnibus survey reached 1100 workers and a follow-up survey reached 1000
of the original 2,408 workers. The project also conducted focus groups
In summary, workers answered three big questions posed by the Survey:
Q. Do employees want greater participation and
at their work place than is currently provided?
Q. What do employees see as essential to attaining their desired level
participation and representation?
A. Management acceptance and cooperation.
Q. What solutions do employees favor to resolve any gap between their
participation and representation and what they currently have?
A. Difficult to answer. Most want cooperative joint committees with
independent standing inside their companies, and many want unions or
The Survey identified "four major gaps between what is and what should
be for American workers:
Workers believe overwhelmingly (82%), that employee participation
would be better run if workers had more say in running them. Workers do
not want management to select employee representatives, with non-union
overwhelmingly choosing against management selection (by a margin of
to 9%); of the 86% of workers wanting to select their own
a 50 percent plurality preferred employee election.
- A trust gap exists in the extent to which employees feel their
to the company is reciprocated by their employers.
- A participation gap exists between workers' actual ability to
decisions that directly affect them, and the amount of influence they
- A representation gap exists between the number of workers who are
with their access to group representation to help resolve workplace
and the number who feel they have sufficient access.
- A legal gap exists between the amount of legal protection workers
like to have to protect their rights, and the protection they believe
"Non-union workers without committees want them as an additional means
for employee voice," the Survey notes, with 69-76 percent of such
(depending on question wording) feeling these committees would be a
effective means of solving problems than their current system. Over
of workers interviewed have no group representation at all, and of
over two-thirds believe an employee committee would improve the system
resolving workers' concerns.23
Fear of offending management plays a role in suppressing workers
for unions. "Employees see management acceptance and cooperation as
the key to the success of the employee organizations and workplace
needed to close the representation/participation gap," Freeman and
Rogers report. Workers would prefer a weak organization in a
environment over a strong one in an adversarial one by a margin of 3-1
vs. 22%).24 About equal numbers of workers say they are pro-union as
(42% - 44%). There is a "sizable" 25 point gap between those workers
in unions and those who would like to be (14% vs. 39%). If management
were not a factor, unions might be competitive in all major sectors
the Financial industry.25
This Survey directly followed in the wake of the Electromation case,
with bills in Congress, Presidential Commissions and long articles in
journals. The following table summarizes
pertinent legal and legislative events preceding and following the
decision. In the last section of this paper I look at the
which have emerged.
1 Commission on the Future of Worker-Management Relations. (May 1994).
Finding Report. Washington, DC: U. S. Department of Labor.
2 Barenberg, Mark. (May 1993). The Political Economy of the Wagner Act:
Power, Symbol, and Workplace Cooperation. 106 Harvard Law Review, 1396
3 National Labor Relations Board. (December 1992). Electromation, Inc.
International Brotherhood of Teamsters, 309 NLRB 992.
4 Barenberg, Wagner Act, p. 1466.
5 Parker, Louise E. (1993). When to Fix it and When to Leave:
Among Perceived Control, Self-Efficacy, Dissent, and Exit. Journal of
6 Freeman, Richard, and Medoff, James L. (1984). What do Unions Do? New
York, Basic Books, p. 8.
7 Ibid., p. 1454.
8 Ibid., p. 1455.
9 Ibid., p. 9.
10 Barenberg, Wagner Act, p. 1430.
11 Ibid., p. 1392.
12 Details of events drawn from Electromation, 309 NLRB 990-992.
13 Ibid., p. 990.
14 Ibid., p. 1019.
15 Ibid., p. 1003.
16 Ibid., p. 1011.
17 Barenberg, Wagner Act, p. 1496.
18 This is expressed by workers themselves as will be noted in the next
section. Also see Scott, William and Hart, David K. (1990),
Values in America, New Brunswick, NJ: Transaction Publishers, p. 153,
they make a case that the masses, though powerful, lack the
expertise to make and maintain the necessary reforms."
19 Teamwork for Employees and Managers Act of 1995 (TEAM Act, H.R. 743
S. 295), Available 10/8/96 at
Section 2. Findings and Purposes.
20 Freeman, Richard, and Rogers, Joel. (1994). Worker Representation
Participation Survey-Final Findings. Available 10/17/96 at
21 Grob, H. (1995). Worker Representation and Participation Survey
Available 10/17/96 at
22 Ibid., p. 3.
23 Freeman, Richard and Rogers, Joel. (1994). First Report of the
Available on 10/17/96 at
25 Freeman and Rogers. (1994). Final Findings, p. 4-5.