Union Membership: Another Potential Obamacare Victim

The Affordable Care Act, more commonly known as Obamacare, has become a serious sticking point in most of the recent negotiations between labor and management. A welfare plan, the most prevalent health care plan, is the only perk provided by most collective bargaining agreements. A jointly administered trust fund, managed by an equal number of union and management trustees, is responsible for paying the company's contribution to these welfare plans. Because the participants are union members and they vote, the practical nature of the trust provides the union with a lot more responsibility and concern even if the union and management trustees as a group have a certain amount of skin in the game.

Because the contribution amount is calculated by a statistician who determines what that amount is based upon certain known criteria, it usually becomes the one item of negotiations which is usually not negotiable. Before Obamacare, the most practical option, if management wanted to provide a health plan for its employees, is by establishing that plan through a jointly administered trust fund.

With the newly minted law, the government is providing a new and very attractive health care option to the management. It proposes that health care contributions, which can range from $800 to $1,500 per month per employee, should not be sent into the welfare fund anymore. Instead, it wants to allow employees to find their own health care on the exchanges (state or Federal).

That's not all. Under Obamacare, companies with 50 or more employees could just choose to pay a small penalty for each employee, instead of providing health care. This is also another attractive option for the management, because the penalty is negligible, especially compared to the annual contribution amount paid for health care for each of its employees.

Unions across the nation are now worried about Obamacare's effects on their membership. Welfare plans have always been a way to keep union members in line. In today's business climate, union shops provide a much desired health plan. Not to mention the fact that companies that provide excellent health care are in short supply. Thanks to Obamacare, employees can now choose not to be union members only for the sake of getting a better health care. Though the exchanges, they can still keep their health care that they can obtain by themselves. Unions should also be concerned about a decrease in their attractiveness to employees they are trying to organize. This can potentially happen if unions no longer have a health plan in force through multiemployer (two or more companies) jointly administered trust funds.

Looking back, Democratic Party unions were in full support when Obamacare was being proposed by President Obama. At that time, the union leadership's ideology superseded their need for maintaining a viable labor organization. To their credit, legislation such as the Fair Labor Standards Act, the Fair Employment Practices Act, the Family Medical Leave Act, the Americans with Disabilities Act, have always been promoted by unions because these laws have favored employees. However, the Affordable Care Act will result in even greater losses in membership than unions are currently experiencing.

Comments? Questions? Email Here

© HowtoAdvice.com

How to Advice .com