A Right to Work, But Not for Your Kind

The BBC has the story on an unusual labor dispute in Britain. Remploy is a manufacturing company set up after World War II to employ disabled serviceman. It is still going over sixty years later, but its disabled-only factories are very costly to run, and the company would like to close them and mainstream the workers, something that is occurring more and more all over the industrialized world.

But the union objects, preferring to keep the factories open, even though many pressure groups representing the disabled believe in mainstreaming and are supporting the company’s efforts. The event is interesting because it reminds me of something that is not nearly as well-known as it should be, the role of organized labor in frustrating the advancement of historically disadvantaged groups.

When we think about “employment discrimination” we usually think of actions by employers against ethnic minorities, females, the disabled, etc. Indeed, modern antidiscrimination law was built on the premise that this is the most important kind of labor-market discrimination. But in fact an employer who discriminates is operating against his other interest, that of making as much money as possible. This doesn’t mean no discrimination ever occurs, but that when it does it is costly, and hence more competitive conditions should diminish it.

Unions, on the other hand, are all about restricting the freedom of workers to offer their labor – about restricting labor supply, in other words. Often they gain from segregated workforces, and union contracts have historically allowed union members to indulge their own tastes for discrimination; racial and sexual job segregation often is the easiest way for organized labor (with minorities and women historically often conspicuously excluded or given subordinate status) to facilitate its members’ interests. An effective businessman can’t afford to discriminate, in other words; an effective union often can’t afford not to.

Thus, U.S. history is full of examples of the most atrocious conduct by unions against racial minorities. Attempts by organized labor to legally exclude blacks from certain occupations date all the way back to colonial times. When whites-only unions attempted to shut factories down in the decades after the Civil War, employers often attempted to use black strikebreakers, who were eager to show off their skills so as to earn higher incomes. But whites often broke these strikes with deadly force; violence fomented by the Knights of Labor during a mining strike in 1885 in Spring Rock, Wyoming led to the deaths of 28 Chinese workers. The California constitution of 1877, heavily influenced by organized labor, prohibited state contractors and even corporations chartered in the state from hiring Chinese workers. The Railway Labor Act and later New Deal legislation relegated blacks to low-rung jobs, and it was not until several decades after the Taft-Hartley Act of 1947 limited union ability to interfere with free commerce that labor union discrimination faded away. Many black leaders, ranging ideologically from Frederick Douglass to Booker T. Washington to W.E.B. Du Bois, saw white unions as perhaps the single greatest obstacle to achievement for blacks after the Civil War. (Paul Moreno’s Black Americans and Organized Labor gives a detailed history of these events.)

Undoubtedly the British unions at Remploy's factories are not devoted by prejudice against the disabled, although in an earlier era American unions unquestionably were. But by cartelizing the labor market they make it more difficult for groups like the disabled that have suffered from past discrimination by employers or unions to get ahead. That is an unavoidable effect of unions using special legal privileges to restrict the labor supply, and always will be.