Billionaires and Bargaining: Labor Mysticism & the Next Chapter

This is the first semester in which I (as a law teacher) have taught workers’ compensation law and labor law in the same term. Workers’ compensation deals with injured workers. Labor Law addresses the right of workers to bargain with their employers over the terms and conditions of their employment. They are both courses about employers bargaining with employees. Employees give up something and employers give up something in return. That was the original design of the labor and employment laws. The underlying assumption was that an eternal battle was being carried on between relatively co-equal antagonists, and that to prevent the very social fabric from being unraveled, negotiation—bargaining—between “capital” and “labor” was essential. The famous jurist, Oliver Wendall Holmes, Jr., wrote, in a notorious dissenting opinion back in 1896,

One of the eternal conflicts out of which life is made up is that between the effort of every man to get the most he can for his services, and that of society, disguised under the name of capital, to get his services for the least possible return. Combination on the one side is patent and powerful. Combination on the other is the necessary and desirable counterpart, if the battle is to be carried on in a fair and equal way.

But these laws seem dusty, and the question that immediately surfaces in my classes (and in practical working life) is whether an economy created by billionaires is one in which “management”—tucked away neatly in gated communities—any longer believes in “bargaining” with the great unwashed mass of humanity. I doubt it very much. And hiding behind the idea that “Gig” workers are free to enter into and out of their side hustles with “freedom” is the tired old rhetoric of “right to work.” You have the freedom, the right, to work your Gig jobs for less money (which one discovers after learning a little accounting), and with less protection from harms arbitrarily imposed on workers because of their race, gender, sexual orientation, disability, etc. In the Gig economy, billionaires don’t bargain because they don’t have to; they unilaterally set inadequate terms of work, which you are “free” to accept or reject by contract.

The original employment law—workers’ compensation, adopted by U.S. states beginning in 1911—is often also explained as a Grand Bargain: workers gave up the right to sue in tort/personal injury lawsuits in exchange for quick but adequate statutory benefits; employers gave up their right to defend against  damages/tort lawsuits, in exchange for insulation from full tort damages (compensatory, pain and suffering, and punitive). They were solely on the hook for maximum statutory benefits of about half the employees’ wages. What employees lost in the magnitude of damages they theoretically gained in the speed of receipt of benefits. Sometimes (as many of us know) being without some money can very quickly become deadly. So, it was a “deal” with a gun to workers’ heads. As I’ve argued at length elsewhere, I think the whole construct is a hot mess. I resist the idea that workers, as workers, ever bargained for anything. And workers who are now bound by the so-called bargain were not even alive when it was allegedly originally negotiated. You must know a lot about tort law to understand what a bad bargain it really is given the structure of 21^st century tort law. I teach tort law and will simply represent that I think the deal was very bad. But good luck trying to get business-dominated state legislatures to alter the “bargain.” In fact, as I have written, the bargain over time gets worse and worse. This is a bargain some billionaires are wise to leave alone. But the key point for my present purposes is to direct attention to the significance that the myth of this bargain was ever created in the first place, and that states find it necessary to continue to deploy the rhetoric of the bargain, even if it is largely fictitious.  

National labor law (the NLRA) sprang on the scene (more or less) in 1935. What labor law essentially concerns is the obligation of an employer to “bargain in good faith” over terms and conditions of employment with its employees’ union. The employer may not “interfere with, coerce, or restrain employees” engaging in union activities or in “concerted activities . . . for mutual aid or protection.” But no employer is required to agree to anything concerning working conditions. Ever. Just read Section 8(d) of the National Labor Relations Act. “ . . . [S]uch obligation [to bargain] does not compel either party to agree to a proposal or require the making of a concession . . .” Ultimately, the employer may implement the working conditions it wants once the parties have bargained to “impasse” over “mandatory subjects of bargaining” (those pertaining to “wages, hours, and other terms and conditions of employment.”) If a union does not like the regime that the employer has created, employees may strike. But if the union calls a strike, striking employees may be “permanently replaced,” if the underlying dispute involved the kind of economic issues one would think it would: pay is too low; hours are too long or unpredictable; workplace danger is too great.

Even given the gloom created by the last paragraph, at times employees have struck. Heck, they struck prior to the 1935 advent of the NLRA. Well prior to it. According to some sources, workers struck in ancient Egypt, during the 29th year of the reign of Pharaoh Ramses III in 1170 BCE! Closer in history, the current film Enola Holmes 2 incorporates the real life “Match Girl Strike” of 1888 into the story. The plot centers on the workplace deaths of women employed at a match factory in the late 19^th century in the U.K. Just as the owner-perpetrators of the deadly working conditions are discovered, the women workers go out on strike. As a complete aside, it is interesting to note that all-women strikes occurred in Pawtucket, R.I in 1824, Dover, N.H. in 1828, and in Lowell, MA throughout the 1830s and 1840s. You can’t tell an honest history of work in the United States without providing a history of strikes.

The level of striking nowadays does not begin to approach what it was, say, during the year I started working in what was still a blue collar economy in metro Philadelphia in1977 (I went to law school in 1992 after pulling 15 years of pretty hard labor). In 2022, for example, there were 23 major work stoppages (those involving 1000 workers or more). In 1977, there were 298 such stoppages (in a much smaller work force).

But striking or not, the central idea has been, since the beginnings of a formal labor law, that “recognition” of a union (or of workers) had to precede bargaining. The employer must recognize me as someone worth bargaining with. This is why the story of the workers’ compensation bargain is so interesting. Why invent a narrative of workers who never bargained unless on some level society (capital) believed the structure should have been bargained (even if it wasn’t and continues not to be)?

The question becomes, assuming the bare courtesy of recognition (the billionaire recognizes me!), does Elon want to bargain with me (or with anyone)? Does Bezos? How about Patrick Soon-Shiong. Do they have an image of a “bargained for” workplace? Or do they have an image of an Uberized work force carved out from the whole idea of employment “law” – ironically by a dozing populace signing off on public referenda (!) purporting to give “liberty” to workers desiring flexibility (made necessary by their bad first and second jobs). But assuming the reality of “free” bargaining of Gig work outside the restrictions of the law of employment, ask your local Instacart or Uber service person how much “input” they had in constructing the terms and conditions of their current work contract. They are “independent” contractors except for the minor detail of actually bargaining the contract! Yes, I’ve heard this kind of “right to work” talk before.

Why do people imagine billionaires would willingly bargain with them? Perhaps because they believe it has voluntarily happened before. It hasn’t. Since before the existence of federal labor law, private sector unions and groups of employees concertedly acting to improve working conditions have engaged in strikes—and often employers responded to the strikes with violence.  Federal labor law since the 1935 Act has allowed workers to retain the credible threat that all workers would walk out the door in the absence of agreement (even if that right has rarely been exercised in the last three decades). To believe in bargaining in any other context is, for me, pure mysticism. Retention of the right to strike implicitly reminds us that Gilded Age employers did not want to recognize or bargain with workers or their unions.

Yet none of these protections (such as they are) even apply if workers are not formally “employees,” for then workers are not rights-holders. Nor do the protections apply (such as they are) if government agencies like the NLRB don’t have the constitutional authority to adjudicate alleged violations of law (an argument that hasn’t been seriously entertained since the 1930s, but one which Meta, SpaceX, and Trader Joe’s are raising now). If there is nowhere for law to be adjudicated except in justice-delayed (and therefore denied) formal judicial forums (courts), there is no law at all. These guys don’t sound like they want to bargain with the likes of me anymore. We’re apparently on to the next chapter of the “eternal conflict” that Justice Holmes wrote about so long ago.