DISCLAIMER: I put this page together for the students in my Public Finance class.  It is by no means meant to
serve as a comprehensive survey of the literature or indepth coverage of all the issues.  The purpose is to put
the discussion into perspective and to provide important background about the issue.  As a further note, I am not
associated with any of the organizations or research mentioned below. - C.R.
 

OKLAHOMA STATE QUESTION 695  (SQ695) bans a new employment contract from imposing
any of the following to get or keep a job:
(1) joining, quitting or remaining in a labor organization;
(2) payment of dues or other payments to a labor organization;
(3) approval from a labor organization of an employee.

IMPORTANT BACKGROUND:
(1) A labor organization is democratically elected by a group of employees in a common unit (bargaining unit).
(2) Once installed, the labor organization is required by law to represent ALL workers in the designated bargaining
unit (even those who don't choose to join the union).
(3) In Oklahoma, a labor organization can negotiate a contract clause called a Union Security Agreement (USA)
which requires employees to pay a representation fee to the labor organization.
(4) By federal law, a labor organization may not collect fees for non-represenational expenditures
over the stated objection of the non-union member covered by a USA clause (Beck Rights).

Legislation such as SQ695 is often called a Right-To-Work (RTW) law.  Essentially it bans
a labor organization from negotiating a USA with an employer.

PRO SQ695 VIEW -
An employee shouldn't be forced to pay for representation if she doesn't want to join the organization.
Why should anyone be forced to pay for something she doesn't want?

CON SQ695 VIEW -
It isn't fair if a worker doesn't have to pay for the protection that the organization is required to provide.
Why would anyone pay for representation if they can get it for free?

WHO'S RIGHT?
Both have a valid point.  The underlying problem is that since the worker organization is required to
represent all workers in the unit, then some workers may choose to "free ride".  That is they will get
the benefits of the organization without paying their share of the cost. This is the same problem associated
with most publicly provided goods.  Since it is difficult to compel individuals to pay for the benefit recieved, the
usual option is to collect taxes from everyone.  A USA clause is essentially the same as imposing a tax to
cover the representation costs.  Since all workers covered by the USA get the benefit of representation, all
members pay the tax.

Note that SQ 695 doesn't offer the option of allowing the worker organization to represent only those
who wish to join the union.

WHAT IS THE UNDERLYING ISSUE?
The real issue involves the familiar conflict between the interests of workers versus the interests of capital.
- Unions tend to raise per capita income (wages) by reducing corporate profit.
- RTW laws signal a pro-business climate more favorable to capital.
(Source: Abraham and Voos, 2000, Southern Economic Journal)
Whose interest should be promoted?

WHO WILL BE DIRECTLY AFFECTED BY THIS LEGISLATION?
The legislation would directly affect only individuals represented by a democratically elected labor
organization that currently has a USA (about 3.5% of Oklahoma's workforce).  If SQ 695 passes,
some workers currently covered by USA's may choose not to pay organization fees.  This would
affect the operating budgets of such organizations and probably make them less effective.
Evidence has shown that rates of unionization are lower in RTW states. If SQ695 fails,
workers covered by a USA who don't favor their USA would still have the option to
hold a democratic election to decertify their labor organization.

HOW DO RTW LAWS AFFECT OTHER INDIVIDUALS ?
RTW laws may have indirect impacts that are relevant to all individuals in the state.  The indirect
impacts, however, are more difficult to assess.  Unfortunately, there are numerous voices on both
sides that make strong conclusions about the impact of RTW laws on the state's economic growth
and on wages.  These arguments, however, are contentious.

IMPACT ON THE STATE'S ECONOMY-
The economics literature does NOT provide conclusive evidence about the the direct effect of RTW
on economic growth. Some literature has found that states with RTW laws have faster economic growth.  However,
there are many factors that influence economic growth. More importantly, association does not imply causality.
The direct impact on economic growth of imposing a RTW law is not clear.

IMPACT ON WAGES AND BENEFITS -
Again, the economics literature does NOT provide Conclusive evidence about the impact of RTW legislation
on wages and benefits.  There is a concensus that union workers make more than comparable non-union workers.
Some researchers have found a positive impact of unions on non-union workers as well.  There is also evidence that
wages in RTW states are lower than in non-RTW states.  However, many factors influence wages and salaries.  The
causality has not been established. The direct impact of RTW laws on overall earnings is not clear.

WHAT CAN WE CONCLUDE ABOUT SQ695?
(1)    We can't predict the economic impacts of passing SQ695 with any degree of certainty.
(2)    Passing SQ695 will undermine the ability of workers to form associations to protect
        their rights in the workforce.
 

WANT TO READ MORE?

COMMENTARIES ON FAIRNESS:

    "Contra SQ695: An Epistle to Open Minded Oklahomans," by Stephen E. Ellis (link)

This editorial discusses the underlying fairness claims concerning SQ695. It lays out the
claims in support of SQ 695 and then argues against them in typical philosophic fashion.
The objective is to convince both undecided citizens and open-minded RTW advocates
to vote NO on SQ695.

        This editorial as well as a host of other in The Oklahoman argue about the fairness
        of RTW laws for workers.  They urge readers to vote Yes on SQ695 for the
        good of Oklahoma.

OPPONENTS OF SQ695:

Oklahomans For No on 695 is "a coalition of Oklahoma small businesses, clergy, senior
  citizens, educators, firefighters, working people, and families opposed to SQ695."

Economic Policy Institute is a "nonprofit, nonpartisan think tank that seeks to broaden
the public debate about strategies to achieve a prosperous and fair economy."  See the following articles.

   ""Right-to-Work" Laws and Economic Development in Oklahoma" edited by Lawrence Mishel

This briefing paper includes opinions from 15 economic development professionals across the country.
The experts express opinions about why the RTW legislations would not benefit Oklahoma in terms
of economic development.

Mishel presents evidence that RTW laws are associated with  lower wages using a compelling
research approach.  In particular, his finding that workers living in metropolitan areas that include
RTW and non-RTW portions have higher wages suggests that there is some wage benefit associated
with proximity to non-RTW areas. While it has not yet undergone the usual peer review, his analysis
appears to be credible.

Oklahoma Council for Public Affairs is a "nonpartisan research and education institute--
a think tank--formulation and promoting public policy research and analysis consistent
with the principle of free enterprise, limited government and individual initiative.

"Does Right to Work Boost Economic Development" by W. Robert Reed

This article cites the concenuss in the economics profession cerncerning the positive
association between economic growth and RTW laws.  It critiques the research by
Mishel (EPI, 2001) and  goes on to argue in support of the passage of RTW in Oklahoma.

"An Open Letter to Oklahoma's Economists on Right-To-Work" (link) by W. Robert Reed

This letter presents results of research that shows a positive association between RTW status
and per capital personal income (PCPI).  The note highlights the importance of accounting for
inital conditions when estimating the impact of RTW laws.  It suggests that passing SQ 695 in
Oklahoma would lead to $1,000 increase in PCPI in the state.  While this research has not
undergone peer review, it appears to be credible.