Retail Groups to Lobby Against Pro-Labor Bill

By ANNE D'INNOCENZIO | AP Business Writer

NEW YORK (AP) - With Barack Obama's election as president and Democrats controlling Congress, retailers and industry trade groups are bracing for a fight on Capitol Hill next year against legislation that would make it easier to unionize workers.

The labor-backed Employee Free Choice Act would allow labor organizations to unionize workplaces without secret ballot elections. It was co-sponsored by Obama, and opposed by Republican nominee John McCain.

Approved in the House of Representatives last year but left stalled in the Senate, it is expected to be taken up by the new House as early as January and could be up for a vote in the Senate by February.

Retail officials have been lobbying against the legislation for the past two years, saying that making it easier for workers to unionize would create costs they can't afford to incur amid a deteriorating economic environment.

"The issue is not whether unions have a place, but how employees go about choosing whether or not to join the union," said Rob Green, vice president of government and political affairs at the National Retail Federation, whose members include Macy's Inc., Home Depot Inc. and Sears Holdings Corp. "This is bad competitively."

Green noted that the trade group will continue to try to sway lawmakers, particularly in the Senate where they have more of chance of quashing the bill, about the legislation.

Katherine Lugar, executive vice president of public affairs for the Retail Industry Leaders Association, whose members consist of fast-growing chains like Target Corp. and Wal-Mart Stores Inc., noted that the group will be stepping up the lobbying efforts.

"We are leaving no stone unturned," Lugar said. "This is a radical proposal that couldn't be more poorly timed in this economic environment."

Democrats broadened their control of Congress in Tuesday's elections, though in the Senate they fell short of the 60 votes needed for a filibuster-proof majority that would have given them almost unlimited power over legislation.

Union-backed groups such as Wal-Mart Watch, which has been putting pressure on Wal-Mart to change its practices, maintain that the legislation would give employees a free choice if they want to join a union and say it would restore balance in the workplace, providing more workers an opportunity to form unions and get better health care, job security and other benefits.

Executives at Wal-Mart, the world's largest retailer, and Target made their opposition to the measure clear to Wall Street at their recent analysts' meetings. Both companies said they have been working hard to develop a strong corporate culture so that they don't create incentives to have a third-party representation.

Target's Chief Financial Officer Doug Scovanner told analysts last month that if approved, the legislation wouldn't put the company at a competitive disadvantage because of the effect of organized labor at competitors such as Wal-Mart and Costco Wholesale Corp.

But he noted, "I think the collective impact of that would clearly be distinctively measurable in the health of U.S. retail sales ... and it would not be a good change."

Lee Scott, president and CEO of Wal-Mart, told analysts last week that the legislation will make the country less competitive.

"It'll be generations in the impact it has on this country. And it won't be positive. I guarantee you that. It will not be positive. But for Wal-Mart, in the short term, and in the longer term on a relative basis with our peers, we're going to run this business," Scott said.

He continued, "We like driving the car and we're not going to give the steering wheel to anybody but us."

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