The Union Safety Effect Myth or Fact? Joseph C. Ben-Ami

Transcription

1 The Union Safety Effect Myth or Fact? Joseph C. Ben-Ami

2 Published by: Arthur Meighen Institute for Public Affairs P.O. Box 1318 Station B Ottawa, Ontario K1P 5R4 Copyright 2012 All rights Reserved

3 Introduction It is a well-established fact that, in the construction industry, projects performed by nonunion contractors are generally less expensive than similar projects performed by union contractors. Consequently, one would expect that governments would be loath to limit bidding on construction jobs under their control to union contractors only - so-called "closed shops". This is especially so today, given the pressure that escalating entitlement costs and uncertain revenues are exerting on public budgets. The opposite seems to be the case, however, as governments across the province adopt restrictive practices that limit bidding to union contractors only. One reason for this in Ontario is a set of Labour Board rules that favour the unionization of private-sector employees performing contract work for municipal governments and the consolidation of these employees into single bargaining units, thereby freezing out, not only non-union workers (and their contractor employers), but also workers who belong to competing unions. There are, however, a number of governments and government agencies in Ontario that have not been "organized" in the manner described above, that nevertheless choose to restrict bidding on work under their control to union contractors only. A key reason for this policy is the widely-held belief that unions enhance workplace safety, resulting in fewer accidents and a commensurate reduction in lost time due to injury and reduced payout of benefits. The purpose of this paper is to examine available research on the topic to determine if indeed this so-called "union safety effect" is myth or fact. 2

4 Surveying the Existing Literature Unions are active in promoting workplace health and safety in several important ways in the construction industry. They provide their members with relevant job-related safety information and training, they protect those members who refuse to work under - or who report - unsafe working conditions, and they assist members in making compensation claims. Unions also negotiate for the provision of protective equipment, and for the creation of joint worker-management safety committees. Given these activities, it is natural to assume that construction projects and contractors that are unionized enjoy a better safety record than those that are not. Not only does the preponderance of studies on the relationship between unionization and increased workplace safety not support this belief, most conclude the opposite, i.e. that the number of workplace injuries is actually higher in unionized environments. This fact is well known in the research community. Writing in 1979, Kip Viscusi, the current Co-Director of Vanderbilt University's Ph.D. Program in Law and Economics, observed that: [t]he absence of any evidence of a significant union reduction of hazards runs counter to the conclusion one might draw on the basis of one's observation of actual union actions. (Viscusi: 1979) 1 Alison Morantz of Stanford Law School agrees, referring to the phenomenon as the "elusive union safety effect" in her otherwise pro-union paper of the same name. Although unions engage in numerous activities designed to promote workers' safety and health, surprisingly few social scientific studies have confirmed the existence of a union safety effect. (Morantz:2009) 1 See also Boden (1985), Fairris (1992), Smitha et al. (2001) and Robinson and Smallman (2006). 3

5 To further illustrate the point, Alejandro Donado at University of Wurzburg in Germany surveyed the findings of 22 major independent studies on the so-called union safety effect conducted in a variety of industries in Canada, Great Britain and the United States. The results were startling. Of the 35 analyses included in his study (some of the 22 studies surveyed included multiple analyses of data using different statistical models) only 1 recorded a statistically significant negative association between unionization and the number of workplace injuries, while 16 showed a significant positive association, i.e. that unionized workplaces actually had more injuries. 15 analyses showed no significant difference at all. (Donado: 2010) Donado's findings echo those of Les Boden, an economist currently at Massachusetts Institute of Technology who studied the effect of unionization in coal mines in the mid- 1970s. Boden observed There remain two puzzling results of the estimation of our model of coal mining injuries. The first of these is the fact that unionized mines have higher non-fatal accident rates than would be expected in non-union mines with the same characteristics. (Boden 1977) Donado's observations are also consistent with those of the aforementioned Alison Morantz who concluded that despite the fact that unions play so many vital roles in the promotion of [occupational safety and health], extant empirical literature contains little evidence of a pervasive union safety effect. A sizable number of studies find, instead, positive (emphasis in original) associations between unionism and occupational injuries. (Morantz: 2009) 4

6 Using data from the pool of studies surveyed, Donato was able to calculate that union workers were 29% more likely to suffer a work-rates non-fatal injury than non-union workers. Any attempt to prove or disprove the existence of a union safety effect in Canada generally, and in Ontario's construction sector specifically, is severely hampered by the absence of data critical to the performance of a credible and comprehensive analysis. Details of the union status of jobsites where injuries are reported are simply not collected as a matter of course. This is somewhat surprising given that governments are basing policies on the existence of the effect. One would assume that, prior to doing so, governments would insist on obtaining compelling empirical evidence in support of the theory. What's more, union leaders themselves would be anxious to provide that evidence. Apparently this is not the case. Be that as it may, it is possible to make some inferences by comparing the records of the Ontario and Quebec construction sectors. Since only approximately 20 percent of construction workers in Ontario are union members while in Quebec, all workers in the construction sector must belong to a union, the existence of a union safety effect would predict lower rates of workplace injuries for Quebec construction workers than those of workers in Ontario. However, as the table below shows, the Quebec rates are actually much higher. Table 1 Year Ontario Quebec Lost time injury rate per 100 workers Source: Statistics Canada and Association of Workers Compensation Boards of Canada, cited by the Construction Safety Association of Ontario 5

7 Another intriguing item is the apparent negative correlation between the percentage of unionized contractors in Ontario's construction sector and the rate of work-related injuries. In other words, as the percentage of unionized construction contractors in Ontario has fallen, the number of accepted time-loss injuries in the province in the construction sector has fallen too. (See table 2 below.) Table 2 Year Number of accepted time-loss injuries* 6,034 4,902 4,619 Percentage of contractors signatory to union collective agreements** Lost-time injuries vs. percentage of union contractors in sector *Source: Association of Workers Compensation Boards of Canada **Source: Ontario Construction Secretariat It is important to note that the data included in the above tables does not, in and of itself, disprove the existence of a union safety effect. What it does do - or, at least, what it ought to do - is induce a pause in the implementation of policies based on the assumption that the effect does exist, especially when those policies typically result in higher expenditures of public funds. 6

8 Explaining the Contradictions Existing literature has offered a number of explanations for the divergence between the expected and actual results of research into the union safety effect. The most prevalent of these explanations is that while unions reduce the number of actual injuries, they also increase the number of reported injuries. This might be called the "Reporting Theory". There are two reasons why this explanation is plausible, and hence, so widely accepted. In the first place, contractors have an incentive to under-report injuries in order to avoid costly paper work, higher compensation premiums and fines. (Leigh et al: 2004) Unions are believed to counteract this effect through diligent policing of the conditions of their jobsites and monitoring the reporting of management of workplace injuries. A second reason why the above explanation is widely accepted in the belief that workers who are members of a union are more likely to report accidents and injuries than their non-union counterparts, the latter of whom might be the target of intimidation or retaliatory action on the part of management. (Azaroff et al: 2002) The obvious response to this explanation is that the costs associated with unsafe working conditions aren't just an incentive to under-report accidents and injuries, they are also an incentive for contractors to ensure that workers are properly trained. and that both their places of work and personal practices are safe. Indeed, that is the reason why fines and increased insurance premiums are attached to poor safety records in the first place. The Reporting Theory ignores the possibility that this policy has actually been effective in improving safety on Ontario construction sites - as it is intended to do - assuming a priori that non-union contractors must be guilty of cheating. This is not just an indictment of non-union contractors - it is also an indictment of the entire system and policy. But is it true? We were unable to find any credible empirical evidence to support the theory in the existing literature, including - surprisingly - among those studies that offer 7

9 the theory as an explanation for the difference between the expected and observed results of their research. Donado sets out to fill this void in the research using data obtained as part of the National Longitudinal Study of Youth 1979 (NLSY79), a nationally representative sample of 12,686 American men and women born in the 1950s and 1060s surveyed by the U.S. Bureau of Labor (sic) Statistics, annually from 1979 through 1994 and biennially since. The data obtained as part of the NLSY79 is not based on information provided by employers who, according to the Reporting Theory, have an incentive to under-report injuries. Instead, the information is obtained from individuals during private, confidential interviews. Since there is no apparent reason why the interviewees would give inaccurate information, it is reasonable to assume that the data collected on workplace accidents or injuries as part of the study should not be affected by under-reporting. Donado's analysis of the NLSY79 data failed to provide any support for the Reporting Theory. Indeed, the results were consistent with his earlier findings that union workers were 29% more likely to suffer a work-related injury than non-union workers. (Donado: 2010) 8

10 Summary and Conclusions The goal of this paper was to survey existing and emerging research on the so-called "union safety effect" to determine if indeed it exists. In our opinion, the empirical evidence is overwhelming that it does not. This evidence is consistent across various industries, timeframes and ages of workers, as well as the countries from which studies were obtained. Although researchers have been puzzled by these findings, their validity is not in dispute. Instead, a number of explanations have been posited as to why they are what they are. The most prevalent of these is that non-union contractors under-report workplace accidents and injuries in order to avoid the costs associated with making such reports. An analysis of data sets that do not suffer from reporting bias, however, fails to substantiate this explanation. The public policy implications of these findings should be clear. There is no justification for a policy of restricting bidding on public construction jobs to union contractors on the grounds that union contractors provide a safer work environment than non-union contractors do. As such, in the absence of other arguments that might be made, and that are outside the scope of this paper, we recommend that such practices be abandoned. 9

11 References AZAROFF, L. S., C. LEVENSTEIN, and D. H. WEGMAN (2002): "Occupational injury and illness surveillance: Conceptual filters explain underreporting", American Journal of Public Health; 92(9), BODEN, L. I. (1977): Underground coal mining accidents and government enforcement of safety regulations; Ph. D. Thesis, MIT BODEN, L. I. (1985): "Government regulation of occupational safety: Underground coal mine accidents ", American Journal of Public Health; 5(5), DONADO, A. (2010) Why do unionized workers have more nonfatal occupational injuries? Proceedings of the 35th Simposio de la Asociación Española de Economía-Spanish Economic Association, Madrid FAIRRIS, D. (1992): "Compensating payments and hazardous work in Union and nonunion settings", Journal of Labor Research; 13(2), LEIGH, J. P., J. P. MARCIN, and T. R. MILLER (2004): "An estimate of the U.S. Government's undercount of nonfatal occupational injuries", Journal of Occupational and Environmental Medicine; 46(1), MORANTZ, A. D. (2009): The Elusive Union Safety Effect: Towards a New Empirical Research Agenda; Proceedings of the 61st Annual Meeting of the Labor and Employment Relations Association, pg ROBINSON, A. M. and C. SMALLMAN (2006): "The contemporary British workplace: A safer and healthier place?", Work, Employment & Society; 20(1), SMITHA, M. W., K. A. KIR, K. R. OESTENSTAD, K. C. BROWN and S. D. LEE (2001): "Effect of state workplace safety laws on occupational injury rates", Journal of Occupational and Environmental Medicine; 43(12), VISCUSI, W. K. (1979): Employment Hazards: An Investigation of Market Performance; Harvard University Press. 10

12 The Arthur Meighen Institute for Public Affairs is an independent conservative think-tank dedicated to the advancement of freedom and prosperity at home and abroad through the development and promotion of good public policy.