Representatives Norcross and Chu introduce No Tax Break for Union Busting Act

July 20, 2022

Today, U.S. Representatives Donald Norcross (D-N.J.) and Judy Chu (D-Calif.) led 101 of their colleagues in introducing legislation intended to punish corporate union busting and make it easier for workers to organize and collectively bargain. Essentially, the bill would take American taxpayer subsidies away from any corporate activity intended to discourage workers from exercising their legally protected right to form a union.

“Our union has a long history of helping workers form a union, and we know all too well the lengths corporations will go to try to prevent workers from having a voice at work,” said SMART General President Joseph Sellers. “It’s time to end the ability of corporations to deduct union busting activity from taxes — a practice that allows corporations to get off scot-free with union-busting activity. We greatly appreciate Congressman Norcross, Congresswoman Chu and their colleagues for their leadership on this legislation and stand ready to advocate with them for its passage.”

According to the National Labor Relations Act of 1935, it is the official policy of the United States government to encourage collective bargaining and protect workers’ freedom of association. In practice, however, corporations often engage in anti-union activity without punishment. As workers around the country continue to organize their workplaces at historic levels, employers are spending an estimated $340 million per year on union-busting campaigns. These expenses are currently tax deductible – and frequently written off as business expenses. (Even though, because of former President Trump’s 2017 tax package, workers are not even able to deduct their union dues or the cost of work tools from their taxes, as they had been able to do in the past.)

Common anti-worker interventions – currently tax deductible – include  “captive audience meetings,” where employers hold mandatory meetings during work hours and spread misinformation intended to discourage unionization; hiring expensive “union avoidance” firms to lead union-busting campaigns; threatening to withhold benefits from pro-union workers; firing pro-union workers; and closing workplaces that appear to be pro-union or that have voted to unionize.

Rep. Norcross and Rep. Chu’s No Tax Break for Union Busting Act would curtail all such practices, ending taxpayer payment for anti-union corporate practice by classifying corporate interference in union campaigns as political speech under the tax code – thereby revoking its tax deductibility. Additionally, the legislation would require corporations to report anti-worker interventions to the IRS, ensuring these corporations pay their fair share of taxes and do not receive undeserved tax deductions.

“American taxpayers shouldn’t be footing the bill for corporations engaged in anti-worker activity,” Congressman Norcross said. “We need to level the playing field for workers and end handouts for union-busting campaigns. It’s not fair that workers pay taxes on their hard-earned paychecks while their bosses save money crushing worker organizing. Why does our tax code favor employers at the expense of the American worker? It’s time to bring fairness to the tax code and end tax breaks for union busting.”

“The right to organize is not just protected by law, it is the official policy of the U.S. government to encourage workers to exercise this right,” added Congresswoman Chu. “However, our tax code provides companies lucrative tax breaks for the hundreds of millions of dollars they spend yearly to upend pro-union action and organizing. The No Tax Breaks for Union Busting Act would not only end taxpayer subsidies for these anti-union efforts, but would give workers the fair shot they deserve to form a union.”