The Wagner Act of 1935, also known as the National Labor Relations Act (NLRA), guarantees the right of workers to organize and outlines the legal framework for labor unions and management relations. In addition to protecting workers, the act provides a framework for collective bargaining.
The main purpose of the Wagner Act was to establish the rights of most workers to organize or join labor unions and to bargain collectively with their employers.
The act guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid and protection."
The legislation was designed to make it more likely that commercial interests could be conducted without disruptions from strikes, thus protecting businesses and the economy as well as workers. The NLRA covers all employers involved in interstate commerce except airlines, railroads, agriculture, and government.
The Wagner Act defines and prohibits five unfair labor practices (others have been added since 1935). These include:
- Interfering with, restraining, or coercing employees in the exercise of their rights (including the freedom to join or organize labor organizations and to bargain collectively for wages or working conditions).
- Controlling or interfering with the creation or administration of a labor organization.
- Discriminating against employees to discourage or encourage support for a labor organization.
- Discriminating against (i.e., firing) employees who file charges or give testimony under the Wagner Act.
- Refusing to bargain collectively with representatives of employees.
The Wagner Act also created the National Labor Relations Board (NLRB), which oversees union-management relations.
The National Labor Relations Board designates the legal structure for the formation and decertification of unions and for conducting fair elections.
The Board investigates charges by workers, union representatives, and employers when their rights under the Wagner Act have been violated.
It encourages parties to come to agreements without adjudication and facilitates settlements of disputes.
The Board also conducts hearings and decides on cases that aren't settled through mediation. It oversees the enforcement of orders, including the trying of cases before the U.S. Court of Appeals when parties don’t abide by board decisions.
The Wagner Act was amended in 1947 by the Taft-Hartley Act, which provided some limitations to the influence of unions. Legislators at that time believed that the balance of power had shifted too far in favor of the unions.
The act provides workers with the right to refuse union membership and to decertify unions if they are unhappy with their representation in collective bargaining. The act also places requirements on unions, including that they honor existing contracts without striking, and that they avoid secondary boycotts or strikes against companies doing business with their employer.
According to the National Labor Relations Board (NLRB), unions were also prohibited from charging excessive dues or initiation fees, and from "featherbedding," or causing an employer to pay for work not performed. The new law contained a "free speech clause," providing that the expression of views, arguments, or opinions shall not be evidence of an unfair labor practice absent the threat of reprisal or promise of benefit.
Several significant changes were made for representation elections. Supervisors were excluded from bargaining units, and the board had to give special treatment to professional employees, craftsmen, and plant guards in determining bargaining units.
The National Labor Relations Board provides the following examples of employer and union conduct that violate the law:
Examples of employer conduct that violate the law:
- Threatening employees with loss of jobs or benefits if they join or vote for a union or engage in protected concerted activity.
- Threatening to close the plant if employees select a union to represent them.
- Questioning employees about their union sympathies or activities in circumstances that tend to interfere with, restrain, or coerce employees in the exercise of their rights under the act.
- Promising benefits to employees to discourage their union support.
- Transferring, laying off, terminating, assigning employees more difficult work tasks, or otherwise punishing employees because they engaged in union or protected concerted activity.
- Transferring, laying off, terminating, assigning employees more difficult work tasks, or otherwise punishing employees because they filed unfair labor practice charges or participated in an investigation conducted by NLRB.
Examples of labor organization conduct that violate the law:
- Threats to employees that they will lose their jobs unless they support the union.
- Seeking the suspension, discharge, or other punishment of an employee for not being a union member, even if the employee has paid or offered to pay a lawful initiation fee and periodic fees thereafter.
- Refusing to process a grievance because an employee has criticized union officials or because an employee is not a member of the union in states where union security clauses are not permitted.
- Fining employees who have validly resigned from the union for engaging in protected concerted activities following their resignation or for crossing an unlawful picket line.
- Engaging in picket line misconduct, such as threatening, assaulting, or barring non-strikers from the employer's premises.
- Striking over issues unrelated to employment terms and conditions or coercively enmeshing neutral activity into a labor dispute.
"A Better Relationship Between Management and Labor"
At the beginning of the New Deal, President Franklin D. Roosevelt and his Labor Secretary, Frances Perkins, steered a progressive middle course in labor relations. They and many of their advisers believed that if laws and regulations could be put in place that improved workplace conditions and increased wages, then workers would not need unions. This idea was a guiding principle in the National Industrial Recovery Act that sought to bring management, labor, and consumers together to create industrial codes that produced goods at a fair price, under fair working conditions, and resulted in a fair profit.
But although the NIRA included a provision known as Section 7a that guaranteed workers the right of collective bargaining, factory owners regularly broke strikes or set up alternate “company unions” that they asserted satisfied the requirements of Section 7a. In an effort to resolve the growing labor crisis, a National Labor Relations Board was established in 1934, but it was administratively weak and had little enforcement power. When the NIRA was finally struck down by the Supreme Court in May 1935 based on the unconstitutionality of the industrial codes, only the weak Section 7a remained.
Enter United States Senator Robert F. Wagner of New York. Wagner was a German immigrant who had come to the United States at the age of nine, he attended the New York City public schools, worked his way through college and law school, and became active in local Democratic politics. He distinguished himself by opposing corruption and fighting for social legislation to aid his low-income constituents. He soon became a well respected state legislator, and was -- along with Smith and Frances Perkins -- part of the team that investigated the Triangle Shirtwaist Factory Fire of 1911. Elected to the United States Senate in 1926, he was reelected three times before resigning in 1949 due to ill health.
Wagner deeply believed in the New Deal’s goal to provide economic security to lower-income groups. He was an early supporter of public housing, public works programs, unemployment insurance, and the Social Security Act. As historian Anthony Badger has noted, “running through all Wagner’s thinking was not just concern for social justice but also a conviction that the American economy could not operate at its fullest capacity unless mass purchasing power was guaranteed by government spending, welfare benefits, and the protection of workers’ rights.” And so Wagner took up the cause to improve upon the foundation laid by Section 7a of the NIRA.
The National Labor Relations Act of 1935 is the product of his efforts, and as a result, it is the law most closely associated with his name. The Wagner Act not only restated the Section 7a right of workers to collective bargaining, it established a new independent National Labor Relations Board with real enforcement powers to protect this right. Under the new law, employee union elections were certified by the NLRB and were based on majority rule and exclusive representation. The so-called “company unions” previously used by management to flout collective bargaining rights were outlawed, as were other unfair labor practice such as blacklisting, strike-breaking, and discriminatory firings. The NLRB was empowered to hold hearings and compel compliance by management.
When FDR signed the National Labor Relations Act (Wagner Act) into law on July 5, 1935, he declared:
“A better relationship between labor and management is the high purpose of this Act. By assuring the employees the right of collective bargaining it fosters the development of the employment contract on a sound and equitable basis. By providing an orderly procedure for determining who is entitled to represent the employees, it aims to remove one of the chief causes of wasteful economic strife. By preventing practices which tend to destroy the independence of labor, it seeks, for every worker within its scope, that freedom of choice and action which is justly his.”
Because of the Wagner Act, union membership increased dramatically throughout the 1930s, and by 1940 there were nearly 9 million union members in the United States. The system of orderly industrial relations that the Wagner Act helped to create led to an era of unprecedented productivity, improved working conditions, and increased wages and benefits. Today, the Wagner Act stands as a testament to the reform efforts of the New Deal and to the tenacity of Senator Robert Wagner in guiding the bill through Congress so that it could be signed into law by President Roosevelt.
More About FDR and Labor
FDR and Federal Government Employee Unions
Frances Perkins, Secretary of Labor