CWA urges the FTC and the DOJ to take into account in merger review guidelines the role of collective bargaining in counterbalancing employer market power
CWA submitted comments to the Federal Trade Commission (FTC) and the Department of Justice (DOJ) in response to the request for comment on new draft merger guidelines. CWA applauded the FTC/DOJ efforts to move the country towards a more consistent and socially beneficial approach to antitrust policy and enforcement and urged the antitrust agencies to fully recognize the difference in labor markets from product markets. CWA urged the antitrust agencies to avoid unquestioned orthodoxies and acknowledge the limits of relying on competition among employers as a means to empower individual workers.
“This means recognizing the unique role of collective bargaining in counterbalancing employer market power.It also includes consulting consistently with workers and their unions during the merger review process, to draw on the unique expertise of workers on their industries,” the comments state. “Moving forward, building on their information-sharing agreements, the Agencies should work in concert with the Department of Labor and National Labor Relations Board to ensure workers’ collective bargaining rights are protected, for the good of society and economic equality.”
In line with CWA’s original recommendations to the agencies in April 2022, the draft guidelines move towards prioritizing the potential for dominance over companies’ suppliers of goods and services, including their workers. The union also applauded the FTC and DOJ for making explicit in the new draft guidelines what has long been an occasional, informal practice of consulting with labor unions at companies seeking to merge.
Workers and their organizations can serve an important and collaborative role throughout the merger evaluation process by helping the agencies appropriately define the relevant labor markets that will be impacted by a merger, providing firsthand knowledge and historical context of how the previous entry or exit of companies into the market has impacted them, offering insights on competition especially where market share is underestimated or not fully captured, and by providing evidence of significant market power or anticompetitive behavior, among other things.
“For example, if workers had been meaningfully consulted in the review process of the Microsoft-Activision Blizzard transaction, the FTC may have recognized the meaningful threat of monopsony harm to video games workers and given credence to the remedy negotiated by CWA with Microsoft to address this harm through a legally-binding pathway to collective bargaining for Activision Blizzard workers,” the comments states.
CWA also called for the merger review process to be subject to increased transparency. Many facts relevant to a merger inquiry are typically not public, nor do agencies typically explain why reviews have closed without taking any action. These practices leave impacted parties unable to rebut analysis that may be incomplete or uninformed. The union cited the T-Mobile-Sprint merger, where the court approved the deal partly on the basis of statements by the parties about the merger’s benefits, including promises of job creation and lower prices that were never fulfilled.
“Given the ongoing ambiguities of merger review, we hope that the Agencies, and consistent with the rule of law principles, will not only make transparent their methodology for assessing the risk of monopsony and tacit collusion in labor markets, but also state the presumptions that they relied upon,” the comments state. “Without transparency, workers are left guessing, as in the case of the Microsoft-Activision Blizzard transaction, where the FTC never publicly addressed the merger’s risks to labor markets.”
Read CWA’s comments on the revised draft Merger Guidelines here.
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