Ohio Union Law Vote Pits Business Groups Against Public Workers

Ohio business groups are joining Governor John Kasich in a Nov. 8 referendum fight to uphold a law limiting collective bargaining for government unions, pitting private might against public workers.

Organizations whose members include Procter & Gamble Co. (PG), Kroger Co. (KR) and Bob Evans Farms Inc. have endorsed keeping the law, contributed an undisclosed amount to the campaign and sent information to members, according Building a Better Ohio, the group supporting the measure.

Businesses are taxpayers, and the law offers the best chance in years to control government costs and make the state more competitive, said Roger Geiger, executive director of National Federation of Independent Business/Ohio. The group represents 24,000 small companies, and 92 percent supported the law in a survey, he said.

“They have a right to expect reforms and things that they believe will better government,” Geiger said. Telling business to avoid the fight “is like saying I’m going to give my kid an allowance, but I’m never going to pay attention to what they spend it on.”

The private groups are taking their stand as public workers account for an increasing share of declining union membership nationwide. The number of Ohioans represented by unions last year fell to almost 702,000 from 1.13 million in 1983, while the share of government employees increased to 47.7 percent from 26.2 percent, according to unionstats.com.

Photographer: David Maxwell/Bloomberg

John Kasich, governor of Ohio. Close

John Kasich, governor of Ohio.

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Photographer: David Maxwell/Bloomberg

John Kasich, governor of Ohio.

Attacking Customers

Opponents of the law, including the repeal coalition We Are Ohio, have called it an effort to bust unions and limit their support of Democratic candidates. The business groups don’t speak for all their members, said Melissa Fazekas, a spokeswoman for We Are Ohio.

“It just doesn’t make a lot of sense, because public employees, middle-class Ohioans, spend their money in their businesses,” Fazekas said.

In March, Kasich, a 59-year-old first-term Republican, signed the law passed by a legislature that his party dominates. It restricts bargaining for almost 360,000 employees and requires them to pay at least 15 percent of their health-care insurance premiums and 10 percent toward pensions. The Ohio law, similar to one backed by Wisconsin Governor Scott Walker that triggered weeks of protests at the Capitol in Madison, is on hold pending the Nov. 8 vote.

Joining Forces

Business groups tend to support Kasich, Paul Beck, a political-science professor at Ohio State University in Columbus, said in a telephone interview.

“There is kind of an anti-union mentality there, and anything that weakens unionization is perceived, I think, as a good thing by many of them,” Beck said.

An Ohio Chamber of Commerce endorsement stems from a report it issued last year making recommendations to reduce costs and “transform state government,” said President Andrew E. Doehrel. The organization says it represents 6,000 members ranging from small businesses to international companies.

“We look at business issues from a business point of view,” Doehrel said in a telephone interview from Columbus. “If that lines up with this governor or a different governor, that’s where we’re going to continue to be. And I would expect the labor guys to line up and try and support their members where their issues are.”

Silent Money

Doehrel said the chamber is contributing money to the campaign while declining to say how much. Jason Mauk, a spokesman for Building a Better Ohio, also declined to say how much the business groups are contributing.

Business interests helped Walker in the Wisconsin fight. The Wisconsin arm of Club For Growth, a Washington-based group that pushes for lower taxes, spent $9 million on nine recall votes on state senators that were prompted by the union- bargaining law. Americans for Prosperity, which billionaire brothers David and Charles Koch and their family’s Koch Industries Inc. helped found, spent $800,000, according to the Wisconsin Democracy Campaign, which tracks campaign spending.

Kasich said the Ohio law will give local governments tools to control costs, prevent dismissals and provide equity with private-industry workers, who he said pay more on average for health care and pensions.

“I believe in unions; I believe they have a place,” Kasich said during a Sept. 29 Toledo rally in support of the ballot measure. “This is not an attack on anybody. It’s asking everybody to pitch in and to do a little bit.”

Wet Dissent

About 50 protesters stood outside in the rain supporting repeal in the referendum, called Issue 2 on the Ohio ballot and which asks voters to choose ‘yes’ to keep the restrictions.

“No on Two,” they chanted as participants walked in. “Shame on you.”

Business groups that endorsed keeping the law include the Ohio Chamber of Commerce and six regional chambers, NFIB/Ohio, the Ohio Farm Bureau Federation and the Ohio Manufacturers’ Association, according to Building a Better Ohio.

Cincinnati-based Kroger hasn’t taken a position on the issue, even though the Cincinnati USA Regional Chamber, to which it belongs, has endorsed it, Kroger spokesman Keith Dailey said by phone. Most of the company’s 338,000 full- and part-time employees are covered by the United Food and Commercial Workers, he said.

We’re Helping

P&G, an Ohio Chamber member based in Cincinnati, also hasn’t taken a position, said Christine Wever, a spokeswoman. The majority of the company’s 129,000 workers is not represented by unions, though there are contracts at a handful of U.S. plants, she said.

As a publicly owned company, Bob Evans, a member of both the Ohio and Columbus chambers, doesn’t take positions on political issues such as the referendum, said Margaret Standing, a spokeswoman.

The business groups’ support will help public employees, because without the law, governments will be forced to cut services and dismiss workers or raise taxes, said Matt Davis, vice president of government affairs for the Cincinnati USA Chamber, which he said represents more than 5,000 members employing 310,000 people.

“It’s going to help them in the long run keep their jobs,” Davis said in a telephone interview.

Still, the board of the 200-member Columbiana Area Chamber of Commerce in northeast Ohio voted to remain neutral because taking a stand wouldn’t benefit the chamber, said Terry McCoy, an architect and the group’s president.

“It’s more important to represent the members of your community and the companies that are here and to find ways to advance their businesses, not to take political stands one way or the other to divide the people,” McCoy said in a telephone interview.

To contact the reporter on this story: Mark Niquette in Columbus at mniquette@bloomberg.net

To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net

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