A coalition of Democratic legislators has announced plans to drop a political nuclear bomb the first week of Colorado’s legislative session, breaking an 81-year-old ceasefire between Colorado businesses and labor.

This move is bad for Colorado’s economy and the battle it starts may quickly spiral out of control.

Since 1943, Colorado has been a red state, purple state, and blue state, and during that time Colorado’s Labor Peace Act has held the middle ground, successfully governing workforce unionization in a harmonious way that may be the best such law in the country.

On one end of the political spectrum are so-called right-to-work states that prohibit mandatory union membership and the payment of union dues as a condition of employment. These laws, usually in red states, ensure employees’ rights to make their own choices regarding union affiliation. Right-to-work laws do not prevent workers from unionizing the shop floor, but the workers are not compelled to join the union or pay dues.

For many companies and site selectors looking for a new location, a right-to-work state is often among the top criteria. Today, roughly 26 states have right-to-work laws, with six of these states coming onboard within the last 14 years.

And, importantly, seven of Colorado’s top 10 competitor states are right-to-work states.

On the opposite end of the spectrum, are “union shop” states that do not have right-to-work laws in place. In these 23 states, employers and unions require workers, where applicable, to join the union or otherwise to pay union dues as a condition of employment, even if they were not union members when hired. In these states, workers may be compelled to become union members or contribute financially to the union, even if they do not want to join. These laws strengthen the union’s bargaining power and influence in the workplace.

Colorado is a unique outlier, a compromise state. It is neither a right-to-work nor union shop state. Under Colorado’s Labor Peace Act, workers can form a union with a simple majority vote, but to permit union security, which allows organized labor to deduct fees from their checks to fund the union work and bargaining activities, they must obtain a 75% vote of members.

Colorado’s balanced approach has promoted the state’s economy and brought us good jobs with good wages. While 75% is a higher bar, it seems appropriate that a higher threshold should be met before requiring all employees to pay union dues and belong to a union.

However, this coalition of politicians seeks to eliminate that second, higher-threshold vote, making it much easier for workers to unionize and fund union work and bargaining activities. Make no mistake, this is a pro-labor, anti-business bill, that will galvanize both sides and spill over to other issues with potentially adverse consequences for all.

While I was a Democrat in a Republican-controlled legislature in the 1990s, Democrats and Republicans came together to defeat right-to-work legislation. And, in 2007, when the legislature sent a union shop bill to former Democrat Gov. Bill Ritter’s desk, he vetoed it. The peace was maintained.

This is a dangerous time to tinker with Colorado’s economy. A recent 2024 CNBC analysis ranked Colorado 39th for its cost of doing business and 32nd for business friendliness. There is strong evidence from respective leaders and experts that becoming a union shop state will make it more difficult to recruit and retain Colorado businesses. Attracting companies to Colorado draws fierce competition amongst states.

Denver Metro Chamber of Commerce’s press release in response to this proposed legislation aptly noted that, Colorado “risks losing critical opportunities for job creation and economic growth” if this legislation passes. In fact, that was the primary reason why Governor Ritter vetoed it in 2007.

Between 2018 and 2023, Colorado’s average annual employment growth rate of 1.5% was more than three times that of union shop states and over 20 years was double that growth rate.

Bringing this issue forward now may also be a risky political miscalculation. In response, business leaders will likely decide to take their case directly to Colorado voters, launching an expensive and protracted right-to-work ballot measure that could succeed. It’s a real gamble that shouldn’t be ignored and would be on the ballot in 2026, a critical election year.

Rather than break this 81-year-old ceasefire, business and labor and our political leaders should sit down together, roll up their sleeves and find an appropriate off-ramp. Perhaps rather than eliminate the second vote altogether, they could simply agree to lower the threshold from 75% to 66.6% for the second vote.

Colorado law has long protected the right to organize as well as provided a path to strengthen unions through union security agreements. That’s the Colorado way and there’s no good reason to break the ceasefire here.

Doug Friednash grew up in Denver and is a partner with the law firm Brownstein Hyatt Farber Schreck. He is the former chief of staff for Gov. John Hickenlooper.

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Originally Published: December 5, 2024 at 10:32 AM MST