In the early days of the American labor movement, company bosses, alarmed at a surge of employees demanding higher wages and safer working conditions, cooked up a plan to hamstring their opposition. To create a false sense of worker empowerment, corporations set up so-called company unions dominated by management types, providing workers with relatively cheap concessions — like pool halls, recreation centers and free or discounted company products — while guaranteeing that any real decisions over pay and benefits remained in corporate hands.
That ended in 1935, when Congress passed the National Labor Relations Act (NLRA) and banned company unions. All labor organizations would now have to be freely elected by the workforce, without interference from above. Since then, American unions have successfully fought for 40-hour workweeks, the end of most child labor and other protections that are now enshrined in law. The income gap between the richest and poorest Americans shrunk considerably in the years after the NLRA passed, before growing once more as unionization declined in the 1970s and 1980s.
