Investopedia / Laura Porter

What Is Featherbedding?

The term featherbedding refers to a labor union practice that requires employers to change their workforce to live up to union regulations. When unions engage in featherbedding, companies are generally forced to increase their labor costs in order to meet these demands. This may come in the form of hiring more workers than necessary or limiting production to meet contractual provisions.

Key Takeaways

  • Featherbedding is a labor union practice that requires employers to change their workforce to live up to union regulations. 
  • Under featherbedding, companies are generally forced to increase their labor costs in order to meet these demands. 
  • Employers may be required to hire more employees than necessary, add time-consuming policies and procedures that increase labor costs or adopt practices that slow down their productivity. 

How Featherbedding Works

Featherbedding is a colloquial term that is commonly used in North America akin to overmanning in the United Kingdom. It occurs when labor unions require employers to increase their labor costs to a degree greater than necessary in order to complete a particular task.

Featherbedding often takes the form of requiring employers to hire additional employees—more than what may be necessary. It can also mean adding time-consuming, make-work policies and procedures that increase labor costs or adopting practices that slow down a company's production levels and overall productivity.

Featherbedding also occurs when employees who are no longer needed are required to be retained by the union, or when unions demand that employers hire workers who are overqualified for a particular position.

Featherbedding emerged as a way for unions to keep people employed in the face of technological advancements and development.

This practice emerged as a way for unions to retain workers as industries developed and implemented technological advancements to increase productivity. Because featherbedding is often portrayed in a negative light, unions typically deny its existence, even though some economists claim the practice may actually help redistribute surplus profits from organizations to employees who would otherwise be unemployed.

Detractors claim that featherbedding promotes outdated and inefficient practices and policies, especially those made obsolete by technological efficiencies.

Special Considerations

The United States Congress created the National Labor Relations Board (NLRB) in 1935 to enforce the National Labor Relations Act (NLRA), which was passed into law the same year to protect the rights and interests of both employers and workers. The NLRB is empowered to order violators of the NLRA to cease unfair labor practices, regardless of who it is—employers or labor unions.

The NLRB may also direct offenders to provide relief to the employees or entities harmed by the wrongful actions through financial compensation.

The NLRA encourages collective bargaining—which takes place between employers and labor unions or groups of employees to negotiate employment terms—and protects workers' rights by curtailing unfair labor practices in the private sector. The NLRA was amended by the Taft-Hartley Act or the Labor Management Relations Act of 1947. The Taft-Hartley Act placed restrictions on the activities of labor unions, prohibiting tactics like jurisdictional strikes, wildcat strikes, secondary boycotts, closed shops, and monetary contributions by unions to federal political campaigns.

Featherbedding is specifically addressed under Section 8(b)(6) of the act, which reads:

Unions may not seek payment for services not performed.
Section 8(b)(6) of the Act makes it unlawful for a labor organization or its agents "to cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other thing of value, in the nature of an exaction, for services which are not performed or not to be performed."

This section specifically outlaws practices that cause an employer to pay for work that is not performed or for any work that is not intended to be performed, although it does not outlaw securing payment for performed services that are unnecessary.

This provision has been interpreted narrowly by the U.S. Supreme Court, which ruled that the NLRA only limits situations in which a labor union exacts pay from an employer in return for services not performed or not to be performed. A union may demand payment for work that is actually done by an employee, with the employer’s consent, even if fewer employees could have done the work as well in the same amount of time.

Article Sources
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  1. National Labor Relations Board. "'Featherbedding' (Section 8(b)(6))." Accessed Oct. 23, 2020.