American workers in the postwar decades held something most workers today do not: a claim on the full value of their labor. Union membership in that period meant wages, but it also meant a defined benefit pension — a guaranteed share of the future. It meant employer-paid healthcare, workplace safety enforcement with teeth, grievance procedures that gave workers standing against arbitrary treatment, and job security that could not be dissolved at a manager’s convenience. These were not generous extras. They were the mechanisms by which workers captured a portion of what they produced.
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The productivity-pay gap measures what happened when those mechanisms were removed. From 1979 to 2025, American worker productivity grew 90 percent. Worker pay grew 33 percent. If compensation had kept pace with productivity, the typical worker would earn $16.40 more per hour today. The Economic Policy Institute is direct about what produced that gap: it was driven nearly entirely by intentional policy decisions targeting worker bargaining power. Union density tracks the divergence almost exactly. In the 1940s and 1950s, more than 30 percent of American workers belonged to unions. Overall union membership today stands at 10 percent. In the private sector, it is 5.9 percent. The lines move together because they are describing the same thing.
Union decline has several documented causes — globalization, manufacturing contraction, right-to-work legislation, workforce shifts. This piece examines one specific employer strategy that has received less public attention than it warrants: a legal structure called the double-breasted employer, built to extract from union and non-union workers simultaneously. It is not a recent innovation. It proliferated in the 1980s, and it operates today in an enforcement environment that makes accountability nearly impossible.
The Deliberate Campaign
On August 23, 1971, corporate attorney Lewis Powell sent a confidential memorandum to the U.S. Chamber of Commerce titled “Attack on American Free Enterprise System.” Powell argued that American business was losing ground to consumer, labor, and environmental movements and called for a coordinated corporate political response — joint organizing, sustained funding, and direct engagement in legislation, regulation, and the courts. Two months later, Nixon nominated Powell to the Supreme Court.
The Chamber acted on the memo. Its membership expanded from roughly 60,000 firms in 1972 to over a quarter million a decade later. The Heritage Foundation was established in 1973. The Cato Institute followed in 1977. The Business Roundtable reorganized to lobby Congress directly. Think tanks produced policy arguments for deregulation, anti-union legislation, and privatization. The infrastructure was purpose-built over a decade, and it pointed in one direction.
What followed wasn’t one big legislative blow. Research by the Economic Policy Institute documents the 1970s as the pivotal decade: unfair labor practice charges against employers rose sevenfold between 1950 and 1980; anti-union consulting firms grew from a handful at the start of the decade to hundreds by its end; and by 1977, workers were losing more than half of the union elections they themselves had called — down from winning 80 percent in the 1940s. The deliberate dismantling of union organizing power was well underway before the decade ended.
The public signal that the political environment had fully shifted came in August 1981, when Ronald Reagan fired 11,359 striking air traffic controllers and banned them from federal employment for life. The message to employers was clear: the rules had changed. By the early 1980s, the political and regulatory conditions for accelerated union dismantling were in place.
The Double-Breasted Mechanism
A double-breasted employer operates two companies under one ownership — one union, one non-union — competing in the same market. The structure is legal under the National Labor Relations Act. It has been litigated for decades and its boundaries are well established in labor law. What it does to workers is straightforward.
The union company signs a collective bargaining agreement. That agreement sets wages, benefits, pension contributions, and working conditions. It also sets the floor — the minimum below which a competing employer would have to drop to take the contract away.
The non-union company is that competitor. It bids the same jobs at lower cost because it carries none of the CBA obligations: no pension contributions, no employer-paid healthcare at union rates, no seniority protections, no grievance procedures. It does not need to beat the union rate by much. A few dollars an hour is enough.
The union is then told it cannot negotiate higher wages or better benefits because the non-union competition will undercut it and workers will lose jobs entirely. That pressure is real. What goes unstated is that the non-union competition belongs to the same parent company. The owner wins the contract either way. The wage floor is suppressed from both directions simultaneously, and the ownership interest that controls both companies captures the difference.
Workers in the union arm are held down by the threat of the non-union arm. Workers in the non-union arm are held just above the union floor — enough to attract labor, not enough to close the gap. Neither group can effectively organize against the pressure because the source of that pressure appears to be the market itself.
The mechanism proliferated in the 1980s, directly in the wake of the political infrastructure built through the previous decade. Construction is where the practice took deepest hold. Union coverage in construction stood at 35 percent in 1979. By 2019 it had fallen to 14.5 percent. Today, 11 percent of construction workers are unionized. The double-breasted model was a significant driver of that collapse. As University of Minnesota law professor Stephen Befort documented in a 1987 Wisconsin Law Review analysis of the practice, an administrative law judge had warned a decade earlier that the employer’s ability to treat each project as a new enterprise unrelated to prior undertakings “means an end to all collective bargaining contracts, and all stable union representation in the entire industry.” The prediction proved accurate.
Navillus Tile was founded in New York in 1987 and grew into one of the city’s largest union concrete contractors. It was a signatory to collective bargaining agreements with more than 20 unions, covering wages, benefits, and pension contributions for its workforce. It was also, simultaneously, the controlling interest behind a set of non-union companies performing the same work.
In 2014, a coalition of five building trades unions sued. After three years of litigation, a Manhattan federal court found that Navillus had created non-union subsidiaries — principally Advanced Contracting Solutions — as alter egos of the union company. The non-union arms took work that the collective bargaining agreements required to be performed under union conditions, avoiding the pension and benefit fund contributions those agreements mandated. The court ordered Navillus to pay $76 million — at the time the largest judgment of its kind in the United States.
Federal prosecutors subsequently indicted the founder and president, Donal O’Sullivan, his sister and treasurer Helen O’Sullivan, and the company’s financial controller on charges of wire fraud, mail fraud, and embezzlement from employee benefit funds. From 2011 to 2017, the indictment alleged, the defendants funneled more than $7 million through a consulting firm to pay Navillus workers off the books, hiding hours worked from the union benefit funds and avoiding over $1 million in required contributions. O’Sullivan received six months in prison. His sister received two years of probation. The comptroller received one year in prison.
Navillus filed for bankruptcy following the civil judgment. The settlement reached with the unions was $25.7 million — roughly one third of the original award. Judge Colleen McMahon, who presided over the case, noted in her ruling that the evidence showed Navillus was not ideologically anti-union: the company “did not want to be shut out of the increasingly non-unionized market for residential real estate construction in New York City.” The double-breasted structure was a market response, not a crusade. That is precisely what makes it a template.
The Navillus case is worth examining for two reasons. The first is what the double-breasted structure accomplished: years of avoided pension and benefit contributions, work diverted from union jurisdiction, wages suppressed across the market. The second is what accountability required: five unions acting in coalition, three years of federal civil litigation, a separate criminal prosecution, and a judgment large enough to force bankruptcy — which the company then used to reduce its actual payment by two thirds.
Newtron: The Current Example
The Newtron Group was founded in Baton Rouge in 1973 by Newton B. Thomas as a union instrumentation contractor. In 1982, Thomas launched Triad Electric and Controls as a separate company under the same parent, explicitly to pursue non-union electrical and instrumentation work in the same markets. The Newtron Group became the holding company for both. This is not inference. The company’s own website describes the structure and its purpose in plain terms. The founder’s obituary, published in 2025, confirms it: Triad was “a merit shop version of Newtron.”
Merit shop is industry language for non-union.
Today the Newtron Group is one of the largest privately owned specialty electrical construction companies in the United States, operating across Louisiana, Texas, California, and Nevada, with approximately 4,500 employees and roughly $1 billion in annual revenue. Newtron operates as the union arm. Triad Electric and Controls operates as the non-union arm. Both bid industrial electrical and instrumentation work. Both are owned by the same parent.
Triad was founded in 1982 — the same moment the political infrastructure described above had restructured the regulatory environment to make this kind of operation viable. That timing is not unique to Newtron. It reflects an industry-wide acceleration that the legal literature tracks directly to the same period.
The Newtron Group has faced no federal prosecution. No civil judgment. The structure Thomas built in 1982 continues to operate today, documented on the company’s own website, with no meaningful accountability in sight.
The Enforcement Collapse
The Navillus case established what accountability looks like when the enforcement environment is functional: five unions, three years, federal prosecutors, and a judgment that the company still reduced by two thirds through bankruptcy. That was the ceiling. The current environment is well below it.
The National Labor Relations Board is the federal agency responsible for enforcing labor law, investigating unfair labor practice charges, and overseeing union elections. In January 2025, the Trump administration fired NLRB board member Gwynne Wilcox before her term expired, leaving the board without the quorum required to issue decisions. The board remained without quorum for most of 2025. During that period, employers could violate labor law with no immediate legal consequences. The same administration issued executive orders stripping collective bargaining rights from more than one million federal workers — an action one labor historian called the largest single act of union-busting in American history.
The board’s quorum was restored in December 2025 when the Senate confirmed two Trump nominees, giving the board a Republican majority. One new member previously served as chief labor counsel at Boeing. At her confirmation hearing, the incoming general counsel declined to state whether she believed the NLRB itself is constitutional.
The agency’s operational capacity had already been gutted. The new general counsel rescinded 31 Biden-era enforcement memoranda in February 2025, citing the case backlog. The NLRB requested $285 million for fiscal year 2026 — a reduction of $14 million from the prior year, and a figure that would be over $381 million in today’s dollars if it had kept pace with the FY2016 budget. Since Trump’s inauguration, the agency had lost 196 employees while hiring only seven. Staffing fell to 1,152 full-time employees — 500 fewer than the agency requested a decade earlier, despite a higher combined intake of cases. The agency carried 17,000 open unfair labor practice investigations, more than half of them over six months old.
After a new intake protocol was introduced in late 2025, union attorneys reported charges being dismissed on technicalities — regional offices throwing out filings because charging parties had not re-submitted information they had already provided. Only two of the agency’s 26 regional offices had sufficient staff to handle their caseloads.
A longer-horizon threat runs through the courts. In August 2025, the Fifth Circuit ruled that the NLRB’s structure likely violates the Constitution — specifically the removal protections for board members and administrative law judges. SpaceX brought the challenge. Amazon, Trader Joe’s, and Starbucks were co-parties — all companies facing hundreds of unfair labor practice charges. The ruling functionally froze NLRB enforcement in the Fifth Circuit. The Supreme Court’s handling of the Wilcox firing suggests the Court’s six-three conservative majority is receptive to the constitutional argument. The NLRB under the current administration is not appealing the Fifth Circuit decision.
If the Supreme Court rules the NLRB’s structure unconstitutional, the enforcement mechanism that produced even the partial Navillus accountability disappears entirely. What remains is a board whose members serve at the president’s pleasure, in an administration that has described union resistance to its agenda as grounds for stripping bargaining rights.
The Newtron Group’s dual structure has operated without federal consequence since 1982.
Sources and Further Reading
The Productivity–Pay Gap. Economic Policy Institute; March 23, 2026. Economic Policy Institute
Union membership rate 10.0 percent in 2025. Bureau of Labor Statistics; April 24, 2026. Bureau of Labor Statistics
Milkman, Ruth and Joseph van der Naald. The State of the Unions 2025. CUNY School of Labor and Urban Studies; 2025.
Powell Memorandum: Attack On American Free Enterprise System. WNET/Thirteen; 1971. WNET/Thirteen
Harvey, David. A Brief History of Neoliberalism. Oxford University Press; 2005. p. 43.
Mishel, Lawrence, Lynn Rhinehart, and Lane Windham. Explaining the Erosion of Private-Sector Unions. Economic Policy Institute; November 18, 2020. Economic Policy Institute
“PATCO Strike.” St. James Encyclopedia of Labor History Worldwide. Encyclopedia.com. Encyclopedia.com
Befort, Stephen F. Labor Law and the Double-Breasted Employer: A Critique of the Single Employer and Alter Ego Doctrines and a Proposed Reformulation. Wisconsin Law Review, Vol. 1987, p. 67; 1987. Wisconsin Law Review
Only 11 Percent Of Construction Workers are Unionized. Metal Construction News; February 19, 2026. Metal Construction News
Union workers win $76M from Midtown construction firm that used alter-ego company to skirt collective bargaining. New York Daily News; September 21, 2017. New York Daily News
President of Navillus Contracting Charged with Defrauding Union Benefits Funds. U.S. Department of Justice; 2020. U.S. Department of Justice
Ex-Navillus CEO Sentenced to Prison in Union Scheme. The Real Deal; June 30, 2023. The Real Deal
Navillus Receives Approval to Exit Bankruptcy. GlobeSt; October 15, 2018. GlobeSt
About Us. The Newtron Group. The Newtron Group
Newtron Group Founder Newton Thomas Dies. 1012 Industry Report; 2025. 1012 Industry Report
Working People Respond to Executive Order Attacking Federal Worker Collective Bargaining Rights. AFL-CIO; March 28, 2025. AFL-CIO
NLRB-Overseen Union Elections Fell in 2025 Amid Trump Administration Attacks. Center for American Progress; February 11, 2026. Center for American Progress
NLRB Releases FY 2026 Budget: Proposed Staffing Cuts and Focus on Efficiency and IT Modernization. National Law Review / Proskauer Rose; June 9, 2025. National Law Review
Trump’s NLRB Doesn’t Want to Investigate Worker Complaints. The American Prospect / Revolving Door Project; April 15, 2026. The American Prospect
The Fifth Circuit’s Latest Labor Law Rulings Are a Gift to Elon Musk. Balls and Strikes; November 10, 2025. Balls and Strikes
Rights to Unionize and Collectively Bargain: State Solutions to the U.S. Worker Rights Crisis. Economic Policy Institute; February 17, 2026. Economic Policy Institute