COLUMBUS, Ohio (Reuters) - Governor John Kasich signed on Thursday a bill that curbs collective bargaining rights and bans strikes affecting about 360,000 public workers, making Ohio the most populous state to pass anti-union legislation this year.
Republican Kasich signed the controversial measure at a ceremony in Columbus one day after it received final approval from the legislature.
"(The bill) gives local governments and schools powerful tools to reduce their costs so they can refocus resources on key priorities like public safety and classroom instruction," Kasich said in a statement.
While massive protests in Wisconsin earlier this year grabbed national attention, Ohio is far more important to the union movement. It has the nation's sixth largest number of public sector union members, which is twice as many as Wisconsin.
Wisconsin passed a law similar to Ohio earlier this year but a judge temporarily blocked its implementation and Wisconsin Republicans on Thursday said they would suspend enforcing the law while they fight the legal challenge.
Several other states are considering anti-union legislation and the issue is likely to be a factor in the 2012 elections. Lawmakers in New Hampshire and Oklahoma on Thursday approved proposals that critics said would hurt public sector unions.
The wave of anti-union measures in the states may be the biggest challenge to the power of the union movement in the United States since then President Ronald Reagan fired striking air traffic controllers nearly 30 years ago.
Ohio Democrats want to overturn the new law through a referendum on the November ballot. Under Ohio law, the measure does not take effect for 90 days. If opponents are able to secure the approximately 231,000 signatures needed to place a referendum on the ballot during the 90 days, the law will be on hold until the election in November.
Public opposition to the bill was intense and the Democrats' chances of getting a referendum are "very good" but it's hard to say how it will do in November, said Ohio State University political science professor Paul Beck.
"If the vote were held right now, the bill would be overturned," said Beck. "The real question is will the intensity survive between now and November."
The bill requires public employees such as firefighters, police officers and teachers to pay at least 15 percent of their health insurance premiums, and would get rid of automatic pay increases and replace them with merit or performance pay.
Employees would not be required to pay dues to a union if they refuse union membership, and public employers would not be allowed to automatically withdraw payroll funds for deposit into a union political action committee.
One of the biggest problems for unions has been a change that does away with binding arbitration in contract disputes, letting the legislative body choose their own offer if negotiations fall apart. Opponents say this effectively ends collective bargaining, because the employer always is able to come out on top.
Republican State Sen. Bill Seitz, who voted against the bill, called this a "heads I win, tails you lose" proposition.
Public employees can still bargain on issues related to wages and certain working conditions, but not health care, sick time or pension benefits.
A group that will likely be known as "We are Ohio" is already forming to gather petitions against the bill, and is planning a referendum rally on April 9 in Columbus to encourage people to be volunteer as signature gatherers, said Anthony Caldwell, spokesman for the Ohio SEIU.
"As soon as physically and legally possible we'll have those petitions out in every one of the 88 counties," Caldwell said.
"Working families across Ohio will make sure we gather as many signatures as possible to make sure we get this on the ballot," Caldwell said.
Republicans plan a campaign against the referendum, "to debunk the myths, the half-truths, and the lies the fat cat labor bosses have been spewing in Ohio, Wisconsin and other states," said Kevin DeWine, chairman of the state Republican party.
"There will be a full-throated defense of (the bill) and our leaders who helped fight for its passage," DeWine said.
DeWine said people have made false claims that salaries will be cut in half and pensions will be gone.
Beck said one problem Republicans face is that if there is a referendum, the law will be frozen, so no one will be able to tell if it does any good. On the other hand, voters will be feeling the effect of Kasich's budget cuts in schools and other agencies.
"I think we'll see the bad news before there's good news," Beck said.
Writing by Mary Wisniewski; Additional reporting by Jo Ingles; Editing by Greg McCune