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The Labor Relations Framework

CompetitiveChallenges- Legal- Stakeholder needs- High-performance work systems

Goals- Employees and unions- Management- Society

Union Membershipand Relative

Bargaining Power

Union Structure andAdministration

Goal Attainment- Employees and unions- Management- Society

Union and ManagementInteractions- Organizing- Negotiating- Administering

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Goals and Strategies• Society

– Labor unions' major benefit to society throughout history has been the balancing of power and the institutionalization of industrial conflict in the least costly way.

– The National Labor Relations Act (NLRA, 1935) sought to provide a legal framework conducive to collective bargaining.

• Management– Must decide whether to encourage or discourage

the unionization of its employees.

• Labor Unions– Seek to give workers formal representation in

setting the terms and conditions of employment.

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Union Structure, Administration, and Membership

• National and International Unions– Craft unions– Industrial unions

• Local Unions– Responsible for the negotiations of a contract as

well as the day-to-day administration of the contract, including the grievance procedure.

• AFL-CIO– Not a union but rather an association that seeks

to advance the shared interest of its member unions at the national level.

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Union Security

CheckoffProvision

Right-to-Work Laws

ClosedShop

Maintenanceof Membership

UnionShop

AgencyShop

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Union Membership and Bargaining Power

• Reasons for the consistent decline of union membership in the U.S. include:– Structural Changes in the Economy– Increased Employer Resistance– Substitution with HRM– Substitution by Government Regulation– Worker Views– Union Actions

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Legal Framework

• The 1935 NLRA enshrined collective bargaining as the preferred mechanism for settling labor-management disputes.

• Section 7 of the NLRA: employees have the "right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining."

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Unfair Labor Practices (ULPs)

• The NLRA prohibits certain activities by both employers and labor unions:– Employers cannot interfere with, restrain, or

coerce employees in exercising their Section 7 rights.

– Employers cannot dominate or interfere with a union.

– Employers may not discriminate against an individual for exercising his or her right to join or assist a union.

– Employers may not discriminate against employees for providing testimony relevant to enforcement of the NLRA.

– Employers cannot refuse to bargain collectively with a certified union.

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Unfair Labor Practices - Unions

• Originally the NLRA did not list any union unfair labor practices. These were added by the 1947 Taft-Hartley Act.

• The 1959 Landrum-Griffin Act further regulated unions’ actions and their internal affairs– i.e. financial disclosure and

conduct of elections.

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Enforcement

• The National Labor Relations Board (NLRB) has the primary responsibility for enforcing the NLRA.– The NLRB is a five-member board appointed

by the president. Additionally, there are 33 regional offices.

– The NLRB has two major functions: • To conduct and certify representation elections.• To prevent unfair labor practices.

– ULP charges are filed at and investigated by the regional offices.

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Why Do Employees Join Unions?

• Virtually every decision to join a union focuses on two questions?– Is there a gap between pay,

benefits, and other conditions of employment that employees actually receive versus what they believe they should receive?

– If such a gap exists, is it sufficiently large enough to motivate employees to remedy the situation?

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The Process and Legal Framework of Organizing

• An election may be held if at least 30 percent of the employees in the bargaining unit sign authorization cards.

• A secret ballot election will be held. The union is certified by the NLRB if a simple majority of employees vote for it.

• A decertification election may be held if no other election has been held within the year or if no contract is in force.

• Certain categories of employees cannot be included in bargaining units.

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Organizing Campaigns

• The NLRB may set aside the results of an election if the employer has created an atmosphere of confusion or fear of reprisals.

• Associate union membership is a form of union membership in which the union receives dues in exchange for services but does not provide representation in collective bargaining.

• Corporate campaigns seek to bring public, financial, or political pressure on employers during the organizing and negotiating process.

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The Negotiation Process

Distributive Bargaining- win/lose

Intraorganizational Bargaining

- conflicting objectives of different factions

Integrative Bargaining- win/win

Attitudinal Structuring- relationship

and trust

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Preparing Managers for Negotiations

• Seven steps:– Establish interdepartmental contract

objectives.– Review the old contract.– Prepare and analyze data.– Anticipate union demands.– Establish the costs of various possible

contract provisions.– Make preparations for a strike.– Determine the strategy and logistics.

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Negotiation Stages and Tactics

• The early stages may include many individuals, as union proposals are presented.

• During the middle stages, each side makes decisions regarding priorities, theirs and the other parties'.

• In the final stage, momentum may build toward settlement or pressure may build as an impasse becomes more apparent. May involve interaction with negotiators or facilitators.

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Management’s Willingness to Take a Strike

• The following factors help determine whether management is able to take a strike:– Product Demand– Product Perishability– Technology– Availability of Replacement Workers– Multiple Production Sites and Staggered

Contracts– Integrated Facilities– Lack of Substitutes for the Product

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Alternatives to Strikes

• Mediation - Has no formal authority to force a solution; acts as a facilitator for the parties.

• Fact finder - Investigates and reports on the reasons for the dispute and both sides' positions.

• Arbitration - A process through which a neutral party makes a final and binding decision.

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Grievance Procedure

• The negotiation process typically occurs every three years.

• Negotiation processes and administration processes are linked.

• The effectiveness of grievance procedures may be judged on three criteria:– How well are day-to-day problems resolved?– How well does the process adjust to changing

circumstances?– In multi-unit contracts, how well does the process

handle local contract issues?

• Duty of fair representation

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Grievance Procedure• Arbitration is a final and binding step.• Criteria arbitrators use to reach decisions

include:– Did the employee know the rule and the

consequences of violating it?– Was the rule applied in a consistent and

predictable way? – Were the facts collected in a fair and

systematic way?– Did the employee have the right to question

the facts and present a defense?– Does the employee have the right of appeal? – Is there progressive discipline?– Are there mitigating circumstances?

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New Labor Management Strategies

• There are signs of a transformation from an adversarial approach to a less adversarial and more constructive approach to union-management relations.– The transformation includes

increasing worker involvement and participation and reorganizing work to increase flexibility.

• Union leaders have frequently resisted such change, fearing an erosion of their influence.

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Labor Relations Outcomes

• Strikes• Wages and Benefits

– In 2006, private-sector unionized workers received, on average, wages that were 24 percent higher than nonunion counterparts.

• Productivity– Some argue that unions increase productivity, while

other argue that they decrease productivity.– Studies have concluded that union workers are more

productive than nonunion workers although the explanation is unclear.

• Profits and Stock Performance– These may suffer under unionization if costs are raised.

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The International Context

• The United States has both the largest number of union members and the lowest unionization rate of any Western European country or Japan.

• The growing globalization of markets will continue to put pressure on labor costs and productivity.

• The United States differs from Western Europe in the degree of formal worker participation in decision-making.

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The Public Sector

• During the 1960s and 1970s, unionization in the public sector increased dramatically.

• As of 2006, 36 percent of government employees were covered by a union contract, and 42 percent of all government employees were covered by a collective bargaining contract.

• Strikes are illegal at the federal level and in many states for government workers.