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*Chapter Twelve

Dealing with Employee-

Management Issues and

Relationships

Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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*GOALS of ORGANIZED LABOR

• To work with fair and competent management.

• Be treated with human dignity.

• Receive a reasonable share of wealth in the work it generates.

Employee -Management Issues

LG1

12-2

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*ORGANIZED LABOR

• Unions -- Employee organizations whose main goal is to represent members in employee-management negotiations of job-related issues.

• Labor unions were responsible for:- Minimum wage laws

- Overtime rules

- Workers’ compensation

- Severance pay

- Child-labor laws

- Job-safety regulations

LG1

Employee - Management Issues

12-3

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*HISTORY of

ORGANIZED LABOR

• Craft Union -- An organization of skilled specialists in a particular craft or trade.

• As early as 1792, shoemakers in a Philadelphia craft union met to discuss fundamental work issues.

LG1

The Early History of Organized Labor

• Work weeks were 60+ hours, wages were low and child labor was rampant.

12-4

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*EMERGENCE of LABOR

ORGANIZATIONS

• Knights of Labor -- First national labor union; formed in 1869.

LG1

The Early History of Organized Labor

• Knights attracted 700,000 members but fell from prominence after a riot in Chicago.

• American Federation of Labor (AFL) -- An organization of craft unions that championed fundamental labor issues; formed in 1886.

12-5

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*INDUSTRIAL UNIONS

• Industrial Unions -- Labor unions of unskilled or semiskilled workers in mass production industries.

• Congress of Industrial Organizations (CIO) -- Union organization of unskilled workers; broke away from the AFL in 1935 and rejoined in 1955.

• The AFL-CIO today has affiliations with 56 unions and about 10.5 million members.

LG1

The Early History of Organized Labor

12-6

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*EFFECTS of LAWS on

LABOR UNIONS

• Labor unions’ growth and influence has been very dependent on public opinion and law.

• The Norris-LaGuardia Act helped unions by prohibiting the use of Yellow-Dog Contracts -- A type of contract that required employees to agree to NOT join a union.

• Collective Bargaining -- The process whereby union and management representatives form an agreement, or contract, for employees.

LG2

Labor Legislation and Collective Bargaining

12-7

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*FORMING a UNION in the

WORKPLACE

• The National Labor Relations Board (NLRB) was created to oversee labor-management issues and provide guidelines for unionization.

• Certification -- The formal process by which a union is recognized by the NLRB as the bargaining agent for a group of employees.

• Decertification -- The process whereby employees take away a union’s right to represent them.

LG2

Labor Legislation and Collective Bargaining

12-8

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*WHY JOIN a UNION?

• Pro-union attitudes

• Poor management/employee relations

• Negative organizational climate

• Poor work conditions

• Union’s reputation

• Job security

Labor Legislation and Collective Bargaining

LG2

12-9

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*LABOR/MANAGEMENT

AGREEMENTS

• Negotiated Labor-Management Agreement (Labor Contract) -- Sets the terms under which labor and management will function over a period of time.

• Union Security Clause -- Stipulates workers who reap union benefits must either join the union or pay dues to the union.

LG3

Objectives of Organized Labor

12-10

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*UNION SECURITY AGREEMENTS

• Closed Shop Agreement -- Specified workers had to be members of a union before being hired for a job.

• Union Shop Agreement -- Declares workers don’t have to be members of a union to be hired but must agree to join the union within a specific time period.

• Agency Shop Agreement -- Allows employers to hire nonunion workers who don’t have to join the union but must pay fees.

LG3

Objectives of Organized Labor

12-11

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*RIGHT-to-WORK LAWS

• Right-to-Work Laws -- Legislation that gives workers the right, under an open shop, to join or not to join a union.

• The Taft-Hartley Act of 1947 granted states the power to outlaw union shop agreements.

• Open Shop Agreement -- Agreement in right-to-work states that gives workers the right to join or not join a union, if one exists in their workplace.

LG3

Objectives of Organized Labor

12-12

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*RESOLVING DISAGREEMENTS

• Labor contracts outline labor and management’s rights and serves as a guide to workplace relations.

• Grievances -- A charge by employees that management isn’t abiding by the terms of the negotiated agreement.

• Shop Stewards -- Union officials who work permanently in an organization and represent employee interests on a daily basis.

LG3

Resolving Labor-Management Disagreements

12-13

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*USING MEDIATION and

ARBITRATION

• Bargaining Zone -- The range of options labor and management have between initial and final contract offers that each side will consider before an impasse is reached.

• Mediation -- The use of a third party to encourage both sides to keep negotiating to resolve key contract issues.

• Arbitration -- An agreement to bring in a third party to render a binding agreement.

LG3

Mediation and Arbitration

12-14

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*The GRIEVANCE RESOLUTION

PROCESS LG3

Mediation and Arbitration

12-15

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*TACTICS USED in CONFLICTS

• Weapons used by labor unions include:

- Strikes

- Boycotts

- Work Slowdowns

- Pickets

LG4

Tactics Used in Labor-Management Conflicts

12-16

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*STRIKES and BOYCOTTS

• Strikes -- A strategy in which workers refuse to go to work.

• Primary Boycott -- When a union encourages both its members and the general public to not buy the products of a firm in a labor dispute.

• Secondary Boycott -- An attempt by labor to convince others to stop doing business with a firm that’s the subject of a primary boycott.

LG4

Union Tactics

12-17

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*TACTICS USED in CONFLICTS

• Weapons used by management include:

- Lockouts

- Injunctions

- Strikebreakers

LG4

Tactics Used in Labor-Management Conflicts

12-18

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*LOCKOUTS, INJUNCTIONS and

STRIKEBREAKERS

• Lockout -- An attempt by management to put pressure on workers by closing the business thus cutting off workers’ pay.

• Injunction -- A court order directing someone to do something or refrain from doing something.

• Strikebreakers -- Workers hired to do the work of striking workers until the labor dispute is resolved; called scabs by unions.

LG4

Management Tactics

12-19

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*CHALLENGES FACING LABOR

UNIONS

• The number of union workers are falling.

• Many workers (like airline employees) have agreed to Givebacks -- Gains from labor negotiations are given back to management to help save jobs.

LG4

Future of Unions and Labor-Management Relations

12-20

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*LABOR UNIONS in the FUTURE

• Union membership will include more white-collar, female and foreign-born workers than in the past.

LG4

Future of Unions and Labor-Management Relations

• Unions will take on a greater role in training workers, redesigning jobs and assimilating the changing workforce.

• Unions will seek more job security, profit sharing and increased wages.

12-21

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*UNION MEMBERSHIP by STATE

LG4

Future of Unions and Labor-Management Relations

12-22

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*COMPENSATING EXECUTIVES Executive

Compensation

LG5

• CEO compensation used to be determined by a firm’s profitability or increase in stock price.

• Now, executives receive stock options and restricted stock that’s awarded even if the company performs poorly.

12-23

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*COMPENSATING EXECUTIVES

in the FUTURE

Executive Compensation

LG5

• Boards of directors are being challenged concerning executive contracts.

• Government and shareholders are putting pressure to overhaul executive compensation.

• Financial crisis of 2008-2009 strengthened the argument of shareholders concerning limits on compensation.

12-24

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*The QUESTION of PAY EQUITY Pay Equity

LG5

• Women earn 78.7% of what men earn.

• This disparity varies by profession, experience and level of education.

• The 2009 Paycheck Fairness Act strengthened protections against compensation discrimination.

12-25

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*EQUAL PAY for EQUAL WORK

Equal Pay Act Factors that Justify Pay Differences

• Skill

• Effort

• Responsibility

• Working Conditions

Pay Equity

LG5

12-26

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*WHAT’S SEXUAL HARASSMENT

Sexual Harassment

LG5

• Sexual Harassment -- Unwelcomed sexual advances, requests for sexual favors or other verbal or physical conduct that creates a hostile work environment.

• Sexual harassment laws cover men, women and foreign companies doing business in the U.S.

• Violations can be extremely expensive for businesses.

12-27

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*KINDS of SEXUAL HARASSMENT

Sexual Harassment

LG5

• Quid pro quo sexual harassment involves threats like “Go out with me or you’re fired.” An employee’s job is based on submission.

• Hostile work environment sexual harassment is conduct that interferes with a worker’s performance or creates an intimidating or offensive work environment.

12-28

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*FACING CHILDCARE ISSUES Child Care

LG5

• The number of women in the workforce with children under three-years-old has increased.

• Childcare related absences cost businesses billions of dollars each year.

• Who should pay for the cost of childcare - a dividing issue among employees and businesses.

12-29

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*BUSINESSES RESPONSE to

CHILD CARE

Child Care

LG5

• Firms have established discount arrangements with national childcare providers.

• Employees are given vouchers that offer payment toward childcare.

• Referral services identify high-quality childcare facilities to employees.

• On-site childcare centers and sick-child centers have been established at some companies.

12-30

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*INCREASING ELDER CARE

CHALLENGES

Elder Care

LG5

• Households with at least one adult providing elder care has tripled.

• About 20 million workers provide care which costs companies $11 billion a year in absenteeism, reduced productivity and turnover.

• Costs could rise up to $25 billion.

12-31