To Organize or Not to Organize

PART1 Recognizing Rights and

Responsibilities of Unions

and Management

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Part 1 introduces the labor relations process

that will be discussed throughout the book,

placing it in historical and legal perspec-

tives. It also examines the difference

between union and management organiza-

tions and their labor relations strategies.

Chapter 1

Union–Management Relationships in Perspective

Chapter 2

The History of Labor–Management Relationships

Chapter 3

Legal Influences

Chapter 4

Unions and Management: Key Participants in the Labor Relations Process

Chapter 5

Why and How Unions Are Organized

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CHAPTER 1

Union–Management Relationships in Perspective

BOB SAT IN his office staring out the window and thinking about the future. As the human resources manager of the firm, Bob had just finished preparing an announcement to be sent to all employees informing them that the company had just been sold to a larger competitor. After 20 years of service, Bob was very proud of the employee relations that existed at his company and wondered how things might change now that a larger corporation would be in charge. Although Bob’s unit was not unionized, he knew that the new owner had a number of unionized facilities within its corporate structure. Bob had never thought much about what it would be like to manage in a unionized firm and whether the management strategies he had relied upon throughout his career would be as effective or even entirely legal. How might the labor relations process change if he had to deal with employees as a group through their selected union representative rather than as individuals? Would there be an effort to equalize employment terms and policies between union and nonunion facilities of the new owner? Would unions already representing employees at other similar facilities of the owner now seek to organize employees at Bob’s unit? While Bob had more questions than answers about the immediate future, he did resolve to be proactive by attempting to expand his current level of knowledge about the labor relations process.

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Questions

1. In your opinion, what is the biggest difference between managing employees in a unionized versus nonunion firm?

2. In your opinion, does having other unionized facilities within a corpora- tion’s operating units alter management’s approach to labor relations at its nonunion facilities and, if so, give an example to illustrate what you mean.

T oday’s global economy presents many challenges and opportunities for both employers and employees. As organizations seek to use resources both efficiently and effectively,

there will be inevitable tension over how best to manage those assets to benefit both ownership and employees. The effective management of human resources is critical to maintaining an organization’s competitiveness. Recognition of and respect for the legitimate interests of both labor and management are an important step in building and maintaining work relationships capable of adapting to change in the competitive environment most organizations face. Stable work relationships are built upon trust between ownership and employees, which is reflected in both the actions and words of the parties.

Chapter 1 seeks to build a basic frame of reference for understanding the labor relations process by first defining the three phases of the labor relations process and then placing this process into an analytical perspective. Chapter 1 introduces the activities, focal point, participants, and influences of the labor relations process, which are discussed in detail in subsequent chapters. The chapter ends with a discussion of the current status of union membership and the relevance of labor organizations in today’s economy.

Phases in the Labor Relations Process

The labor relations process involves managers (representing the ownership interests) and a labor organization (union), selected by employees as their exclusive bargaining agent to rep- resent their interests. Managers and union representatives jointly determine and administer work rules. Where employees are not represented by a union, work rules are typically deter- mined unilaterally by the employer with the opportunity for individual bargaining between an employee and his or her employer at the employer’s discretion. The negotiation and administration of work rules demonstrate considerable variation across public- and private- sector organizations in the United States, reflecting unique aspects of each organization.

The labor relations process includes three basic phases:

1. Recognition of the legitimate rights and responsibilities of union and manage- ment representatives. Employees have a legal right to form and join a union or to refrain from doing so (see Chapters 3 and 5). Labor law also sets forth the rights and responsibilities of management and union officials to abide by applicable laws and labor agreement (contract) terms. From a union’s perspective, phase 1 may be the most impor- tant phase because without gaining legal recognition as the exclusive bargaining represen- tative of a group of employees in phase 1, the process does not proceed to phases 2 and 3.

2. Negotiation of the labor agreement, including appropriate strategies, tactics, and impasse resolution techniques. Contract negotiation involves union and management

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representatives jointly determining work rules (policies) governing the parties’ rights and responsibilities affecting wages, hours, or other terms and conditions of employ- ment (discussed in Chapters 6, 7, and 8). The outcomes of such negotiations have an important impact on a firm’s labor costs, management’s rights, and covered employees’ standard of living. Most interest disputes (i.e., a dispute over what the terms or condi- tions of employment or work rules will be) are resolved voluntarily by union and man- agement negotiators during the bargaining process. Strikes, lockouts, mediation, and interest arbitration are examples of impasse resolution techniques (discussed in Chapter 9) that can be used to resolve an interest dispute. Phase 2 of the labor relations process generally receives the most media attention even though phases 1 and 3 are equally essential.

3. Administration of the negotiated labor agreement—the interpretation and applica- tion of labor contract terms on a daily basis. Once contract terms have been settled in phase 2, there is a need to apply those terms every day during the stated term or dura- tion of the labor agreement. The contract enforcement phase of the labor relations pro- cess is generally accomplished through daily union and management interactions and, when necessary, the use of a grievance-arbitration procedure to resolve rights disputes (i.e., disputes over the interpretation or application of a contract’s terms, discussed in Chapters 10, 11, and 12). Resolving rights disputes accounts for the most time and energy spent by union and management officials in the labor relations process and usually involves a larger number of these officials than the preceding phases.

Of course, not all labor–management relationships progress smoothly through these three phases. Indeed, employees and their chosen union representative at some public- and private-sector organizations have a difficult time moving from the recognition of an employee bargaining representative (phase 1) through the remaining two phases of the process.1

The phases of the labor relations process are subject to qualitative variation as well. In the first phase, for example, organizations vary in the amount of mutual trust and respect union and management officials have for each other’s goals. In the second phase, negotiations are carried out with different levels of intelligence, preparation, and sincere desire to achieve results. The third phase may vary as to how well the negotiated labor agreement is understood and effectively administered in good faith by both parties. There are probably as many different relationships as there are union and management officials negotiating labor agreements.

Elements in the Labor Relations Process

Exhibit 1.1 provides a framework for the labor relations process. The elements shown can be applied to the labor relations activities at a single or multiple facilities owned by a single company, or in an entire industry. The exhibit cites three major elements: (1) the negotiation and administration of work rules, which are the focal point of labor relations; (2) the key participants in the process, who are the union and management organiza- tions, employees, third-party neutrals, and branches of government (administrative, leg- islative, and judicial); and (3) the constraints or influences affecting the parties in their negotiation and administration of work rules.

Focal Point of Labor Relations: Work Rules

Any academic discipline needs a focal point so that research, investigation, and commen- tary can generate applicable insights. “Labor” or “industrial” relations can become a

6 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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broad topic including many academic concerns. For example, sociologists have examined employee alienation; psychologists have investigated causes of job satisfaction and work motivation; economists have studied wage determination; and political scientists have assessed the impact of union and management as interest groups attempting to influence government policy and legislative outcomes.

John Dunlop’s book Industrial Relations Systems provides a useful focal point for these diverse academic approaches. Dunlop suggested that the center of attention in labor relations should be the work rules negotiated between management and union offi- cials. Work rules facilitate the implementation of operational plans designed to accom- plish an organization’s strategic goals. Work rules determine employees’ standard of living and the work environment within which employees will spend a substantial por- tion of their time. Today external factors (e.g., state of the economy, technology, interna- tional forces) play an increased role in determining the substance and type of work rules created by union and management representatives.

It is important to understand the influences determining the creation and particular content of work rules.2 Work rules can be placed in two general categories: (1) rules governing compensation in all its forms (e.g., wages, overtime payments, vacations, holi- days, shift premiums) and (2) rules specifying the employees’ and employers’ job rights and obligations, such as no employee strike or employer lockout during the term of the labor agreement. This second category of rules may specify performance standards,

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Labor M arket

Tech nology

Financial M arket

Public Opinion

Int ern

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M ar

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Employees

Third-Party Neutral

Government: Executive, Legislative, Judicial

StateFederal Local

Work Rules

Existence and Particular Content

Negotiation and

Administration

Management Negotiators

and Administrators

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ana gement Officials

Owners

Stockholders

Cr ed

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Su b

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Consultants Com pet

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Suppliers

U

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Union Negotiators

and Administrators

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Exhibit 1.1 Elements in the Labor Relations Process

CHAPTER 1 • Union–Management Relationships in Perspective 7Not For Sale

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promotion qualifications and procedures, job specifications, and layoff procedures. Addi- tional examples of work rules are furnished in Exhibit 1.2.

Compensation work rules, such as a negotiated wage rate, often capture the attention of employees and the media because they are negotiation outcomes that are easier for most people to understand and compare. Union and management officials, however, may attach equal or greater importance to work rules regarding the second work rule category, job rights, and obligations. Managers are often adamant about retaining control over key oper- ating decisions such as determining the number and types of employees, equipment and technology decisions, geographic location of company operations, and operating hours. In order to appreciate the importance of these rules, consider the following three examples: Managers at Company “A” are interested in obtaining a work rule that permits production employees to perform “minor repairs,” instead of requiring higher paid maintenance employees to do the tasks. At Company “B” the union wants to reduce forced overtime; they want workers to have the final decision about whether and when they will work over- time. About 39 percent of union contracts contain limitations on the right of management to require employees to work overtime. At Company “C” union leaders are seeking work rules that would change the standard work week to less than 40 hours required to earn full-time pay and benefits.3 Why would the union at Company “C” seek a shorter work week? Assuming the number of employee work hours required to meet a firm’s workload is relatively stable, reducing the number of hours considered to be an employee’s full work week would theoretically require additional employee positions (and potentially more due- paying union members) or create more overtime work opportunities for employees.

Work rules can vary depending upon whether they are common or unique in the sub- ject matter addressed and vague or specific in the wording used to express the rule. Because work rules are the outcome of joint negotiation between union and management represen- tatives, neither party typically gets the exact contract language it originally preferred. Com- promise language is often worded more generally, which allows room for interpretation. However, vague wording can lead to subsequent grievance disputes during the contract’s term as management implements its interpretation of contract terms through job decisions and that interpretation is challenged by employees or their union representative through the grievance dispute process. The wording or interpretation of work rules can also change over time in response to changes in operating environments and the need for greater flexibility.

For example, the work rules for airline flight attendants today would most certainly dif- fer from the following three work rules formulated in the 1930s: (1) swat flies in the cabin after takeoff, (2) prevent passengers from throwing lighted cigar butts out the windows, and (3) carry a railroad timetable in case of plane trouble. Today, the flight attendants’ union is concerned with issues such as too much luggage stuffed into overhead compartments, which may fall and hit a passenger, and passenger use of cell phones during flights, which could pose a security risk by making it easier for terrorists to communicate with each other.4

An analysis of work rules helps to explain the complex output of the labor relations process. The formal labor agreement in this sense represents a compilation of jointly negotiated work rules. However, as discussed in Chapter 10, labor relations activities are not limited to the negotiation of work rules. The labor relations process also includes the everyday interpretation and application of work rules and the resolution of any disputes arising over such decisions.

Concern over health care workers’ exposure to H1N1 flu, the Ebola virus, and acquired immune deficiency syndrome (AIDS) represents working conditions that create a need for appropriate work rules to limit patients’ and health care workers’ exposure. A nurses’ union could seek to negotiate health and safety work rules aimed at protecting members from unnecessary occupational exposure or ensure the availability of appropri- ate treatment when exposure does occur.5

8 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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Exhibit 1.2 Examples of Work Rules Job or Industry

Classification Work Rule

Government Installation

The employer agrees to furnish adequate protective clothing for employees required to work outside during rain, sleet, hail, or other atmospheric conditions detrimental to health or safety, provided the employee subjected to such assignments normally and historically performs the majority of his or her work assign- ment indoors. Employees who normally perform a majority of their work outdoors shall furnish their own protective clothing

Electricians Where the work assignment of employees who have been assigned a permanent reporting location requires travel to and between other work locations and/or return to their permanent reporting location, the time consumed by the employees in such travel shall be counted as time worked

Health Care In situations where a department head determines that it is necessary for an employee to use bilingual skills, those employees who have been previously determined to possess those skills at a level necessary for the assignment, and who are so assigned by the department head, shall be eligible to receive additional compensation of 3 percent above the applicable pay rate for the time period of the assignment

Communications The company subscribes to the principle that a well-informed union leadership promotes harmony and efficiency in union–management relations. The company agrees to notify the union of any proposed changes affecting rates of pay, hours of work, and other conditions of employment. It is understood that the company has the sole right to institute all such changes as it may consider necessary, subject to the terms of this agreement. The union agrees to cooperate with the company at all times in maintaining a high degreeof service to its customers and through conscientious endeavor and application of effort to strive for the lowest possible costs

Professional Baseball

The player and the club recognize and agree that the player’s participation in certain other sports may impair or destroy his or her ability and skill as a baseball player. Accordingly, the player agrees that he or she will not engage in professional boxing or wrestling, and that except with the written consent of the club, he or she will not engage in skiing, auto racing, motorcycle rac- ing, sky diving or in any game or exhibition of football, soccer, professional league basketball, ice hockey, or other sport involv- ing a substantial risk of personal injury

Television The latest version of the script will be made accessible to the player in the casting office 24 hours in advance of a scheduled reading or immediately after the scheduling of the interview, whichever occurs last

Manufacturing When employees are called to work at a time other than their regular reporting time, and after having clocked out, they shall be paid two hours plus one and one-half their straight time rate for all hours worked, but in no event will less than four hours at the straight rate be paid

Cemeteries In all cases where a grave is dug straight down, a second person shall be assigned to assist the digger after a depth of five feet is reached

CHAPTER 1 • Union–Management Relationships in Perspective 9Not For Sale

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Companies and unions are also negotiating “no-smoking” rules in the workplace both as a health benefit and a means of reducing health care costs associated with smoking- related insurance claims. In 1908, a Columbia University professor insisted that “the dele- terious effects of tobacco are greatly exaggerated,” a belief that prevailed for the next 70 years. Now, union and management officials and possibly arbitrators at thousands of facilities jointly determine whether the issuance of a no-smoking policy is reasonable and whether an employee was properly disciplined or discharged for violating the rule. For example, in Kansas City, an arbitrator ruled that a collective bargaining agreement between the fire department and the firefighters union that allowed smoking in designated areas of fire stations prevailed over a newer law banning smoking inside work facilities.6

A majority of employers engage in one or more forms of electronic monitoring of employee work performance. Computer monitoring software, bar code scanners, video cameras, and pressure-sensitive plates have enabled management to monitor employee performance in various ways, such as counting the number of key strokes made on com- puter keyboards, listening to employees’ telephone conversations with customers, following truck drivers via Global Positioning Satellite (GPS) signals, or viewing computer files, e-mail messages, and Internet connections on company computers. Employers have several legitimate interests for monitoring. These include evaluating employees’ work performance, seeking to eliminate illegal employee misconduct, protecting their company’s trade secrets, and defending the firm’s business reputation. Employees have a legitimate interest in ensuring that their union representatives negotiate appropriate work rules to govern the time, place, and method of such electronic monitoring as well as the use of such informa- tion to reward or penalize employees’ work performance. Employees also have a legitimate interest in discussing wages, hours, and working conditions among themselves electroni- cally (e.g., on social media Web sites) without fear that managers are electronically moni- toring their discussions in order to punish those who criticize the company.7

Key Participants in the Labor Relations Process

Through the organization’s structure, managers represent the interests of the ownership as well as their own self-interests. Under a legal doctrine known as agency theory, man- agers are delegated authority by the owners to make decisions required to operate the organization. Because managers represent the owners’ interests in employment relations matters, U.S. managers do not generally have a legally protected right to unionize.

Managers work at various levels within the organization from first-line supervisors or department heads to the highest ranking management official (e.g., chief executive officer). Labor relations managers are typically found at corporate, divisional, and plant levels. Companies with both represented (union) and unrepresented (nonunion) employees or facilities often prefer the term “human resources manager” rather than “labor relations manager.” Organizations that operate different facilities in different geographic locations may emphasize standardizing some work rules (e.g., management rights) at all locations while insisting that other work rules, such as a wage rate for a particular job classification, be based on local labor market conditions. Thus, wages would vary across facilities.

Plant-level labor relations managers implement these “corporate” directives, but they must also deal with other managers at each facility’s location (particularly production and maintenance managers and first-line supervisors) who direct the daily work activities of hourly employees.

As will be further discussed in Chapter 10, first-line supervisors or department heads typically hear and attempt to resolve employees’ grievances on the production floor. In some cases, lower-level managers are surprised to learn that higher-level man- agement officials have overturned their decisions. Alert union leaders may use dissension

10 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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or lack of clear communication among different levels of management officials to influ- ence labor relations activities and the company’s position toward unions.

Management consultants are individuals hired from outside the organization to provide some special service or expertise. The activities of management consultants in the labor relations process are varied and sometimes controversial, ranging from restruc- turing personnel practices in nonunion firms (in the absence of any active union- organizing campaign) to designing and presenting the employer’s response throughout a formal union-organizing campaign. During an organizing campaign, both union sup- porters (often including professional union organizers) and union opponents (often including managers and managerial consultants) try to persuade employees to support (or oppose) forming a labor union; the campaign usually ends with a secret-ballot vote, supervised by the federal National Labor Relations Board (NLRB). One union estimate found that managerial consultants were involved in 75 percent of union-organizing cam- paigns.8 Employers who hire managerial consultants to thwart union-organizing efforts are more likely to engage in a number of legally and ethically questionable tactics. “Employers who make threats of plant closings are more likely to hire outside consul- tants, discharge union activists, hold captive audience meetings and supervisor one- on-ones, establish employee involvement committees during the organizing campaign, make unilateral changes in benefits and/or working conditions, use bribes and special favors, use electronic surveillance, threaten to report workers to the INS [U.S. Immigra- tion and Naturalization Service], and show anti-union films.”9 Controversy occurs over the consultants’ effectiveness. Research shows that the use of a management consultant can reduce the probability of a union win in very closely contested elections, but it does not appear to be as big an influence on union election outcomes as some other factors such as election-unit size (i.e., how many people will vote in a union representation elec- tion) or relevant labor market conditions.10

Effectively managing an organization’s labor relations is an important part of the ownership goal of being competitive in the industry or market. Organizations with a quality labor–management relationship may gain a competitive advantage over firms that lack the ability to gain cooperation and consensus from employees necessary to effectively implement change to meet new competitive pressures.

Union representatives, usually elected by the members to represent their employ- ment interests, are another key participant in the labor relations process. As elected representatives, union officials must consider the varied and sometimes conflicting inter- ests of individual employees within the bargaining unit seeking to build a consensus for decisions that benefit the majority of constituents. Unlike managers who are appointed by higher-level managers, union officials are subject to the political pressure of majority rule if they wish to be reelected to a union leadership position in the future. Unions as democratic organizations do experience internal differences of opinion on policies and priorities that union officials must learn to effectively manage. Every union has its own history, traditions, personalities, and accepted practices that can lead to observed differ- ences across union organizations as well as within a particular union. While different unions may share common interests and positions on many issues of common concern, each union tends to value maintaining its own independence and sense of self- determination in representing the interests of its membership.

Certainly some of the most significant participants in the labor relations process are nonmanagerial employees because they often determine whether a union is even present in an organization (representation elections and union-organizing drives are discussed in Chapter 5), whether a negotiated labor agreement is accepted or rejected, and the extent to which a threatened strike is actually carried out (see Chapter 9).

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Employees are treated here as a separate category because they may demonstrate dual loyalty to both their employer and union organization.11 Most employees want their organization to be successful but also value the ability of their union to voice employee concerns to managers or demand that employees be treated fairly both in com- pensation and work activities. For example, public employees such as firefighters, police, and teachers may feel torn between the critical or professional nature of their jobs and the strategic advantages of a strike. Auto workers may agree that operating costs, includ- ing labor costs, must be reduced for their employer to remain competitive. Yet they expect their union representative to ensure that when profitability improves employees will fairly share in that improvement. Employees’ varied interests help shape the exis- tence and content of particular work rules and thus employees are considered a third key participant in the labor relations process.

The government acting through its different branches—executive, legislative, and judicial—at the federal, state, and local levels represents another key participant in the labor relations process. As discussed in Chapters 2 and 3, the government’s role in regulating labor relations has gradually increased over time as the importance of labor relations to the effective functioning of the economy has become more apparent. In the public sector, government officials also serve as managers in the labor relations process, representing both taxpayers and the general public’s interests (discussed in Chapter 13).

In the private sector, the federal government has traditionally played an indirect role in determining the outcomes of work rule negotiations, preferring to allow union and management representatives to determine such work rules through the bargaining pro- cess. Governments in many other industrialized countries (see Chapter 14) take a much more active role in both regulating and determining the outcomes of specific work rules (e.g., amount of paid vacation time). The federal government’s hands-off approach in most private-sector bargaining situations is based on the belief that most management and union officials are better equipped than their government counterparts to assess their needs and limitations and reach a mutually acceptable labor agreement.

Although the federal government does not dictate the terms of a negotiated labor agreement, laws, judicial decisions, and administrative agencies, such as the NLRB, can influence work rules and the ability to exercise legally granted rights. The following three examples illustrate this: First, legislation to deregulate the trucking and airline industries has contributed to reduced union membership and economic gains for employees.12 Sec- ond, the Age Discrimination in Employment Act prohibits union and management offi- cials from negotiating a mandatory retirement age of 60 years. Third, although some coal miners have long believed that females working in mines would be bad luck, union and management officials would be violating sexual discrimination aspects of the Civil Rights Act if they negotiated a provision prohibiting female employees from working in mines.

Third-party neutrals (i.e., mediators and arbitrators) represent a final key partici- pant in the labor relations process. Differences between union and management officials that arise in negotiating the terms of a labor agreement (interest disputes) or administer- ing its provisions (rights disputes) are often resolved with the aid of a third-party neu- tral. Mediators (discussed in Chapters 9 and 13), often supplied by the Federal Mediation and Conciliation Service (FMCS) or a state or private mediation agency, may be used to help resolve interest disputes during contract negotiations. The mediator assists the union and management officials to clarify and resolve their differences, thus promoting a voluntary settlement. The mediator does not possess any binding legal authority to require the parties to settle an interest dispute, but he or she will offer advice to help each party assess its own priorities and the costs or risks associated with failing to reach a voluntary agreement.

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An arbitrator is a third-party neutral hired by union and management representa- tives to make a final and binding decision on a disputed issue. While final and binding arbitration may occasionally be used to resolve the terms of a new contract (an “interest dispute”) (see Chapter 9), most often it is used to resolve grievances (“rights-type disputes”) arising during the term of a labor agreement over the interpretation or application of the contract’s language (see Chapters 11 and 12).

Three Basic Assumptions Underlying U.S. Labor Relations

To better understand the U.S. labor relations system and the actions of its participants, it is helpful to bear in mind certain underlying assumptions that affect the thinking and behavior of most individuals within the system. Whereas the degree of support by some participants for these three basic assumptions has varied over the course of U.S. labor history, these assumptions have been the basis for a majority consensus for many years.

First, the free enterprise (capitalist) economic system in the United States creates an inherent conflict of interest between employers (owners) and employees. Both employees and employers seek to advance their own self-interests. Employers seek to maximize their return on capital invested, while employees seek to advance their pay, working con- ditions, and job security. Most of the interests employees seek to advance through the collective bargaining process represent an increased cost to the employer which, unless offset by cost savings elsewhere or higher productivity, may reduce the investment return desired by ownership. This creates a natural tension within a capitalist economic system between the pursuits of employees’ and employers’ legitimate interests. Such conflict should not be viewed in a negative light but rather as simply a reality of business opera- tion which must be managed effectively. The presence of some degree of inherent con- flict between employer and employee interests should also not be viewed as precluding opportunities for cooperation between the parties. Both employees and employers share a common interest in ensuring that the organization is competitive. Maintaining a suffi- cient number of qualified and motivated employees is necessary for an employer to attain desired organizational goals (e.g., productivity, product or service quality). Profits in turn permit an organization to provide competitive wages, benefits, and working con- ditions to help ensure the recruitment and retention of qualified employees. Ideally, employees perceive their own self-interest as best advanced by seeking to advance the interests of the organization as a whole.

A second underlying assumption of the U.S. labor relations system is that employees in a free and democratic society have a right to independently pursue their employment interests using lawful means. Employees should have a right to determine for themselves what is in their best interests and to pursue means of attaining such interests so long as the goals pursued and tactics used are legal. Only by allowing individuals to pursue their legitimate interests can a society foster the necessary support for prevailing economic, social, and political systems used to sustain the country. Employees may choose to pur- sue their legitimate interests on an individual basis or collectively by joining a labor organization. Managers may prefer to work with employees individually and avoid deal- ing with a union, in order to contain any wage disagreements to only a few people and to avoid negotiating widespread workplace rule changes. However, co-workers may see it as unfair when individual employees with unique skills negotiate special work arrange- ments or pay rates (sometimes called idiosyncratic deals). Further, perceived injustice has been shown to predict unionization. Therefore, such idiosyncratic deals can be chal- lenging to negotiate and implement for managers.13

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A third underlying assumption of the U.S. labor relations system is that collective bar- gaining provides a process for meaningful employee participation through independently chosen representatives in the determination of work rules. Employees in the U.S. labor relations system are not required to form or join a labor organization for the purpose of engaging in collective bargaining, but they are permitted to do so when a majority of the employee group expresses such a preference. In the absence of collective bargaining, indi- vidual bargaining may occur between an employer and his or her employee. Labor history suggests that most employees are at a relative bargaining power disadvantage in individual bargaining when confronted with the greater resources of their employer, but each employee is free to determine the degree of satisfaction that his or her own individual bar- gaining experience provides. Many unrepresented employees, for a variety of reasons, do not attempt to engage in individual or collective bargaining, thereby permitting the employer to unilaterally (without bargaining) establish work rules, setting the terms and conditions of employment. In limited cases, employment terms may be mandated by gov- ernment action (e.g., minimum wage law, safety, and health standards).

Exhibit 1.3 presents a list of some basic characteristics of the private-sector U.S. labor rela- tions system. These characteristics will be discussed in further detail throughout the text.

Constraints or Influences Affecting Participants’ Negotiation and

Administration of Work Rules

The labor relations participants who affect the development of work rules are influenced by external variables or constraints in their labor relations activities (see the outer circle of Exhibit 1.1). These constraints and influences can sometimes affect one another and may relate to a particular firm, local community, or society in general. The following discussion furnishes a few illustrations of how these constraints and influences can affect the existence and content of work rules.

State of the Economy: National, Industrial, and Firm-Specific

Indicators

The state of the economy is usually referred to by indicating movement among such quan- titative indicators as inflation, unemployment, and productivity. During the 1980s, the United States witnessed a rising inflation rate, which influenced the negotiation of work rules—notably, union insistence that a labor agreement include provisions to increase wages if increases occur in the cost of living (see Chapter 7). In the early 1990s, the focus of negotiations was on wage increases, enhancing employee benefits, and containing rising health care costs. More recently, with slow economic growth, low inflation, and rising job losses, union and management negotiators returned to an emphasis on job security and other job protection issues. Many employers, citing competitive pressures, have successfully negotiated labor cost reductions involving wages, benefits (e.g., pensions, health care), and inefficient work rules (e.g., restrictive job descriptions).

Two economic indicators that can affect work rules are interest and unemployment rates. An increase in interest rates can slow home and industrial construction projects. The Federal Reserve Board voted to raise interest rates 17 times between June 2004 and June 2006 out of concern that too rapid economic growth might trigger an increase in consumer inflation.14 More recently, the Federal Reserve Board has cut interest rates to historically low levels in an effort to spur economic growth by making capital more available at reasonable cost. If employees’ wage gains do not at least match the rate of increase in consumer prices (inflation rate), the purchasing power of employees declines, adversely affecting employees’ standard of living. If interest rates are raised to fight

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inflation, employees will pay more for consumer debt (e.g., credit cards, auto, or home loans). A union might respond to such a rising interest/inflation rate environment by seeking to negotiate pay improvements that exceed the rate of inflation as well as by offering group discount rates to members on benefits such as credit cards or various types of consumer loans. In a low interest/inflation rate environment, a union might focus more on job security issues knowing members are more likely to be satisfied with moderate wage and benefit improvements that match the low inflation rate.

The unemployment rate affects work rules that provide job protection. Chapter 6 discusses ways in which the unemployment rate can affect the bargaining power of union and management officials. If this and other economic measures pertaining to the gross national product, productivity, cost of living, compensation at all employee levels, and exports and imports are unfavorable, unions will be more likely to accept bargaining concessions. By the same token, strong product sales, economic growth, and low unemployment tend to strengthen union bargaining power as employers have more reason to compromise to avoid any disruption in the production of current products or services.

The National Bureau of Economic Research has determined that the most recent recession affecting the U.S. economy began in December 2007 when the national unem- ployment rate was 4.9 percent. By October 2009, the national unemployment rate had risen to 10.2 percent, representing 15.7 million individuals—the highest rate since the recession in the early 1980s. By September 2014, the unemployment rate had declined to 5.9 percent, representing 9.3 million individuals. An additional 698,000 individuals were classified as discouraged workers who had given up searching for a job because they

Exhibit 1.3 Basic Characteristics of the U.S. Private-Sector Labor Relations System

• Primarily a bilateral process (union and management) governed by a framework of labor laws. For example, LMRA, Labor Management Reporting and Disclo- sure Act (LMRDA), Railway Labor Act (RLA), OSHA, Family Medical Leave Act (FMLA), ERISA, ADA, Norris-LaGuardia Act, and anti-discrimination laws.

• A highly decentralized bargaining structure that results in a large number of labor contracts negotiated most often between a single employer and a spe- cific union to cover a defined group of employees (bargaining unit) at a specific geographic location.

• Recognition of the key legal principles of majority rule and exclusive bargaining representation. No union can gain the right to represent a group of employees for purposes of collective bargaining without first demonstrating the majority support (50 percent + 1) of the employees in that group. Once recognized, the union is the only legal representative authorized to negotiate work rules with the employer to establish the work group’s terms and conditions of employment.

• Permits the use of economic pressure (e.g., strike, lockout, picketing, and boy- cott) to aid the parties (union and management) in reaching a voluntary negoti- ated settlement of interest disputes over what the terms and conditions of employment will be.

• Encourages the use of final and binding arbitration, if voluntary grievance nego- tiation efforts fail, to resolve rights disputes that arise during the term of a con- tract over the interpretation or application of the labor agreement’s terms.

• Characterized by significant employer opposition to employee efforts to orga- nize and bargain collectively through representation by an independent labor union chosen by the employees themselves.

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believed no jobs were available for them.15 While unemployment rates are expected to continue to decline as economic recovery occurs, the decline is expected to be gradual, extending over several years, as employers are typically reluctant to add new jobs or fill existing vacancies until the recovery in product and service demand is well established.16

The skills, wage levels, and availability of employees in a relevant labor market can affect negotiated work rules. Management is often concerned with ensuring that an ade- quate supply of labor of the skill levels required to operate is available in a particular com- munity. For example, a firm needing skilled employees from a relatively low-skilled labor market supply would probably wish to negotiate work rules regarding apprenticeship pro- grams or other forms of job training. Management would also consider negotiating a rea- sonable employee probationary period (e.g., 60–120 days) within which it could terminate a union-represented employee who cannot learn the job and perform adequately, with no union right to protest the action through the labor contract’s grievance procedure.

One example of a labor–management cooperative effort to assist employees in adjust- ing to changes in labor market forces is the Alliance for Employee Growth and Develop- ment, Inc., created in 1986 as a joint enterprise by American Telephone & Telegraph (AT&T), the Communication Workers of America (CWA), and the International Brother- hood of Electrical Workers (IBEW) to help displaced workers. Today, the Alliance also includes employers Alcatel-Lucent, OFS Optical Fiber, and Avaya.17 The Alliance has pro- vided training and development services to more than 175,000 individuals, helping to pre- pare them to handle new technologies, job skills training (e.g., technical, customer service, teamwork), and career transition training. Other outstanding examples include the United Auto Workers (UAW)/General Motors Skills Centers and the joint training programs of Ford Motor Company and the UAW. The Service Employees International Union (SEIU) has partnered with Kaiser-Permanente in California to provide training to upgrade the skills of workers in entry-level jobs, such as housekeeping. Trainees can then move into health care–related jobs such as medical assistant and acute care nursing assistant that offer higher pay and more career potential. The vacancies created in entry-level jobs are filled with those transferring from part-time positions and from newly hired unemployed and economically impoverished workers who have also received training. In the building trades, unions have played a major role in training skilled workers. Because workers move from employer to employer on a regular basis, single construction companies have less financial incentive to train employees who may end up working for a competitor. Therefore, the unions, through their training and apprenticeship programs, provide an obvious contribution to the general national welfare. In fact, unions and their contractors outspend their nonunion counterparts by a ratio of 50 to 1 in training investments.18

Both management and union representatives should share an interest in establishing competitive compensation rates for comparably skilled employees within a relevant external labor market and internally within the firm itself. Externally, when wages are increasing, both the firm and the union may want to pay comparable wage rates. Employees generally see this as fair and owners see it as a way to attract and retain good workers. In cases where the employer faces significant labor cost competition from nonunion or foreign employers, a union may have to agree to compensation reduc- tion that will permit a unionized employer to remain competitive in pricing goods or services sold in the firm’s product or service markets. Internally, a job with higher skill or responsibility requirements should earn a higher compensation rate than jobs with less skill or job responsibility requirements.

The labor relations process can be affected by the product or service market where the company either sells its product or purchases key elements required for production of its products or services. Management would be more vulnerable if a strike occurred at

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a time when major customer sales were anticipated or on-time delivery of promised goods was critical to meet a customer’s needs. For example, management at a brewery would prefer to avoid a labor agreement expiring, possibly leading to a strike, during the summer months, when significant beverage sales are anticipated. A public school sys- tem would much prefer a contract expiration date in early summer after the regular school year has ended, rather than risk a possible work stoppage disruption if the con- tract expiration date coincided with the first day of the new school year.

A second dimension of the product market, the source of key elements for product manufacture, can be a factor affecting union members’ perceptions of job security. For example, the UAW union is concerned over the fact that many of the parts utilized in U.S. automobiles are being manufactured in other countries, creating job opportunities for foreign workers but not for UAW-represented employees.19

Another important consideration in the labor relations process is the financial market, the arena in which the employers (and unions) seek to borrow funds to finance their invest- ment strategies. Companies must consider exchange rate money value differences among countries, which affect the profitability of plant location and sales marketing decisions. Exchange rates between countries (see Chapter 14) can alter companies’ investment strategies because exchange rates affect comparative wage rates and, consequently, the comparative labor costs of production. As an example, when the peso in Mexico was devalued by as much as 50 percent of the U.S. dollar, the labor costs of production in Mexico declined dramatically and made producing goods in Mexico more attractive and economical for multinational corporations. A strong euro currency valuation in comparison to the U.S. dollar helped drive up labor production costs in European countries such as Germany, encouraging automakers such as Daimler AG (Mercedes) and Bavarian Motor Works (BMW) to build production plants in the United States.

When a company wants to expand its plant capacity and increase jobs, it often has to borrow money in the financial markets at the same time it may request wage conces- sions from a union (see Chapter 7) or request the elimination of work rule restrictions to improve productivity (see Chapter 8). Unions must be able to perform financial valuation analysis to support, for example, an employee stock option plan (ESOP) (see Chapter 7), or anticipate the advantages or disadvantages of the sale or merger of an existing employer’s operations with another competitor or private equity fund from the perspective of union-represented employees.

Labor unions have been able to use their financial resources and become active in the financial markets as a source of capital. With U.S. employee pension funds valued in excess of $7 trillion, many unions believe that decisions on how to invest those funds ought to take into consideration the effect of capital investments on the economic and job security interests of union members.20 Thus, one goal of many unions is to invest pen- sion funds in firms that are already unionized. For example, the United Steelworkers have created a regional investment fund of $100 million called the Heartland Labor Capital Project, which has the following objectives: (1) invest in regional business and protect jobs, (2) promote economic awareness as well as training workers and unions and raising the level of influence on economic development, (3) stimulate regional economies, (4) encourage regional business enterprises by involving both labor and its allies to support institutional development, (5) provide capital to enterprises where unions have created more democratic and sustainable practices, and (6) provide prudent returns to investors.21

Other unions, including the American Federation of Labor-Congress of Industrial Organi- zations (AFL-CIO), have similar programs to promote jobs for union members.

Perhaps the most immediate and persistent influence on the creation of work rules is the technology of a particular workplace. Technology has four dimensions: (1) equipment

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used in the operation, (2) the pace and scheduling of work, (3) characteristics of the work environment and tasks to be performed, and (4) information exchange. Consider, for example, the major equipment found at a steel mill blast furnace, which requires a very high temperature for operation. Such a furnace cannot simply be turned on and off like a household oven. Often several days are required for either reaching the high operating temperature or for cooling the furnace for maintenance. This equipment characteristic affects the facility’s work rules. In essence, steel mills must operate 24 hours a day, 7 days a week—a situation prompting related work rules, such as wage premiums for working the night shift, weekends, or holidays. Other continuous operating organizations like hospitals, hotels, or large retail centers may face similar work rule issues.

In some cases, the introduction of equipment reduces or eliminates employees in a particular job classification. This situation occurs when industrial robots handle tasks formerly performed by employees. A rather common application occurs in the auto industry, where mechanically joined arms perform spot welding, spraying, machine unloading, and assembly. Unions faced with having membership replaced by robots have increased related bargaining demands to protect their members’ job security such as more paid time off; fewer hours comprising a regular work week (e.g., 35 or 38 hours versus a 40-hour week); or job transfer or retraining rights, enabling displaced workers to fill available vacant employment opportunities.

Technological advances in computer and communications have made many profes- sional jobs (e.g., accounting, engineering, and radiology) capable of being outsourced to workers at outside firms and even in different countries. Some workers benefit from new job opportunities, while others may lose their job as their employer seeks to reduce labor costs by outsourcing work formerly performed by its own employees.

Changes in technology have raised the level and type of skill requirements for many workers. While most competing firms have access to the same technology, the ability to apply that technology using the skills and brainpower of their employees ultimately determines whether any real competitive advantage is achieved. Technology improve- ments have created a greater demand for more highly skilled workers who are able to assume multiple responsibilities, while reducing the demand for strictly manual labor. Although, both profits and productivity growth have improved, average real hourly com- pensation for American workers has not changed significantly over the last 20 years, cre- ating increasing stress on workers seeking to maintain a middle class standard of living.22

Technological change can also result in certain jobs requiring fewer skills to perform. In the supermarket industry, electronic scanners are used to change item prices, record customers’ purchases, and maintain product inventory counts. Radio Frequency Identifica- tion (RFID) chips combined with “smart shelf” systems can send electronic signals to notify personnel when store shelves are depleted. These activities result in reduced skill requirements and compensation for cashiers as well as a need for fewer employees. Inter- estingly, self-service checkout stations in grocery stores, which allow one cashier to do the work of up to six, have met with some consumer resistance; many customers simply prefer to have their groceries scanned and bagged by grocery store employees.23

The pace and scheduling of the workday also affect the work rules of certain occupa- tions. For example, bus companies optimizing their productivity and revenue would concen- trate on rush-hour traffic (6:00–9:00 A.M., 3:00–7:00 P.M.) when buses are likely to be filled with passengers. However, problems would remain in scheduling work because many bus drivers might have a daily eight-hour work schedule of three hours on, three hours off, one hour on, two hours off, and four hours on. Because of the nature of the work, most labor agreements in related industries have provisions pertaining to the permissible number, length, and possible compensation of intervals (times off) between daily work assignments.

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Computer operations can help both union and management officials in their daily labor relations activities. Union officers can use computer applications to maintain mem- bership and dues records, as well as word processing for communication to the member- ship. Union and management officials can also use computer applications in the areas of contract negotiations (costing the various proposals, writing contract language) and administration (maintenance and research of grievances and arbitration decisions).24

Union officers also use computer applications for communicating with the union’s cur- rent and prospective members. E-mail, Internet, weblogs (“blogs”), and social networking Web sites are used to keep union members and the public informed of progress during negotiations. Also, both union and management spokespersons frequently use these commu- nication tools during union-organizing campaigns. (See Chapter 4, which discusses how unions use computer technology.) For example, the United Food and Commercial Workers (UFCW) Local 21 in Washington state has used its own Web site (http://www.ufcw21.org/) and a Facebook page (https://www.facebook.com/2013GroceryBargainingUFCW21) to bring attention to its complaints about nonunion grocers, including Wal-Mart.

One survey of U.S., U.K., Irish, Australian, and New Zealand labor unions finds that 97 percent have a Web site, 78 percent have an e-mail newsletter, and about one-half use Facebook. Less than 10 percent of union leaders use UnionBook, a social media site for union organizations (http://www.unionbook.org/); 13 percent post YouTube videos. The AFL-CIO has an extensive Web site (http://www.aflcio.org/) which enables workers, union members, and students of labor and employment relations to become informed regarding current developments.25 Students needing to research current labor relations topics for a class assignment may find the “Labor Relations in Action” box in this chapter helpful.

International Forces

As participants in the global economy, both labor and management must continuously monitor international developments and trends to determine how their respective inter- ests may be affected and how best to respond. Many U.S. firms are dependent on foreign sales or production to generate profits. The international financial crisis in recent years has affected U.S. and foreign currency values as well as the availability and costs of nec- essary operating capital. Economic cycles have differing effects: a weak U.S. dollar value may make U.S.-produced goods and services cheaper to export but drive up the cost of imported goods and services. A strong U.S. dollar has opposite consequences in that U.S.-produced goods are more expensive overseas and imported goods become cheaper. After several years of decline, the dollar had begun strengthening; at the end of 2014, the U.S. dollar was again considered “strong” against other currencies. Finally, a recession in other countries may reduce the demand for U.S. goods and services in those countries, thus adversely affecting employment levels at U.S. exporting firms.26

The wars in Iraq and Afghanistan have affected thousands of Americans, including union members called up as reservists. Although companies are required to retain the reservists’ positions, some companies may be reluctant to hire and train new employees who may have to be laid off upon return of the reservists. Instead, companies may require other employees to work more overtime or temporarily reclassify employees (through pro- motions or transfers) to fill the positions left vacant by the call-up of the reservists.

Unions are concerned about the job security and economic impact of “free trade agreements” such as the North American Free-Trade Agreement (NAFTA; discussed more in Chapters 2 and 14) involving the United States, Canada, and Mexico. While imports from Mexico have clearly increased the U.S. trade deficit with Mexico since the enactment of NAFTA, the effect of NAFTA on U.S. employment and wages tends to be less clear.27 Unions tend to stress “fair trade” rather than “free trade” in discussing ways

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to ensure that domestic companies can compete effectively in global markets. In addition to fostering more cooperation with foreign-based labor organizations, U.S. unions also seek to promote policies aimed at raising pay, working conditions, and environmental and safety standards applicable to workers in foreign countries.28 Not only does such an approach serve to raise the living standards of workers in their own countries, it also serves to reduce the labor cost advantage of moving work done by U.S. workers to those foreign countries, thus enhancing job security for U.S. workers.

International trade is a major influence in the labor relations process. Imports and exports, trade deficits, exchange rates, capital investments, and jobs are interconnected. As an example, the U.S. trade deficit with China increased from $6 million in 1985 to $318 billion in 2013.29 Using trade surplus funds to purchase U.S. Treasury notes, China has become the U.S. government’s largest foreign creditor.30 Some economists believe that China’s currency is undervalued by 25 to 40 percent.31 Coupled with a low-wage work- force, this provides China with a competitive advantage in trade with the United States.

Major retailers, such as Target, Best Buy, and Wal-Mart, depend on low-priced imports from China. These imports help to keep inflation rates low and have helped the Federal Reserve to keep interest rates in the United States at their lowest levels in four dec- ades.32 A strong U.S. dollar has made imports appear cheap and has contributed to the growing U.S. current account deficit (mainly comprising the trade deficit but including capital income and transfers). “With large and persistent external deficits, the United States has swung from being the world’s largest creditor nation to its largest debtor, with net for- eign liabilities now at about one-fourth of GDP (gross domestic product).”33

The trend toward globalization has been characterized as free-market capitalism, which places enormous competitive pressures on all firms that become part of the global economy. Multinational firms that sell globally are pressured to produce globally by seg- menting their production chains and outsourcing each segment to the country that can produce cheapest and most efficiently. Newly industrialized countries are able to com- pete in price-conscious markets by paying lower wages, offering fewer benefits, and pro- viding less ideal working conditions than those available in the United States. In addition, due to the diversity and customization made possible by computer-based tech- nology, the cost advantages of American-style mass production have been reduced.34

Labor unions have been active in the international arena since their beginning. American labor unions have a long history of resisting the importation of foreign pro- ducts. Over the last two centuries, organized labor has been one of the more protection- ist institutions in America. This position should not be a surprise because unions are democratic organizations that must reflect the interests and needs of their members, many of whom believe that their jobs are endangered by foreign imports. Most union members have little inclination to accept assurances that they will find another compara- ble job or that, in the long run, everyone will be better off. Organized labor unsuccess- fully opposed trade legislation such as NAFTA and has consistently encouraged Congress to ensure that trade agreements with other countries contain safeguards for workers’ rights and environmental protections applicable to foreign trading partners. North American unions continue to support positions of the International Labor Orga- nization (ILO), a United Nations-sponsored labor federation headquartered in Geneva, Switzerland, which has adopted “core labor standards” promoting basic workers’ rights such as freedom of association, collective bargaining, the right to earn a living wage in a safe workplace, and the prevention of forced child labor.35 Organized labor continues to press the World Trade Organization and the International Monetary Fund to forge links between international trading rights and labor standards.36

20 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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LABOR RELATIONS IN ACTION Getting Online with Labor Relations Research

The number of electronic sources for locating informa- tion on collective bargaining and labor relations is con- stantly increasing. The most efficient method for finding reports in journals, magazines, newspapers, and other periodical literature is through the use of online research databases, which are offered by most university and college libraries to their students, faculty, and staff members. You will choose your sources depending on the time period you want to cover, the amount of infor- mation you need, and the availability of resources in your area. Libraries still maintain a collection of print indexes, but most of these are being replaced by online versions, which allow for faster searching and less maintenance by the library.

Online databases have several advantages over print indexes, including currency, the ability to print in a variety of formats, the ability to combine terms and other ways to limit (e.g., date, language, and publication title) to broaden or narrow a search, generate biblio- graphic citations by style, and the ability to e-mail or download articles. Online databases that can be searched from college libraries can also usually be searched from a dorm room, home, or office with appro- priate user authentication. A few disadvantages are the commitment of time to become skilled in their use, the availability of only selected content in some databases, and overlapping titles from database to database.

Subscriptions to online databases that provide access to indexing or the full text of articles on business topics are sold by a number of vendors, including Lex- isNexis, ProQuest (formerly University Microfilms or UMI), OCLC (FirstSearch), Gale (part of Cengage Learn- ing), and EBSCO. Databases specifically devoted to labor relations cases and issues are provided by the Bureau of National Affairs (BNA) and Commerce Clear- ing House (CCH). Most of these databases are provided through the Internet, although there are a few that are available electronically only on CD-ROM.

General business indexes are extremely useful in locating articles on labor relations. Business Periodicals Index, originally published by the H.W. Wilson Com- pany, is a print index that is still found in most libraries and, for many years, was the only business index likely to be found in a small library. The online version of the current index is Wilson Business Abstracts with Full Text; earlier years are accessible via a separate data- base: Business Periodicals Index Retrospective: 1913– 1982. Wilson merged with database provider EBSCO in 2011.

Other general business periodical databases that are useful for finding trade publications are ABI/ INFORM Trade & Industry (ProQuest), Business & Industry (Gale Cengage Learning) and the Business News portion of LexisNexis Academic. Both Lexis- Nexis and its competitor, WestLaw Next (Thompson Reuters) publish law-related information and court case summaries. Trade journals such as Automotive News, Supermarket News, Editor & Publisher, and Modern Healthcare can provide related insights into labor issues and unions such as the United Autowor- kers (UAW), UFCW, Newspaper Guild, and American Nurses Association, respectively.

ABI/INFORM Global, produced by ProQuest, was one of the first electronic databases to provide an index to both scholarly journals and practitioner maga- zines pertaining to business. EBSCO Business Source Complete is another comprehensive business periodical database that offers 2,300 journals and general busi- ness periodicals including Business Week, Forbes, For- tune, American Banker, and many others. EBSCO has exclusive rights to the electronic version of Harvard Business Review. Both ABI/INFORM and EBSCO data- bases feature several academic journals in the field of labor and employment relations. Leading academic jour- nals include Industrial Relations, Industrial & Labor Rela- tions Review (ILR Review), Journal of Labor Economics, British Journal of Industrial Relations, Labor Law Jour- nal, Employee Relations, Labor History, Journal of Col- lective Negotiations, and Journal of Labor Research.

Newspapers are an excellent source of business information because of the detailed analysis of events not often found in other periodical literature. Because newspapers are often published daily, they offer the latest news about ongoing labor negotiations or work stoppages. Citations to articles in leading newspapers may be found in print indexes, whereas a rapidly increasing number of electronic indexes provide the complete text and indexing of national and regional newspapers. Many major newspapers maintain online Web sites that offer free access to some stories (e.g., the Washington Post, USA Today, Detroit Free Press, and Los Angeles Times). The text of the Wall Street Journal is offered by several sources, such as Lexis- Nexis Academic and ABI/INFORM Complete.

LexisNexis Academic and Regional Business News (EBSCO) are reliable sources to consult for arti- cles from regional newspapers about a particular event published in the city or region where the event took

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Public Opinion

Public opinion is a factor that also affects the labor relations process. The mass media (television, radio, newspapers, movies, music) represent an important influence within a community, serving as both a generator and conduit of community opinion. Media sources often tend to perpetuate a negative stereotype of unions. “When put together, the collective media image portrays unions as greedy and corrupt institutions, eager to strike, protective of unproductive workers, heedless of America’s need to compete inter- nationally, and generally outmoded in a society that would have no disruptive class antagonisms were it not for a few self-aggrandizing union hot-heads.”37 The media are profit-making businesses, and at least one prominent union official contends that this orientation biases the reporting of labor relations activities:

The media tend to cover collective bargaining as if it were a pier six brawl. The intri- cate moves and trade-offs that really make up bargaining aren’t as newsy as impas- sioned rhetoric or a picket line confrontation. Reporters are given little training in covering collective bargaining. They are told to look for the “news”—the fist fight, the walkout, the heated exchange—and, as a result, frequently miss the “story,” which is the settlement.… Every union proposal is a “demand,” every management proposal is an “offer.” 38

An analysis of 40 years of New York Times columns concerning labor unions agreed with the preceding quotation, as it found that the newspaper had increasingly concen- trated on strike activities and had exaggerated the frequency of strikes.39 Media coverage of labor issues often treats the subject matter as a consumer issue, focusing on how con- sumer prices or the availability of goods or services may be affected rather than focusing on the concerns of the workers affected by the labor issue.40

From the 1930s through the mid-1970s, the percentage of Americans who approve of unions was 60 percent or higher. Between the mid-1970s and 2008, approval has

place. Regional publications often offer a different per- spective from that of a national newspaper.

The Daily Labor Report, published by BNA in both print and online versions, is extremely useful in research- ing current labor relations topics. Coverage includes leg- islation pending in Congress, discussion of court cases, bargaining settlements, statistical information, and other items relating to labor. BNA also publishes the Labor and Employment Law Resource Center online, providing the full text of labor and employment cases, sample contract clauses, and manuals for answering day-to-day labor and employment law questions.

Government sources and libraries can also prove valuable. NLRB cases and policies can be searched directly from the agency’s Web site. FLRA.gov has descriptions of cases involving federal employees who are covered under the Federal Labor Relations Act. Sev- eral states have searchable databases for state public- sector grievance cases; for example, Wisconsin cases

can be found at the Wisconsin Employment Relations Commission Web site. Archived full-text collective bar- gaining agreements can be downloaded at the Institute for Research on Labor and Employment at the Uni- versity of California—Berkeley (http://www.irle.berkeley. edu/library/CBA.html). A similar database of collective bargaining agreements is found at the “Digital Com- mons” of the Industrial & Labor Relations School at Cornell University. The Digital Commons also contains reports from groups such as the Fair Labor Association, an anti-sweatshop group, which monitors production facilities to assess their compliance with the organiza- tion’s labor standards.

“Exploring the Web” Internet exercises at the end of each chapter in this book will give you a chance to use some of these resources. They can be helpful in exploring different labor relations topics further to enhance your understanding of labor and employment relations.

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hovered between 55 and 65 percent. Public approval of labor unions declined at the start of the recent economic recession to an all-time low of 48 percent in August 2009, down from 59 percent one year prior; however, it has since climbed steadily to 54 percent in 2013.41 These results vary by political party affiliation with a majority of Democrats (75 percent) approving of unions in 2013 compared to 51 percent of Independents and 34 percent of Republicans. Approximately two-thirds of Americans believe that unions are helpful to their members, but less than 50 percent believe unions are helpful to the companies where workers are organized and to the U.S. economy in general. About one- third of those surveyed in 2013 desired to see unions exert the same or more influence in the United States in the future compared to today; 25 percent said that unions should have the same amount of influence and 39 percent said that they should have less influence.

Public opinion of institutions in general is low in the United States, with more than one-third of the public currently expressing confidence in only 5 out of 17 surveyed American institutions: the military (74 percent), small business (62 percent), the police (53 percent), the church or organized religion (45 percent) and the medical system (34 percent). Only 22 percent of the public expressed a lot of confidence in organized labor—about the same as “big business” (21 percent). Confidence in unions did rank ahead of the public’s opinion of Congress (7 percent), television news (18 percent), and news on the Internet (19 percent).42 In a separate 2009 Harris Poll, adults surveyed believed that a number of groups exerted too much power and influence over govern- ment in Washington, D.C., including big companies and political action committees (85 percent each), news media (75 percent), entertainment and sports celebrities (70 percent), and labor unions (54 percent).43

Public opinion, like other external influences, can affect one or more phases of the labor relations process, as well as the content of negotiated work rules. After experienc- ing a bitter, well-publicized strike between Caterpillar and the UAW, the mayor of Peoria, Illinois feared employers would not locate in his community: “We had worked so hard to make this a city with the image of having a cohesive relationship between labor and management, a place [in which] people should think about expanding their businesses or opening new ones. Now comes this strike, which is going to damage our reputation.” In some cases, a community may stress its low union membership level or the anti-union attitudes of citizens as a benefit to encourage business organizations to expand or relocate there. For example, commenting on UAW efforts to organize a Volkswagen plant in Chattanooga (see Chapter 5 for details), Tennessee Senator Bob Corker explained why he spoke against unionization, “It was critical that workers knew the potential long-term economic consequences of this decision on the state. If the UAW came into our community, attracting suppliers and other prospective companies would be far more difficult…. On Feb. 14, [2014] the workers made their voices heard, with 53% voting against allowing the UAW to represent them. I believe that the workers understood that they were nothing more than dollar signs for the UAW.”44

Union officials are aware of the significant influence that public opinion can have on the labor relations process. Albert Shanker, former president of the American Federation of Teachers, indicated why he wrote the first of 1,000 columns entitled “Where We Stand.” After strikes were conducted by his union, Shanker reflected,

I became one of the best-known figures in New York City, but people saw me only as a militant union leader—urging teachers to strike, refusing to settle, going to jail. In late 1968, I became convinced that I had been dead wrong in believing that the pub- lic’s opinion of me didn’t matter. Public schools depend on public support. And the public was not likely to support the schools for long if they thought teachers were led

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by a powerful madman…. I decided to devote some time and energy to letting the public know that the union’s president was someone who read books and had ideals and ideas about how to fix the schools.45

Union officials seek to enhance public opinion in three general ways: (1) monitoring and reacting to negative comments made in the media, (2) getting organized labor’s pos- itive message out to the community, and (3) forming alliances with various groups in the community. For example, the AFL-CIO supported a march sponsored by the Rainbow PUSH Coalition in New Orleans, Louisiana, to encourage faster government action to rebuild homes and communities devastated by Hurricanes Katrina and Rita.46 The AFL-CIO has created its own Gulf Coast Revitalization Program, committing $1 billion dollars over seven years to fund housing and economic development initiatives. Another example is the BlueGreen Alliance, which is a national strategic partnership between environmental groups (e.g., Sierra Club) and labor unions (e.g., SEIU, United Steel- workers, CWA, and the American Federation of Teachers).47 The Alliance’s goal is to expand the number and quality of jobs in the “green economy.” Organized labor con- tinues to work with community-based religious, civil rights, and environmental groups on issues of shared interests, such as improving health care access and affordability, immigration reform, and ensuring economic and social justice on the job and within the communities in which workers live.48

Unions have also become more sophisticated in creating their own media campaigns to support union membership and bargaining activities. Some efforts such as WakeUpWalMart.com or WalMartWatch.com target a specific company, while others target a specific issue, such as the Health Care Hustle Web site sponsored by Working America, an affiliate of the AFL-CIO representing 1.5 million employees who currently are not members of an organized bargaining unit.49 Some form alliances with indepen- dent Worker Centers. For information about such alliances, see the appropriate “Labor Relations in Action” box.

In some cases, organized labor has cultivated alliances with business organizations. A coalition including Wal-Mart, AT&T Inc., Intel Corporation, the SEIU, and the CWA worked to encourage public policy changes that would provide affordable health care coverage to all Americans.50 Other examples include the Public Works Alliance, which involves labor unions and contractors cooperating to obtain federal funds for road and bridge improvements in the Long Island, New York, area and a labor– management alliance in Rhode Island seeking to save the funding of a valued job train- ing program.51

Union Membership

Union membership in the United States has shown a steady, gradual decline as a propor- tion of the total labor force (i.e., all employed persons 16 years of age or older). In 2014, union membership was 14.6 million, or 11.1 percent of the 131 million wage and salary employees in the total U.S. labor force.52 In 1945, union membership was about 36 per- cent of the total labor force. One partial explanation of this trend is that while the num- ber of union members has declined slowly (e.g., from 16.1 million in 2002 to 14.6 million in 2014), the number of people in the workforce has risen (e.g., from 122 million in 2002 to 131 million in 2014). Thus, even if union membership had held constant, it would comprise a smaller percentage of an expanding workforce. Union density, the propor- tion of a total group (e.g., national labor force, industry, or geographic region) comprised of union members, is one measure of relative union strength or potential influence.

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LABOR RELATIONS IN ACTION Unions and Worker Centers

During the past decade, over 200 “Worker Centers” have formed. These nonprofit organizations provide ser- vices for groups of workers in their communities or in specific types of low-paying jobs. For example, there are Worker Centers for taxi drivers, day laborers, undocu- mented workers, farm workers, and fast-food employ- ees. They are funded through charitable donations and grants, often obtaining financial support from religious, political, environmental, and civil rights groups.a Worker Centers typically educate low-income and immigrant workers about their legal rights and about social ser- vices; some also advocate that workers join labor unions. Thus, Worker Centers represent a “hybrid” between social work organizations, political action/advo- cacy groups, and union recruiting centers. As one Worker Center described its activities,

If, for example, we discover that the most common problem in the restaurant sector … is employer fail- ure to pay extra for overtime work, we may suggest to the [Worker Center] Board that we make that failure the focal point of a [publicity] campaign. (p. 112)b

Many individual unions support Worker Centers financially, and through joint cooperative actions. In 2006 and again in 2013, the AFL-CIO endorsed the idea of cooperating with Worker Centers. This alliance has produced some notable successes. For example, since the 1980s, many New York taxi firms have reclas- sified their drivers from “employees” to “independent contractors”; this change means that the drivers are unable to join a union. Instead, many of the taxi drivers have formed the New York City Taxi Workers Alliance (NYTWA), a type of Worker Center. In 2006, the group partnered with the AFL-CIO and began securing improved working conditions from individual firms. In 2012, the NYTWA negotiated a fare increase from the New York Taxi and Limousine Commission, with the increase designated for a new type of benefit: health coverage.c

Because Worker Centers do not negotiate labor contracts with businesses or have ongoing relationships with specific employers, legally, they are not labor unions. Therefore, they are free to use tactics that tradi- tional unions cannot use, such as a “secondary boy- cott” where the group attempts to convince the public to boycott one firm’s goods in order to persuade that firm to either not do business with a second company or pressure the second company to change its labor pol- icies. Thus, Worker Centers are not subject to the reg- ulations of the Labor–Management Relations Act.d

Neither are they required to abide by the Labor– Management Reporting and Disclosure Act (LMRDA; also called the Landrum-Griffin Act); this means that they do not have to disclose financial information to the same degree as labor unions.e They do not even have to garner the support of a majority of workers in a firm. If the leaders of a Worker Center believe that there are, say, safety problems at a particular employer, they can immediately take action.

What sorts of actions do Worker Centers do? A few tactics are common:

(1) Publicizing problems in the media. Protests for higher wages for fast food workers in the summer of 2014 were largely organized by Worker Centers in major U.S. cities.

(2) Boycotts and picketing. Besides drawing the pub- lic’s attention to issues of concern, these efforts can hurt a company financially. For example, a four-year boycott of Taco Bell in Florida by the Coa- lition of Immokalee Workers led to Taco Bell restau- rants agreeing to pay more for tomatoes, with the increase going into farm workers’ pay.

(3) Lobbying for government action. This has resulted in increases in the minimum wage in some cities as well as California and Washington State.

(4) Class-action lawsuits. Lawsuits filed on behalf of employees can sometimes result in out-of-court voluntary settlements that improve wages or work- ing conditions—and sometimes these settlements include employer donations to the Worker Center.

(5) Union organizing. Sometimes Worker Centers help organizers get jobs within a nonunion firm with the primary goal of forming a union—a tactic that is called “salting.”

Employers see this set of tactics as a form of harassment, led by outside groups who are not accountable to anyone. A union is accountable to its members who are employees of the company; if a majority of the members want the union to pursue a course of action, then they can encourage its leaders to do so. However, because Worker Centers are not unions, they do not need to have the support of a majority of the employees. Critics complain that the lack of legal regulation, accountability, and officially sanctioned union bargaining rights for Worker Centers means that employers cannot negotiate a compromise settlement. Many employers complain that their profit margins are too thin to afford some of the demands these groups make—yet they can’t afford to hire

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One estimate predicts that unions would need to organize 1 million new members annually to increase the union density level in the total labor force by 1 percent.53

Exhibit 1.4 shows union membership data trends since 1975.

Exhibit 1.4 Union Membership Trends, 1975–2014 (in thousands)

Year

Total

Employment

Union

Members

Percentage

Union

Members

Percentage

Represented

for

Bargaining

1975 75,703.9 16,778 22.2 —

1980 87,479.5 20,095 23.0 25.7

1985 94,520.5 16,996 18.0 20.5

1990 103,904 16,740 16.1 18.3

1995 110,038.1 16,359 14.9 16.7

2000 110,038.1 16,258 14.9 14.9

2005 125,889.3 15,685 12.5 13.7

2010 124,073 14,715 11.9 13.1

2013 129,110 14,528 11.3 12.4

2014 131,431 14,576 11.1 12.3

Data set is based upon information in the Current Population Survey (CPS) compiled by the Bureau of Labor Sta- tistics, U.S. Department of Labor.

SOURCES: U.S. Department of Labor, “Union Members in 2010,” News Release, January 21, 2011; U.S. Department of Labor, “Union Members in 2014,” News Release, January 23, 2015; Barry Hirsch and David Macpherson, “Union Membership, Coverage, Density, and Employment among All Wage and Salary Workers, 1973–2006,” Unionstats.com, 2007, p. 1 at http://www.trinity. edu/bhirsch/unionstats/.

attorneys, lobbyists, and advertising agencies to fight these tactics either. Consequently, some owners, managers, and critics (like “Worker Center Watch”) view Worker Center tactics with distain, likening them to extortion.f

Even within the labor movement, the alliance between Worker Centers and traditional unions is often tenuous. Some Worker Centers are dominated by activists who are suspicious of both capitalism and of what they see as overly bureaucratic unions. At others, leaders worry about being co-opted by traditional unions. Unions have criticized Worker Centers for refer- ring the unemployed to low-wage nonunion employers. Consequently, while both types of groups cooperate to improve poor workers’ wages and working conditions, such cooperation has not yet resulted in substantial membership gains for unions.g

It will be interesting to see how this develops over the upcoming years. Will Worker Centers remain a set

of minor players in the labor movement? Or will they grow and redefine the labor movement in the twenty- first century?

aRobert J. Grossman, “Leading from Behind?” HR Magazine, 58 (12), Dec., 2013, pp. 37–41. bAlice B. Gates, “Integrating Social Services and Social Change: Lessons From an Immigrant Worker Center,” Journal of Community Practice, 22(1), 2014, pp. 102–129. cAvendaño, Ana, and Jonathan Hiatt, “Worker Self-Organization in the New Economy: The AFL-CIO’s Experience in Movement Building with Community-Labour Partnerships,” Labour, Capital & Society, 45(1), April, 2012, pp. 66–95. dEli Naduris-Weissman, “The Worker Center Movement and Traditional Labor Law: A Contextual Analysis,” Berkely Journal of Employment & Labor Law, 30(1), 2009, pp. 232–335. eMax Mihelich, “Worker Centers Are Center of Attention,” Workforce, 92(11), Nov., 2013, pp. 24–25. fRyan Williams, “Worker Center Watch calls on Florida Attorney General to Investigate CIW,” Worker Center Watch News, Nov., 2013. Accessed Oct. 28, 2014 at: http:// www.workercenterwatch.com/wcw-calls-on-fl-attorney-general-to-investigate-ciw/. gFine =Janice R. Fine, “New Forms to Settle Old Scores: Updating the Worker Center Story in the United States,” Relations Industrielles/Industrial Relations, 66(4), Fall, 2011, pp. 604–630.

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Unions typically represent a higher number of employees than are actually union members because a simple majority of employees must support a union in order for that union to gain the legal right to represent the entire employee group (called a “bar- gaining unit”) for purposes of collective bargaining. While no employee can legally be required to become a full active member of any union, if that employee is a member of an employee group whose majority has chosen to be represented by a union, then all members of that group would be covered by the labor agreement negotiated by that union and the employee group’s employer. In 2014, 1.6 million employees had jobs cov- ered by a collective bargaining agreement (labor contract) but were not union members themselves.54 Almost half of these individuals were government employees.

In 2014, 7.3 million (6.6 percent) of over 111 million private-sector employees were union members, while 7.4 percent of private-sector employees were represented by a union for purposes of collective bargaining.55 A similar number of union members were employed in the public-sector (7.2 million), but the union density was greater, with union members comprising 35.7 percent of total public-sector employment. Approximately 39.2 percent were represented by a union for purposes of collective bargaining. The higher union representation among public-sector employees varies by level of public employment, with 45.5 percent of local government employees, 32.8 percent of state employees and 31.6 percent of federal employees represented by a union for purposes of collective bargaining. Union membership among these groups is 41.9 percent for local government employees, 29.8 percent for state employees, and 27.5 percent for federal employees. Public-sector labor relations issues and trends will be discussed further in Chapter 13.

The gradual decline or stagnation in union membership has been attributed to three broad factors: (1) structural changes in the labor force, (2) improved management prac- tices in business organizations, and (3) political and legal conditions governing the work- place. Of these three explanations, research suggests that changes in the structure of the labor force may be the most important.56 Since 2008, job losses due to the economic recession resulted in the loss of many union members, particularly in the manufacturing and construction industries.57

Structural Changes in the Economy

Employment has shifted from traditionally unionized industries (manufacturing, rail- roads, and mining) to professional and service-related industries (e.g., health care, legal, education, food preparation, personal care and service, building and grounds cleaning and maintenance, and protective services).58 Many of the fastest growing occupations are at opposite ends of the level of education and skills continuum required for effective job performance. “The problems of defending a shrinking number of high wage manufacturing jobs are different from organizing the growing ranks of lower-wage ser- vice workers. But what they have in common is the need to confront industry with one union that can bargain hard and solve problems.”59

Most business organizations in the United States are small, with 88 percent of firms having fewer than 20 employees and 98 percent of firms having fewer than 100 employ- ees.60 Union membership has traditionally been concentrated in the 2 percent of firms that account for 43 percent of all jobs in the economy. Efforts to increase union membership in small firms is both time consuming and more expensive for labor organizations.

Demographic trends affecting the size and composition of the labor force can also affect union membership trends. The proportion of the labor force comprised of individuals 55 years and older is expected to increase while the proportion of individuals in the 16–24 and 25–54 age groups is expected to decline.61 Over the period from 1992 to 2014, the proportion of the U.S. labor force comprising men declined from 54.6 percent to 51.7 percent, while

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women’s proportion increased from 45.4 percent to 48.2 percent. These percentages are expected to remain virtually unchanged through 2022. The percentage of Whites in the work- force changed little, from 77.1 percent in 1992 to 79.2 percent in 2014; yet, it is expected to drop to 60 percent in 2022. In 2014, Black, Asian, and Hispanic workers comprised 12.0 per- cent, 5.7 percent, and 16.4 percent of the workforce. By 2022, groups of Black, Asian, and Hispanic origin groups will increase their representation in the labor force to an estimated 12.4 percent, 6.2 percent, and 19.1 percent of the labor force respectively. Unions will need to be able to attract and retain new members from these groups of employees to maintain or increase current union density levels in the future.

In 2014, 24.7 million part-time workers comprised about 19 percent of the total labor force.62 Unions represented 13.6 percent of full-time workers but only 6.6 percent of part-time workers for purposes of collective bargaining in 2014. Among these, 12.3 percent of full-time workers and 5.8 percent of part-time workers are union members.63

Research demonstrates that growth in part-time employment has a small, but significant, negative impact on union density, although this negative effect declines as the number of hours of work increases to 20 or more per week.64

LABOR RELATIONS IN ACTION Are Unions Still Relevant?

The answer to the provocative question of whether unions are still relevant in today’s economy may depend on who you ask. Andrew Stern, past president of the SEIU believes the need for unions today may be greater than at any time in the past 75 years.

I think American workers want a voice on their job. The question is: Will unions change to become better partners with employers to respond to what is now a global economy where more people went to work in the U.S. in retail than in manufacturing? We want to find a 21st century new model that may look more like a European model, that is less focused on individual grievances, more focused on industry needs. We don’t see our employers as enemies. We need to build successful employers [and] as a part of that you need to be involved and have a voice, and every- one needs to share in the success of an employer, not just the share-holders and executives.a

The AFL-CIO shares the belief that unions are just as important today as ever and views one important union role as safeguarding workers’ past gains while seeking a fair share of future prosperity.

Through unions, workers win better wages, bene- fits, and a voice on the job—and good union jobs mean stronger communities. Unions have made life better for all working Americans by helping to pass laws ending child labor, establishing the eight-hour day, protecting workers safety and health and helping to create Social Security, unemployment insurance and the minimum wage, for example. Unions are continuing the fight today to improve life for all working families in

America.b A survey of Canadian employees reported the top three advantages of unions were that they made health and safety, job security, and benefits a lot better on the job.c While agreeing that it was important for workers to have a voice on the job, more Canadians preferred an employee association form of representa- tion that would take up problems on behalf of workers with management than the traditional Canadian union model.

Employers, particularly those who currently are non- union, are more likely to argue that unions today are no longer necessary. “… the protections unions used to seek, such as from unfair dismissal and dangerous work- places, have—with labor’s ardent support—been taken over by government.”d What were once considered sig- nificant employee pension and health care benefit gains under union contracts are now referred to as “high legacy costs” by unionized employers in industries such as air- lines and autos, making those employers less competi- tive and threatening job security.e

Ultimately, what matters is how employees will answer the question of whether unions are still relevant. The issue of why employees join a union will be explored further in Chapter 5.

aKris Maher, “Are Unions Relevant?” Wall Street Journal, January 22, 2007, p. R-5. bAFL-CIO, “A Quick Study of How Unions Help Workers Win a Voice on the Job,” Unions, 101 (accessed August 13, 2010), p. 1 at http://www.aflcio.org/joinaunion/ union101.cfm. cUyen Vu, “Employees Want a Collective Voice, but Not Necessarily a Union, Survey Says,” Canadian HR Reporter, 16(20), 2003, pp. 3, 11. dRobert J. Grossman, “Do Unions Pay?” HR Magazine, 50(5), May 2005, p. 49. eMichael Barone, “Big Labor, RIP,” Wall Street Journal, July 28, 2005, p. A-10.

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Changing Management Practices

Another reason often given for stagnant or declining union membership is that more organizations are learning how to operate their businesses on a nonunion basis. Some- times this entails moving some or all operations to less-unionized geographic areas of the United States (e.g., the Southwest and South). More firms are trying to be proactive in recognizing and addressing employee interests and concerns. Managers are also adopting human resource management practices, including aggressive anti-union cam- paigns (see Chapter 5), to keep their firms nonunion.

Some union officials indicate that employers often use labor law loopholes to fore- stall or negate free employee union choice through secret-ballot elections. For example, using pre-election procedural time delays, contesting election results, lengthy appeals, and delays in union attempts to negotiate a first contract settlement once union recogni- tion is granted are possible under the Labor Management Relations Act (LMRA) (see Chapter 3). One analyst makes a comparison with the political process: Suppose U.S. political elections were legally structured so that access to potential voters was denied to one political party (analogous to the union), while it was granted to the other one for eight hours a day at one’s place of work. The second political party (analogous to man- agement) could force the electorate to listen to campaign speeches (captive audience meetings), while the opposing party was denied access.65

Changing Legal Environment

Employment law changes that have expanded employees’ rights Passage of the Ameri- cans with Disabilities Act (ADA), Equal Employment Opportunity Act, Occupational Safety and Health Act (OSHA), Employee Retirement and Income Security Act (ERISA), Lilly Ledbetter Fair Pay Act, and other laws have helped employers to argue that unions are less necessary today. Indeed, many unions appear to be committing more of their resources to serving the needs of their current members than to organizing new members.

There is an ongoing debate within the union movement regarding the proportion of resources that ought to be devoted to organizing new members versus providing enhanced services (e.g., negotiating contracts; researching wage, benefit, and working condition issues; processing contract grievances; monitoring political issues) to currently represented members. Each union’s membership must decide if organizing new employees is in their best interests when these efforts would require the use of scarce union organization funds earmarked for present members’ services. Mary Kay Henry, the president of the SEIU, has made union organizing the organization’s primary goal, with the union investing $250 mil- lion annually in organizing activities.66 Because unions are political organizations and union leaders are elected by the current membership, the incentive to organize new mem- bers is often less than the incentive to provide services to current members.67

Although union membership has experienced a gradual decline as a percentage of the total labor force, many labor unions have responded by increasing their union- organizing activities. Unions are attempting to improve the ways in which they relate both to their own members and to employers with whom they have bargaining relation- ships.68 The social significance of unions can also be assessed in general terms by consid- ering what the consequences would be if unions were absent from our society. With no organized voice for workers’ interests to counterbalance the economic interests of employers to reduce labor costs, will the improvements gained over the previous century continue, or will they be subject to erosion and lax enforcement? Labor unions have his- torically functioned in the United States as a countervailing power necessary to maintain some balance between employer and employee rights and responsibilities.

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Summary

Although unique to the particular labor–management activities, attitudes, and relationships at each organiza- tion (discussed more in Chapter 4), the labor relations process includes three key phases or steps: recognition of the legitimate rights and responsibilities of union and management representatives, negotiation of a labor agreement, and daily administration of the terms of that negotiated labor agreement.

The labor relations process focuses on jointly nego- tiated and administered work rules that pertain to com- pensation and employees’ and employers’ rights and responsibilities. The labor relations process is flexible enough to permit negotiated work rules to vary, thus accommodating the unique characteristics of a particular industry, job classification, geographic setting, or exter- nal environmental conditions. The labor relations pro- cess is dynamic, which enables bargaining relationships to adapt to changing competitive conditions.

Union and management officials represent two key participants in the labor relations process along with employees, government, and certain third-party neu- trals such as mediators and arbitrators who aid in resolving interest and rights-type disputes. Employees are particularly important in the labor relations process

because they determine whether a union will be chosen to represent their employment interests. Employees typically demonstrate some degree of dual loyalty to both their union and employer, which helps to deter- mine the organizational effectiveness of each. However, there may be certain critical times in a bargaining relationship when each employee will have to decide “which side they are on.”

Participants in the labor relations process are influ- enced by several variables such as technology (equip- ment, pace and scheduling of work, the work environment and tasks to be performed, and informa- tion exchange); labor and product markets; international forces such as trade agreements or armed conflicts; public opinion; and prevailing economic conditions.

The current status of labor unions can be assessed from both statistical and general standpoints. A pro- longed decline in the proportion of the total labor force comprised of unionized employees has occurred in the United States. However, this trend and its related general explanations (employment shifts; business organizational practices; and economic, legal, and political conditions) do not indicate that unions have lost their societal significance.

Key Terms

labor relations process, p. 5 interest disputes, p. 6 rights disputes, p. 6 work rules, p. 7 managers p. 10 management consultants, p. 11 union representatives, p. 11 employees, p. 11

dual loyalty, p. 12 government, p. 12 third-party neutrals, p. 12 mediators, p. 12 arbitrator, p. 13 economy, p. 14 discouraged workers, p. 15 labor market, p. 16

product or service market, p. 16 financial market, p. 17 technology, p. 17 international forces, p. 19 public opinion, p. 22 Worker Centers, p. 24 union density, p. 24 employment-at-will, p. 39

Discussion Questions

1. Exhibit 1.1 illustrates the focal point of the labor relations process and many variables that affect the process. Select an academic discipline such as political science, economics, or sociology, and indicate three specific ways the discipline could add insights into the labor relations process.

2. Think about a job you have performed and dis- cuss some of the external variables (see the outer

circle of Exhibit 1.1) that influenced the work rules required on that job.

3. The text outlines three basic assumptions under- lying the labor relations process in the United States. To what extent do you agree or disagree with these assumptions? Does your response dif- fer depending on whether you think about the question from the perspective of an employer or an employee?

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4. Discuss your opinion regarding whether unions are still relevant and necessary in today’s work environment. What other means might be used to ensure “employee voice” in the workplace?

5. Can an individual be both pro-union and pro- employer, or does being pro-union mean one has to be anti-employer? Can an individual be anti- union and still legitimately claim to support pro- employee interests?

Exploring the Web

Labor Relations from Several Points of View

1. Public Opinion Polls

Chapter 1 discusses the effect that public opinion may have on the labor relations process. Public opinion polls can provide an indication of the back- ing or support by the public during a strike.

The Gallup Organization’s Web site provides abstracts of the results of polls the organization has conducted (a subscription is required to read most of the full reports). The abstracts can provide some insight into the attitudes of the public on labor issues. Go to the Gallup home page and determine how employees are reacting to the recent economic recession.

The Harris Poll provides portions of its reports without charge on the Harris Interactive Web page. Search the site for results of a recent poll on American adults’ attitudes toward gender equality.

2. Reports from Labor and Management Web Sites Good sources of information on labor relations can be found by searching the Web sites of labor unions and management organizations as well as reports from newspapers and newswires.

Go to the Web site of the AFL-CIO and under “Get Informed” click on “Health Care” to find out what labor unions are thinking and doing to implement health care reform.

Go to the Web site of the U.S. Chamber of Com- merce and find out what the Chamber is doing to help employers implement health care reform legis- lation recently passed by Congress.

3. Newspapers

The Library of Congress provides News & Periodical Resources on the Web, a Web page that provides links to online newspapers and news services. You may know of other free news services that you search on a daily basis. Search online news sources to find articles that discuss labor relations involving aircraft mechanics at American Airlines and/or Southwest Airlines in the Dallas—Fort Worth, Texas area. For example, mechanics at Southwest are upset with increasing workloads and difficulty in negotiating a new contract. Some members at American have been unhappy with their current union representative, the Transport Workers Union, and are considering joining a new, indepen- dent union (the Association of Maintenance Profes- sionals). Pick one of these airlines and write about the main issues and current developments. For example, what might be the advantages or disadvan- tages of being represented by a smaller independent union versus a larger national union affiliated with the AFL-CIO (an organization discussed further in Chapter 4) at American Airlines? How do mergers or acquisitions affect labor relations? You may also want to consult union and industry weblogs (e.g., “Sky Talk”) as you research your topic.

References

1. See, for example, Lance Compa, “Workers’ Free- dom of Association in the United States,” in Workers’ Rights and Human Rights, ed. by James A. Gross (Ithaca, NY: Cornell University Press, 2003), pp. 23–52; AFL-CIO, The Silent War: The Assault on Workers’ Freedom to Choose a Union

and Bargain Collectively in the United States (Washington, D.C.: AFL-CIO, June 2002), pp. 1–24; Kate Bronfenbrenner et al., “Introduc- tion” in Organizing to Win: New Research on Union Strategies (Ithaca, NY: ILR Press, 1998), pp. 1–8; William N. Cooke, “The Failure to

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Negotiate First Contracts: Determinants and Policy Implications,” Industrial and Labor Rela- tions Review 38(2), January 1985, pp. 163–178.

2. John Dunlop, Industrial Relations Systems, rev. ed. (Boston: Harvard Business School Press, 1993), pp. 13–16.

3. “2010 Employer Bargaining Objectives,” Collec- tive Bargaining Bulletin, 15(5), 2010, p. s23; John D. Boyd, “Hours Rule Change Pits Railroads against Unions,” Journal of Commerce (July 2, 2009), pp. 1–2; “VW Wants 35-Hour Workweek, but Union Says No,” Wall Street Journal, June 13, 2006, p. A-11.

4. “AFA-CWA Applauds Anticipated FCC Decision to Keep Cell Phones Off Aircraft,” News Release, March 22, 2007, p. 1 at http://www.afanet.org (accessed April 29, 2011); Nancy Keates, “Rising Concern: Falling Luggage Inside Airplanes,” Wall Street Journal, November 10, 1997, pp. B-1 & 10.

5. Service Employees International Union, Health- care Workers in Peril: Preparing To Protect Worker Health and Safety During Pandemic Influenza: A Union Survey Report, April 16, 2009, pp. 1–14 at http://www.seiu.org/Healthcare% 20Workers% 20in%20Peril%20April%202009.pdf; Bureau of National Affairs Inc., Daily Labor Report, September 10, 1992, p. A-12.

6. Sandra M. Tomkowicz and Susan K. Lessack, “Where There’s Smoke: Employer Policies on Smoking,” Employee Relations Law Journal, 32(3), 2006, pp. 48–65; Mollie H. Bowers, “What Labor and Management Need to Know about Workplace Smoking Cases,” Labor Law Journal 43(1), January 1992, pp. 40–49; Americans for Effective Law Enforcement, AELE Law Library of Case Summaries: Employment & Labor Law for Public Safety Agencies—Smoking Rights/Restrictions & Air Quality. November 4, 2014, at http://www. aele.org/law/Digests/empl205.html

7. Dionne Searcey, “Currents—Labor Journal: Some Courts Raise Bar on Reading Employee E-mail, Companies Face Tougher Tests to Justify Moni- toring Workers’ Personal Accounts, Rulings Hinge on ‘Expectation of Privacy’,” Wall Street Journal, November 19, 2009, p. A17; David Halpern, Patrick J. Reville, and Donald Grunewald, “Management and Legal Issues Regarding Electronic Surveillance of Employees in the Workplace,” Journal of Business Ethics, 80(2), 2008, pp. 175–180; William H. Ross,

Christopher J. Meyer, Jeng-Chung Victor Chen, and Paul Keaton, “The Role of Human Resource Management in Protecting Information at Tele- communications Firms,” Journal of Information Privacy and Security, 5(2), pp. 2009, 49–77; Donald E. Sanders, John K. Ross, and Patricia Pattison, “Electronic Snoops, Spies, and Supervisory Surveil- lance in the Workplace,” The Southern Law Journal, 23(1), 2013, pp. 1–27; Margaret A. Lucero, Robert E. Allen, and Brian Elzweig, “Managing Employee Social Networking: Evolving Views from the National Labor Relations Board,” Employee Responsibilities and Rights Journal, 25(3), 2013, pp. 143–158.

8. “The System for Forming Unions Is Broken,” AFL-CIO, 2007, p. 1 at http://www.aflcio.org/ joinaunion/voiceatwork/brokensystem.cfm joinaunion/voiceatwork/brokensystem.cfm; Kris Maher, “Unions’ New Foe: Consultants,” Wall Street Journal, August 15, 2005, p. B1.

9. Kate Bronfenbrenner, “Raw Power: Plant Closing Threats and the Threat to Union Organizing,” Multinational Monitor, December 2000, p. 28.

10. John J. Lawler, “The Influence of Management Consultants on the Outcome of Union Certifica- tion Elections,” Industrial and Labor Relations Review, 38(1), 1984, pp. 38–51; Bruce E. Kaufman and Paula E. Stephan, “The Role of Management Attorneys in Union Organizing Campaigns,” Journal of Labor Research, 16(4), 1995, pp. 439– 455; Bureau of National Affairs Inc., Special Report, Labor Relations Consultants: Issues, Trends, and Controversies (Washington, D.C.: Bureau of National Affairs Inc., 1985).

11. William A. Ward, “Manufacturing Jobs, 2005– 2010,” Economic Development Journal, 5(1), 2006, pp. 7–15; Louis Uchitelle, “A Missing Statistic: U.S. Jobs That Have Moved Overseas,” New York Times, October 3, 2003, p. 21. For a more thorough discussion, see Erica L. Groshen and Simon Porter, “Has Structural Change Contributed to a Jobless Recovery?” Report of the Federal Reserve Bank of New York, 9(8), 2003, pp. 1–7 at http://www.ny.frb.org/research.

12. Therese Jefferson and Alison Preston, “Negotiat- ing Fair Pay and Conditions: Low Paid Women’s Experience and Perceptions of Labour Market Deregulation and Individual Wage Bargaining,” Industrial Relations Journal, 41(4), 2010, pp. 351–366; Kevin E. Henrickson and Wesley

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W. Wilson, “Compensation, Unionization, and Deregulation in the Motor Carrier Industry,” Journal of Law and Economics, 51(1), 2008, pp. 153–177; John Nevile and Peter Kriesler, “Minimum Wages, Unions, the Economy and Society,” Economic and Labour Relations Review, 19(1), 2008, pp. 25–38; Pierre-Yves Cremieux, “The Effects of Deregulation on Employee Earn- ings: Pilots, Flight Attendants, and Mechanics, 1959–1992,” Industrial and Labor Relations Review, 49(2), 1996, pp. 223–242.

13. Denise Rousseau, I-deals: Idiosyncratic Deals Employees Bargain for Themselves. (Armonk, NY: M. E. Sharpe, 2005); Steven L. Blader, “What Leads Organizational Members to Collectivize? Injustice and Identification as Precursors of Union Certification,” Organization Science, 18(1), 2007, pp. 108–126.

14. “Interest Rates: How Soon and How Far will they Climb?” ABA Banking Journal, 102(5), 2010, p. 38; Jon Hilsenrath, “Fed Sees Slower Growth, Officials Debate How to Respond if Recovery Falters, Softer 2nd Half Is Seen,” Wall Street Journal, July 14, 2010, p. A-1; Barbara Hagen- baugh, “Fed Holds Rates Steady Again,” USA Today, May 9, 2007, pp. 1–2 at http://www.usa today.com/money/2007-05-09-fed_N.htm.

15. Stephen F. Hipple, “The Labor Market in 2009: Recession Drags On,” Monthly Labor Review, 133(3), 2010, pp. 3–22; Ian D. Wyatt and Kathryn J. Byun, “The U.S. Economy to 2018: From Recession to Recovery,” Monthly Labor Review, 132(11), 2009, pp. 11–15; U.S. Department of Labor, “The Employment Situation: October, 2009,” News Release, November 6, 2009, pp. 1–29 at http://www.bls.gov/news.release/archives/emp- sit_11062009.pdf; U.S. Department of Labor, “The Employment Situation: September, 2014,” News Release, October 3, 2014, pp. 1–38 at http:// www.bls.gov/news.release/pdf/empsit.pdf.

16. Catherine Rampell, “With Positions to Fill, Employers Wait for Perfection,” New York Times [online edition], March 6, 2013 at http://www. nytimes.com/2013/03/07/business/economy/ despite-job-vacancies-employers-shy-away-from- hiring.html?pagewanted=all&_r=0; Gregory W. Brown and Christian Landblad, “The U.S. Economic Crisis: Root Causes and the Road to Recovery,” Journal of Accountancy, 208(4), 2009, pp. 42–49.

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19. Laurie Harbour-Felax, “Challenges for Industry Decision Makers,” Automotive Design & Produc- tion, 120(2), 2008, p. 12; Kathy Jackson, “UAW Fights GM Plan to Hire Suppliers to Prepare Parts,” Automotive News, June 2, 1997, p. 1; James R. Healey, “Tangled Web of Rules Obscures Autos’ Origins,” USA Today, March 2, 1992, pp. B-1, 3.

20. Barry B. Burr, “UAW’s $45 Billion Vehicle Steers Towards a New Asset Allocation,” Pensions & Investments, 38(5), 2010, pp. 2–4; Pensions at Work: Socially Responsible Investment of Union- Based Pension Funds, ed. by Jack Quarter, Isla Carmichael, and Sherida Ryan (Toronto: Univer- sity of Toronto Press, 2008); Jill Andresky Fraser, “Capital: State of the Union,” Inc. Magazine, July 2002, pp. 1–2 at http://www.heartlandnetwork. org/pressarticles/article9.htm; Emma Blackwell, “Asset Managers Launch Labor-Friendly Private Equity Vehicles,” Corporate Financing Week, April 24, 2006, p. 1; Working Capital: The Power of Labor’s Pensions, ed. by Archon Fung, Tessa Hebb, and Joel Rogers (Ithaca, NY: Cornell University Press, 2001).

21. Thomas Croft, Up from Wall Street: The Respon- sible Investment Alternative (New York: Cosimo Books, 2009); Wheeler, The Future of the Ameri- can Labor Movement, pp. 176–177; The Heart- land Labor Capital Network, at http://www. heartlandnetwork.org/ (accessed April 29, 2011).

22. Rebecca Keller, “How Shifting Occupational Composition Has Affected the Real Average Wage,” Monthly Labor Review, 132(6), 2009, pp. 26–38; David Wessel, “Politics and Econom- ics, Capital: Fishing Out Facts on the Wealth

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Gap,” Wall Street Journal, February 15, 2007, p. A-10; David Wessel, “Fed Chief Warns of Widening Inequality,” Wall Street Journal, February 7, 2007, p. A-6; Wheeler, The Future of the American Labor Movement, pp. 25–27.

23. Attaran, M. “Keeping the promise of efficiency,” Industrial Engineer, 41(3), 2009 (March), pp. 45–50. Ming-Hui Huang and Roland T. Rust, “Should Your Business Be Less Productive?” MIT Sloan Management Review, 2014 (Spring) [Online edition] at http://sloanreview.mit.edu/article/ should-your-business-be-less-productive/.

24. Christopher M. Lowery, Nicholas A. Beadles II, and Larry H. Faulk II, “Assessing the Usability of Union Web Sites,” Communications of the IIMA, 8(3), 2008, pp. 49–56; Neil De Clereq, Alec Meiklejohn, and Ken Mericle, “The Use of Microcomputers in Local Union Administration,” Labor Studies Journal, 10(1), Spring 1985, pp. 3–45.

25. Jessica Miller-Merrell “Research Reveals how Labor Unions Use Social Media” Blogging4Jobs, [online weblog], Feb. 22, 2012, at http://www. blogging4jobs.com/social-media/labor-union- social-media/; Cynthia G. Wagner, “Cyberunions: Organized Labor Goes Online,” Futurist, 34(1), 2000, p. 7; Alex Bryson, Rafael Gomez, and Paul Willman, “Online Social Networking and Trade Union Membership: What the Facebook Phe- nomenon Truly Means for Labor Organizers,” Labor History, 51(1), 2010, pp. 41–53.

26. Charles Forelle, Nick Skrekas, and Bob Davis, “Greece Gets Aid, Promises Austerity,” Wall Street Journal (Online), May 1, 2010, pp. 1–2 at http://proquest.umi.com/pdqweb? did=2023352491&sid=3&Fmt=3&client id=1997&RQT=309&VName=PQD; V. K Bhalla, “Global Financial Turmoil: Containment and Resolution,” Journal of Management Research, 9(1), 2009, pp. 43–58; Andrew Dollard, “The Dollar’s Decline Offers Advantages Over Foreign Rivals,” Rochester Business Journal, 24(19), 2008, p. 25; Paul R. LaMonica, “The U.S. Dollar is Super Strong Now,” CNN Money, Sept. 2, 2014, at http://money.cnn.com/2014/09/02/investing/ strong-us-dollar-euro-weak-ecb/

27. Ki Hee Kim and William Paterson, “Is Free Trade Good for Working Americans: Lessons from North American Free Trade Agreement,” Business Review, Cambridge, 15(1), 2010, pp. 33–38; Mihal

Nica, Ziad Swaidan, and Michael M. Grayson, “The Impact of NAFTA on Mexican-American Trade,” International Journal of Commerce and Management, 16(3–4), 2006, pp. 222–233.

28. Marisa von Bulow, “Networks of Trade Protest in the Americas: Toward a New Labor Internation- alism?” Latin American Politics and Society, 51(2), 2009, pp. 1–27; Andrew Batson, “How U.S. Labor Leaders Chart a Global Course,” Wall Street Jour- nal, May 23, 2007, p. A-6; Anya Sostek, “USW Joins Effort to Form Superunion,” Knight Ridder Tribune Business News, April 19, 2007, p. 1.

29. Foreign Trade Division of the U.S. Census Bureau, “Trade in Goods (Imports, Exports and Trade Balance) with China,” Foreign Trade Statistics, November 24, 2014, pp. 1–18 at https://www. census.gov/foreign-trade/balance/c5700.html.

30. David M. Dickson, “Trade Deficit Cut by Half of ’08 Levels in ’09,” McClatchy Tribune Business News, February 11, 2010, pp. 1–2 at http:// proquest.umi.com/pqdweb?did=1960355591& sid=2&Fmt=3&clientd=1997&RQT=309& VName=PQD.

31. “Labeling China’s Currency Undervalued Correct: USW Calls for More Action,” PR Newswire, July 9, 2010, pp. 1–2 at http://proquest.umi.com/ pqdweb?did=2076839101&sid=1&Fmt= 3&clientid=1997&RQT=309&VName=PQD.

32. Sudeep Reddy, “Bernanke Prepared, but Reluc- tant, to Act on Economy; Fed Chief Discusses Limited Options to Boost GDP, Calls Outlook ‘Unusually Uncertain’,” Wall Street Journal (Online), July 21, 2010, pp. 1–2 at http://proquest. umi.com/pqdweb?did=2087363941&sid=4& Fmt=3&clientid=1997&RQT=309&VName= PQD; Jon Hilsenrath, “Fed Sees Slower Growth, Officials Debate How to Respond if Recovery Falters, Softer 2nd Half Is Seen,” Wall Street Journal, July 14, 2010, p. A-1.

33. William R Cline, “Why the U.S. External Imbalance Matters,” Cato Journal, 27(1), 2007, p. 53.

34. Wheeler, The Future of the American Labor Movement, p. 25.

35. Christopher Candland, “Core Labour Standards under the Administration of George W. Bush,” International Labour Review, 148(1–2), 2009, pp. 169–181; International Labor Organization, ILO Declaration on Fundamental Principles and Rights at Work, 1996–2003, pp. 1–2 at http:// www.ilo.org.

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36. Wheeler, The Future of the American Labor Movement, pp. 81–82.

37. David Porreca, “Through Jaundiced Eyes: How the Media View Organized Labor,” Journal of Communications, 46(3), 1996, p. 198.

38. Lane Kirkland, “Labor and the Press,” American Federationist, 82, December 1975, p. 3; John A. Grimes, “Are the Media Short Changing Orga- nized Labor?” Monthly Labor Review, 110(8), August 1987, pp. 53–54.

39. Diane E. Schmidt, “Public Opinion and Media Coverage of Labor Unions,” Journal of Labor Research, 13(3), Summer 1992, pp. 151–165; William J. Puette, Through Jaundiced Eyes: How the Media View Organized Labor (Ithaca, NY: ILR Press, 1992); Paul Jarley and Sarosh Kuruvilla, “American Trade Unions and Public Approval: Can Unions Please People All of the Time,” Journal of Labor Research, 15(2), Spring 1994, pp. 97–117; Geoff Walsh, “Trade Unions and the Media,” International Labour Review, 127(2), 1988, pp. 205–220.

40. Christopher R. Martin, Framed: Labor and the Corporate Media (Ithaca, NY: Cornell University Press, 1994).

41. Lydia Saad, “Labor Unions See Sharp Slide in U.S. Public Support,” Gallup Poll, August 6-9, 2009, pp. 1-6 at http://www.galluppoll.com/poll/ 122744/Labor-Unions-Sharp-Slide-Public- Support.aspx?version=print; Costas Panagopoulos and Peter L. Francia, “The Polls-Trends: Labor Unions in the United States,” Public Opinion Quarterly, 72(1), 2008, pp. 134–159; Andrew Dugan, “In the U.S., Majority Approves of Unions but Say They’ll Weaken” Gallup Poll, August 30, 2013, at http://www.gallup.com/poll/ 164186/majority-approves-unions-say-weaken. aspx.

42. Rebecca Riffkin, “Public Faith in Congress Falls Again, Hits Historic Low,” Gallup Poll, June 19, 2014, at http://www.gallup.com/poll/171710/ public-faith-congress-falls-again-hits-historic-low. aspx.

43. “Very Large Majorities of Americans Believe Big Companies, PACs, Political Lobbyists and the News Media Have Too Much Power and Influ- ence in D.C,” Business Wire, March 12, 2009, pp. 1–3 at http://proquest.umi.com/pqdweb? did= 1660004401&sid=2 &Fmt=3&client= 1997&RQT=309&VName=PQD.

44. Jonathan P. Hicks, “Dreams and City Image Put at Stake in Strike,” New York Times, April 10, 1992, p. A-31; Bob Corker, “Bob Corker: Now the Auto Union Wants to Muzzle Public Officials,” Wall Street Journal [online edition], March 3, 2014, at http://online.wsj.com/articles/SB100014 24052702304360704579415431328820424.

45. Albert Shanker, “Where We Stand,” New York Times, December 16, 1990, p. 7; Sandra Feldman, “The Big Lie,” New York Times, June 7, 1998, p. 7.

46. “Statement by AFL-CIO President John Sweeney on Rainbow PUSH Coalition Reclaiming Our Land March in New Orleans,” News Release, April 27, 2007, p. 1.

47. “About the BlueGreen Alliance,” BlueGreen Alli- ance, August 11, 2010, pp. 1–2 at http://www. bluegreenalliance.org/about_us?id=0001.

48. Caroline Preston, “Advocacy Groups Work to Strengthen Their Influence on Immigration Laws,” Chronicle of Philanthropy, 22(11), 2010, p. 16; Robert Schmidt, “Big Bank Nightmare on K Street,” Bloomberg Businessweek, May 24, 2010, p. 30; Steve Early and Larry Cohen, “Jobs with Justice: Mobilizing Labor Community Coalitions,” Working USA, 1(4), 1997, pp. 49–57; James Craft, “The Community as a Source of Union Power,” Journal of Labor Research, 11(2), Spring 1990, pp. 145–160. For a detailed account of a community effort involving religious institu- tions in an attempt to restore closed steel mills as a community- and employee-owned enterprise, see Thomas G. Fuechtmann, Steeples and Stacks: Religion and Steel Crisis in Youngstown (New York: Cambridge University Press, 1989).

49. “Why Wal-Mart Must Change,” Wakeup WalMart.Com, August 11, 2010, p. 1 at http:// www.wakeupwalmart.com/change; “Wal-Mart’s Urban Problem,” Wal-Mart Watch, August 8, 2010, pp. 1–9 at http://www.wakeupwalmart. com/change; “Wal-Mart’s Urban Problem,” Wal-Mart Watch, August 8, 2010, pp. 1–9 at http://walmartwatch.com/pages/wal_mart_ urban_problem/.

50. Kris Maher, “Politics and Economics: Wal-Mart Joins Health Care Call; Unlikely Coalition of Labor, Business Pushes for Overhaul,” Wall Street Journal, February 8, 2007, p. A-6.

51. David Winzelberg, “L.I. Labor, Management Forge New Alliance,” Long Island Business News, June 9, 2010, p. 1 at http://proquest.umi.com/

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pqdweb?did=2058869961&sid=1&Fmt=3& client=1997&RQT=309&VName=PQD; Cynthia Needham, “Diverse Group Rallies for R.I. Job-Training Program,” McClatchy–Tribune Business News, April 30, 2010, pp. 1–2 at http:// proquest.umi.com/pqdweb?did=2022057401& sid=1&Fmt=3&client=1997&RQT=309& VName=PQD.

52. United States Department of Labor, “Union Members in 2014,” News Release, January 23, 2015, pp. 1–12, at http://www.bls.gov/news. release/union2.nr0.htm.

53. Gary Chaison, “The AFL-CIO Split: Does It Really Matter?” Journal of Labor Research, 28(2), 2007, p. 305.

54. United States Department of Labor, “Union Members in 2014,” News Release, January 23, 2015, pg. 1, at http://www.bls.gov/news.release/ union2.nr0.htm.

55. United States Department of Labor, “Union Members in 2014,” News Release, January 23, 2015, Table 3, pp. 7–8, at http://www.bls.gov/ news.release/union2.nr0.htm.

56. John Godard, “The Exceptional Decline of the American Labor Movement,” Industrial and Labor Relations Review, 63(1), 2009, pp. 82–108; Arne L. Kalleberg, “Precarious Work, Insecure Workers: Employment Relations in Transition,” American Sociological Review, 74(1), 2009, pp. 1–22; Justice on the Job: Perspectives on the Erosion of Collective Bargaining in the United States, ed. by Richard N. Block, Sheldon Fried- man, Michelle Kaminski, and Andy Levin (Kala- mazoo, MI: W. E. Upjohn Institute for Employment Research, 2006); C. Timothy Koel- ler, “Union Activity and the Decline in American Trade Union Membership,” Journal of Labor Research, 15(1), Winter 1994, pp. 19–31.

57. “Union Ranks Down in 2009 as Recession Elim- inated Jobs,” BNA’s Collective Bargaining Bulletin, January 28, 2010, p. 8.

58. T. Alan Lacey and Benjamin Wright, “Occupa- tional Employment Projections to 2018,” Monthly Labor Review, 132(11), 2009, pp. 82–99.

59. Rik Kirkland, “The New Face of Labor,” Fortune, 154(8), October 16, 2006, pp. 122–132.

60. Shail J. Butani, Richard L. Clayton, Vinod Kapani, James R. Spietzer, David M. Talan, and George S. Werking Jr., “Business Employment Dynamics:

Tabulations by Employer Size,” Monthly Labor Review, 129(2), 2006, p. 4; United States Census Bureau, “Statistics about Business Size (Including Small Business),” available at http://www.census. gov/econ/smallbus.html.

61. Mitra Toosi, “Labor Force Projections to 2022: The Labor Force Participation Rate Continues to Fall,” Monthly Labor Review, 136(12), Dec., 2013 [online edition] at http://www.bls.gov/opub/mlr/ 2013/article/labor-force-projections-to-2022-the- labor-force-participation-rate-continues-to-fall-1. htm; also see, U.S. Bureau of Labor Statistics, “Employment Projections: Civilian Labor Force by Age, Sex, Race, and Ethnicity” at http://www. bls.gov/emp/ep_table_304.htm.

62. U.S. Department of Labor, “Union Members Summary: 2014,” News Release, January 23, 2015, Table 1, at http://www.bls.gov/news.release/ union2.t01.htm.

63. U.S. Department of Labor, “Union Members Summary: 2014,” News Release, January 23, 2015, at http://www.bls.gov/news.release/union2.nr0. htm.

64. Arleen Hernandez, “The Impact of Part-Time Employment on Union Density,” Journal of Labor Research, 16(4), 1995, pp. 485–491.

65. Bruce Nissen, “The Recent Past and Near Future of Private Sector Unionism in the U.S.: An Appraisal,” Journal of Labor Research, 26(2), 2001, p. 325.

66. Michelle Amber, “Henry Pledges Innovative Organizing Efforts Along With Addressing U.S. Economic Crisis,” Daily Labor Report, 93, 2010, pp. C-1–2.

67. Joseph B. Rose and Gary N. Chiason, “New Measures of Union Organizing Effectiveness,” Industrial Relations, 29(3), Fall 1990, pp. 457–468.

68. Andrew W. Martin, “Resources for Success: Social Movements, Strategic Resource Allocation, and Union Organizing Outcomes,” Social Problems, 55(4), 2008, pp. 501–524; Peter Fairbrother and Glynne Williams, “Unions Facing the Future: Questions and Possibilities,” Labor Studies Jour- nal, 31(4), 2007, pp. 31–53; Paul F. Clark and Lois S. Gray, “Changing Administrative Practices in American Unions: A Research Note,” Industrial Relations, 44(4), 2005, pp. 654–658.

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1- 1 Was “a Troublemaker” Laid off for Sharing Wage

Information? Or for Business Reasons?

The American Restoration Contractors (ARC), Inc. was hired to reroof and fix cracks in the bricks of several buildings of a regional university. Because it was a large job, several new employees were hired. One was an experienced mason and bricklayer named Bruce Potts.* Potts had completed a four-year union appren- ticeship training program and another four years as a journeyman; subsequently, he had 12 years’ experience in both union and nonunion settings. ARC was a non- union contractor.

Potts testified before the federal NLRB that he had been led to believe by both his immediate supervisor, Gene Polizzi, and a co-worker who had been hired along with him, that the job would pay $44 per hour. However, upon arriving at the work site, Potts learned that it only paid $35 per hour, which made him angry, given the nature of the work.

He described the work as difficult. It required him to wash the building surface and the roof, removing any dirt. Next, employees inspected the bricks, caulk, and wood for needed repairs. Rotted caulk and other defec- tive building materials had to be removed and replaced. When the new caulk dried, the building was again sprayed with a high pressure hose. After the water dried, final waterproofing chemicals were applied. The caulk work was the most laborious, calling for the great- est expertise and precision. Much of this work took place on a 100° roof under the sweltering summer sun.

In recognition of the excellent work that Potts was doing, Polizzi recommended him for several pay raises: As the summer passed, Potts’s pay went from $35 (the first week of June) to $36.13 (second week) to $37 (third week) to $39.21 (last week of June) to $40.13 throughout July and August, until he was laid off on in early September. As a result of these raises, Potts became the highest-paid non-managerial employee on the job site.

Potts often told his co-workers what his current pay rate was and he encouraged them to ask for more money. He said everyone was underpaid and all the workers should all be getting more. He also criticized some of the work methods they were asked to use. One employee quit soon after Potts discussed wage rates with him. The following week, the firm’s Human

Resources Manager, Dixie Boxrud, hand-wrote the fol- lowing message on Potts’s July 1st pay stub:

Please keep your pay rate to yourself. Thanks, Dixie B.

Further, when he distributed pay envelopes, Polizzi told Potts that he shouldn’t be discussing his pay with his co-workers and “stirring up trouble” by encourag- ing them to complain.

At the end of the summer, Potts was laid off with four other workers, even though three others who did similar work kept their jobs. Potts accused ARC of lay- ing him off in retaliation for his complaining about the wages. Potts testified. “I was telling everyone how they were getting short-changed and management was mak- ing a lot of money off of them and how they ought to do something about it—threaten to quit or something—to get what they deserved.” Potts also indi- cated that Polizzi had told him that ARC had bid on another, similar job and that Potts offered to work at that site, even though it was several hours’ drive away. However, he was never called to work at that site, or any other ARC work sites.

The General Counsel (which often prosecutes cases involving allegations of unfair labor practices under the National Labor Relations Act, as amended by the Labor Management Relations Act [LMRA]), alleged that ARC was retaliating against Potts for his activities. Under federal labor law, employees, have the right to “… engage in concerted activities for the pur- pose of collective bargaining or other mutual aid or protection …” (Section 7); it is an unfair labor practice for employers to “interfere with, restrain, or coerce employees in the exercise of [their] rights” or to dis- criminate “in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization …” (Sections 8 (a) (1) and 8 (a) (3) of the LMRA). The General Counsel argued that ARC’s actions were illegal because (1) they interfered with Potts’s actions aimed at “mutual aid and protection” (securing pay raises for all workers) and (2) ARC discriminated against Potts when making layoff and rehiring decisions because of his efforts to organize the workers to com- plain about their pay.

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Polizzi and other company officials denied the charges. They said that from the first day that he showed up at the job site Potts had been a trouble- maker. When he was hired, he had an erroneous impression as to what the pay for the work was worth. He was quite vocal about what he saw as low pay—and other subjects, such as how the work should be done. “I had to put up with his mouth, always com- plaining and whining,” Polizzi said. However, he over- looked it because, “he was a good caulker and he was productive.” His outstanding productivity and excellent work resulted in several pay raises in the ensuing weeks. Still, his constant complaining bred dissatisfac- tion and caused one co-worker to quit. ARC had an informal (unwritten) policy that people not tell others their pay rate; such complaining leads to workers com- paring themselves to each other, breeding dissatisfac- tion. Potts went against that policy, even after he had been asked politely to “keep your pay rate to yourself.”

Ms. Boxrud testified that she wrote this on Potts’s pay stub because he “was causing issues on the job site telling people that, walk off and they will give you a raise. I wanted to keep an atmosphere of calm on the job. We already had one employee quit over it. Talking about pay was causing problems, so I wanted him to stop talking about it.”

Managers also denied that their actions violated labor law. The workers had not formed a union, nor were they contemplating forming a union. The word “union” was never mentioned to ARC managers. Fur- ther, workers were not bargaining collectively and they were not threatening to strike if wages stayed unchanged. Clearly, they were not joining together for

“mutual aid and protection” against an exploitive employer, given that they were all earning over $30 per hour. Thus, management at ARC was not interfer- ing with their rights under labor law.

Finally, ARC did not retaliate against Potts for his complaints. He was laid off near the end of the job, along with several other workers. He would have been laid off regardless of his statements to his co-workers: When a job neared completion, fewer workers were needed. Yes, it was true that Potts offered to work at another job site. However, what Polizzi did not know at the time that he mentioned that project was whether ARC would win the contract. It turned out that the firm did not have the low bid and the contract was awarded to another firm. The firm won other bids, but the work was not as difficult; thus, the company did not need to hire a caulker who commanded the high rate of pay that Mr. Potts earned. Consequently, ARC did not need his services. Potts’s charges of retaliation are baseless.

* = All company and individual names and some minor facts are changed. This case is adapted from an NLRB case.

Questions 1. Given the facts of the case and the brief description

of the LMRA, did ARC violate labor law by telling Mr. Potts to “Please keep your pay rate to yourself”? Explain your reasoning.

2. Did ARC retaliate against Mr. Potts when it laid him off and did not offer him work on other jobs? Did these actions constitute violations of the LMRA? Explain your reasoning.

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1- 2

Discharge for Whistleblower Activity

Janet Broom and Darla Miller were employed as a cer- tified medication aide and cook, respectively, at the employer’s residential care facility located in Norman, Oklahoma. Both employees suspected another employee of stealing and using drugs, intended for use by residents of the facility, from the facility’s medi- cation room. Broom and Miller decided to report the suspected employee based on their observation that she had falsified medical drug log books to conceal her theft from facility managers.

The facility’s Employee Handbook clearly outlined a procedure employees were to follow when making com- plaints involving other employees. The Employee Hand- book called for the initial complaint to be filed with the accused employee’s immediate supervisor. Because the two employees making the complaint believed that the immediate supervisor in this case, Sarah Dutton, was a close personal friend of the accused, Broom and Miller chose to make their complaint to another manager, who was the medication consultant at the facility.

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Upon learning of the complaint from the medica- tion consultant, supervisor Dutton discharged Broom and Miller for “not following the proper chain of com- mand in raising an issue about another employee.” Both Broom and Miller are nonunion employees unrepresented by a union. After being discharged, Broom and Miller’s only recourse was to file a wrongful discharge state court claim, arguing that they were engaged in internal whistle blowing activity and thus protected from discharge as a matter of Oklahoma public policy.

The employer argued that Broom and Miller were subject to the Oklahoma common law employment- at-will (EAW) doctrine, which permits an employer to discharge an at-will employee at any time for any or no stated reason. The employer sought and received a summary judgment in state district court declaring Broom and Miller’s discharge to be lawful under the state’s common law, EAW doctrine.

Broom and Miller appealed the state district court’s decision to a federal Court of Appeals, seeking to reverse the district court’s decision.

In Groce v. Foster, 880 P.2d902 (Okla. 1994), the Oklahoma Supreme Court recognized five types of public policy exceptions to the common law, EAW doctrine. Under Oklahoma law, an at-will employee may not be lawfully discharged for (1) refusing to par- ticipate in an illegal activity; (2) performing an impor- tant public service (e.g., jury duty); (3) exercising a legal right or interest of the employee; (4) exposing some wrongdoing by his or her employer; and (5) perform- ing an act that public policy would encourage or refus- ing to perform an act that public policy would discourage, when the discharge action is coupled with a showing of bad faith, malice, or retaliation.

Broom and Miller argued that their discharge fell under the fifth public policy exception to the EAW doctrine. By reporting to management a co-worker who they honestly believed was engaged in stealing drugs intended for administration to residents of the facility, Broom and Miller believed they were engaging in conduct that Oklahoma public policy encourages.

The Oklahoma Supreme Court mandates that to be recognized and enforced, public policy exceptions must be clearly stated in state constitutional, regula- tory, or case decision law. To that end, Broom and Miller cited three statutory laws that they believed pro- vided a clear statement of public policy supporting their action.

The first law is the Nursing Home Care Act, which governs safeguards and procedures for the storage, safekeeping, monitoring, dispensing, and, when neces- sary, destruction of patient prescription drugs. The employer argued that the act specifically applies only to licensed nursing homes operating within the state. The employer’s facility is licensed as a residential care facility and thus is excluded from coverage under the Nursing Home Care Act. The state of Oklahoma grants operating licenses for several different types of elder- care facilities, including nursing homes, assisted living homes, and residential care facilities.

The second law is the Residential Care Act, which the employer admitted does apply to the facility in this case. Broom and Miller noted that the law authorizes the Oklahoma State Department of Health to “develop and enforce rules and regulations … to implement the provisions of the Residential Care Act. Such rules and regulations shall include but not be limited to govern- ing temperature limits, lighting, ventilation, and other physical conditions which shall protect the health, safety, and welfare of the residents in the home.” The employer argued that Broom and Miller did not raise the issue of the Residential Care Act’s applicability to their case when the case was before the district court and therefore could not legally raise it as a supporting argument on appeal. It is a well-settled legal principle that issues or arguments not clearly presented and con- sidered at a prior legal proceeding cannot be subse- quently raised as a legal basis for argument on appeal. The employer also noted that the language referred to by Broom and Miller in the Residential Care Act is very general and not specific enough to rise to the level of a clear statement of public policy supporting intent to make an exception to the prevailing Oklahoma EAW doctrine.

The third law cited by Broom and Miller as a basis for their appeal is the Uniform Controlled Dangerous Substances Act. Although this law does make it a crim- inal offense to steal a controlled dangerous substance, Broom and Miller made no specific argument as to how this law established a clear mandate of public pol- icy applicable to their discharge case. The employer argued that Broom and Miller again failed to meet the required showing of a clear and compelling public policy in favor of restricting an employer’s right to dis- charge an at-will employee for failing to follow the established procedure for bringing a serious complaint against a co-worker.

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Questions 1. Should the federal appeals court deny Broom and

Miller’s appeal and enforce the decision of the state district court finding upholding the discharge of the two whistleblowers? Explain your reasoning.

2. How might this case have been handled differently if Broom and Miller had been members of a bargain- ing unit represented by a union for purposes of collective bargaining?

40 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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41

CLASSROOM EXERCISES

1.1 Work Rules

Directions: This activity can be performed as an individual or group assignment using either an oral or written report format. Select a recent (not more than one-year old) news story or article and explain how the information in the story could affect the nego- tiation or administration of a particular work rule. An appropriate news story or article should contain information on one or more of the possible constraints or influences affecting the negotiation or administration of work rules identified in the text (e.g., state of the economy, labor market conditions, product market conditions, financial mar- ket conditions, technology, and international forces or events).

1.2 Union Membership Trend

Directions: This activity can be performed as an individual or group assignment using either an oral or written report format. Select a recent (not more than one-year old) news story or article and explain how the information in the story could affect future union membership growth in a positive or negative manner. Your explanation should clearly indicate why or how you think the information in your story will have the pre- dicted effect on future union membership growth.

1.3 Word Association

Directions: Divide the class into groups of three to five students. Presented below are 25 words or phrases. Each group should classify each listed word or phrase as primarily applicable to UNIONS (U) or MANAGERS (M), BOTH U & M (B), or NEITHER U nor M (N). Groups may compare their results and discuss their reasoning for associating particular words or phrases with the terms Union or Management. Groups may also list additional descriptive terms or phrases that they would strongly associate with the terms Union or Management.

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Words or phrases to classify

1. Powerful 2. Educated 3. Democratic 4. Profit-oriented 5. Productive 6. Fair 7. Violence 8. Trustworthy 9. Job security 10. Competitive 11. Political 12. Authority 13. Reasonable 14. Work stoppage 15. Professional 16. Employee compensation 17. Ethical 18. Innovative 19. Flexible 20. Quality improvement 21. Risk taker 22. Necessary 23. Job safety and health 24. Work rules 25. Growth-oriented

42 PART 1 • Recognizing Rights and Responsibilities of Unions and Management

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