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CHAPTER 15

Union–Management Relations

Learning Objectives

Discuss what a union is and explain why employees join and employers resist unions

Outline the current state of union activity in the United States and identify several reasons for the decline in union membership

Explain the provisions of each of the major U.S. labor laws and recognize the impact of these laws and National Labor Relations Board (NLRB) rulings on nonunion workplaces

Learning Objectives (continued)

Describe the phases of the unionization process and the typical collective bargaining process

Define a grievance and identify the stages in a dispute resolution procedure

Unions

Union: Formal association of workers that promotes the interests of its members through collective action

Employees join unions because:

They are dissatisfied with how they are treated by employers

They believe that unions can improve their work situations

Perspectives on Unionization

Advantages

Provides a channel for feedback about employee concerns and suggestions

Balances unchallenged decision-making power of management

Increases job tenure, performance, and employee earnings

Disadvantages

Negatively impacts the allocation of organizational resources

Decreases profitability

Hurts productivity as a result of increased compensation and rigid work practices

Factors Leading to Employee Unionization

Working conditions

Inadequate staffing

Mandatory overtime

Unsatisfactory work requirements

Unrealistic expectations

Compensation

Noncompetitive pay and inequitable pay raises

Inadequate benefits

Unfair allocation of resources

Factors Leading to Employee Unionization (continued)

Management style

Arbitrary decision making

Use of fear/intimidation and autocratic leadership

Lack of recognition

Employee treatment

Job insecurity

Unfair discipline/policies

Lack of response to complaints

Harassment/abusive behaviors

Why Employers Resist Unions

Unions affect how employees and workplaces are managed

Unions may create inefficiencies in the workplace that cause waste and poor performance

Union workers frequently receive higher compensation than nonunion workers

Prevention of Unions

Develop good employment practices

Earn employee trust

Encourage employee feedback

Offer fair, competitive compensation

Build supportive supervisory relationships with workers

Ensure that both H R professionals and operating managers are attentive and responsive to employees

Union Membership in the United States

Unions played a critical role in improving the lives of American workers

Evolved as the Industrial Revolution took hold in the early 20th century

Focused on better wages, reasonable work hours, and safer working conditions

After the Great Depression in 1929, workers gained the right to:

Form labor unions

Negotiate with their employers regarding terms and conditions of their employment

Union Membership in the United States (continued)

Membership in unions has steadily declined since 1983

Only 10.7% of employed individuals in the United States were members of unions in both 2016 and 2017

Significant difference in membership exists between the private and public sectors

In 2017, only 6.5% of private-sector employees belonged to labor unions, whereas 34.4% of public-sector employees belonged to labor unions

Reasons for U.S. Union Membership Long-Term Decline

Changing job conditions

Deregulation

Foreign competition

Increased right-to-work legislation

Increased use of temporary or contingent workers

Improved workplace practices

Unions no longer seen as necessary

Reasons for U.S. Union Membership Long-Term Decline (continued 1)

Geographic changes

Firms may elect to move their operations to places that are less open to unions or to places where there is cheaper labor and fewer employment restrictions

Industrial changes

Jobs in the United States have shifted from manufacturing, construction, and mining industries to service industries

Private-sector union membership is primarily concentrated in the shrinking part of the economy

Reasons for U.S. Union Membership Long-Term Decline (continued 2)

In 2017, union representation of nongovernmental employees was heavily concentrated in utilities, transportation and warehousing, and other industrial sectors

Unions are not making significant progress in the fastest-growing segments of the U.S. economy

Workforce changes

Decline in many blue-collar jobs in heavy industry and increase in white-collar jobs

Growing percentage of women in the U.S. workforce

Public-Sector Unionism

The public sector is the most highly unionized part of the U.S. workforce

Local government workers have the highest unionization percentage of any group in the U.S. workforce

Criticized recently because of:

High cost of union benefits

Slow change to contemporary contribution plans

Inadequately funded pensions

Automatic deduction of dues

Ways to Fight Decline in Union Membership

Creating partnerships with outside organizations and worker centers

Protests

Work stoppages

Targeting low-skilled workers and contingent workers

Joint employer status

Early Labor Legislation

Railway Labor Act, 1926

Represented a shift in government regulation of unions

Gave railroad employees the right to organize and bargain collectively through representatives of their own choosing

Allows either unions or management to use the National Labor Relations Board

Norris-LaGuardia Act, 1932

Guaranteed workers some rights to organize

Early Labor Legislation (continued)

Restricted the issuance of court injunctions in labor disputes

Prohibits employers from asking employees to sign yellow dog contracts

Yellow dog contracts: Pledges by workers not to join a labor union

Major National Labor Laws and Their Primary Focuses

Wagner Act

Focuses on rights of unions and workers

Taft-Hartley Act

Focuses on rights of management

Landrum-Griffin Act

Focuses on rights of union members in their unions

Major National Labor Laws

Wagner Act, 1935

Known as the National Labor Relations Act

Declared that the official policy of the U.S. government was to encourage collective bargaining

Provided the right to engage in protected concerted activities

Protected concerted activities: Actions taken by employees working together to try to improve their pay and working conditions, with or without a union

Major National Labor Laws (continued 1)

Prohibits the following unfair labor practices:

Interfering with, restraining, or coercing employees in the exercise of their right to organize or to bargain collectively

Dominating or interfering with the formation or administration of any labor organization

Encouraging or discouraging membership in any labor organization by discriminating with regard to hiring, tenure, or conditions of employment

Discharging or otherwise discriminating against an employee because the employee filed charges or gave testimony under the act

Major National Labor Laws (continued 2)

Refusing to bargain collectively with representatives of the employees

National Labor Relations Board (NLRB)

Conducts unionization representation elections

Investigates complaints by employers or unions through its fact-finding process

Issues opinions on its findings

Prosecutes violations in court

Major National Labor Laws (continued 3)

Taft-Hartley Act, 1947

Amended or qualified in some respect major provisions of the Wagner Act and established an entirely new code of conduct for unions

Notable change brought in the process of representation elections is excluding supervisors from inclusion in the bargaining unit

Union members were given the right to hold elections to deauthorize or decertify the union thus reversing the process of representation

Major National Labor Laws (continued 4)

Allows the president of the United States to declare:

That a strike constitutes a national emergency

An 80-day cooling-off period during which the union and management continue negotiations

Allowed states to enact right-to-work laws

Right-to-work laws: State laws that prohibit requiring employees to join unions as a condition of obtaining or continuing employment

Open shop: Employer that does not require workers to join or pay dues to a union

Major National Labor Laws (continued 5)

Closed shop: Employer that requires individuals to join a union before they can be hired

Different types of arrangements exist in states that do not have right-to-work laws

Union shop: Workers must join the union, usually 30 to 60 days after being hired

Agency shop: Workers who don’t join the union must make payments equal to union dues and fees to get union representation services

Maintenance-of-membership shop: Workers must remain members of the union for the period of the labor contract

Major National Labor Laws (continued 6)

Identifies unfair labor practices that might be committed by unions

Refusing to engage in good-faith negotiations with employers

Engaging in activities that might cause employers to discriminate against employees because of their union or nonunion status

Coercing or discriminating against members and failing to adequately represent all those covered by a collective bargaining agreement

Charging excessive membership fees

Engaging in secondary boycotts with neutral parties if the company and union are in a labor dispute

Major National Labor Laws (continued 7)

Landrum-Griffin Act, 1959

Also called Labor Management Reporting and Disclosure Act

Protects democratic rights of union members

Unions are required to:

Establish bylaws

Make financial reports

Provide union members with a bill of rights

Major National Labor Laws (continued 8)

Significant NLRB activities and rulings

Include company policies on:

Employees’ use of social media and electronic communications

Courteous or respectful behavior

Company confidentiality rules

Bargaining unit determination and elections

Franchisors as joint employers

Franchisor is liable for labor violations at all operations bearing the company’s name, regardless of who owns the restaurant

Typical Unionization Process

Involves the following steps:

Organizing campaign

Authorization cards/petition filing

Representation election

Certification

Collective bargaining/contract negotiation

Union Organizing Process

Employers’ union prevention efforts can include:

Emphasizing good morale and loyalty

Paying competitive wages and benefits

Using a fair system for dealing with complaints

Providing safe working conditions

Creating no-solicitation policies

Hiring “union busters”

Union Organizing Process (continued)

Unions’ organizing efforts can include:

Personally contacting employees outside work

Mailing materials to employees’ homes

E-mailing information about the union to employees

Inviting employees to attend special meetings away from the company

Publicizing advantages of union membership

Distributing brochures and leaflets

Salting: Unions hire and pay people to apply for jobs at certain companies to begin organizing efforts

Authorization Cards

Union authorization card: Card signed by employees to designate a union as their collective bargaining agent

30% of the employees must sign authorization cards for a representative election to be scheduled

If enough employees sign authorization cards, a union could be designated as their representative without an election

Representation Election

Bargaining unit: Employees eligible to select a single union to represent and bargain collectively for them

The Taft-Hartley Act excludes supervisors from voting for or joining unions

Results in the exclusion of supervisors in bargaining units for unionization purposes except in industries covered by the R L A

Representation Election (continued)

All activities must conform to requirements established by applicable labor laws

The Wagner Act and the Taft-Hartley Act place restrictions on the activities employers and unions can engage in

Election process

Union needs to receive only a majority of the votes to win

Election results can be appealed to the N L R B on suspicion of unfair labor practices

Unfair Labor Practices during Organizing Campaigns

Threatening to reduce pay, fire workers, or take other negative steps to prevent workers from voting for a union

Questioning employees to learn who initiated the organizing attempt and how workers plan to vote

Promising pay raises or other perks in exchange for employees rejecting the union

Spying on employees to find out who is participating in union organizing activities

Certification and Decertification

N L R B or an equivalent body gives the official certification of a union as the legal representative for employees

Once certified, the union attempts to negotiate a contract with the employer

Decertification: Process whereby a union is removed as the representative of a group of employees

Can occur through election, which requires at least 30% of employees to sign decertification authorization cards

Contract Negotiation or Collective Bargaining

Process whereby representatives of management and workers negotiate over wages, hours, and other terms and conditions of employment

Goal is to establish conditions beneficial to both

Balances the power between parties

Collective bargaining agreements will be in force for several years

Figure 15-10: Continuum of Collective Bargaining Relations

Collective Bargaining Issues

Bargaining issues

Management rights: Rights reserved so that the employer can manage, direct, and control its business

Union security provisions: Contract clauses to help the union obtain and retain members and collect union dues

Require union membership of all employees, subject to state right-to-work laws

Dues checkoff clause: Provides for the automatic deduction of union dues from the payroll checks of union members

Classification of Collective Bargaining Issues

Mandatory issues: Negotiation topics and collective bargaining issues identified specifically by labor laws or court decisions as subject to bargaining

Permissive issues: Collective bargaining issues that are not required but might relate to certain jobs or practices

Illegal issues: Collective bargaining issues that would require either party to take illegal action

Mandatory Subjects of Collective Bargaining

Compensation

Wages, merit increases, and bonuses

Benefits

Pensions, profit sharing, and health and welfare plans

Working conditions

Grievance procedures, disciplinary procedures, drug testing, seniority, promotions and transfers, worker health and safety, work assignments, and plant closings

Collective Bargaining Process

Consists of four possible stages:

Preparation and initial demands

Negotiations

Settlement or impasse

Strikes and lockouts

Preparation and Initial Demands

Employer and industry data on the following are gathered:

Wages, benefits, working conditions, management and union rights, productivity, safety, and absenteeism

Core bargaining issues

Wages

Benefits

Working hours and conditions

Continuing Negotiations

Each side attempts to determine what the other side values highly so that the best bargain can be struck

Good-faith negotiations

Parties agree to send negotiators who can bargain and make decisions rather than people who do not have the authority to commit either group to a decision

To be more effective, meetings should be conducted professionally and address issues rather than being confrontational

Settlement and Contract Agreement

Ratification: Process by which union members vote to accept the terms of a negotiated labor agreement

Before ratification, the union negotiating team explains the agreement to the union members and presents it for a vote

If the members approve the agreement, it is then formalized into a contract

Typical Items in a Labor Agreement

Purpose of agreement

Nondiscrimination clause

Management rights

Recognition of the union

Dues checkoff

Wages, incentives, and hours of work

Vacations and sick/absence leaves

Discipline

Typical Items in a Labor Agreement (continued)

Separation allowance

Seniority and pension/insurance

Safety

Grievance procedure

No-strike or lockout clause

Definitions

Terms of contract (dates)

Appendices

Handling Bargaining Impasse

Conciliation: Process by which a third party facilitates the dialogue between union and management negotiators to reach a voluntary settlement

Mediation: Process by which a third party suggests ideas to help the negotiators reach a settlement

Arbitration: Process that uses a neutral third party to make a decision

Strikes and Lockouts

Lockout: Management shuts down company operations to prevent union members from working

Strike: Union members refuse to work in order to put pressure on an employer

Replacement of workers on strike

Management sometimes replaces workers who strike

Workers’ rights vary depending on the type of strike that occurs

Types of Strikes

Economic strikes

Parties fail to reach agreement during collective bargaining

Unfair labor practices strikes

Union members leave their jobs over what they feel are illegal employer actions

Wildcat strikes

Occur during the life of the collective-bargaining agreement without approval of union leadership and violate a no-strike clause in a labor contract

Types of Strikes (continued)

Strikers can be discharged or disciplined

Jurisdictional strikes

Members of one union walk out to force the employer to assign work to them instead of to members of another union

Sympathy strikes

One union chooses to express support for another union involved in a dispute, even though the first union has no disagreement with the employer

Union–Management Cooperation

Employee-involvement programs

Successful organizational restructurings

Occur when unions have been able to obtain information and share that information with their members to work constructively with company management at various levels

Unions and employee ownership

Unions have encouraged workers to become partial or full owners of the firms that employ them

Employee stock ownership plans for union members have been successful in some situations

Resolving Disputes

Division of responsibilities between the H R unit and operating managers for handling grievances varies from one firm to another, even among unionized firms

Grievance: Complaint formally stated in writing

Complaint: Indication of employee dissatisfaction

Grievance procedures: Specific steps used to resolve grievances

Grievance Procedures

Union representation in grievance procedures

Unionized employee has a right to union representation if:

The employee is being questioned by management

Discipline may result

Employee will be reinstated with back pay if Weingarten rights are violated and the employee is dismissed

Grievance Procedures (continued)

Grievance arbitration: Means by which a third party settles disputes arising from different or conflicting interpretations of a labor contract

Common concerns

Discipline and discharge

Safety and health

Security

Steps in a Typical Grievance Procedure

Discussion of written grievance between employee, union steward, and supervisor

Meeting between union steward and supervisor’s manager and/or H R manager

Meeting between committee of union officers and company managers

Discussion between national union representative and company executive or corporate industrial relations officer

Arbitration by impartial third party

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