Labor Unions

Labor Relations Strategies

1) Acceptance 2) Avoidance -Substitution -Suppresion

Landrum-Griffin Act, 1959 (union accountability to members)

1) Bill of rights for union members 2) Unions must have constitution 3) Union must file fin statements with DOL, which are open to public 4) Elections regulated by government 5) Fiduciary responsibility of union leaders

Benefits of worker centers

1) Certifying a union is difficult and long process 2) Accomplish goals outside of formal structure of unions (save resources) 3) More effective in generating support (union could be derogatory)

Types of unions

1) Craft unions (UBC, organized around a specific craft/specialty) 2) Industrial Unions (UAW, organized around an entire industry) 3) Public sector unions (teachers, fire fighters, etc.) *Growth of unions in public sector, but less power

Wagner Act (National Labor Relations Act, 1935)

1) Established NLRB 2) Protects most private workers EXCEPT: -managers -independent contractors -agricultural workers -public-sector workers 3) Set up rules for organizing campaign 4) Establishes bargaining unit 5) Union majority votes represent all workers in unit

Unions do for workers & Society...

1) High wages/benefits through collective bargaining 2) Manage employment relationship (protection from supervisors/voice to express values) 3) Political activities 4) Lower wage inequality/high economic mobility

Impact of unions on workers (2 things)

1) Higher wages and benefits for members (wage premium--greater for lower-skilled workers) 2) Unions help set standards of pay that non-union employers follow

What does NRLA outlaw

1) Interfering with employee rights to form unions 2) Interfering with the administration of a union 3) Discrimination of members 4) Discrimination against employee who filed charges under act 5) Refusing to bargain with union in good faith

Negative impacts

1) Lee & Mas (Unionization reduces cumulative Returns to Investors 10% in 2 years), reduces PPE growth/no real effect on profit 2) Unions have sign neg effect on profits and effect is larger in US 3) Difficult to adapt to changing economic conditions

Impacts of unions on society (4 things)

1) Lower wage inequality and increase upward mobility 2) Low-income children rise higher in income when growing up in areas with high union membership 3) Union density is one of best predictors of area's mobility (or HS dropout rate) 4) Children of non-college educated fathers earn 28% more if father is in union

Unionization Trends: Public v Private

1) More Private union workers than public as of 2013 (7.3 to 7.2 million) 2) Total Union membership and private union membership continually going down 3) Public union membership as a % of total salary workers staying mostly stable

Impact of unions on workers (2 things)

1) Protect interest of average worker who is older, with more tenure/seniority 2) Constrains employment through unionization

What unions do (4 things)

1) Replace individual with collective voice to address imbalance of power (control labor supply through strikes) 2) Skill formation (train and certify workers) 3) Institutionalize rules of access to employment based on social criteria (eg internal labor markets) 4) Public policy to limit supply of labor (eg mandatory retirement ages, public pensions, tax breaks for stay-at-home parents)

Impact of unions on workers (2 things)

1) Safer, healthier working conditions (ex. through OSHA 1978 legislation on cotton dust, lowered brown lung cases) 2) Removes management ability to make unilateral decisions (eg seniority provisions)

Positive/no impacts of unions on firms

1) Small difference in wages, employment, output between unionized and non-unionized workplaces 2) Contract provides greater predictability for business 3) Not much evidence that unions hurt productivity, quality, or innovation

Suppression

1) Threats of relocation and outsourcing 2) Dismissal (firing) 3) Wage and benefit cuts 4) Use of strikebreakers (people hired as employees during and after a strike occurs)

Taft-Hartley Act, 1947 (limits some union powers)

1) Unions can't preclude firms from hiring non-union members 2) States have right to pass "right-to-work" 3) Managers/foreman explicitly excluded from joining union 4) Required union officers to sign non-communist forms 5) Unions must give 60 days notice in order to strike 6) Outlawed wildcat, political strikes and secondary boycotts

What causes strikes and why have they declined? (reading)

1) employer efforts to reduce wages 2) low unemployment triggers increase in walk-outs BUT not anymore the case, now... 3) Low jobless rate combined with tepid wage growth (no longer tied to short-term fluctuations in business cycle) 4) possibly it has to do with increased power of unions in bargaining

Rosenfeld theory for why unions no longer as effective...

1) larger "assault" from business on labor that began in 70s and crystalized with firing of PATCO strikes in 1981 2) Resulted in increased use of hiring replacement workers and moving production to non-union facilities 3) Broader economic shifts were disadvantageous to unions (decline in manufacturing employment and less negotiating leverage)

What unions no longer do (Rosenfeld, "strikes" takeaways (3)

1) strikes are no longer as prevalent as they used to be (due largely by strikes being ineffective at increasing labor's share of available income) 2) Strikes no longer effective as they used to be in leading to WAGE & BENEFIT INCREASES

Explanations for why unions improve children economic mobility (3)

1) unions = higher wages (better education, more stable home life) 2) union = better benefits (health insurance) 3) unions advocate for opportunity-advancing public policies (ex. inc minimum wage, public services)

Union Definition

An organization which exists for the purpose of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, and conditions of work FOCUS ON COLLECTIVE BARGAINING AND WORK RULES

Acceptance

Company doesn't challenge the union's right to represent employees, and accepts collective bargaining

Functions of Worker centers

-File claims against firms -Work with government to enforce laws -Raise awareness and campaigns against firms -Education (language, personal finance)

Unions do for firms...

Affect on firms is mixed -Little evidence that union negatively impact productivity, innovation, or product quality -Can negatively impact firm profitability and shareholder returns

Right to work laws

Affirms the right of every American to work for a living without being compelled to belong to a union (membership provisions are illegal, workers can't be forced to join union as part of employment) *Allows free riding and makes it less efficient to organize bargaining units and negotiate contracts Alt def: government regulation of the contractual agreements between employers and labor unions that prevents them from excluding non-union workers, or requiring employees to pay a fee to unions that have negotiated the labor contract all the employees work under

Worker Centers

Community-based social-movement organizations that organize and provide support to communities of low wage workers who are not already members of a union (typically target immigrants)

Increased use of hardball union opposition tactics (both legal and illegal)

Employers have increased their use of punitive tactics such as plant closing threats, actual plant closings, discharges, harassment, disciplinary actions, surveillance, etc.

Substitution

HR practices similar to or better than those at unionized firms

Joint Liability Rules

Issue for franchising, contracting, and temporary staffing where employers are responsible for treatment of staff (ex. Subway, Uber)

Union membership and coverage globally

US has very low membership and coverage rates compared to other countries