Labor Relations: Exam 1
Union Effects: Work Rules
-"just cause" provision for discipline and dismissal -grievance procedure that ends in arbitration -seniority rights: used for allocating benefits and personnel decisions (ex. promotions, transfers, layoffs); typically not the only factor -job security: may include job guarantees for both workers, may be employment to both labor and management depending on the policies -income security: includes fringe benefits
Historical Evolution of Labor Policy: Early Unionism
-1804-1840s -Courts hostile to collective action -major opposition to Unions, essentially made them illegal -the conspiracy doctrine: limited rights to exist (shoemaker union was found guilty in their terms, injured shoemakers not part of the union)
Historical Evolution: The Labor Wars
-1860s-early 1900s -violent disputes between labor and management -spurred by wage cuts -involved strikers, strikebreakers, police and private security
Union Density: by region/state
-30 states have below the US average -highest states: NY 24.7%, Hawaii 20.4%, Alaska 19.6% -lowest: South Carolina 2.1%, North Carolina 3.0%
Evolution of the New Deal System: 1950s
-AFL/CIO merged -expansion of contract scope-gaining bargaining power -management taking a harder line in negotiations -Landrum Griffin Act to regulate internal union affairs -peak union involvement: 35%
Direct Regulation of Employment: Fair Labor Standards Act
-FLSA -establishes minimum wage, minimum age, overtime pay -state laws typically meet or exceed FLSA -applies to most workers OR the state law is better
Historical Evolution of LP: Industrial Unionism and the New Deal
-Great Depression lead to programs designed to increase worker purchasing power and stimulate the economy -National Industrial Recovery Act (1933): gave workers the right to organize but NIRA ruled unconstitutional in 1935 -union membership grew by 1 million (1933-1935) -real and symbolic effects -National Labor Relations Act (NLRA; Wagner Act, 1935): gave employees the right to organize and encouraged collective bargaining -NLRA meant to foster industrial peace (keep production going), left management rights in tact, and codified principles of scientific management into labor contracts; ex, narrow division of labor and the "not my job!" syndrome (valet vs. bellhop)-non union employee can't help unionized employee
Additional Union Effects
-Health and safety: safety provisions, joint union-management safety committees, higher compensation for riskier jobs -turnover: quit rates lower among union employees
National Labor Relations Board (NLRB)
-Independent Federal Agency -Enforces the NLRA -board members are appointed by the president of the US with Senate Approval -Key Activities: 1. Conducts union representation elections 2. Investigates and adjudicates unfair labor practices by employers and unions 3. NLRA also gives the NLRB the power to issue rules necessary to carry out the Act's provisions
Evolution of the New Deal: 1980s
-Political shift and PATCO strike-->shifted to the right -economic recession brought about layoffs and concessionary bargaining -Union decline accelerated
Direct Regulation of Employment: Discrimination Laws
-Title VII of the Civil Rights Act (1964): prohibits discrimination based on race, color, religion, sex, national origin -disparate treatment/impact: doesn;t have the intention of discriminating but it still can -business necessity -other laws: ADEA (1967: protects workers over 40), PDA (1978: pregnant workers), ADA (1990: disabled workers)
Union Structures for Collective Bargaing
-Union Federations (AFL-CIO, CtW): main role is political lobbying, supports national unions -national unions: center of power, actively involved in negotiation of collective bargaining agreements -local unions: often organized by geographic area, represent workers an negotiate local contracts
Attitudinal Structuring
-accompanies bargaining -involves influencing attitudes and perceptions -trust building and perspective taking -essential if you are trying to engage in an integrative approach -happens before bargaining even starts
The Role of the Environment
-affects the bargaining power of labor and management: functional/middle level -key element of bargaining power: strike leverage-ability and willingness of each part to sustain a strike, who comes back to the table first? -total power: how competitive is the company? -relative power: not the size of the pie, the share of the pie
Management Strategies
-alternative industrial relations patterns: different approaches to the employment relationship with different personnel policies -shaped my management values and business strategies (may also be influenced by union strategies) -some management likes to deal with employees directly
Historical Evolution of Labor Policy: Late 1800s-early 1930s
-anti trust legislation included unions--> they were considered monopolies -lead to injunctions that limited union and workers' ability to strike, picket or boycott employees -Norris LaGuardia Act (1932) outlawed injunctions in labor disputes and yellow dog contracts -Union recognition and collective bargaining remained a voluntary process between labor and management -no enforcement of rights
NLRA: section 8
-bargaining in good faith: bad faith=will only meet at weird times, sends someone with no real power -unfair labor practices -mandatory and permissible subjects of bargaining -mandatory: must negotiate on them, directly relate to wages and working conditions -permissible: both sides must agree to negotiate, can't strike on these subjects
Bargaining Structures
-centralized or decentralized -centralized: contract negotiated for all employees in a company or industry -decentralized: contract negotiated for employees in a single workplace -pattern bargaining is an informal way to centralize bargaining
3. The Demographic Environment
-changing workforce: older, more women, higher and lower education -shift from manufacturing to services (80% of jobs are in services) -increasing part time and home based work -present opportunities and challenges for unions and management (ex. nurses union)
Election Campaigns: Nontraditional Organizing Tactics
-corporate campaigns -emplyer neutrality and/or voluntary recognition ("card check")
Union Effects: Productivity
-debate over union effects on productivity (pos vs neg) -parties can also negotiate over work rules to increase productivity (broader job classifications, flexible team based work systems)
5. The Technological Environment
-debates on the role of technology: effect on skills, replacing workers, effect on types of jobs -high tech paradox: highest technology plants are not the most productive (can't replace labor with technology); need to integrate technology with HR strategy; workers "give wisdom to new machines)
role of bargaining power
-determines whether a strike occurs and the outcomes of a strike; is management trying to build up inventory, credible threat of replacement
Historical Evolution: Early Unionism
-developed with the industrial revolution -First unions were skilled craftsman (1794: shoemakers) -workers from unions in response to deteriorating wages and working conditions
Historical Evolution: Pre Civil War
-early child labor legislation -10 hour workday -ethnic diversity and competition made organizing difficult
Employment at WIll
-employees and employers are free t end the employment relationship at any time for any reason without liability -some exceptions: collective agreements, individual contracts, public sector employees -other exceptions granted by the courts, v rare -can't be discriminating
NLRA
-est 1935 -gives clear definition of power imbalance -unions and collective bargaining are important for commerce and the economy because they restore equality of bargaining power and help to resolve industrial disputes -covers private sector workers (with some exceptions)
Historical Evolution: The Rise of the AFL
-established in 1886 -union federation active in political lobbying -business unionism (bread and butter) -craft focus
NLRA: section 7
-gives employees the right to self organize -concerted activity protected for union and non union workers (2+ workers) -employers can replace striking workers -bans secondary boycotts (encouraged people to stop working with employers that work with your bad employer)
Evolution of New Deal: 2000s-now
-growing non-union sector: union density ~11% -debates and disagreement in the labor movement about the best way forward (AFL-CIO and Change to Win: what should you be doing as a union?) -expansion of international trade, creating the need for international unions -criticisms of the market driven US economic system: do corporate owners and shareholders have too much power? -employer substitution: if you treat employees well, you don't need a union
Evolution of the New Deal System: 1960s
-growth of white collar industries and nonunion HR policies -decline in private sector union membership -growth in public sector unionism
Union Density: by occupation
-highest in education, training and library occupations, and protective service occupations (~35% each) -lowest in sales (3.3%) and farming, fishing and forestry (1.9%)
Union Density: By Industry
-highest in utilities (21.4%), transportation and warehousing (18.9%), telecommunications (13.3%) and construction (13.2) -lowest in agriculture (1.2%), finance (1.3%), and food services (1.5%)
Representation Elections
-if 50% + 1 employee vote in favor of the union, the union is certified as the bargaining agent -Union and management must being negotiations *duty to bargain in good faith, but not required to reach an agreement
union density: by demographic groups
-in 2015, men had higher union membership than women (11.5% vs 10.6%) -black workers had higher union membership (13.6%) than whites (10.8%) or Asian workers (9.8%), or Hispanic workers (9,4%) -union membership is highest among workers 45-64 (~14%)
Election Campaigns: Management
-individual contact and "captive audience" speeches -often hire professional firms to carry out campaigns -if management commits severe ULPs, NLRM can certify the union
Assumptions about labor and conflict
-labor is not a commodity -conflicting vs common interests between employees and employers? -conflict: economic interests (employees want high pay, benefits, job security; employers want profits) -common: joint gains
Evolution of New Deal: 1990s
-labor participation in some cases, high conflict in others -management actively resisted unions
Participant Goals
-labor: wants to improve working conditions of employees (wages, benefits, job security, health and safety) -management: labor costs, productivity, profits, managerial control -government: industrial peace, democracy, regulate collective bargaining, and employment conditions
2. The Legal and Public Policy Environment
-legality of unions: determine whether unions have the right to exist (gives unions formal rights) -NLRA: rights and obligations of each party affect bargaining power; often seen by labor giving employers too much power; amendments and rulings can influence the balance of power -direct regulation and employment standards: supported by unions
Evolution of the New Deal System: 1970s
-little change despite competitive pressures "most boring period" -IR professionals isolated
Management Rights
-management typically negotiates a "management rights" clause -general clause that states: "the supervision, management, and control of business/operation/plant are exclusively the function of the company" -meant to maintain autonomy in running the business
Historical Evolution of Labor Policy: Pre Civil are to Late 1800s
-means-ends doctrine: unions are not illegal conspiracies, but still have limited rights to strike, picket or boycott employees -yellow dog contract: employers made employees sign this, made them promise to not join a union or participate in union activities; employment contingent on not joining a union-enforced by the courts -still some labor advances
1. The economic environment
-microeconomic influences on bargaining power: management strike leverage=alternative means to maintain sales, production and profits; union's strike leverage: alternative sources of income while you're on strike (can't make $$ when you're on strike) -the wage/employment tradeoff: higher wages can bring employment cuts; depends on the difficulty of replacing worker, demand for the product, supply of other inputs, labor's share of total costs (importance of being unimportant) -macroeconomic influences on bargaining power: unemployment (tightness/looseness of the labor market), state of the economy
Historical Evolution: Late 1800s-Early 1900s
-need for national unions -employers' ability to shift production and goods across state lines created the need
zone of agreement
-none=no settlement, and/or parties have to adjust their bottom line
Union Density: Over Time
-peaked in 1945 at 35.5% -steady decline since the early 1960s -in 2015, union density was 11.1% overall -35.2% in the public sector vs 6.7% in the private sector
Union Strategies and Structures
-political strategies -unions engage in political action -support federal laws and employment standards -no labor party but traditionally lean left -debates about the extent and type of political activity going forward
Union Growth and Membership
-primary strategy of unions is attracting and retaining members -union density is the %age of the workforce that belongs to the union -varies across time, region, industries, occupations, demographic groups
Election Campaigns: Unions
-provide pro union message inside and outside of the workplace -individual and group meetings after work
4. The Social Environment
-public approval: generally positive towards unions and their role in protecting interests of employees; less favorable towards union leaders; the representation gap=44% -historically, public opinion can shape bargaining power of both parties -labor and management will often initiate campaigns to influence public opinion (especially during a strike) -ex. protestors on campus, right to works ads
Union Effects: Wages
-relative union wage is 15%-20% -varies across time, demographic groups, industries, and occupations -also negotiate other wage-related clauses: COLA, deferred wage increases, incentive systems
Collective Bargaining
-seen as one way to protect workers and resolve conflicts -negotiation and compromise among divergent interests; collective action
Recent Labor Strategies
-servicing vs organizing -traditionally focus on contract negotiations and contract admin -some argue that unions need to focus more on organizing new workers -these and related issues led to conflicts in the labor movement and the formation of a new union federation (Change to Win Coalition)
Historical Evolution: Industrial (1920s+)
-shift to mass production left many unskilled workers organized -difficult to coordinate efforts across craft unions -CIO challenged AFL: organize all workers in an industry, regardless of skill or craft
Bargaining Power
-underlying assumption that there is unequal bargaining power between individual employees and their employer -in general, employees seem to have more power
Taft Hartley Amendments (1947)
-unfair labor practices by unions: can't coerce someone into joining -workers can decertify unions -outlawed recognition strikes -employers are allowed to make anti-union statements, but not threats or promises (can give factual info about other union consequences) -excludes supervisors from NLRA -outlawed closed shops and states can ban agency/union shops (ex. right to work laws) -procedures for national emergency disputes-"cooling off period"
Takeaways from Labor History
-unilateral changes in working conditions can spur labor unrest and/or desire for unions -public opinion and political climate matters: left=more supportive of unions -economic climate matters -management strategies and structures shape union strategies and structures (ie capital mobility) -labor management relations in the US are path dependent (ie management rights and principles of Scientific Management)
strike
-union refuses to work -decreasing, but still a very important consideration
Union Effects: Fringe Benefits
-union workers have higher level and greater variety of fringe benefits than non-union workers -typical fringe benefits: health insurance, paid sick leave, vacations and holidays, retirement, SUB
Evolution of the new deal system: 1940s
-war labor board helped obtain acceptance of collective baraining -strike wave after the war and change in political climate led to Taft-Hartley Act (1947) and shifted the public view of unions -Professionalization of IR staffs (labor relation departments)
Distributive Bargaining
-win lose (zero sum) bargaining -one side's gain is the other side's loss -ex. wages and benefits -if one party gets a bigger piece of the pie, then the other side gets a smaller piece -higher wages=lower profits
Integrative Bargaining
-win win bargaining -joint gains through problem solving (not always easy) -challenging: identifying issues vs positions; often accompanied by distributive bargaining -difficult to reconcile different tactics, and depends on overall relationships between the parties -want to find ways to "enlarge the pie"
Intraorganizational Bargaining
-within organization bargaining -results from different goals and preferences within the org, on either side -management may have different preferences or opinions about what is feasible or desirable -unions may face conflicting demands for different groups of workers and /or leaders have different goals -may actually be what leads to a strike
Union IR Patters
1. Conflict: can happen before a union even forms; combative labor management relations; may impose high costs on the parties 2. New deal: Most common relationship, comes from NLRA; formal labor management relations; detailed contracts including grievance arbitration, seniority, job classification, standard pay; closes to bureaucratic 3. Participatory: new to workplaces, doesn't happen often but is becoming more common; flexible and cooperative labor management relations; includes practices like contingent compensation, job security, and employee involvement in decision making; collaboratve
4 Subprocesses of Negotiation
1. Distributive 2. Integrative 3. Intraorganizational 4. Attitudinal
The Negotiation Cycle: Traditional
1. Early Stages -research and preparation -present opening proposals -laundry 2. Middle Stages -estimating relative priorities of each side and liklihood of reaching agreement -negotiating proposals -signaling areas for compromise, settling easy issues (where you find the zone of agreement) 3. Final Stages -difficult issues tackles -convincing and compromise -off the record discussions are common -avoiding impasse is a top priority for both sides
Union Organizing: The Process
1. Initial Organizing: union organizing begins, union solicits employee signatures on authorization cards 2. petition: if >= 30% of employees sign cards, union can petition NLRB for election; if>= 50% sign, management can voluntarily recognize union (most managers say no) 3. Election: NLRB determines appropriate bargaining unit, sets date for secret ballot election; management and union campaigns 4. Bargaining: If union wins election, NLRB certifies the union as the bargaining agent; union and management are obligated to begin negotiating the first contract; bargaining can be centralized or decentralized (must bargain in good faith)
NLRB Determination of a Bargaining Unit
1. NLRB determines if it has jurisdiction 2. NLRB determines if there is sufficient interest among worker (30%+) 3. NLRB determines the appropriate election unit -employees must have a community of interest -who should be excluded (managers and supervisors; can be contested) -labor and management have strong interests in how the unit is structured-->can affect election outcomes!
Management Structures for Collective Bargaining
1. Size of Labor relations staff: larger staffs where labor relations impose high costs 2. Centralization of decision making: corporate executives create labor relations policy and make decisions in negotiations (management can shape negotiation outcomes) 3. specialization of labor relations function: technical expertise still needed but changing; often works with HR at first
Explanations for US union decline
1. changing economic and demographic structure: more jobs in South and SW, expansion of service and white collar jobs, young and female workers, explains 40% of decline but where is the rest? 2. Union suppression by employers: more sophisticated campaigns, legal & illegal activities 3. Union substitution by employers: sophisticated personnel strategies (HRM); long term strategy 4. Union substitution by the government: substantive regulations (ie employment standards); but does this really reduce the need for unions? 5. American ideology and values: US workers are individualistic and not class oriented 6. Internal union factors: public image and bad publicity, not enough resources dedicated to organizing new workers, limitations to traditional models of representing workers; membership turnover is a big issue
The Negotiations Cycle: Interest Based
1. early stages -research and prep -parties present or jointly determine a list of problems that need to be addressed 2. Middle Stages -open and honest discussion -data sharing and analysis -brainstorming to generate options 3. Final Stages -evaluate options -make decisions that maximize joint interests -even here, some issues will involve distributive tactics but the goal is overall mutual gains
Non Union IR Patterns
1. paternalistic: small biz, family owned; informal, high managerial discretion 2. bureaucratic: formal and standarized with written policies, detailed job classifications (businesses move towards this as they get larger) 3. HRM: flexible, progressive policies like incentive pay, teams, and communication procedures; can include employee and peer review committees as long as they're not acting as unions
3 Tiers of IR activity
1. strategic level: union and management strategies and structures 2. functional level: bargaining structure and bargaining process 3. workplace level: work organization, employee motivation and participation, conflict resolution
Union Avoidance
1. union suppression: actively resisting unions through unfair labor practices, nonunion campaigns (Target Video); repercussions are compensatory, not punitive (usually still cheaper than getting a union) 2. Union substitution: removed the incentives for unionization, typically through sophisticated HR practices (if i treat my employees well, they don't need to unionize) 3. Double breasting: has both unionized and non unionized operating sites; depends on how strong or centralized the union is; increases company's bargaining power -union avoidance depends on management philosophy and attitudes towards unions
Collective Bargaining: Contract Terms
1.Mandatory subjects: refusing to bargain over these items violates NLRA 2. Permissive Subjects: refusing to bargain over these subjects does not violate NLRA (cannot strike over these items) 3. Illegal Subjects: bargaining over these subjects in unlawful
Historical Evolution of MANAGEMENT
1800s-early 1900s: mass production, drive system 1900-1920: scientific management 1920s+: welfare capitalism, growth of personnel departments and progressive personnel policies -open shop movement
Why would workers want a union?
Dissatisfaction with: -current or recent changes to wages or working conditions -how decisions are made in the workplace
Developing Bargaining Targets
Factors to consider: -economic and labor market conditions: prevailing wages and COLA (local labor market) -product market competition: goal is to take wages out of competition -the firm's ability to pay: profits -internal comparisons: equity with other employers
lockout
management doesn't let the union work