Collective Bargaining Midterm

Dynamic nature of organizing

- campaigns are dynamic and emotional 1. role of the group -- momentum matters 2. role of the leaders -- e.g., skilled workers 3. unions often must help the lowest paid through standardization of wages and rules 4. in many campaigns a recent action by management becomes the rallying cry for union -- the union tries to paint this at as a sign of management's betrayal of the work force, e.g. the harsh disciplining of a well-liked or well-known employee

neutrality towards worker unionization effort

- company doesn't want to spend money - they think they'll lose anyway, not worth resources and time - sometimes provided in exchange for union concessions in other bargaining units

total power

- concerns the total profits that are available to labor and management - both labor and management prefer situations with greater total power

Productivity and Efficiency (union vs. non-union)

- conventional wisdom was the unions limit output by reducing work effort, and limiting managerial discretion... recent evidence suggests this may not be true - Freeman and Medoff find a positive union effect, low quit rates limit turnover which is expensive - workers potentially more satisfied and invested in their jobs - it's ultimately unclear unions are more productive

Integrative negotiation tactics

- focus on specific problems - share information - multiple voices and problem solving - high trust

strike leverage

- in negotiations the parties will not settle for something far from the potential strike outcome - each side loses income in a strike, bargaining power is determined by each side's ability and willingness to suffer income loss

Unions have faced decline in the U.S from the 1970s on as a result of:

- large number of plants closing - employment declines in existing bargaining units, particularly in manufacturing such as steel, textile, etc.

aggressive opposition towards worker unionization efforts

- often involves illegal action - company image in the eyes of the community and customers can be effected

Distributive negotiation tactics

- overstate demands - information is power to be closely held - low trust - arm's length communication = single voice

authorization cards

1. 30% needed for NLRB election 2. If union gets 50% cards signed, management can voluntarily recognize the union (called card check), and no election is needed - authorization cards are a US practice only - do people sign authorization cards freely or are they coerced?

Union Organizing Campaign

1. Traditional top down approach-leaflets etc., external actors arriving on the workplace and handing out pamphlets 2. Rank and file -- reliance on the greater "internal organizing," internal action, more organic, links to community groups * rank and file tends to be more successful 3. Union corporate/strategic campaigns -- seek various sources of leverage/pressure (public, govt. regulators, bank/board embarrassment) - cost/benefit, chances of success

Elasticity of demand for labor

1. Wage increases affect employment -- the greater is the reduction in employment that results from a wage increase, the less workers may be willing to use bargaining power available via their strike threat 2. Strike leverage gives workers the ability to raise wages; elasticity of demand influence whether workers choose to use their wage raising capabilities - Marshall's four conditions - plant closing threat

costs to management in opposition campaign

1. attorneys and consultants dealing with campaign 2. potentially frustrating employees 3. opportunity cost - exerting resources to fight union rather than doing something else 4. starting the company/union relationship off poorly

Factors that influence labor's ability and willingness to absorb income losses during strike

1. availability of other jobs -- when unemployment is low, strikers can more easily find replacement work therefore having greater strike leverage, more successful in wage demands 2. Union strike fund 3. savings -- any alternative source of income to the striking employees 4. solidarity == the strike is a communal cause 5. anger at managment

low wage service jobs -- low unionization

1. high turnover amongst employees 2. low waged employees are turned off by idea of union dues 3. little bargaining power... employees are easily replaceable

Strike related facts to be explained

1. strikes only occur in small percentage of negotiations, (5% of the time strikes occur) 2. pro-cyclical nature of strikes... strikes occur more frequently in good economic times 3. strikes sometimes occur over apparently trivial issues

Factors that influence management's ability and willingness to absorb losses during strike

1. sustainability of production -- how essential are the striking employees? 2. Effects of a strike on sales 3. Consequences of strike on profits

total power influenced by two factors:

1. the degree of competition facing the employer (microeconomic factors) 2. the state of the economy (macroeconomic factors) - unions try to influence government regulation to limit competition and shift the macro environment to stimulate demand

NLRB oversight

Election unit determination by NLRB in US 1. commonality of interests 2. history of association 3. preferences of parties -- e.g., craft severance issue Bargaining unit determined by NLRB - considers common interests - craft v industrial source of controversy - NLRB goal of "laboratory conditions," unions right to circulate literature in non-work areas on non-work time

Marshall's Four Basic Conditions

Marshall argued that unions are most powerful when demand for labor is inelastic (i.e., when large wage increases do not cause layoffs) Such conditions are: - When labor cannot be easily replaced in the production process by other workers or machines - When demand for the final product is price inelastic - When the supply of non-labor factors of production is price inelastic - When the ratio of labor cost to total cost is small

The Wage-Employment Trade-Off

Strike leverage determines whether workers are able to press for higher wages - Higher wages often bring cuts in employment - In some cases, unions opt not to raise wages as much as they could - Thus, the "wage-employment trade-off"

Management Campaigns

a spectrum of alternative approaches from aggressive opposition, to moderate opposition, to neutrality, to card check acceptance - strategy is guided by cost/benefit and by management's ideology

bargaining power

consists of total power and relative power

Intra-organizational bargaining

differences within each side: workers have different attitudes 1. differences between union leaders' and workers' interests - leaders want large organizations and may have more information while workers can be self-interested and more militant 2. differences across workers - old v. young, craft v. production, preference and ideology variation, skilled v unskilled 3. differences across and within management - individuals disagreeing over what is possible and feasible - CEO v. LR Staff - corporate v. plant manager, where corporate focused on maintaining corporate uniformity while local management focused on innovation or pursing local options

National Labor Relations Act 1935

established protected right to organize, collectively bargain and other concerted activity - union membership tripled in 1937-1947

relative bargaining power

influenced by two major factors: 1. strike leverage 2. the elasticity of demand for labor -- the wage-employment trade-off - both sides don't have relative power, one side holds the relative power in a negotiation (common misconception)

captive audience speeches

management can give captive audience speeches to their employees while the union cannot *management can't coerce employees to not join the union but they can say factual data that discourages unions - what each side says and does during the campaign is the source of my Unfair Labor Practice allegations/charges

Intermediate case Union

multiplant but single company

Centralized Union

multiplant, multicompany, multi-industry - union often benefits from centralization -- vehicle to impose standardization and avoid lowest common denominator, "raise the floor," but union doesn't always benefit from centralization (UAW whipsaw US/Canada ) - management does not want centralization because of ego and for opportunity to capitalize on competitors strikes, but there are exceptions (cartelization) - difficult for companies to bargain in an association: diversity of interests, strong egos, gains from coordination or standardization

grievance procedures

part of bargaining agreement to settle internal disputes over the implementation of the bargaining agreement - 90% of contracts have grievance procedures *union owns the grievance, not the individual... union decides if it wants to bring the case, can drop the case, can bunch similar cases together - unions use the grievance procedure strategically - grievance procedures have not been copied by other countries

Integrative bargaining

problem solving, joint gain, e.g., technological change - taking steps to "expand the pie," such steps may include training/development, health/safety * key issues in integrative bargaining is deciding where company can actually "expand the pie," and for every expansion in pie there is a new distributive question - tactical conflicts and problem identification and solution difficulties exist too

Decentralized Union

single plant (employer interests covered)

Craft Union

single trade (employee interests covered)

cartelization strategy

some big companies want centralization so the can take advantage of the weaknesses of smaller companies in the industry, hence resulting in lower wages

Hicks model

strike occur most frequently because of miscalculation - when there is no "contract zone," Hick's assumes either management or the union (or both) are way off about their expected outcomes... leads to strikes - Hick's model doesn't explain pro-cyclical nature of strikes, he contrarily thinks strikes should occur less in good times - miscalculations can be caused by new relationships, changing economic conditions, poor negotiator skills, confusion caused by bluffs, etc. - see Hicks model diagram

Militance Theory

strikes are a reflection of bargaining power (specifically good at explaining pro-cyclical nature of stirkes) - militance leads to labor power and strikes - management likes the status quo; it takes labor's initiative to change employment conditions

"Behavioral" theories of strike causes

strikes as an expression of anger and isolation - geographic and social isolation leads to strikes - mining, longshoring, and lumbering have high strike rates across times and countries. - a conflict of isolation, not integration - another behavioral theory of strikes has to do with strikes as learning devices --teaching workers or top executives what is possible - theory doesn't agree with pro-cyclical nature of strikes

court deferral to arbitration

the court is reluctant to overrule arbitration except if the issue is non-arbitrable or the arbitrator is blatantly capricious and arbitrary

Layoff rates (union vs. non-union)

the evidence is that the layoff rate is higher in the union sector - wage rigidity may lead to employment volatility -- employers can't lower wages during downturns - maybe unions don't cause layoffs but rather respond to it... union representation is greater as a result of layoffs - unionized industries are sensitive to the business cycle

Quit rates (union vs. non-union)

the quit rate is lower in unionized jobs - Freeman and Medoff: workers have more voice within a union, exit v. loyalty, the voice effects of unionism - union selling seniority rights to workers

arbitration

third party that has the authority and power to make binding decisions general grievance hierarchy steps: 1. supervisor 2. labor representative at plant level 3. division/corporation 4. arbitration

Attitudinal structuring

trust building, degree of trust between both sides - parties worried if change will come back to haunt them, worried if the other side is well-intentioned - trust can facilitate interactive bargaining - different personalities for distributive vs. integrative tactics

just cause

typically a "just cause" clause is in the CB agreement - "just cause" provides protection to worker against unfair termination and other inappropriate workplace discipline * the burden of proof in discipline cases is on management - employer must prove just cause to an arbitrator in order to terminate or discipline employee burden of proof - the duty of a party in a trial to produce the evidence that will shift the conclusion away from the default position to that party's own position.

acceptance of union

typically part of a "participatory bargain" that leads to a favorable first contract

"Rank and File" organizing approach

use of community groups, and face-to-face contact, and focus on gender equity, and other rights issues. - most successful union organization approach

Absolute Wage Effect

wage of union worker compared to wage if no union existed in the economy - this is not absolute because unions do exist in our economy, we cannot measure absolute wage effect - can maybe be measured by comparing place with strong and weak unions, across countries

Relative Wage Effect

wage of union worker compared to wage of non-union worker - we can actually measure this

representation election

way in which a new bargaining unit is created

Pattern Bargaining

when workers across a sector attempt to bargain uniform standards - union side favors pattern bargaining, wants to "raise the floor" - workers' wants are relativistic - pattern bargaining levels playing field - leaders use patterns to legitimate their bargains

Distributive bargaining

win-lose, zero-sum, e.g., wage or fringe benefits - one side's gain is the other side's loss - both sides don't have relative power, only one side does - you want one speaker in which all negotiations runs through

Industrial Union

workers of all skill grades in a unit (employee interests covered)