Chapter 15: Working with Organized Labor Labor Relations Specialist ? is knowledgeable about labor relations and can represent management?s interests to a union - often a member of the HR department - they negotiate labor contracts, resolve grievances, & advise top management on labor strategies Managers - bear the major responsibility for day-to-day labor?management relations Wagner Act ? aka the National Labor Relations Act - passed during the Great Depression in 1935 - designed to protect employees? rights to form and join unions and to engage in activities such as strikes, picketing, and collective bargaining - created the NLRB, an independent federal agency charged with labor relations oversight Identified following five practices as illegal: 1. Interfering with, restraining, or coercing employees to keep them from exercising their rights to form unions, bargain collectively, or engage in concerted activities for mutual protection. 2. Dominating or interfering with the formation or administration of a union or providing financial support for it. 3. Discriminating against an employee to discourage union membership. Discrimination can include not hiring a union supporter, or not promoting, firing, or denying a pay raise to an employee who is a union member or who favors union representation. 4. Discharging or otherwise discriminating against an employee who has filed charges or given testimony under the act?s provisions. 5. Refusing to bargain collectively with the union that employees chose to represent them. Taft-Hartley Act (1947): - designed to limit some of the power that unions acquired under the Wagner Act & to protect management?s rights - basically favorable to management?s interests, its goals were to adjust the regulation of labor?management relations to ensure a level playing field - prohibits the following six practices: 1. Restraining or coercing employees in the exercise of their rights guaranteed under the act, and/or coercing an employer?s choice of a representative in collective bargaining. 2. Causing or attempting to cause an employer to discriminate against an employee who is not a member of a labor union for any reason other than failure to pay the union dues and initiation fees uniformly required as a condition of acquiring or retaining membership in the union. 3. Refusing to bargain in good faith with an employer after a majority of the employees in a unit have elected the union as their representative. 4. Asking or requiring its members to boycott products made by a firm engaged in a labor dispute with another union (secondary boycott). However, a union can call a boycott of products produced by its own firm (primary boycott). 5. Charging employees excessive or discriminatory union dues as a condition of membership in a union under a union shop clause. (A union shop clause requires employees to join the union 30 to 60 days after their date of hire.) Allows states to enact right to work laws. 6. Causing an employer to pay for services that are not performed. This practice, often called featherbedding, is technically illegal, but the definition of unnecessary or unperformed work is often murky. Landrum-Griffin Act (1959): - enacted to protect union members and their participation in union affairs - allows the government, through the Department of Labor, to regulate union activities. - includes the following key provisions: 1. Each union must have a bill of rights for union members to ensure minimum standards of internal union democracy. 2. Each union must adopt a constitution and provide copies of it to the Department of Labor. 3. Each union must report its financial activities and the financial interests of its leaders to the Department of Labor. 4. Union elections are regulated by the government, and union members have the right to participate in secret ballot elections. 5. Union leaders have a fiduciary responsibility to use union money and property for the benefit of the membership and not for their own personal gain. Members can sue and recover damages from union leaders who fail to exercise their fiduciary responsibilities. Business unionism - unionism that focuses on ?bread-and-butter? issues (e.g. wages, benefits, and job security) - US unions traditionally avoided trying to influence the running of the company & provide little input on strategic decisions Unions Structured by Job ? one union can be found in many different companies - AFL-CIO & Change to Win are confederations of many different unions - together they have about 16 million members Focus on Collective Bargaining - system which unions & mgmt negotiate with each other to develop the work rules under which union members will work for a stipulated period of time - work rules include any terms or conditions of employment, including pay, work breaks and lunch periods, vacation, work assignments, and grievance procedures Labor Contract ? the product of collective bargaining - an agreement that spells out the conditions of employment and work rules that affect employees in the unit represented by the union Growth of Unions in the Public Sector ? percent of unionized workers in the public sector has increased substantially - incr due to expansion of local government in the 1980s and to organizing efforts targeting both public-sector and service-sector employees - public-sector workers tend to have less bargaining power b/c govt power is diffuse & b/c many contracts prohibit strikes - but as voters, unions have some political power over their employer, especially in low turnout elections - Adversarial Nature of Labor-Mgmt Relations & Shrinking Membership: - U.S. labor laws based on view that labor and management are natural adversaries - Union membership shrinking: about 12 percent of the U.S. labor force is unionized, down from a peak of about 35 percent in 1945 - but unions continue to be an important part of the U.S. labor relations system because they establish wage and benefit patterns that influence nonunion employers Works councils ? in Germany - committees composed of worker representatives & managers who have responsibility for governing the workplace - participate in operational decisions (e.g. the allocation of overtime, discipline and discharge of workers, hiring of new workers & training) Codetermination ? in Germany - representation of workers on a corporation?s board of directors - with one-third to one-half of their boards of directors representing workers, German companies are likely to give employees? needs a high priority. - fostered a spirit of cooperation between workers and managers - results have been fewer strikes and higher productivity - for workers, the results have been both greater responsibility and greater security Enterprise union ? in Japan - labor union that represents workers in only one large company rather than in a particular industry - the practice ensures that the union?s loyalty will not be divided among different companies - enterprise union negotiates with management with an eye on the company?s long-term prosperity - this labor relations system was long reinforced by large Japanese corporations? offer of lifelong employment - but were limits to lifelong employment promise The most important choice affecting a company?s labor relations strategy is management?s decision to accept or to avoid unions Union Acceptance Strategy - management chooses to view the union as its employees? legitimate representative - accepts collective bargaining as an appropriate mechanism for establishing workplace rules - likely to be in state of working harmony or labor-mgmt cooperation Union Avoidance Strategy - labor relations strategy in which management tries to prevent its employees from joining a union - likely to be in armed truce or open conflict - are two types of union avoidance: substitution & suppression Union Substitution ? aka Proactive HR - mgmt is so responsive to the employees, there is no need for unionization Union Suppression ? mgmt uses hardball tactics to prevent union formation Three steps in Labor Relations Process: - Union Organizing - Collective Bargaining - Contract Administration Union Organizing ? employees must show interest in union - a minimum of 30 percent of the employees must sign an authorization card indicating that they union representation - mgmt must avoid treating employees in way that could be interpreted trying to influence the outcome of the election - elections supervised by NLRB - majority vote needed to create bargaining unit - if don?t get majority, must wait 12 months till next election Employee Free Choice Act (EFCA) ? under consideration by US Congress - allow workers to form unions without a secret-ballot election - allow union organizers to form a union simply by having a majority of employees sign an authorization card Good Faith - parties show good faith in collective bargaining when: - both parties are willing to meet and confer with each other at a reasonable time and place - both parties are willing to negotiate over wages, hours, and conditions of employment (the mandatory bargaining topics) - the parties sign a written contract that formalizes their agreement and binds them to it - each party gives the other a 60-day notice of termination or modification of the labor agreement before it expires Bargaining power - one party?s ability to get the other party to agree to its terms Distributive bargaining - focuses on convincing your counterpart in negotiations that the cost of disagreeing with your terms would be very high Integrative bargaining - focuses on convincing your counterpart in negotiations that the benefits of agreeing with your terms would be very high Mediator - a neutral third party that attempts to help the parties in a dispute come to a voluntary agreement - do not have the power to impose their ideas for a settlement on the other parties - are trained in conflict resolution techniques and are sometimes able to improve communication so that the impasse is resolved - The Federal Mediation and Conciliation Service (FMCS), established by the Taft-Hartley Act, monitors labor disputes and sometimes mediates disputes - FMCS maintains a list of impartial mediators and arbitrators who are qualified to assist with contract disputes Economic strike - a strike that takes place when an agreement is not reached during collective bargaining Wildcat strike - a spontaneous work stoppage that happens under a valid contract - it is usually not supported by union leadership Lockout ? occurs when the employer shuts down its operations before or during a labor dispute Arbitration - a quasi-judicial process that is binding on both parties - the arbitrator is neutral & selected from outside the firm - is compensated by both the union and management (who split the fee) Most areas of HRM are impacted by the presence of unions: - Staffing ? seniority-based, not merit-based - Employee Development ? limited use of performance appraisals, mostly developmental - unions more interested in training and development - Compensation ? higher & with better benefits than non-union shops ? unions prefer across the board increases (e.g. COLAs), not merit - Employee Relations ? union empowers the workers - generally have more rights than the employee handbook provides non-union workers
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