copyright © 2003 by south-western. all rights reserved. text by profs. gene boone & david kurtz...

Copyright © 2003 by South-Western. All Rights Reserved.

Text by Profs. Gene Boone & David KurtzText by Profs. Gene Boone & David KurtzMultimedia Presentation byMultimedia Presentation byProf. Milton PressleyProf. Milton PressleyThe University of New OrleansThe University of New Orleans

[email protected]@uno.edu

CHAPTER ELEVENCHAPTER ELEVEN

LABOR-MANAGEMENT RELATIONSLABOR-MANAGEMENT RELATIONS


• Summarize the history of labor unions and Summarize the history of labor unions and list their primary goalslist their primary goals

• Describe the structure of organized laborDescribe the structure of organized labor• Identify the major federal laws that affect Identify the major federal laws that affect

labor unions and explain the key provisions labor unions and explain the key provisions of each lawof each law

• Explain the process of forming unions, the Explain the process of forming unions, the way they achieve goals through collective way they achieve goals through collective bargaining, and the issues typically bargaining, and the issues typically addressed in union contractsaddressed in union contracts

• Describe the roles played by mediators and Describe the roles played by mediators and arbitrators in labor negotiationsarbitrators in labor negotiations

LEARNING GOALSLEARNING GOALSLEARNING GOALSLEARNING GOALS


• Identify the steps in the union grievance Identify the steps in the union grievance process process

• Outline the tactics of labor and Outline the tactics of labor and management in conflicts between themmanagement in conflicts between them

• Describe how unions and employers are Describe how unions and employers are developing partner relationshipsdeveloping partner relationships

• Discuss employee-employer Discuss employee-employer relationships in nonunion firmsrelationships in nonunion firms

• Explain the challenges facing labor and Explain the challenges facing labor and the strategies currently being used to the strategies currently being used to rebuild union membershiprebuild union membership

LEARNING GOALSLEARNING GOALSLEARNING GOALSLEARNING GOALS


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CHAPTER OVERVIEWCHAPTER OVERVIEWCHAPTER OVERVIEWCHAPTER OVERVIEW• Explore reasons for the Explore reasons for the

emergence of labor unionsemergence of labor unions• Look at the history of labor Look at the history of labor

union operations in U.S.union operations in U.S.• Review legislation that affects Review legislation that affects

labor-management relationslabor-management relations• Discuss the process of Discuss the process of

collective bargainingcollective bargaining• Look at the future of labor-Look at the future of labor-

management relationsmanagement relations


EMERGENCE OF LABOR UNIONSEMERGENCE OF LABOR UNIONSEMERGENCE OF LABOR UNIONSEMERGENCE OF LABOR UNIONS

• Craft worker organizations Craft worker organizations operated in Europe and Asia operated in Europe and Asia for hundreds of yearsfor hundreds of years

• Nongovernment union Nongovernment union membership has declined membership has declined significantly in recent years in significantly in recent years in industrialized nationsindustrialized nations

• Union membership has grown Union membership has grown considerably in some considerably in some developing nationsdeveloping nations

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Need for Labor UnionsNeed for Labor UnionsNeed for Labor UnionsNeed for Labor Unions

• Focus on efficiency created Focus on efficiency created some hardships for workerssome hardships for workers

• Specialization made workers Specialization made workers dependent on factories for dependent on factories for their livelihoodstheir livelihoods

• Working conditions were Working conditions were typically exhausting – even typically exhausting – even dangerous – for low wagesdangerous – for low wages

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Figure 11.1 Union and Nonunion Wages and Benefits Figure 11.1 Union and Nonunion Wages and Benefits


History of U.S. Labor UnionsHistory of U.S. Labor UnionsHistory of U.S. Labor UnionsHistory of U.S. Labor Unions

• Began before the Declaration of Began before the Declaration of IndependenceIndependence

• Early unions were loose-knit, Early unions were loose-knit, local organizationslocal organizations• Served primarily as friendship Served primarily as friendship

groups or benevolent societiesgroups or benevolent societies• Were typically short-livedWere typically short-lived

• Gradually grew strong enough Gradually grew strong enough to get results to their demandsto get results to their demands

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• Labor union:Labor union: group of workers group of workers who have banded together to who have banded together to achieve common goals in the achieve common goals in the important areas of wages, hours, important areas of wages, hours, and working conditionsand working conditions

• American Federation of Labor American Federation of Labor (AFL): (AFL): organization that united organization that united individual craft unions under a individual craft unions under a common affiliation in 1886 common affiliation in 1886 • By 1920, three out of four organized By 1920, three out of four organized

workers were AFL members workers were AFL members

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• Congress of Industrial Congress of Industrial Organizations (CIO):Organizations (CIO): grouping of industrial grouping of industrial unionsunions

• Union membership peaked Union membership peaked during the 1940s and 1950sduring the 1940s and 1950s

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• Union membership as a Union membership as a percentage of the workforce percentage of the workforce steadily declined during the steadily declined during the second half of the last century second half of the last century except among government except among government employeesemployees

• Two of every five government Two of every five government workers belong to unionsworkers belong to unions

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Figure 11.2 The World’s Tallest Roller Coaster: Union-Made at Cedar Point Amusement Park, Sandusky, OHFigure 11.2 The World’s Tallest Roller Coaster: Union-Made at Cedar Point Amusement Park, Sandusky, OH


Figure 11.3 Percentage of U.S. Workers in Unions,

by Industry

Figure 11.3 Percentage of U.S. Workers in Unions,

by Industry


LOCAL, NATIONAL, AND LOCAL, NATIONAL, AND INTERNATIONAL UNIONSINTERNATIONAL UNIONSLOCAL, NATIONAL, AND LOCAL, NATIONAL, AND INTERNATIONAL UNIONSINTERNATIONAL UNIONS

• National union:National union: union union organization made up of organization made up of many local unionsmany local unions

• Local union: Local union: organization organization operating as a branch of a operating as a branch of a national union, representing national union, representing union members in a given union members in a given geographic areageographic area

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LOCAL, NATIONAL, AND LOCAL, NATIONAL, AND INTERNATIONAL UNIONSINTERNATIONAL UNIONSLOCAL, NATIONAL, AND LOCAL, NATIONAL, AND INTERNATIONAL UNIONSINTERNATIONAL UNIONS

• International union:International union: union with union with members outside of the U.S.members outside of the U.S.

• Federation: Federation: grouping of many grouping of many national and international unions to national and international unions to serve mediation and political serve mediation and political functionsfunctions

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Figure 11.4Federal Labor Laws

Figure 11.4Federal Labor Laws

LABOR LEGISLATIONLABOR LEGISLATIONLABOR LEGISLATIONLABOR LEGISLATION


Union Security ProvisionsUnion Security ProvisionsUnion Security ProvisionsUnion Security Provisions

• Closed shop:Closed shop: employment policy, employment policy, illegal in the U.S., requiring a firm to illegal in the U.S., requiring a firm to hire only current union membershire only current union members

• Union shop:Union shop: employment policy employment policy requiring nonunion workers to join a requiring nonunion workers to join a union that represents a firm’s workers union that represents a firm’s workers within a specified period after being within a specified period after being hiredhired

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Union Security ProvisionsUnion Security ProvisionsUnion Security ProvisionsUnion Security Provisions

• Agency shop: Agency shop: employment policy employment policy that allowing workers to reject that allowing workers to reject union membership but requiring union membership but requiring them to pay fees equal to union them to pay fees equal to union duesdues

• Open shop:Open shop: employment policy employment policy making union membership and dues making union membership and dues voluntary for all workersvoluntary for all workers

• Right-to-work laws: Right-to-work laws: prohibit prohibit union shops and outlaw compulsory union shops and outlaw compulsory union membershipunion membership

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Figure 11.5 States with Right-to-Work LawsFigure 11.5 States with Right-to-Work Laws


Unfair Union PracticesUnfair Union PracticesUnfair Union PracticesUnfair Union Practices

• Taft- Hartly Act outlawed unfair Taft- Hartly Act outlawed unfair practices like:practices like:• Refusal to bargain with employerRefusal to bargain with employer• Striking without 60 days noticeStriking without 60 days notice• Most secondary boycottsMost secondary boycotts• Featherbedding (demanding pay for Featherbedding (demanding pay for

workers who do not work)workers who do not work)• Boycott:Boycott: effort to prevent people effort to prevent people

from purchasing a firm’s goods or from purchasing a firm’s goods or servicesservices

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THE COLLECTIVE BARGAINING THE COLLECTIVE BARGAINING PROCESSPROCESSTHE COLLECTIVE BARGAINING THE COLLECTIVE BARGAINING PROCESSPROCESS• Collective bargaining:Collective bargaining:

negotiation between negotiation between management and union management and union representatives concerning representatives concerning wages and working wages and working conditions for an entire conditions for an entire group of workersgroup of workers

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How Employee’s Form a UnionHow Employee’s Form a UnionHow Employee’s Form a UnionHow Employee’s Form a Union

• Must conduct an organizing Must conduct an organizing drive to collect the signatures drive to collect the signatures of at least 30 percent of of at least 30 percent of employees on special employees on special authorization cardsauthorization cards

• Union then petitions the Union then petitions the National Labor Relations National Labor Relations Board (NLRB) for an electionBoard (NLRB) for an election

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Figure 11.6 Steps in Starting a UnionFigure 11.6 Steps in Starting a Union


Bargaining PatternsBargaining PatternsBargaining PatternsBargaining Patterns

• Vary for different industries Vary for different industries and different occupational and different occupational categoriescategories• Most collective bargaining Most collective bargaining

involves involves single-plant, single-single-plant, single-employer agreementsemployer agreements

• AA multiplant, single-employer multiplant, single-employer agreement applies to all plant agreement applies to all plant operated by an employeroperated by an employer

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Bargaining PatternsBargaining PatternsBargaining PatternsBargaining Patterns• Coalition bargainingCoalition bargaining

involves negotiations between involves negotiations between a coalition of several unions a coalition of several unions that represent the employees that represent the employees of one companyof one company

• In In industrywide bargaining, industrywide bargaining, a single, national union a single, national union engages in collective engages in collective bargaining with several bargaining with several employers in a particular employers in a particular industryindustry

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Bargaining ZoneBargaining ZoneBargaining ZoneBargaining Zone

• Issues covered in a bargaining Issues covered in a bargaining agreements include wages, work agreements include wages, work hours, benefits, union activities and hours, benefits, union activities and responsibilities, grievance responsibilities, grievance procedures and arbitration, and procedures and arbitration, and employee rights and seniorityemployee rights and seniority

• Bargaining zone:Bargaining zone: range of range of collective bargaining between collective bargaining between conditions that induce a union to conditions that induce a union to strike and those that induce strike and those that induce management to close the plantmanagement to close the plant

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Union ContractsUnion ContractsUnion ContractsUnion Contracts

• Typically cover a 2 or 3 year Typically cover a 2 or 3 year periodperiod

• Once ratified by the union Once ratified by the union membership, contract membership, contract becomes a legally binding becomes a legally binding agreement that covers all agreement that covers all labor-management relations labor-management relations during the period specifiedduring the period specified

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Figure 11.7Typical Provisions in a Union Contract

Figure 11.7Typical Provisions in a Union Contract


Wage Adjustments in Labor ContractWage Adjustments in Labor ContractWage Adjustments in Labor ContractWage Adjustments in Labor Contract

• Contracts often provide for wage Contracts often provide for wage adjustments during the life of the contractadjustments during the life of the contract

• Cost-of-living-adjustment (COLA) Cost-of-living-adjustment (COLA) clauses (escalator clauses): clauses (escalator clauses): designed to designed to protect the real incomes of workers during protect the real incomes of workers during periods of inflation by increasing wages in periods of inflation by increasing wages in proportion to increases in the CPIproportion to increases in the CPI

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Wage Adjustments in Labor ContractWage Adjustments in Labor ContractWage Adjustments in Labor ContractWage Adjustments in Labor Contract

• Consumer Price Index (CPI): Consumer Price Index (CPI): indicator for the cost of living that tracks indicator for the cost of living that tracks the cost of such expenses as housing, the cost of such expenses as housing, clothing, food, and automobilesclothing, food, and automobiles

• Givebacks: Givebacks: wage and benefit wage and benefit concessions to help employers remain concessions to help employers remain competitive and continue to provide jobs competitive and continue to provide jobs for union membersfor union members

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SETTLING UNION-MANAGEMENT SETTLING UNION-MANAGEMENT DISPUTESDISPUTESSETTLING UNION-MANAGEMENT SETTLING UNION-MANAGEMENT DISPUTESDISPUTES• Mediation:Mediation: process which brings process which brings

in a third party, called a in a third party, called a mediatormediator, , to make recommendations for to make recommendations for settling differencessettling differences

• Arbitration:Arbitration: bringing in an bringing in an impartial third party called an impartial third party called an arbitratorarbitrator to render a binding to render a binding decision in the disputedecision in the dispute

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GRIEVANCE PROCEDURESGRIEVANCE PROCEDURESGRIEVANCE PROCEDURESGRIEVANCE PROCEDURES

• Grievance:Grievance: employee or union employee or union complaint that management is complaint that management is violating some provision of the violating some provision of the union contractunion contract


Figure 11.8Steps in the Grievance Procedure

Figure 11.8Steps in the Grievance Procedure


COMPETITIVE TACTICS OF COMPETITIVE TACTICS OF UNIONS AND MANAGEMENTUNIONS AND MANAGEMENTCOMPETITIVE TACTICS OF COMPETITIVE TACTICS OF UNIONS AND MANAGEMENTUNIONS AND MANAGEMENT

• Strike (walkout): Strike (walkout): temporary work stoppage temporary work stoppage by employees until a by employees until a dispute is been settled or a dispute is been settled or a contract signedcontract signed

• Picketing: Picketing: workers workers marching at a plant marching at a plant entrance to protest some entrance to protest some management practicemanagement practice

Union Tactics



• Lockout: Lockout: in fact, a in fact, a management strike to management strike to bring pressure on union bring pressure on union members by closing the members by closing the firmfirm

• Strikebreakers: Strikebreakers: nonunion workers who nonunion workers who cross picket lines to fill cross picket lines to fill the jobs of striking the jobs of striking workersworkers

Union Union TacticsTactics

Management Tactics



• Injunction: Injunction: court order court order prohibiting some practice prohibiting some practice – to prevent excessive – to prevent excessive picketing or certain unfair picketing or certain unfair union practicesunion practices

• Employers’ associations: Employers’ associations: employers group that employers group that cooperates and presents a cooperates and presents a united front in dealing united front in dealing with labor unionswith labor unions

Union Union TacticsTactics

Management Tactics


THE TREND TOWARD UNION-MANAGEMENT THE TREND TOWARD UNION-MANAGEMENT CO-OPERATIONCO-OPERATIONTHE TREND TOWARD UNION-MANAGEMENT THE TREND TOWARD UNION-MANAGEMENT CO-OPERATIONCO-OPERATION

• Hostile and antagonistic attitudes Hostile and antagonistic attitudes that have sometimes that have sometimes characterized labor-management characterized labor-management relationships are changingrelationships are changing

• Companies should treat Companies should treat employees as valuable human employees as valuable human resources and adopt policies resources and adopt policies designed to empower themdesigned to empower them

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Figure 11.9 GMC: Employees as Valued ResourcesFigure 11.9 GMC: Employees as Valued Resources


EMPLOYEE-MANAGEMENT RELATIONS EMPLOYEE-MANAGEMENT RELATIONS IN NONUNION ORGANIZATIONSIN NONUNION ORGANIZATIONSEMPLOYEE-MANAGEMENT RELATIONS EMPLOYEE-MANAGEMENT RELATIONS IN NONUNION ORGANIZATIONSIN NONUNION ORGANIZATIONS

• Nonunion companies often Nonunion companies often offer compensation and offer compensation and benefits comparable to those benefits comparable to those of unionized firms to avert of unionized firms to avert unionizationunionization• Satisfied workers may thus Satisfied workers may thus

conclude that a union is conclude that a union is unnecessaryunnecessary

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Grievance Programs for Grievance Programs for Non-union EmployeesNon-union EmployeesGrievance Programs for Grievance Programs for Non-union EmployeesNon-union Employees

• Can file: Can file: • Lawsuits against their firmsLawsuits against their firms• Charges with the U.S. Equal Charges with the U.S. Equal

Opportunity CommissionOpportunity Commission• Charges with a state human Charges with a state human

rights commissionrights commission

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Grievance Programs for Grievance Programs for Non-union EmployeesNon-union EmployeesGrievance Programs for Grievance Programs for Non-union EmployeesNon-union Employees

• Alternative dispute resolution Alternative dispute resolution programs: programs: vary, but usually vary, but usually include open-door policies, include open-door policies, employee hotlines, peer review employee hotlines, peer review councils, mediation, and arbitrationcouncils, mediation, and arbitration

• Peer-review boards:Peer-review boards: typically typically consists of three employee peers and consists of three employee peers and several management representativesseveral management representatives

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Figure 11.10Grievance Programs for Nonunion Workers

Figure 11.10Grievance Programs for Nonunion Workers


Job Security in Nonunion Job Security in Nonunion CompaniesCompaniesJob Security in Nonunion Job Security in Nonunion CompaniesCompanies• Primary motivation for Primary motivation for

workers to form labor workers to form labor unionsunions

• To reduce staffing levels, To reduce staffing levels, firms may try to provide firms may try to provide alternatives to layoffsalternatives to layoffs• Some companies offer Some companies offer

incentives for early incentives for early retirement and resignationretirement and resignation


• Unions are representing a Unions are representing a declining share of the workforcedeclining share of the workforce

• Reasons include:Reasons include:• Downsizing by large, unionized Downsizing by large, unionized

firms to improve global firms to improve global competitivenesscompetitiveness

• Shift in favor of free-market Shift in favor of free-market ideologiesideologies

• Growth of the information Growth of the information economyeconomy

CHALLENGES FACING CHALLENGES FACING ORGANIZED LABORORGANIZED LABORCHALLENGES FACING CHALLENGES FACING ORGANIZED LABORORGANIZED LABOR


INITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONS

• Share of people who have Share of people who have positive attitudes towards positive attitudes towards unions is growingunions is growing

• Global economy provides Global economy provides opportunitiesopportunities

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Figure 11.11 Selmer Woodwinds/Bach Instrument Assemblers: UAW Members in Unlikely PlacesFigure 11.11 Selmer Woodwinds/Bach Instrument Assemblers: UAW Members in Unlikely Places


INITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONSINITIATIVES TO REBUILD UNIONS

• AFL-CIO’s membership drivesAFL-CIO’s membership drives• Unions focusing narrow Unions focusing narrow

organizing efforts on unskilled, organizing efforts on unskilled, low-wage service workerslow-wage service workers

• Corporate campaignsCorporate campaigns pressure pressure employers to accept unionsemployers to accept unions

• U.S. unions developing a role in U.S. unions developing a role in the world economythe world economy

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WHAT’S AHEADWHAT’S AHEADWHAT’S AHEADWHAT’S AHEAD

• Next chapter covers the ways in Next chapter covers the ways in which businesses produce world-which businesses produce world-class goods and servicesclass goods and services

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copyright © 2003 by south-western. all rights reserved. text by profs. gene boone & david kurtz...

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