Comparative Industrial Relations

LESSON 1

LESSON 2

LESSON 3

LESSON 4

LESSON 5

LESSON 6

LESSON 7

LESSON 8
 LESSON 9

Definitions & Overview of Unions

Unions:

 Unions are defined as the association of workers formed to enhance their power in dealing
with employers
 The core functions of unions are:
 Collective bargaining
 Grievance-handling
 Other functions include:
 Political action
 Pressure group for social change
 Business/investment ventures
 Educational ventures

Union Density or Union Membership Rate

 The percentage of organizable workers belonging to unions

Union Coverage

 The percentage of employees covered by a collective agreement, including those who do

not become union members
 As of the end of 2017, union coverage in Canada was 30.4% or 4.8 million workers
 There are many variations in the structure of unions based on:
 The origins of their constitutions
 Their process of amalgamations
 The structure of the industry in which they bargain
 The organization of workers into union often follow the:
 Geographical distribution of labour force
 The type of work

Unions Objectives

 Improvement in wages, benefits and other terms of work

 Improvements in non-economic issues
 Health and safety, work hours, and job security
 Protection against arbitrary management actions
 Provision & management of conflict resolution processes
 A pressure group to control/eliminate inhuman labour practices
 Contribution to national dialogues and the introduction/refinement of public policies

Organization of Unions

 Many unions have local branches and are further organized into districts or regions
  Members of the union elect the Executive Committee or Council
 The Executive Committee or Council is responsible for administering the union’s activities
and policies
 Unions have General Secretaries, who are full-time officers and who are responsible to the
Executive Committee
 In addition to General Secretaries, the larger unions also have Presidents
 The (slide 7)

Advantages & Disadvantages of Unions

Advantages Disadvantages

Promotion of higher wages Discounting of workers education and experience

Bargaining outcomes of higher benefits On-going & mandatory membership dues

Established workplace grievance process Participation in activities not in members’ interest

Reduced level of employee exit and turnover “Group Think” limits & discourages individual
creativity

Improved workplace governance “Bumping” of senior workers during layoffs

Access to funded retirement benefits Possibility of blame & political animosity

Workers’ protection – “Just Cause” vs. “At Will” Creation of a hierarchal environment

Unions Actions

 Collective bargaining
 Integrative rather than adversarial
 Changing nature & issues of bargaining

Methods Used by Unions to Achieve their Goals

 Unions utilized a mix of strategies that include:

o Collective bargaining
o Restrictive licensing and credentialing policies for trades and professions
o Opposition to free trade agreements
o Opposition to liberalized immigration policies
o Support for higher minimum wages and equal pay legislation
o Support for changes to labour aimed at improving the bargaining environment
 LESSON 10

Union Impact on Compensation, Productivity, and Management of the Organization

The Union Power

 The powers of unions are enhanced (or reduced) by:

- The elasticity of demand for labour
- The availability of substitute products
- Labour costs

Internal Union Power

 The solidarity of the union executives and member

 Available expertise & experience to manage the union
 The financial health of the union

Debilitating Factors to Internal Power

 Political rivalry
 Members discontentment
 Poor leadership

External Factors Affecting Union Power

 The external environment has a moderating effect on unions

o The availability of substitute products
o Substitutability of inputs (capital and non-union workers)
o The labour cost as a percentage of total expenses

The Case for (and Against) Substitute Products

 Increased wage demand passed on to customers (or not)

 Increased prices of goods and services (if passed on)
 Cutbacks in labour a profitability (if not passed on)

Substitute Inputs

 Fully unionized industry increased union power

 Power accrues to unions when union labour is not easily substituted by technology – the
power of the union maintains strength
 Partially explain why unions sometimes resist the introduction of new technology in the
workplace
 Restrictive work practices that ensure union labour is more difficult to replace with lower-
paid workers
 Restrictive certification and licensing standards to prevent easy substitution of labour
 Controlling the hiring process through union security clauses
Labour Costs

 Unions have more power in industries:

o Where cost of labour is low compared to total expenses
o In capital intensive industries
o In monopoly industries – because they know they are the only one people have as
a choice

Public-Sector Labour Market

 Unions are powerful in the public sector

 Increased labour costs are passed on to taxpayers
 Unlike in the private sector, able to withstand longer strikes with continued income stream
– you’re not able to get long strike period

LESSON 11

Definitions & Overviews

 Employment legislation is a legal requirement that emphasizes:

1. The minimum standards of employment in a workplace.
2. Legal rights and responsibilities of both employers and employees.
 Employment legislation/standards cover:

Minimum wage Employment of people under 18

Minimum daily pay Resolving disputes
Meal breaks Termination
Hours of work Maternity/Paternity leave
Overtime Statutory deductions
Statutory holidays Record keeping
Annual vacation Sexual harassment & discrimination
Vacation pay Etc.

Types of employee

I. Independent contractor
 Not classified to have an employer-employee relationship with the company
 Not subjected to any type of employment contract
 Contractors perform services for a company and provide all their own tools and
supplies
 Responsible for withholding or paying any takes by self
 Example include a telecommunication engineer
II. Employee
 A common-law employee is one over which an employer has control
  Employers withhold all statutory deductions
 Employers pay Medicare, Social Security and unemployment taxes
III. Statutory Employee
 Workers treated as employees by statute but are independent contractors
 Apply only if the individual meets certain criteria including:
Performs services on a continuous basis for the employer
In possession of a service contract
No substantial personal investment in the equipment used to perform
services
 Example is an insurance agent
IV. Statutory Non-Employee
 A class of employees treated as self-employed for tax purposes
 Perform services under a written contract that states that they will not be treated
as employees
 Compensation based on ration of total sales or output versus number or hours
worked
 Examples are Licensed Real Estate Agents

3 Basic Employee Rights in the Workplace

The right to know

 Workers must be aware of the hazards presented by people, equipment, materials, the
environment, and processes.
 Workers have the right to be trained & have access to information on hazards

Be able to collaborate and join a group

 The right to participate in work process and to organize

 Workers have the right to be a part of the process of identifying, assessing and controlling
workplace health and safety hazards

Refuse to work on a unsafe work environment

 The right to refuse unsafe work

 Protection from reprisal, or retaliation, from the employer

Human Rights in the Workplace

 The basic rights and freedoms of every person protected by the law
 Based on principles of:
 Dignity
 Fairness
 Respect
 Equality

The Individual Employment Contract

  A document contracted between employer and employee setting and describing their legal
relationship
I. Legally binding for both parties
II. Reduces the risk of misunderstandings & reminds parties about their rights and
obligations

The Common Law Contract of Employment

 A common law employment contract exists whenever an employee is hired (verbal or

written)
I. Usually only applies to traditional employees
 There are three elements necessary to establish a contract of employment:
I. An offer (typically by the employer)
II. The acceptance of an offer (typically by the employee)
III. Terms and conditions of employment (ideally written or implied)
 The terms & conditions refers to the obligations of both parties

Obligations of the Employee

 A duty of fidelity toward the employer

 The law aims for a balance between employee and employer rights
 The lack of fidelity is a breach of contract

The Contract of Employment

Obligations of the Employer

 Pay wages for work done

 Provide a reasonably safe workplace
 Treat employees fairly
 Give reasonable notice of termination
 The following are considerations for a reasonable notice of termination:
 Unprofessional or bad faith conduct by the employer
 Inducement factor/scenario
 The length of service of the employee
 Employee’s level of seniority

Null & Void Contracts

 Illegitimate and unenforceable formal agreement from the moment it was created
 Violates the essentials of contract law
 A party was forced or threatened to sign the contract
 A part was under the influence
 A part was not mentally competent
 The terms of the contract were violated
 Mistakes were made by both parties
 The contract is illegal
 The information and facts were misrepresented or withheld
Dismissal at Common Law

I. The are 2 types of dismissal at common law:

1. Economic dismissal (not able to make enough money)
2. Constructive dismissal
1. Economic dismissal
 When it is unprofitable to retain a worker
 Employee commits misconduct or performs unsatisfactorily
 A combination of both factors

NB:

II. At common law an employee has no legal right to keep his/her job
III. Employee is only entitled to compensation – even in cases with no just cause
2. Constructive Dismissal
 The resignation of an employee due to:
 A unilateral or significant change of a contract by and employer
 A demotion
 Altering the employee’s reporting structure, job description or
working conditions
 Lowering an employee’s compensation
 Changing hours of work
 Imposing a suspension or leave of absence
 Relocating the employee’s workplace
 The creation or encouragement of a hostile work environment
 Failure of the employer to fulfill essential obligations of the employment
relationship
 The employee can sue for damages

Unique Circumstances of Dismissal

 Employer can summarily dismiss an employee who commits acts of misconduct or

incompetence.
 Requirements for just because dismissal must be:
 Rational and for the good of the firm
 Made in good faith and non-discriminatorily
 Proportional to the harm the employee caused
 Unionized workers enjoy more protection compared to non-unionized workers
 Cost of litigation covered by union: nut high for non-unionized workers to
fight this kind of dismissal

Protective Employment Legislation (EPL)

 EPL refers to all regulations that relate to hiring and firing of workers
 The EPL includes all types of employment protection measures achieved through:
 Legislation
 Court rulings
  Collective bargaining
 The following 4 statues protect the rights of Canadian workers
 Employment Standards Act CONTINUE

3.Health & Safety Legislation

 To protect workers from health and safety hazards on the job

 Establishes procedures for dealing with workplace hazards

LESSON 13

Definitions & Overview

 The collective bargaining legislation closely regulates the formation of the collective
bargaining relationships (fights for the rights of the workers)
1. Governs the conduct and timing of the bargaining process
2. Places restrictions on conflicts
3. Mandate certain terms of the collective agreement
 Collective bargaining legislation is pivotal in the IR (Industrial Relations) system and
addresses issues that include:
1. The process of certifying a union
2. When a strike (by the employee) or lockout (by the employer) may legally occur
3. What constitutes unfair labour practices

The Need for Collective Bargaining Legislation

 To either certify or decertify a bargaining unit

 The protection of the right to unionize
 To prevent workers’ suffering though unfair labour practices
 To prevent workplace chaos & violence by regulating industrial conflict
 To prevent economic and human injustices
 Enables labour some measure of input into the terms & conditions of employment

Features of the Canadian Collective Bargaining Legislation

 Legislative fragmentation
 Provincial jurisdictions enabled private and public labour acts
 Federally regulated workers under federal legislation
 Majoritarianism and exclusivity
 Majority defines the whole and determines outcomes
 Exclusive decision-making & sole bargaining agent union once established
 Voluntarism and processes
 Free and voluntary collective bargaining between employers and unions
 Ability of employers and unions to resolve disputes on their own, without
compulsory government intervention
  Establishment of processes that will allow for free collective bargaining to take
place
 Specialized tribunals
 Established in each jurisdiction to administer labour legislations
 The tribunal are established by statute and are very broad
 Tribunals operate under a ‘‘make whole doctrine’’
 Concerned with finding practical solutions to workplace conflict
 No mid-term strikes or lockouts
 Imposition of a ‘‘Peace Obligation’’ on employers and employees while an
agreement is in force
 Unions cannot strike and an employer cannot lock our employees
 Disputes arising during the life of an agreement must be settled through the
grievance process
 The duty to bargain in good faith
 To ensure employers do not subvert the process of collective bargaining
 The legislation sanctions the breach to bargain in good faith
 Statutory freeze following notice to bargain
 A freeze on terms & conditions of existing conditions of employment during
negotiations
 Freeze to last until either a strike/ CONTINUE

Certification of a Bargaining Unit

 A bargaining unit can only be certified by a Labour Relation Board (LRB)

 The proposed union makes an application to the LRB
 Description of the proposed bargaining unit
 Estimated members
 A list of names of union members
 Certification of a bargaining unit is the most important legislative function on the LRB
 The certification process formalized the collective bargaining relationship
 Once certified, the union becomes their exclusive bargaining agent
 Unless later decertified, the employer is required to bargain in good faith to reach a
collective agreement

Exclusions

 Managers and those involved in a confidential capacity with respect to labour legislation
 Essential service staff excluded to varying degrees

Decertification of a Bargaining Unit

 The Labour Relation Board (LRB) may cancel a certification, at any time, in circumstances
where the board becomes satisfied that:
 The trade union has ceased to be a trade union
 The employer has ceased to be an employer
 The union has abandoned its bargaining rights
  If certification obtained by fraud
 If majority of employees do not wish to be unionized
 Employees in the bargaining unit demonstrate enough support for decertification
 Employees must submit an application for decertification
 Application cannot be filed less than 12 months after certification
 At least 45% of the bargaining unit must sign the application for
decertification
 No fewer than 55% of the eligible employees must cast ballots in a
decertification

Protecting the Right to Organize

 The LRBs ensures that employers cannot:

 Interfere with the right of joining a union
 Threaten or intimidate employees
 Interfere with the workings or control unions

Protecting the Right to Run a Business

 Unions are barred from interfering with the formation and operation of employers’
organizations CONTINUE

Union’s Duty of Fair Representation

 The labour statutes obligate unions to fairly represent members of the bargaining unit
 The union must not act in an arbitrary, discriminatory, or bad faith manner
 Remedies for breach of duty of fair representation are handled by the LRB
 Unions can either take an employee’s grievance to arbitration or pay
compensation

Other Legislations Protecting the Canadian Worker

 The Canadian Charter of Rights and Freedoms

 Human Rights and Equity
 The Privacy Legislation
 The need for a balance between individual’s right to privacy and the employer’s
right to protect its image, customers, property, and other employees.
 Implementation of drug & alcohol testing for employees

Peculiar Circumstances in Canada

 At a minimum, workers in legal strike activities get their jobs back following the end of a
strike
 Prohibition of hiring outside (or inside) replacement workers during a legal strike (Quebec
is an exception).
 Prevention of replacement workers from interfering with the goals of legally
striking workers
 Promulgation of ‘‘anti-scab’’ legislation to prevent picket line violence
  Minimum notice of intended strike or lockout action
 Provisions for third-part intervention
 Labour boards, arbitration boards, and the courts can give remedies for illegal strikes and
lockouts
 If negotiations fall, an independent arbitrator is chosen to impose terms for a collective
agreement

The Collective Agreement (contd.)

Definitions & Overview

 Collective bargaining is the negotiation process through which the terms and conditions of
employment for unionized staff are determined
 A team of employer representatives will meet with a team of union
representatives to exchange proposals
 It is a written record of negotiating results and

Four Categories of Collective Agreements

Rights of the union and management

 General and specific ground rule provisions in all agreements

 Include the right to hire, promote, transfer, or lay off workers
 Recognition of the existence of unions & the rights of union officials
 Establishes the process of due collections/deductions
 The grievance process and the handling of disputes

Governance of wages and hours

 Wage schedules outlining different rates of pay for different classes of worker
 Establishment of service increments
 Establishment of conditions for payment of premiums (overtime, shift premiums, etc.)
 Establishment of clauses for various forms of incentive pays and benefits
 Eligibility
 Vacation, overtime, and sick pays
 Established hours of work
 Lunch, coffee, and washroom breaks

Work rules and job control

 Usually the most contested in the collective agreement

 Management’s resentment of seeming controls by the union
 Union’s motive of exerting some measure of control over the way work is done
 Established process of hiring process and job assignment
 Work rule provisions that deals with load and capacity
 Job control provisions as relates to decisions on promotions, transfers, and layoffs
 Skill gap identification and training needs
 Established guidance on contracting-out of union member works
Work behaviour and the workplace environment

 Focuses on the social and physical environment in which work is performed

 The social environment addresses work behaviours and disciplinary procedures
 Sexual harassment
 Discrimination
 Bullying and intimidation
 The physical

Collective Agreements & the Union-Management Relationship

The existing relationship between union and management could be stretched due to:

 Excessively legalistic interpretation of collective agreements is characteristic of exploitive

union-management relationships
 Huge cost of interpretation
 Possibility of further deterioration of relationship
 The impact of technological changes and advancements
 The impact of macro-economics activities that include exchange rate fluctuations
 Periods of economic downturn

Distinctions between Public and Private Sector Bargaining

Factor The Public Sector The Private Sector

Employer differences Dual role of the govt as both an
employer and legislator
Ability to achieve objectives not
achievable during bargaining

The Collective Bargaining Structure

 Bargaining structure refers to the size and scope of organisations engaged in collective
bargaining
 The bargaining structure influences the: CONTINE

The Negotiations Process

 Situations in which two or more parties recognise that differences n interest and values
exist between them and in which they want to seek a compromise agreement.
 Negotiations is an interpersonal decision-making process necessary whenever we cannot
achieve our objectives single-handedly.
 Negotiations is any form of verbal communication in which the participants seek to exploit
their relative competitive advantages and needs to achieve explicit or implicit objectives
within the overall purpose of seeking to resolve problems which are barriers to agreement
 Negotiators need to develop skills in managing the complexities of
interdependence
 Negotiations is a complex process, so planning and preparation are essential keys
to success
Characteristics of Collective Bargaining Negotiation

 Generally, very complex

 Laced with multi-faceted business, financial & human issues
 Parties are strictly legally regulated during bargaining
 Agreements to the negotiated outcomes must be accepted & signed-off by respective
principals

The Bargaining Outcome

Distributive Bargaining (Win-Lose)

 The focuses on one’s own substantive outcomes when resources are (believed to be) fixed
and the parties’ interest are in conflict
 Union’s threat to strike when it perceives that management cannot afford the loss
of production
 A closed system where one party’s gain demands a loss for the other
 Highly competitive with an objective aimed at maximizing the share of a fixed CONTINUE

Integrative Bargaining (Win-Win)

 Integrative bargaining focuses on joint outcomes when the parties’ basic interests are not
fundamentally opposed
 An integrative bargaining situation occurs when it’s possible to produce a greater outcome
together that wither could reach on his own
 It’s used when the parties have a relationship or want to establish one, and when
cooperation benefits both parties
o Involves

Approaches to Negotiation

1. Right-based
2. Power-based
3. Interest-based

Strategic negotiations

 There are 3 strategic options to negotiation available to union & employers

 Forcing change
 Based on distributive bargaining and emphasizes hostility
 Fostering change
 Based on integrative bargaining and builds on consensus
 Escaping the relationship
 Relocating or transferring operations
 Increasing investments in non-unionized locations
 Contracting-out
 Hiring permanent replacement workers
 Attempting to decertify the union
Phases of negotiation

The negotiation process has 3 distinct phases:

I. Pre-negotiations
II. Actual negotiation and
III. Post-negotiation

The negotiation process consists of 3 important factors:

I. The negotiations
II. The negotiating situation
III. Time

3 criteria are identified for an effective negotiation process:

I. A wise agreement – satisfactory to both parties

Planning the Negotiation Strategy

 Plan and prepare

 Identify Interests: what do all parties need and want?
 What do they have that we want?
 What do we have that they need?
 Determine BATNA and WATNA (Best & Worst Alternative to a Negotiated
Agreement)
 Determine your Reservation Point (Driven by the BATNA)
 Determine yours and your opponents’ strengths
 Consider yours and your opponents’ weaknesses

The Zone of Possible Agreement (ZOPA)

 The measure of the value that a negotiated agreement offers to both parties, over the
value of not reaching a settlement
 It is the range between the negotiator’s reservation points and where the respective
minimum targets of the parties overlap
 Aims to reach a settlement that is mot favourable to oneself and does not give too much of
the bargaining zone