Chapter 1: Introduction

Labor Relations

Labor Relations

Labor Relations a set of processes by

which unions and management achieve their
goals while accommodating each others
needs.

a.k.a. Industrial Relations

a.k.a. Labor-Management relations

The Labor Relations environment is heavy

regulated.

The Parties

Employers/Management

Line management
HR management

Unions
Government

What Unions Do

Permit workers to collectively negotiate for pay and

working conditions.
They allow members to exercise monopoly power
over their employers by controlling the supply of
labor.

Union monopoly power costs the GDP about 1.2% per

annum.
It would cost more if unions were not in decline.
In 2007, full-time wage and salary workers who were
union members had median usual weekly earnings of
$863, compared with a median of $663 for wage and
salary workers who were not represented by unions.
[30.2% more]

Trend in Union Membership

1935
1945
1955
1965
1975
1985
1995
2007

13.2%
35.5%
33.2%
28.4%
25.5%
18.0%
14.5%
12.1%

Union Membership

The unionization rate of private sector employees was

7.5 % in 2007.

Transportation 22.1%.
Utilities 22.1%.
Manufacturing industries 13.0%.

The unionization rate of government workers was

35.9% in 2007.

Teachers had the highest unionization rate, at 37.2 %.

Protection agencies (fire & police) at 35.2%.

Source: U.S. Bureau of Labor Statistics (January 25, 2007). Union members in 2007. Union Members
Summary. http://www.bls.gov/news.release/union2.nr0.htm (accessed August 20, 2008).

States with the Greatest Union

Membership

Four states with the highest union

membership rates in 2007:

New York (25.2%).

Alaska (23.8%).
Hawaii (23.4%).
Washington (20.2%).

States with the Lowest Union

Membership

The four states with the lowest union

membership rates in 2007:

North Carolina 3.0%

Virginia 3.7%
South Carolina 4.1%
Georgia 4.4%
Mississippi 6.7%

BLS Union Members Summary

Workers in the public sector had a union

membership rate nearly five times that of private
sector employees.
Education, training, and library occupations had the
highest unionization rate among all occupations, at
37 percent.
The unionization rate was higher for men than for
women.
Black workers were more likely to be union
members than were white, Asian, or Hispanic
workers.

Demographics of Union
Membership

Union membership rates were higher among

men at 13.0%, than for women at 10.9%.
Workers ages 45 to 54 were more likely to
be unionized than either their younger or
older counterparts (16.0%).
Workers in the age category 16 to 24 were
the least likely to be union members (4.4%).

Demographics of Union
Membership

Blacks were more likely to be union

members (14.5 percent) than were whites
(11.7 percent), Asians (10.4 percent), or
Hispanics or Latinos (9.8 percent).
Full-time wage and salary workers who were
union members had median usual weekly
earnings of $833, compared with a median
of $642 for wage and salary workers who
were not represented by unions.
Source: BLS Union Members Summary 2008

Largest Labor Unions

Union members with >1M members:

National Education Association (NEA) 2.7M
Service Employees International Union (SEIU)
1.46M
United Food & Commercial Workers International
Union (UFCW) 1.38M
International Brotherhood of Teamsters (IBT)
1.35M
American Federation of State, County & Municipal
Employees (AFSCME) 1.35M
Source: Labor Research Association http://www.laborresearch.org

Willingness to Vote for a Union

Attitude of local community toward unions.

Favorable v. unfavorable.
Mississippi v. Michigan.

Peer pressure
Belief that union will be successful

Grievance handling
Bargaining demands

Collective Behavior

Collective Behavior usually results from

coming together to counter a mutual threat.
Dependent on:

Group Cohesiveness
Class consciousness
External threat

Factors Affecting Cohesiveness

Greater agreement on group goals, greater

the cohesiveness.
Greater the similarity of members (i.e.,
skills, opinions, attitudes, interests,
background, etc.), the greater the
cohesiveness.
The more frequent the contact among
group members, the more cohesive.
The smaller the group the more cohesive.

Factors Affecting Cohesiveness

The more isolated the group, the more

cohesive.

Physical barriers.
This forces proximity and interaction.

The more intergroup competition the more

cohesive.
The greater the groups success in
achieving group goals the more cohesive.
A real or perceived threat increases
cohesiveness.

Why Employees Organize

Dissatisfaction a necessary but not sufficient

cause for successful organizing campaign.
Working conditions
Wages and benefits
Supervisory practices
Promotion/advancement policies
Job security

Formula for Employees Organizing

Successfully

Dissatisfaction is present and they believe that

they are individually unable to change the
conditions causing their dissatisfaction.
A majority of the employees must believe that
collective bargaining (i.e., a union) will improve
the situation.
This implies that the benefit from improving
conditions out weighs the cost of union dues.

Craft Unions

Union membership is limited to members of a

specific craft (example: IBEW, UBCJA).
One craft, one union.
Exercise economic power by controlling the
supply of the craft.
Control apprenticeship.
Trace history to the guilds of the Middle
Ages.

Industrial Unions

Union membership open to employees of a

specific industry (example: UAW, USW).
One industry, one union.
Exercises economic power only by political
fiat.
In recent years, industry designations have
become meaningless.

Trends in the Labor Movement

Greater female participation in the workforce.

Greater ethnic minority participation in the
workforce.

Fewer skills (LIUNA and Hispanic janitors in L.A .).

Lack of mathematical and scientific skills.
Lower educational achievement.
Multilingual workplaces.
Immigration concerns.

Interestingly, unions used to be radically opposed to

immigration, now they are supportive.

Trends in the Labor Movement

More organizing efforts among professional and

white-collar employees.

Unions have problem with blue-collar image.

Job security offers an incentive for workers to
organize.

Emerging two-tiered economic system based on

education.

Roughly 20% of the working population has four years

of college.
Unions have to deal with a new underclass of workers
who lack the skills to be successful employees.

Why Unions Have Declined

Wages are more often determined by the marketdriven economy than collective bargaining.

Competitive pressures on employers.

Particularly global competition.

Employers control job content.

Employers have been involved with the U.S.
Education system which (in theory) develops skills
for future employees

This ignores the effects of govt and the NEA on public

education.

Why Unions Have Declined

Governments now provide many worker

protections once offered only in CBAs.

OSHA
FLSA
Title VII
ERISA

The large American middle class is largely antiunion

View unions as contrary to efficiency and productivity

Opposition to income redistribution, which unions
support.
Though unions see them as a possible target for
organization efforts.

Why Unions Have Declined

Private sector employers have taken

proactive steps to avoid organization.

Competitive wages & benefits

Participative leadership styles.

More companies are using employee

empowerment programs.

TQM
CQI