chapter 15 Labor Relations and Collective Bargaining

Labor Union Organization of employees that uses collective action to advance its members’ interests in regard to wages and working conditions Industrial union Craft union

Labor Relations The continuous relationship between a defined group of employees and management The relationship includes: The negotiation of a written contract concerning pay, hours, and other terms and conditions of employment The interpretation and administration of this contract over its period of coverage

Legal Overview Commonwealth v. Hunt (1842) Arbitration Act of 1888 Railway Labor Act of 1926 Norris-LaGuardia Act of 1932 National Labor Relations Act (1935 Wagner Act) Labor Management Relations Act (1947 Taft-Hartley Act) Labor-Management Reporting and Disclosure Act (1959 Landrum-Griffin Act)

National Labor Relations Act of 1935 (Wagner Act) (1 of 2) Objective was to encourage the growth of trade unions and restrain management from interfering with this growth Made the government take an active role in union-management relationships by restricting the activities of management Established the National Labor Relations Board (NLRB)

National Labor Relations Act of 1935 (Wagner Act) (2 of 2) As originally drafted, included seven topics: 1. Recognition of employees’ rights to bargain collectively 2. Limitation on collective bargaining 3. Representation 4. Certification and decertification elections 5. Terms of collective bargaining agreements 6. Problem of company unions 7. Right to strike

Unfair Labor Practices by Employers (1 of 2) Interfering with, restraining, or coercing employees in the exercise of their rights to organize Dominating or interfering with the affairs of a union Discriminating in regard to hiring, tenure, or any employment condition for the purpose of encouraging or discouraging membership in any union organization

Unfair Labor Practices by Employers (2 of 2) Discriminating against or discharging an employee because he or she has filed charges or given testimony under the Wagner Act Refusal to bargain collectively with representatives of the employees; that is, bargain in good faith

Labor Management Relations Act of 1947 (Taft-Hartley Act) (1 of 2) Amended and supplemented the Wagner Act Guaranteed employees’ bargaining rights Specified unfair labor practices by a union Denied supervisors legal protection in organizing their own unions Prohibited unions from deducting union dues from members’ paychecks without prior written permission

Labor Management Relations Act of 1947 (Taft-Hartley Act) (2 of 2) Provided the president of the United States the right to seek an 80-day court injunction against strikes or lockouts that could affect the nation’s health Allowed employers to express their views against unions as long as they made no attempt to threaten or bribe employees Allowed states to pass right-to-work laws that ban compulsory union membership

Unfair Labor Practices by Unions (1 of 2) Restraining or coercing employees in the exercise of their right to join or not to join a union, except when an agreement is made by the employer and union that a condition of employment will be joining the union Causing an employer to discriminate against an employee other than for nonpayment of dues or initiation Charging excessive or discriminatory membership fees

Unfair Labor Practices by Unions (2 of 2) Causing an employer to give payment for services not performed (featherbedding) Inducing, encouraging threatening, or coercing any individual to engage in strikes, refuse to work, or boycott where the objective is to: Force or require any employer or self-employed person to recognize or join any labor organization or employer organization Force or require an employer or self-employed person to cease using the products of or doing business with another person Force an employer to apply pressure to another employer to recognize a union

Labor-Management Reporting and Disclosure Act of 1959 (Landrum-Griffin Act) (1 of 2) Regulates the internal affairs of unions Gives every union member the right to: 1. nominate candidates for union office 2. vote in union elections 3. attend union meetings 4. examine union accounts and records Union is required to submit an annual financial report to the Secretary of Labor

Labor-Management Reporting and Disclosure Act of 1959 (Landrum-Griffin Act) (2 of 2) Employers must report any payments or loans made to unions, the officers, or members Sweetheart contracts are eliminated i.e., union leaders and management agree to terms that work to their mutual benefit, but maintain poor working conditions for other employees

Structure and Management of Unions 1. Federation of Unions 2. Intermediate Union Bodies 3. National 4. Local Unions 4

Why Employees Join Unions Employees generally join unions to satisfy needs that are important to them, including: Job security Socialization and group membership Safe and healthy working conditions Communication link to management Fair compensation

Authorization Card Campaign Authorization card – document indicating that an employee wants to be represented by a union in collective bargaining At least 30 percent of the employees must sign authorization cards before the NLRB can be petitioned to hold a representation election If over 50 percent of the employees sign up, the union can ask the company directly that it be named representative without a certification election

Certification Election Union petitions the NLRB for a certification election after the authorization cards demonstrate employees’ interest NLRB conducts a secret-ballot election Union must receive a simple majority of votes cast (50 percent plus one vote) to be certified as the exclusive bargaining representative Collective bargaining begins

Levels of Union Security 4. Preferential Shop 5. Closed Shop 6. Union Shop 2. Restricted 3. Agency 1. Open Shop 5

Right-to-Work Requirements Section 14B of the Taft-Hartley Act States may prohibit labor contracts that make union membership a condition of retaining employment (i.e., union shop) Employees are permitted to resign from union membership at any time 22 states have enacted right-to-work laws

Public Sector Labor Legislation Executive Order 10988 (1962) Executive Order 11491 (1969) Executive Order 11823 (1975) Civil Service Reform Act (1978) Federal Labor Relations Authority (FLRA) Office of Labor-Management Relations

Collective Bargaining: Process by which the representatives of the organization meet and attempt to work out a contract with the employees’ representative – the union

Forces Influencing the Bargaining Process The Bargaining Arena State of the economy Bargaining Process Public sentiment Union representative Management representative Goals of the bargaining parties Issues being discussed Precedents in bargaining Labor law

Mandatory Bargaining Issues Wages Working Hours Other Terms and Conditions of Employment

Types of Collective Bargaining (1 of 2) Distributive bargaining Occurs when labor and management are in conflict on an issue and when the outcome is a win-lose situation Integrative bargaining Occurs when two sides face a common problem Both parties seek a win-win outcome Can result in accommodation of both sides’ needs without cost or through a simultaneous gain

Types of Collective Bargaining (2 of 2) Concession bargaining Exists when something of importance is given back to management Concessions can consist of: wage cuts wage freezes of previously negotiated increases benefits reductions changes in work rules that result in increased flexibility for management

Steps to the Collective Bargaining Process 4. Using the best tactics 5. Reaching a formal contractual agreement 6. Ratifying the contract 2. Selecting negotiators 3. Developing a bargaining strategy 1. Prenegotiation 5

Negotiating Tactics (1 of 2) Conflict-based Each party is uncompromising, takes a hard line, and resists any overtures for compromise or agreement Armed truce Each party views the other as an adversary Recognition that an agreement must be worked out under the guidelines specified by the law

Negotiating Tactics (2 of 2) Power bargaining Each party accepts the other party with the knowledge that a balance of power exists Accommodation Both parties adjust to each other Cooperation Each side accepts the other as full partner

Content of a Labor Agreement Purpose and intent of the parties Scope of the agreement Management rights Responsibilities of the parties Union membership and checkoff Adjustment of grievance Arbitration Suspension and discharge cases Rates of pay Hours of work Overtime and holidays Vacations Seniority Safety and health Military service Severance allowance Savings and vacation plan Supplemental unemployment benefits program (S.U.B.) S.U.B and insurance grievances Prior agreements Termination date

Failure to Reach Agreement: Work Stoppages Strikes Economic strike Jurisdictional strike Wildcat strike Sit-down strike Lockouts Permanent Replacements

Failure to Reach Agreement: Third-Party Intervention Mediation Fact-Finding Interest Arbitration

Administering the Contract Discipline Grievances Arbitration

A Grievance Procedure: A Unionized Situation Arbitrator Step 4 Top union leadership Step 3 Top management Union committee or business agent Middle management Step 2 Step 1 Supervisor Shop steward Aggrieved employee

Key Factors in the Erosion of Unions’ Power Increased competition in a global market Shift in workforce from manufacturing to an economy based on service, knowledge, and information New waves of immigration Slowing or decreasing demand by non-unionized employees for union representation Growing size of the contingent labor force

Summary The future of American unions and whether or not they will remain an important part of our economy will depend on the following critical factors: Quality of union leadership Willingness to experiment with innovative organizing techniques Frequent involvement with the rank-and-file employee Ability to appeal to better-educated professional, service, and knowledge workers Genuine cooperation with management