Labor Relations Striking A Balance 4th Edition Budd Solutions Manual 1

Chapter 05 - Labor and Management: Strategies, Structures, and Constraints
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CHAPTER 5
Labor and Management: Strategies, Structures, and

Constraints
Chapter Overview
The previous two chapters have described the historical development and legal framework of the
U.S. labor relations system. This chapter examines the strategies and organizational structures used
by labor unions and employers to achieve efficiency and/or equity and/or voice. The extent to which
these strategies and structures succeed depends on the constraints of the employment environment,
so the employment environment is also briefly discussed here.
Traditional U.S. union strategies such as business unionism, job control unionism, and the servicing
model are explored in detail as are their alternatives of social unionism, employee empowerment
unionism, and the organizing model. Each philosophy is defined, and illustrative examples are given.
The strategies are summarized side by side, giving students an excellent tool to compare and contrast
the characteristics of each one.
Students of labor relations should also understand the structure of unions and the labor movement in
the United States. Local unions are the focal point of most rank and file members’ contact with the
union, but most local unions today are part of a national union, and most national unions are part of
the American Federation of Labor-Congress of Industrial Organizations. Local and national unions
are governed through traditional, democratic methods but does this ensure that individual union
members continue to be properly represented? Information in this chapter will help students form a
solid opinion regarding the answer to this question.
A company’s business strategy can be broken down into many different elements and directions,
resulting in a wide range of possible management strategies toward labor unions. Understanding
management goals and strategies can help labor decide how best to form and decide on their own
strategies.
But the ability of the labor relations factors to achieve their goals via their strategies is shaped by the
constraints of the labor relations environment. This chapter therefore closes with a brief exploration
of four major elements of the labor relations environment factors that determine labor relations
outcomes: legal, economic, sociopolitical, and ethical dimensions.
Lecture Tips
I generally only cover the highlights of this chapter in class, and rely on students to read the material
on their own. Students should see the basic structure of U.S. labor unions (local unions, national
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unions, and the AFL-CIO) and consider various union strategies. To help understand union
strategies, I distinguish between what I call the scope and soul of representation. The scope is
whether unions have a workplace focus or a focus on the broader socio-political arena. The soul is
who engages in representation—union leaders (as in a servicing model of representation) or rank and
file union members (as in an organizing model of representation).
Management structure is probably more familiar to students so this is not given much coverage, but
management strategies for labor relations are quite important here. I try to emphasize how different
business strategies yield different HR strategies and labor relations strategies. Some of these are
more confrontational; some are more cooperative.
It’s important for students to appreciate the diverse dimensions of the environment that place
constraints on the labor relations factors, but an exhaustive list of examples within each dimension is
not needed. This basic issue of the determinants of labor relations outcomes comes up repeatedly
throughout the remainder of the book, so there is ample opportunity to reinforce this concept later on
(e.g., via a discussion of the bargaining environment in chapter 7).
This material also provides the opportunity to incorporate business ethics into the study and practice
of labor relations. You can begin with the plant closing example in the text and show how these
common responses each imply a different ethical framework. Make this interactive by having
students think of possible reactions to a plant closing and then fitting their responses into the six
theories. Emphasize that ethics is not just about making normative judgments (though this is
important), but that it can also be used to understand behavior without judging it. Cement the
usefulness of ethics by reviewing how various ethical perspectives have useful applications in labor
relations (see Table 5.8). Interested instructors can further explore the ethical theories by covering or
assigning the optional material in the Digging Deeper section.
Lecture Outline
Learning Objectives
1. Compare the traditional U.S. union strategies (especially business unionism, job control unionism,
and the servicing model) and their alternatives (especially social unionism, employee
empowerment unionism, and the organizing model).
2. Understand the organizational structure of unions and the labor movement in the United States.
3. Discuss the range of possible management strategies toward labor unions and how they relate to
human resource strategies and business strategies.
4. Analyze how the labor relations environment, including ethics, influences and constrains labor
relations outcomes.
The heart of labor relations is conflict between the goals of employees and employers; however, the
striking feature of most workplaces is the amount of daily cooperation, not conflict or competition.
Labor law seeks to design systems and policies to manage the conflict to create productive
workplaces that balance efficiency with equity and voice.
Within this legal framework, labor unions and employers design strategies and build organizational
structures to pursue their objectives.
I. Labor Union Strategies
A. In the second half of the 20th century, U.S. labor unions primarily followed strategies that
comprises of a business unionism philosophy and a servicing model of delivery that are
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operationalized through job control unionism and industrial unions (Table 5.1).
1. Equity is achieved through generous wage and benefit packages, seniority-based
layoff and promotion procedures, restrictions on discipline and discharge for just
cause only, and due process protections in the grievance procedure.
2. Voice is achieved through representation at the bargaining table and in the grievance
procedure.
3. Collective bargaining is institutionalized, and the union contract becomes the
“workplace rule of law.”
B. The Traditional Collection of U.S. Union Strategies
1. U.S. labor unions have traditionally embraced a business unionism philosophy; in
this approach, the key to achieving equity and voice is collective bargaining in the
workplace, through which unions win wage gains, benefits, grievance procedures,
and protective work rules; this philosophy accepts the legitimacy of capitalism and
the need for employers to make a profit; labor’s goal is to secure a fair share of these
profits through collective bargaining.
2. An abusive variant of business unionism can be called “hold-up unionism” or
“jungle unionism.” If unrestrained competition, especially in periods of high
unemployment, leads to individual needs for survival, a jungle unionism strategy is
to take whatever you need or can by whatever means necessary—like the law of the
jungle.
3. To carry out their business unionism philosophy. U.S. labor unions traditionally
have represented workers by using a servicing model. Here a union is like an
insurance company in which workers pay dues, and in return they are protected
against bad times—arbitrary supervisors, the vagaries of markets, workplace
accidents, and the like.
4. Some of the features of a servicing model include the following:
 Workers do not participate in a union; rather, they consume union services,
especially collectively bargained contracts and representation in the grievance
procedure.
 Workers are serviced by union officials, that is, problems are solved for the
workers, not by the workers.
 This is a passive form of employee representation; the only active participants
are union officials.
5. How to specifically represent or “service” workers is shaped by the business
environment.
6. Through much of the 20th century, the dominant method of work organization was
scientific management, in which jobs were divided into specialized tasks. Employers
have traditionally been adamant about maintaining their managerial prerogatives—
discipline, production, scheduling, marketing, pricing, investment, and other
managerial functions.
 In this environment, unions have sought to protect their members from volatile
managers and markets by negotiating detailed, legalistic union contracts that
tie employee rights to narrowly defined jobs while removing labor from
business decision making. This is called job control unionism because a
central element is replacing arbitrary management control with union-
negotiated seniority systems for allocating jobs and determining pay and
benefits.
 Another dimension to union strategy is whether unions represent workers
along craft/occupational or industrial lines. Craft unionism, or occupational
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unionism, involves a single union representing only workers in a single

occupation or craft, such as separate unions for electricians, carpenters, and
painters; this was common before the rise of the modern factory, and it
remains prevalent today in the construction industry.
 Industrial unionism focuses on an industry rather than a craft. Industrial
unions seek to represent workers of all occupations within an industry.
C. Alternative Union Strategies for the 21st Century
1. The traditional union strategies are under great pressure to change in the 21st
century. These pressures come from changes in the external business environment
and also from critics within the labor movement itself.
 On the business side, management has been fighting the rigidities of the job
control unionism since the 1980s because of the greater needs for flexibility
and quality that have arisen with increased foreign and nonunion competition.
 A desire to revitalize a weakened labor movement has caused some labor
movement supporters to criticize the conservatism of the longstanding
business unionism philosophy along with the union member apathy that is
created by the passivity of the servicing model.
2. To understand the different dimensions of union strategies it is important to
distinguish between the scope and the soul of employee representation; the scope of
representation describes the breadth of the representation activities—in particular,
whether union activity is concentrated in the workplace or in the broader political
and social arenas; the soul of representation captures how the representation is
pursued or delivered, especially regarding the extent of rank-and-file participation
(Table 5.2).
3. Some argue that unions should embrace an organizing model. This approach views
unions as institutions of active worker participation, empowerment, and
mobilization.
 Organizing drives to unionize nonunion workers are not led solely by full-time
union staff members, but rely heavily on internal organizers.
 Once unionized, problems are not solved for workers as in the servicing
model; rather, workers play an active part in resolving their own problems.
 Workers do not consume equity and voice; they participate in their attainment
and continually serve as internal organizers to create vibrant unions.
 This is an active form of representation, and the soul of the representation
process consists of the rank-and-file union members.
 The servicing model sees the relationship between a worker and his or her
union as a narrow economic exchange that develops only weak ties between
leaders and union members; the organizing model sees this as a social
exchange with the potential for developing strong social ties not only between
leaders and members, but also among members.
4. Labor and management experimented with different ways of moving away from the
servicing model toward an organizing model. Some of these alternatives to job
control unionism can be loosely grouped together as employee empowerment
unionism. Rather than establishing standardized outcomes, such as tying wages to
jobs or layoffs to seniority as are typical in job control unionism, employee
empowerment unionism establishes the framework of procedures in which workers
are empowered to determine their own outcomes. An example of employee
empowerment unionism is skill-based pay where labor and management negotiate
the parameters of the system, and workers are responsible for upgrading their skills
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and reaping rewards for doing so.

5. The workplace scope of representation common in U.S. labor relations contrasts
with the social unionism philosophy that is frequently observed in Europe.
Adherents to a social unionism philosophy see labor unions as more than workplace
mechanisms for winning economic gains; rather, unions are viewed as an integral
participants in a community’s and country’s civic and political activities; the scope
of representation is the broader social and political arena.
6. Social movement unionism, in contrast to social unionism, embraces labor unions as
part of a broader social movement of community, social, and political activist groups
that relies on active grassroots participation and mobilization.
7. Social movement unionism in the United States is often advocated as a basis for
revitalizing the labor movement because rank-and-file activism can provide the
means to increase organizing, especially among traditionally overlooked groups
such as immigrant workers, and to resist management demands for concessions.
8. The sociopolitical activism of social movement unionism is rooted in a belief that
the employment relationship is characterized by deep sociopolitical class conflict
rather than economic conflicts that can be mediated by workplace-focused
institutions.
II. The Structure of the U.S. Labor Movement
A. Local Union Structures

1. Most union members have the greatest contact with their local union.
2. A local union may represent many workers from a single workplace (an industrial
local), workers in a single occupation from several workplaces (a craft local), or
multiple occupations in multiple workplaces in multiple industries (an amalgamated
local).
3. Most worksites also have one or more elected or appointed shop stewards who are
the primary point of contact for most unionized employees; the stewards’ most
important responsibility is processing grievances that have been filed within their
work groups.
4. Local unions are governed by a president and executive committee who are
democratically elected; there may also be a negotiation committee and a grievance
committee; some local unions may be active in local politics and in trying to
organize new members.
5. Nearly all local unions are part of a national union; some, however, may be an
independent organization and not part of a national union.
B. National Union Structures
1. There are approximately 100 national unions in the United States. The largest are the
National Education Association (NEA) with over 3.2 million members and the
Teamsters, United Food and Commercial Workers (UFCW), Service Employees
International Union (SEIU), and American Federation of State, County, and
Municipal Employees (AFSCME), each with over 1 million members.
2. Some national unions are called “internationals” because they also have locals in
Canada; for example, the UFCW’s full name is the United Food and Commercial
Workers International Union.
3. While local unions are the focal point of most rank-and-file members’ contact with
the union, the greatest power and authority generally lie with the national unions.
4. National unions charter the local unions and often have final approval authority over
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local actions.
5.
Most national unions are responsible for the following functions:
 Organizing new members
 Providing research and training
 Lobbying legislators
 Providing strike benefits
 Supervising the collective bargaining process
6. When bargaining with larger companies, the national union may directly handle
collective bargaining; with smaller companies, a local union’s negotiating
committee may take the lead, but often with the support and advice of a national
union staff member.
7. National unions generally comprises of the following:
 Departments—consist of specialized staff in important functional areas;
common departments include organizing, collective bargaining, research,
education or training, and government affairs.
 Divisions or conferences—focus on important industries or occupations within
a national union and provide the opportunity for coordination and networking
within these areas.
 Regions—consist of regional or district offices to serve the local unions.
8. National unions, like local unions, are governed through traditional democratic
methods; national union officers are periodically elected either directly by the
membership or indirectly through elected delegates; overall policy directions and
changes to the constitution are made through periodic conventions attended by
delegates elected by the union’s membership.
9. Although unions have increased their use of formal human resources, financial, and
strategic planning processes, improving the management and strategic planning
skills of union leaders is needed.
10. Historically it was easy to distinguish between national craft unions representing
workers in a single craft and national industrial unions representing all workers in a
single industry. But unions have diversified and merged over the years, so there is
now less of a distinction.
11. Many U.S. unions today are better described as general unions rather than as true
industrial or craft unions because these unions represent workers from diverse
occupations and industries.
C. The Pros and Cons of General Unions
1. One persistent question for the U.S. labor movement is whether the increased
strength that the national unions gain by increasing their membership and financial
base through mergers and diverse organizing activity outweighs the potential
problems with being responsive to the increasingly disparate needs and situations of
individual workers.
2. Opportunistic mergers and organizing activity are criticized and characterized as
“nickel-and-dime business unionism” that lacks a coherent strategy for representing
diverse workers; also, mergers do not always go smoothly.
3. A related question relates to union competition for members, or rival unionism.
Merger activity reduces interunion competition. But diverse organizing activity
among general unions increases competition among unions.
4. The question for the labor movement is whether this competition is a waste of
precious resources or whether it causes better representation; perhaps the benefits of
competition that cause corporations to innovate and strive for better goods and
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services also apply to labor unions.

D. National and International Union Federations
1. At the top of the structure of each country’s labor movement is one or more national
labor federations. A labor federation is an association of labor unions that provides
support and leadership to the labor movement.
2. The American Federation of Labor–Congress of Industrial Organizations (AFL–
CIO) was a major national labor federation in the United States between 1955 and
2005; it consists of 56 national unions that represent 10.5 million workers; a fraction
of the union dues collected by each member union is forwarded to the AFL–CIO to
fund its operations.
3. To further appreciate the power structure of the U.S. labor movement, it is
instructive to compare it to the levels of government in the United States.
 Local unions are like state governments—they have their own elected officials
and can pursue their own policies and conduct their own activities, subject to
the ultimate approval of a superior authority.
 National unions are like the federal government—they have the ultimate
authority.
 The AFL–CIO is like the United Nations—it provides overall leadership and
important services, but membership is voluntary; neither the AFL–CIO nor the
United Nations has the authority to compel its members to comply with its
decisions.
4. Following are some of the features of the organizational structure of the AFL–CIO:
 Specialized departments called programmatic departments—include civil and
human rights, international affairs, organizing, and several pertaining to the
AFL–CIO’s political function (legislative, political, and public policy).
 Divisions for specific industries or occupations called trade and industrial
departments—include building and construction trades, food and allied
services, maritime trades, and professional employees.
5. The AFL–CIO plays an important leadership role in the direction and coordination
of the U.S. labor movement, but most of the organizing, negotiating, and grievance
handling is done by local and national unions, not the AFL–CIO.
6. The AFL–CIO’s main functions are:
 Political lobbying
 Research
 Education
 Overall coordination and direction
7. The AFL–CIO is a member of the International Trade Union Confederation
(ITUC)—a federation of national union federations.
E. Competing National Union Federations
1. Frustration with the continued decline of the U.S. labor movement led to unusually
open and pointed calls for a change in the direction and leadership of the AFL–CIO
in 2004.
2. Several union presidents wanted to see the AFL–CIO rationalize the structure of the
labor movement by consolidating smaller unions and refocusing the diffuse energy
of general unions toward specific core jurisdictions like the industrial unions of the
1930s.
3. The calls for change combined with significant rivalries among various union
leaders resulted in several unions leaving the AFL–CIO in 2005 and forming a new
labor federation, the Change to Win federation—includes only seven unions, but
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they are among the largest and represent a total of 6 million workers.
4.
The breakup of the AFL–CIO rippled throughout the structure of the labor
movement, especially at the local and state levels, where AFL–CIO–affiliated
central labor councils and state federations were forced to expel local unions
affiliated with Change to Win.
5. The national AFL–CIO created a “Solidarity Charter” program in which local
unions from the Change to Win federation are allowed to be part of the local and
state AFL–CIO bodies.
F. Union Democracy
1. A primary role of labor unions is to provide voice. This makes it imperative for
unions to be democratic; democracy in unions is also championed because of the
belief that democratic unions more effectively represent their members.
2. Union democracy can be analyzed along the following three dimensions:
 Procedural—procedurally, U.S. law (the Landrum–Griffin Act of 1959)
mandates basic democratic procedures within unions, including free speech
and election provisions.
 Behavioral—behaviorally, unions appear to be more democratically vibrant at
the local than the national level.
 Substantive—even if officer turnover is low, however, the presence of
opposition can keep leadership responsive to its membership.
3. Managerial pressures for employee involvement in workplace decision making can
also undermine union democracy by eroding employee commitment to their union
and lowering participation in union affairs.
III. Management Strategies
A. The corporation is dominant in contemporary labor relations and more generally in the
world economy.
B. Many union strategies are developed in reaction to managerial strategies; two possible
management attitudes toward labor unions include:
1. Union avoidance—the extent to which management works toward remaining
nonunion, or becoming nonunion if already unionized.
2. Union acceptance—the extent to which management accepts, perhaps begrudgingly,
the presence of a union or a drive to establish a union.
C. Theoretically there is a third possibility: union encouragement, but there is little doubt that
except in rare situations, U.S. corporations prefer to be nonunion
D. Business Strategies
1. It is common to divide business strategies into the following two general types:
 Cost leadership strategies (emphasizing low cost)—likely pursued through a
human resources strategy that seeks to minimize labor costs; efficiency stems
from low costs and high output, so labor is driven and treated as a commodity
or machine; equity and voice are seen in market-based terms, and efficiency is
paramount. Such approaches are consistent with the well-known Theory X of
management, in which workers are assumed to dislike work and must
therefore be commanded and controlled through threats of punishment. The
result is a human resources approach that is largely autocratic.
 Differentiation strategies (emphasizing product quality and features)—likely
pursued through a human resources strategy that develops, rewards, and
perhaps even empowers employees to create a loyal and productive workforce;
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equity and voice are important components of this strategy because fair
treatment and protective benefits (equity) and individual voice mechanisms
such as open-door policies can foster loyalty, satisfaction, and therefore
productivity; this human resources strategy is consistent with Theory Y, in
which managers motivate employees by establishing conditions of
commitment and responsibility. More extensive approaches might even
employ a strategic business partner HR strategy in which employees are seen
as a source of competitive advantage; employees are thus empowered in high-
performance workplaces. In management theory this approach is similar to
Theory Z, which features participative decision making. The overall approach
is paternalistic.
E. Labor Relations Strategies
1. The autocratic and paternalistic/strategic patterns help reveal the importance of
managerial attitudes toward unions.
2. A union acceptance strategy in an autocratic organization would likely consist of
adversarial negotiations in which labor and management negotiators challenge and
threaten each other during negotiations; strikes and grievance activity would also be
expected to be higher than average as management fights to keep labor costs down
and unions react to this aggressiveness. But management does not seek to oust the
union.
3. However, a union avoidance strategy in an autocratic organization is union
suppression. Some might call this union busting. Union suppression tactics may
include harassment, demotion, or firing of union supporters. This behavior is illegal
in the United States, but is nevertheless common.
4. A set of union suppression tactics involves either proactively or reactively shifting
work from locations that are unionized (or are threatening to unionize):
 Plant closings
 Outsourcing
 Bankruptcies
 Double-breasting (the opening of nonunion operations in the same market, a
popular strategy in construction).
5. An aggressive union suppression strategy in a unionized workplace might include
the following tactics:
 To decertify (kick out) the union
 Engaging in surface bargaining (going through the motions without intending
to reach agreement)
 Using permanent strike replacements to take the jobs of union supporters
6. In a paternalistic/strategic organization, a union avoidance strategy is union
substitution in which management adopts policies and practices to keep unions out
by making them unnecessary; some of the central features of this strategy include
the following:
 Paying above-market wages and benefits (often comparable to unionized
compensation packages)
 Providing employment security
 Giving employees opportunities for training and development
 Instituting informal grievance procedures or at least complaint mechanisms
 Authoritarian supervision is replaced with more respectful, coaching methods
of supervision, and attitude surveys are used to monitor employee satisfaction.
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
Employees are made to feel like they are part of the organization, and have
voice, with information sharing and participatory mechanisms such as quality
circles.
 Through these equity and voice mechanisms, employers hope to create not
only loyal and productive workers, but also workers who feel they do not need
a union.
7. A union acceptance attitude in a paternalistic/strategic organization results in a
participatory labor relations strategy in which the union is enlisted as a partner to
help the business create high-performance work systems.
F. Labor Relations Strategies in Practice
1. Henry Ford implemented a form of paternalistic welfare capitalism with his $5-a-
day plan in 1914. After a recession in the early 1920s, however, Ford adopted a
more antagonistic strategy and aggressively fought any attempts at unionization by
its workers for the next 20 years. Ford became famous for its so-called Service
Department—essentially an internal police force composed of criminals and
informers—which used spying, intimidation, and violence to suppress union
activity.
2. In the postwar period the United Auto Workers (UAW) became entrenched at Ford,
and resistance to unions became prohibitively expensive; Ford then adopted a union
acceptance strategy that accepted, but sought to contain, the presence of the UAW.
3. The auto and other manufacturing industries, however, are no longer the pacesetters
for the rest of American business. Rather, some argue that Wal-Mart is creating the
template for 21st-century capitalism in the United States and around the world.
 Wal-Mart’s human resource strategies fit with the business strategy where
policies are centralized and standardized, store managers’ labor costs are
carefully policed by Wal-Mart’s headquarters, worker behavior is tightly
proscribed, and wages and benefits are low.
 Wal-Mart is also aggressively antiunion; if a manager suspects any union
activity, a rapid response team is dispatched from headquarters to squelch this
threat; antiunion videos are shown, supervisors meet with employees one-on-
one, employees are closely watched, and union supporters are reportedly fired.
IV. The Labor Relations Environment
A. Labor and management must contend not only with each other’s sometimes conflicting
strategies but also with the pressures, constraints, and opportunities of the labor relations
environment; the four important dimensions of this environment are—legal, economic,
sociopolitical, and ethical.
B. The Legal Environment
1. The legal system in every country establishes the framework for labor–management
interactions.
2. The clearest component of the legal environment is the set of laws explicitly
pertaining to labor relations; however, the legal environment is not confined to labor
law.
3. Following are some of the laws that establish some of the U.S. employment
standards:
 The Fair Labor Standards Act (minimum wages and overtime payments)
 The Civil Rights Act (nondiscrimination)
 The Occupational Health and Safety Act (workplace safety)
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 The Family and Medical Leave Act (unpaid leave)

4.
Tax laws, bankruptcy codes, and deregulation can also affect labor relations.
5.
Common law—law based on tradition and precedent rather than created by statutes
enacted by lawmakers—is also important.
6. The employment-at-will doctrine which govern the U.S. employment relationship is
the most significant in labor relations; in the absence of legislative (especially
antidiscrimination laws) or contractual restrictions (most widely associated with
union contracts), employees can generally be discharged or quit at any time for any
reason. This at-will relationship is established by the legal environment.
C. The Economic Environment
1. The economic environment includes the following:
 The labor market
 The market for the employer’s products or services
 Markets for other factors of production
 The state of the overall economy
2. Within the framework established by common and statutory laws, the economic
environment critically determines workers’ employment options.
3. If the labor market is tight—that is, if unemployment is low and jobs are easy to
find—a frustrated employee might quit and find a better job elsewhere.
4. In a weak labor market with high levels of unemployment, employees might be
reluctant to form a union for fear of being fired and unable to find a new job;
similarly, employees might be less willing to strike when the labor market is weak,
and collective bargaining settlements are therefore expected to favor employers.
5. Another important factor is labor demand—the strength of an employer’s need for
employees; it is a demand derived from employers’ competitive positions in markets
for their goods and services.
6. The sharp increase in the employment in the early 1980s, accompanied an intense
period of concession bargaining in which many unions agreed to wage, benefit, and
work rule concessions (or givebacks) to try to save jobs; this is a scenario that was
recently repeated in the first decade of the 21st century as the major auto companies,
airlines, and newspapers teetered on the edge of survival.
7. Technology also affects the relative supply of and demand for various occupations
and is therefore an important element of the labor relations environment; the central
debate over technology is whether technological change is skill-biased or deskilling.
 Skill-biased technological change—upgrades the skill requirements of
technical jobs and results in greater demand for high skills; it is biased in favor
of skilled workers; often associated with information technology and is a
leading explanation for the increased wage gap between low- and high-skilled
workers.
 Deskilling technological change—reduces the skills required for a specific job;
often associated with scientific management efforts to reduce complex jobs to
simple, repetitive tasks and is argued to be a management tool for gaining
control of the workplace and enhancing its bargaining power.
D. The Sociopolitical Environment.
1. The sociopolitical environment captures factors stemming from the social and
political arenas that influence labor and management.
2. Employment outcomes can be influenced by public attitudes toward labor unions.
3. Business and labor can also lobby political leaders for favorable treatment.
4. Political environment can affect the labor relations environment by making it easier
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for unions to organize new workplaces.

5.
Some employee groups rely on political lobbying rather than collective bargaining
to improve wages and working conditions; because of their shunning of collective
bargaining, such groups are often referred to as associations rather than unions;
associations can grow into “full-fledged” unions that engage in collective
bargaining.
E. The Ethical Environment
1. Business ethics studies moral standards as they apply to the business context and is
therefore important for understanding and evaluating labor relations behaviors,
policies, and outcomes.
2. Business ethics should be viewed as a motivating force for and potential constraint
on behavior.
3. An ethical framework that emphasizes efficiency produces very different behaviors
than one in which individuals are expected to treat others with dignity.
4. Following are the six key ethical theories:
 Utilitarianism—defines ethical actions as those that maximize aggregate
welfare (“utility”) so aggregate economic prosperity is highlighted,
irrespective of how it is achieved.
 Libertarianism—sees actions that infringe on others’ freedoms as unethical,
and therefore emphasizes property rights and freedom from governmental (or
labor union) interference.
 Kantian ethical theory—individuals have a duty to respect human dignity;
highlights a concern with how workers are treated.
 Rawlsian justice ethics—there is an ethical concern for the least well-off;
highlights a concern with how workers are treated.
 The ethics of virtue and care—highlight the ethical value of our individual
actions and our special relationships with others.
5. The external environment establishes the parameters for decision makers, but
specific actions within these parameters result from choices made by individual
employees, managers, union leaders, and shareholders; one important influence on
these choices is ethics.
6. Ethics is not just philosophy; it provides an additional framework for a better
understanding of labor relations.
7. Arguments against labor unions on the grounds that they impair efficiency or intrude
on property rights reflect utilitarian and libertarian ethical beliefs.
8. Arguments for labor unions because they provide equity and voice that respect
human dignity, fairness, and the importance of community reflect the ethics of duty,
justice, virtue, and care.
9. The continuing managerial drive for greater flexibility in deploying labor, and the
continued resistance by workers and unions, reflect in part a clash between
utilitarian concerns with efficiency and Kantian concerns with the quality of human
life.
Active Learning Ideas
1. Have students form small groups and answer the questions in the box named, HR Strategy:
Achieving Quality. Discuss the outcomes in class.
2. Have groups of students tackle the issue of whether soldiers should be allowed to join unions.
5-12
(Hint: consider both the environment and ethics.)

Suggestive Answer:
Military unions in the United States are illegal, but this question asks whether this should be the
case. Students’ answers will vary. Most answers will likely be no, soldiers should not be
allowed to join unions due to the technical context—in the military, organizational effectiveness
and survival are dependent on following orders with no questions asked, i.e., no “bargaining,”
going on strike, or filing grievances when ordered to do something. On the other hand,
preventing unionization does not prevent discontent and perhaps unionization is a more
productive channel for handling discontent than insubordination or going AWOL. With respect
to ethics, a utilitarian perspective implies that outlawing military unions is fine as the benefits
are greater than the costs; the ethics of liberty implies that outlawing military unions is
acceptable as long as soldiers know this when they voluntarily sign up for military duty. The
ethics of duty, fairness, virtue, and care place greater emphasis on how individuals are treated
and are therefore less consistent with outlawing unions, even for the military. Allowing soldiers
to join unions, however, might have to be balanced with operational requirements—such as
outlawing the right to strike. In fact, police and fire unions have operated successfully in many
cities for many years with similar restrictions, and you don’t hear reports of firefighters refusing
to fight a fire and filing a grievance instead.
Reflection Questions
1. Of the union strategies in Table 5.1, which ones do you think are best for the 21st-century
world of work? Are some of the strategies always better, or does this depend on the
environment?
Students’ answers will vary. Strategies do depend on the environment. In the 21st century,
business unionism has advantages over social unionism to the extent that communities are large
and politicians are basically unreachable, especially on labor issues. Sticking together in the
workplace will probably produce better results. But on some issues, such as health care, perhaps
a broader social approach will be better. Employee empowerment unionism is probably better
than job control unionism for educated workers or for workplaces that emphasize flexibility.
The wisdom of industrial unionism, craft unionism, or some alternative depends in part on the
extent to which workers identify with an industry or occupation.
2. Describe the pros and cons of union mergers for (a) two unions that represent workers in
the same industry, and (b) two unions that represent workers in different industries.
Should U.S. law encourage, discourage, or remain neutral on union mergers?
Students’ answers will vary.
(a) Pros—These workers will more than likely be seeking the same set of benefits, therefore it
makes sense for them to band together in bigger unions to gain more power. Cons—the larger a
union is, the less likely those individual employees will have visibility to the union leaders who
are making decisions about their working conditions; also, no diversification across industries so
that workers can help each other out when one industry is on strike or is struggling.
(b) Pros—again, more members means more power, plus diversification across industries means
that workers can help each other out when one industry is on strike or is struggling. Cons—at
best, it is more difficult to represent workers in different industries, and at worst, the “winning”
union might be more concerned with the needs of its “own people.”
3. There is longstanding debate over “American exceptionalism”—the extent to which the

low levels of support for unionization and a socialist movement make the United States
5-13
unique among industrialized, democratic countries. There might also be a management

side: American management has been exceptionally antiunion compared to managers in
other countries. Why do you think this is?
Students’ answers will vary. The United States is more aggressively capitalist than many other
countries. Managers are more likely to succeed by being concerned with the profits of the
company, not the satisfaction of the workers, and are not penalized for not being concerned with
anything but the bottom line. Driven by the importance of the stock market, U.S. capitalism has
also developed a very short term-focus and this emphasis on short-term financial results
reinforces anti-union attitudes. Other countries appear to be more socially aware, with
management more connected and concerned about the rank and file workers. Fewer pressures
from faceless shareholders and intense stock markets allow companies in other countries to have
a broader perspective. There is perhaps also a chicken and egg type problem here—when union
density is low, there can be more of a competitive disadvantage if one company becomes
unionized so companies will be more anti-union. With high union density, unionization is
perhaps less of a competitive disadvantage so managers are less oppositional.
4. It is almost universally accepted that labor unions, but not companies, must be democratic.
Why is there this dichotomy? What does this dichotomy imply about the organizational
structures and sources of power for labor unions and for corporations?
Students’ answers will vary. Since providing voice is one of the primary roles of labor unions, it
is imperative that unions are democratic. Also, unions are made up of human beings who desire
someone to represent them—unionism therefore only makes sense if the leaders represent the
interests of the members. Companies, on the other hand, are generally viewed as private entities
that exist to make a profit. They do not exist to provide voice or representation and are therefore
not viewed as needing to be democratic. Moreover, a strong sense of property rights means that
the owners are seen as retaining control rights. Democracy in companies boils down to one
dollar, one vote. This dichotomy implies that the owner of a company is more powerful than the
leader of a union—companies have top-down power structures, unions (ideally) have bottom-up
power structures.
5. Employees might respond to workplace injustice in one of five ways: quitting, individual
voice (such as complaining), collective voice (including forming a union), resistance
(including work withdrawal such as absenteeism, reduced work effort, and work
avoidance, or perhaps even sabotage), and silence. How might union strategies, managerial
strategies, and the external environment shape which response an individual worker
chooses? What else might affect whether workplace injustice causes an individual to
support a labor union over the other options for dealing with injustice?
Students’ answers will vary. The discussion should discuss how autocratic human resources
approach can lead individuals to resolve to unionization, resistance or silence. While open-door
policies, rewards and fair treatment can allow individuals to deal constructively when they
encounter workplace challenges.
Suggested Class Discussion or Short Essay Topics
1. U.S. law mandates basic democratic procedures within unions including election provisions.
Many national leaders are regularly re-elected while there is greater turnover of leaders at the
local level. What explanation can you give for this?
2. With respect to employer behavior, it is commonly believed that the firing of the public-sector
5-14
air traffic controllers by President Ronald Reagan during the illegal PATCO strike in 1981
created a climate in which it was acceptable for private-sector employers to actively fight unions
and resist their legal strikes. What arguments might someone give to support this acceptance?
What arguments might someone give to dispel the logic of this acceptance? Do you think the
President made the right decision in firing the air traffic controllers? Why or why not?
Internet Exploration
1. Find some descriptions of national union structures on various union websites (on many sites
there is a link for “About Union Name”). How similar are the structures? Can you find
differences in structures that are related to differences in the environment? Here are some
websites: the American Postal Workers Union (www.apwu.org), International Brotherhood of
Boilermakers (www.boilermakers.org—look under “who we are”), International Longshore and
Warehouse Union (ILWU) (www.ilwu.org), and the United Auto Workers (UAW)
(www.uaw.org). Additional union links can be found at http://www.aflcio.org/About/AFL-CIO-
Unions and http://www.changetowin.org/
2. Find the AFL–CIO state federation or central labor council closest to you (see
http://www.aflcio.org/About/Find-a-State-or-Local-AFL-CIO/). What types of activities and
issues is it emphasizing? How does this support the local labor movement?
3. Find and explore the websites for the AFL–CIO and Change to Win. In what ways are the
messages and strategies of the two federations similar? Different? Are workers better off when
the labor movement has a single, unified federation or multiple, competing national federations?
4. Identify a local company or some other business organization that is of interest. Search the
Internet to find information on the economic environment for that company. Try to find labor
market information as well as company-level, industry-level, and economy-wide information
regarding consumer demand and ability to pay. Are there trends in other dimensions of the labor
relations environment that are relevant for this company?
Other Links
AFL-CIO: http://www.aflcio.org
Change to Win: http://www.changetowin.org
Canadian Labor Congress: http://www.clc-ctc.ca
Trades Union Congress: http://www.tuc.org.uk
International Labor Organization: http://www.ilo.org
Society for the Promotion of Human Rights in Employment: http://www.sphre.org
Living Wage Resource Center: http://www.livingwagecampaign.org/
National Association of Manufacturers: http://www.nam.org/
National Public Employer Labor Relations Association: http://www.npelra.org
Union Jobs Clearinghouse: http://www.unionjobs.com
Suggested BusinessWeek Articles
1. “IUE Loses Its Bargaining Battle” (October 29, 1960, pp. 82-83)
2. “The Obsolete View from Labor’s Summit” (August 17, 1981, p. 28)
3. “Palace Coup at the AFL-CIO” (March 17, 2003, pp. 78-79)
(http://www.businessweek.com/stories/2003-03-06/palace-coup-at-the-afl-cio)
5-15
4. “Can This Man Save Labor?” (September 13, 2004, pp. 80-88)
(http://www.businessweek.com/stories/2004-09-12/can-this-man-save-labor)
5. “So Long AFL-CIO. Now What?” (August 8, 2005, p. 35)
(http://www.businessweek.com/stories/2005-08-07/so-long-afl-cio-dot-now-what)
6. “No Solidarity for Labor” (June 15, 2009, p. 28)
(http://www.businessweek.com/magazine/content/09_24/b4135028917564.htm)
5-16

Labor Relations Striking A Balance 4th Edition Budd Solutions Manual 1

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Chapter 05 - Labor and Management: Strategies, Structures, and Constraints

Solution Manual for Labor Relations Striking a Balance 4th

Labor and Management: Strategies, Structures, and

I. Labor Union Strategies

unionism, involves a single union representing only workers in a single

and reaping rewards for doing so.

II. The Structure of the U.S. Labor Movement

A. Local Union Structures

services also apply to labor unions.

III. Management Strategies

IV. The Labor Relations Environment

 The Family and Medical Leave Act (unpaid leave)

for unions to organize new workplaces.

Active Learning Ideas

(Hint: consider both the environment and ethics.)

3. There is longstanding debate over “American exceptionalism”—the extent to which the

unique among industrialized, democratic countries. There might also be a management

Suggested Class Discussion or Short Essay Topics

Suggested BusinessWeek Articles

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