Labor Unions

Workers of the world unite!

 Labor Unions
• Def. an organization of workers that tries
to improve working conditions, wages and
benefits for its members.
• Also known as Organized Labor
• Less than 14% of U.S. workers belong to a
labor union.
 Declines in Union Membership
• Unions rose to prominence in the 1930s,
but several factors have led to declines
in union membership since the 1950s:

1. “Right to Work” Laws

Laws which ban mandatory union membership
at the workplace. A union cannot force
workers to join.
 Declines in Union Membership
2. Economic Trends
Unions have traditionally been strongest in the
manufacturing sector, representing workers
who have industrial jobs. These jobs have
been declining in number as the American
economy becomes more service oriented.
Less manufacturing jobs, less union
workers.
 Declines in Union Membership
3. Fulfillment of Union Goals
With the government setting standards for
workplace safety, and with more benefits
being provided by both private and
government sources, some claim that the
union membership has decreased simply
because their goals have been fulfilled.
 Types of Union Workplaces
Union workplaces fall into 3 categories:

1. Union Shop: will hire nonunion workers,

but requires them to join the union once
hired.

2. Closed Shop: hires only union members

(must be a member before hiring). These
are now illegal.
 Unions in the Workplace
3. Agency Shop: will hire nonunion workers,
and does not require workers to join the
union. However, nonunion workers must
pay union dues and are covered by the
union contract.
 Collective Bargaining
Def. The process in which union and
company representatives meet to
negotiate a new labor contract. The
contract contains all the requirements of
workers to the employer and the employer
to the workers. They include; salary,
benefits, working conditions, work
day/hours, conditions for hiring/firing, etc.
 Collective Bargaining
In collective bargaining for a new contract,
unions argue for:
1. Better wages and benefits
2. Safe working conditions
3. Conditions under which an employee can
be fired
 Collective Bargaining
When a contract needs to be renewed, union
and employer representatives meet and
discuss their demands. Compromises are
made until a new contract is agreed upon
by both sides. A vote by union members is
held to approve a new contract.

But, what if both sides cannot agree on a

new contract?
 If Collective Bargaining Fails…
• Mediation:
Def. A settlement technique in which a neutral
mediator (usually a judge) meets with both
sides and suggests a solution for both sides.
The mediation is non-binding, i.e. the union or
management can reject the mediation.

Ex. The union wants a 5% raise, management

offers a 1% raise. The mediator suggests a
3% raise. Both union and management can
reject the offer!
 If Collective Bargaining Fails…
• Arbitration:
Def. A settlement technique in which a third
party (arbitrator) reviews the case and
imposes a decision that both sides are
required to accept.

Ex. Union wants a 5% raise, management

offers 1%. The arbitrator imposes a 3% raise.
The union has to accept the arbitration
without a vote.
 Other tools of unions
• Work slowdown: in order to put pressure
on management, unions could ask
members to work as little as required by
the contract. Ex. Using all sick days (called
the “blue flu”), leaving and coming to work
exactly on time (work to rule), not working
overtime, etc.
 Union’s Ultimate
Weapon!
• STRIKES!
– Def. A strike is an organized work stoppage intended
to force an employer to address union demands.
– Strikes can be harmful to both employer and union
members. The employer loses money and business
to competitors during a strike, union members do not
get paid during a strike. It becomes a waiting game-
who can last the longest.
 Replacement Workers
• Replacement workers (a.k.a.
Strikebreakers or Scabs) are hired to
replace striking workers.