15-1

15-2

15

Labor Relations and

Collective Bargaining

McGraw-Hill/Irwin
Human Resource Management, 10/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved.
15-3
Introduction
This chapter introduces a powerful political and
economic force in American society—the labor union
An organization of employees that uses collective
action to advance its members’ interests in regard to
wages and working conditions
Employees of both private and public firms have
joined unions
Regardless of the sector in which they are employed,
their philosophy is the same—strength is found in
joining together
15-4
Introduction
Ingeneral, there are two types of unions:
An industrial union consists of all employees in a
company or industry, regardless of occupation
Members of a craft union belong to one craft or to a
closely related group of occupations
Unionsare discussed in the context of labor relations
The relationship includes:
Negotiation of a written contract
Interpretation and administration of the contract
15-5
Diagnostic Approach to Labor Relations
Union officials and management interact daily and
at contract time
Their attitudes toward each other affect the degree of
peace and effectiveness that can exist
Environmental factors that influence the nature of
collective bargaining:
Labor market conditions
Government
15-6
Diagnostic Approach to Labor Relations
Ifthe labor market has a surplus and demand for
goods is soft, management has an advantage
The company can sustain a strike and perhaps benefit
economically from it
Under these conditions, union members are less
likely to vote for a strike
When the labor market is tight and the demand for
goods is strong, the union has the advantage
15-7
Diagnostic Approach to Labor Relations
The government creates the legal environment in
which labor relations occur
Government boards rule on legal differences in the
system, and government mediators/conciliators often
help settle disputes
Governments can also enter into trade agreements
which can affect other external factors, including:
Economic conditions
Composition of the labor force
Organizational locations
15-8
Early Collective Action & Union Formation
Employers successfully resisted the earliest efforts to
organize unions
In 1794, strikers were found to have engaged in a
criminal conspiracy and were fined
This doctrine was a key management weapon
until 1842
The Massachusetts Supreme Court decided that
criminal conspiracy does not exist if unions use legal
tactics to achieve legitimate goals
15-9
Early Collective Action & Union Formation
Rapid industrial expansion began during the Civil
War, when employment conditions included:
Long work hours
Unsafe working conditions
Low wages
High unemployment

The turbulent era after the war brought recognition

that labor unions could help solve social and
economic problems
15-10
Early Collective Action & Union Formation
The first union to achieve significant size and
influence was the Knights of Labor
Formed around 1869, it attracted employees and local
unions from all crafts and occupational areas
The Knights had two objectives:
Establish one large union for all employees,
regardless of trade
Replace capitalism with socialism

The strength of the Knights of Labor was diluted

It failed to integrate needs and interests of both
skilled and unskilled members
15-11
Early Collective Action & Union Formation
A group of craft unions left the Knights of Labor
around 186 to form the American Federation of
Labor (AFL)
Samuel Gompers of the Cigar Maker’s Union was
elected president
Membership was initially limited to
skilled tradespeople, such as
machinists, bricklayers, and carpenters
15-12
Early Collective Action & Union Formation
Growth in unions was slow from 1886 to 1935
In 1935, the Congress of Industrial Organizations
(CIO) was formed
It was led by John L. Lewis, president of the United
Mine Workers
The CIO grew quickly
Craft, semiskilled, and unskilled employees within an
industry could all be members
Competition for new members led to conflicts
between the AFL and CIO until they merged in 1955
15-13
Labor Legislation Overview
Union-management interaction is governed by state
and federal laws
Arbitration Act of 1888:
Encouraged the voluntary settlement of labor
disputes in the railroad industry through arbitration
Railway Labor Act of 1926:
Gave railroad workers the right to organize and
bargain collectively with management
Prohibited yellow-dog contracts
15-14
Labor Legislation Overview
In the 1930s, the federal government became
involved in labor disputes outside the railroad
industry
Norris-LaGuardia Act of 1932:
Limited the use of injunctions to stop union
picketing, boycotts, and strikes
Extended the prohibition of yellow-dog contracts
beyond the railroad industry
15-15
Labor Legislation Overview
Labor law today is linked to three federal statutes:
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)
Better known as the Wagner Act, the National
Labor Relations Act was passed in 1935 to:
Encourage the growth of trade unions
Keep management from interfering with this growth
15-16
National Labor Relations Act
As originally drafted, it included seven topics:
Recognition of the right to bargain collectively
Limitation on collective bargaining
Representation
Certification and decertification elections
Terms of collective bargaining agreements
Problems of company unions
Right to strike
15-17
National Labor Relations Act
This act restricts unfair practices of management:
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 a union
Discriminating against or discharging an employee
because he/she filed charges or gave testimony under
the Wagner Act
Refusal to bargain in good faith
15-18
National Labor Relations Act
The Wagner Act was based on the notion that:
An individual employee has unequal bargaining
power compared to the employer
Employers strongly objected and fought to have the
act declared unconstitutional
The U.S. Supreme Court upheld the Act in National
Labor Relations Board v. Jones and Laughlin Steel
The power to implement the Act was given to:
A five-person National Labor Relations Board
(NLRB) and a staff of lawyers and other personnel
15-19
National Labor Relations Act

The National Labor Relations Board:

Sets up elections to determine if workers wish
to have a union as a bargaining representative
Investigates complaints of unfair labor practices
15-20
Labor Management Relations Act
Passed in 1947, the Labor Management Relations
Act, (Taft-Hartley Act):
Amended and supplemented the Wagner Act
Guaranteed employees’ bargaining rights
Forbade the unfair labor practices by employers
established in the Wagner Act
Specified unfair labor practices by a union
15-21
Labor Management Relations Act
Unfair labor practices by a union include:
Restraining or coercing employees in the exercise of
their right to join/not join a union
Causing an employer to discriminate against an
employee other than for nonpayment of dues or
initiation fees
Refusal to bargain with an
employer in good faith
Charging excessive or
discriminatory membership fees
Causing an employer to give payment for
service not performed (featherbedding)
15-22
Labor Management Relations Act
Unfair labor practices by a union (continued):
Inducing, encouraging, threatening, or coercing any
individual to engage in strikes, refusal to work, or
boycott where the objective is to:
Force any employer/self-employed person to cease
using the products of, or doing business with, another
Force any employer to recognize or bargain with the
union, unless it has been certified by the NLRB
Force an employer to apply pressure to another
employer to recognize a union
15-23
Labor-Management Reporting & Disclosure Act

In 1959, Congress passed the Labor-Management

Reporting and Disclosure Act to regulate the internal
affairs of unions
Also known as the Landrum-Griffin Act
 Gives every union member the right to:
Nominate candidates for union office
Vote in union elections
Attend union meetings
Examine union accounts and records
15-24
Labor-Management Reporting & Disclosure Act

The union is also required to submit an annual

financial report to the Secretary of Labor
Employers must report payments or loans made to
unions, the officers, or members
This eliminated “sweetheart contracts”
Union leaders and management agree to terms that
work to their mutual benefit, but maintain poor
working conditions for employees
15-25
Structure and Management of Unions
Union structure in the U.S. consists of four levels:

The federation of
unions (AFL-CIO)

Intermediate

National

Local
15-26
Federation of Unions
Today, over 68 national and international labor
unions belong to the AFL-CIO
Formed in 1955 when the American Federal
of Labor merged with the Congress of Industrial
Organization
Represents over 13 million employees
15-27
Federation of Unions
The stated mission of the AFL-CIO:
Strengthening working families by enabling more
workers to join together in unions
Building a stronger political voice for working
families
Providing a new voice for workers in the global
economy
Creating a more effective voice for working families
in our communities
15-28
Federation of Unions
National headquarters provides many services to
affiliated unions, including:
Training for regional and local union leaders
Organizing assistance
Strike funds
Data for use in contract negotiations

The chief governing body of the AFL-CIO is the

biennial convention, which sets policy
Between conventions, executive officers, assisted by
a 51-member executive council and the general board,
run the organization
15-29
Intermediate Union Bodies
Intermediate organizing bodies interface with the
AFL-CIO and with national and local units
Intermediate units include:
Regional or district offices
Trade conferences
Conference boards
Joint councils
They are usually affiliated with a national union and
provide services to a given geographic area
15-30
Intermediate Union Bodies
The primary purpose of intermediate bodies is to:
Help coordinate union membership
Organize discussions of issues pertaining to the
relationship between labor and management
Join together local unions with similar goals
They may also provide office space and other
facilities for local unions
15-31
National Unions
The national union establishes the rules, policies,
and procedures under which local unions may
become chartered members
Each national union has control over local unions
Collecting dues, admitting new members to the
local, using union funds
The national provides local unions with support for
organizing campaigns and administrating contracts
There are about 100 national union organizations
They have from 18 to over 1.4 million members
15-32
Local Unions
The grass roots of labor organizations are the local
craft or industrial unions
Local unions have a direct influence over
membership
Through the local, members exercise their complaints
and pay the dues that support the national union
The activities of locals are conducted by officials
elected by the members
Elected officials of local unions often have full-time
jobs in addition to their union duties
15-33
Local Unions
In many unions, the business representative is the
dominant person
Responsibilities of the business representative:
Negotiate and administer the labor agreement
Settle contract problems that arise
Collect dues
Recruit new members
Coordinate social activities
Arrange union meetings
15-34
Local Unions
The union steward represents the local union
members in their on-the-job relations with managers
Stewards are the union’s direct link to management
They are front-line representatives who must:
Work for the workers they represent
Keep the lines of communication, trust, and respect
open between union members and management
15-35
Union Organizing Campaign
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
15-36
Union Organizing Campaign
Conditions most likely to trigger union organizing:
Lack of job security
Low wages
Subcontracting
Hostile supervisory practices
Inadequate health care or other benefits
15-37
The Union Organizing Process
Insert Exhibit 15-3 here
15-38
Authorization Cards and Certification
An authorization card is a document indicating that
an employee wants union representation
A signed card authorizes the union to represent an
employee during negotiations
At least 30% of employees must sign before the
NLRB can be petitioned to hold a representation
election
If over 50% of the employees sign up, the union can
ask the company to recognize it as the employees’
representative without a certification election
15-39
Authorization Cards and Certification
Three ways a union can be certified:
The union proves it represents a majority of the
firm’s employees, so management voluntarily
recognizes it
The union receives a simple majority during a
certification vote
The NLRB directs the employer to recognize the
union without an election
This occurs when the employer engages in unfair
labor practices during the organization campaign
15-40
Union Security
After a union is certified, it’s focus shifts to union
security or preservation of membership
Unions want to increase their security by requiring
all employees to join
Especially true if the union was voted in by a
slim margin
Some employees won’t want to join the union, so
different types of union “shops” have developed
15-41
Levels of Union Security
Open shop
There is neither a union present nor an effort by
management to keep the union out
Restricted shop
Management tries to keep a union out without
violating any labor laws
Agency shop
All non-managerial employees must pay union dues,
whether they are union members or not
15-42
Levels of Union Security
Preferential shop
The union is recognized and union members are
given preference in some things
Closed shop
New employees must be a union member when hired

Union shop
Requires an employee to join the union after being
hired
15-43
Levels of Union Security
An employee can satisfy membership requirements
by simply paying union initiation fees and dues
Payments cannot support activities unrelated to
collective bargaining, grievance resolution, or
contract administration
Per Marquez v. Screen Actors Guide (1998)
A compulsory unionism clause need not explain
alternatives to formal membership
Employees must be told that the membership
requirement is met by paying union fees and dues
15-44
Right-To-Work Requirements
Section 14B is an important elements of the Taft-
Hartley Act
Any state that wishes to pass legislation more
restrictive of union security than the union shop is
free to do so
To date, 22 states have enacted right-to-work laws
These states ban compulsory union membership
Employees are permitted to resign from union
membership at any time
15-45
Public Employee Associations
Public employees first organized during the early
1800s in federal shipyards
In 1836, a naval shipyard strike involved direct
confrontation with President Andrew Jackson
In 1863, the postal workers organized the first
nationally prominent employee association
By 1890, the National Association of Letter Carriers
was created
By 1896, other federal employees began to organize
In 1912, customs inspectors organized
15-46
Public Employee Associations
Finally, two larger, general purpose federal
organizations were formed:
The American Federation of Government Employees
(AFGE) in 1932
The National Association of Government Employees
(NAGE) in 1934
State and local government associations were not
evident until the 1960s
Local employees (teachers, firefighters, police)
tended to form associations along craft lines
Union membership among public employees has
steadily increased since 1983
15-47
Public Sector Labor Legislation
1962—President Kennedy issued Executive Order
10988
Created a federal collective bargaining system
Included a strong management rights clause and
banned strikes and the union shop
1969—President Nixon issued Executive Order
11491, which allows the Secretary of Labor to:
Determine bargaining units
Supervise union recognition
Examine unfair labor practices
It also established the Federal Labor Relations Council
15-48
Public Sector Labor Legislation
In 1975, President Ford issued Executive Order
11823, which:
Requires federal agencies to bargain with their
employees on all issues, unless the agency can show a
compelling need not to negotiate
Provides for an FLRC-appointed final arbitrator
15-49
Public Sector Labor Legislation
In 1978, the Civil Service Reform Act was passed:
It abolished the Civil Service Commission
Federal employees’ rights were placed under the
Federal Labor Relations Authority (FLRA)
It created the Office of Labor-Management Relations
to provide technical advice to agencies on labor
policies, leadership, and contract administration
15-50
Collective Bargaining
Collective bargaining is a process by which:
Representatives of the organization meet and attempt
to work out a contract with the employees’
representative, the union
The collective bargaining process and the final
agreement reached are influenced by variables
In a tight economy, a union’s push for higher wages
is less likely to succeed because it would be
inflationary
The firm’s representative must consider whether the
company can pay an increased wage, given current
and expected economic conditions
15-51
Three Types of Bargaining
Distributive bargaining
Labor and management are in conflict on an issue and
the outcome is a win-lose situation
Integrative bargaining
The two sides face a common problem

Concession bargaining
Something of importance is given back to
management
15-52
Collective Bargaining
The process of negotiating a collective bargaining
agreement:
Pre-negotiation
Selecting negotiators
Developing a bargaining strategy
Using the best tactics
Reaching a formal contractual agreement
Ratifying the contract
15-53
Prenegotiation
In collective bargaining, both sides try to receive
concessions that helps them achieve their objectives
As soon as a contract is signed, both parties begin
preparing for the next collective bargaining session
The importance of prenegotiation preparation cannot
be over-emphasized
Various types of contract and demographic data is
maintained by both unions and management
It is also important to check the background of the
union negotiators
15-54
Selecting the Negotiators

Negotiators are members of the bargaining teams

They represent areas of particular interest in the
contact, or have expertise in specific negotiation areas
Each side is led by a chief negotiator
Management is also represented by at least one line
manager, usually the plant manager
15-55
Selecting the Negotiators
The management team of negotiators:
An HR expert
A lawyer
A manager or vice president with knowledge of the
entire business organization
Various experts

The union team of negotiators:

Business agents
Shop stewards
The local union president
Representatives from the national union headquarters
15-56
Selecting the Negotiators
The union team is often elected by union members
The chief negotiator may have little input
One/more rank-and-file members will be on the team
They come from various operating departments to
ensure everyone’s concerns are equally represented
The negotiating teams meet independently before the
bargaining sessions to plan the best strategy to use
This preparation identifies the chief spokesperson and
the roles of each member on the team
15-57
Selecting the Negotiators
Specific roles include:
Leader, usually the senior team member
Summarizer, who summarizes the negotiations to
date
Recorder, who both keeps notes on the various
agreements and observes the opposition team
Strategy is the plan and policies that will be pursued
at the bargaining table
Tactics are actions taken in the bargaining sessions
15-58
Developing a Bargaining Strategy
An important issue in strategy is identifying the
maximum concessions that will be granted
By shifting a position during bargaining, the other
side may develop expectations that are hard to change
By granting too much, one side may be viewed as
weak
How far management or the union will go before it
risks a work stoppage or lockout is also part of the
strategic plan
15-59
Developing a Bargaining Strategy
Another strategy issue is developing the cost profile
of the maximum concession package
This helps management determine how willing it
is to take a strike
Most negotiations are conducted today just as they
always have been
The two sides sit face-to-face across a table and
orally try to reach an agreement
A modern change has been the addition of a computer
15-60
Developing a Bargaining Strategy
Having access to computers can help negotiators:
Reduce ambiguity, misunderstandings, and mistrust
Track progress
Save time between sessions
Prepare the final agreement

Computerized bargaining tools:

A contract log
An electronic bargaining book (EBB)
An article checklist
A proposal editor
15-61
Using the Best Tactics
Tactics are calculated actions used by both parties
Tactics are sometimes used to mislead the other party
They are also used to secure a favorable agreement

Popular tactics:
Conflict-based
Armed truce
Power bargaining
Accommodation
Cooperation
15-62
Using the Best Tactics
If either side fails to bargain in good faith, unfair
labor practices can be charged
The associated costs, publicity, and hostility are
usually too high to disregard
Lack of good faith is demonstrated by:
Unwillingness to make counter-proposals
Constantly changing positions
Use of delaying tactics
Withdrawing concessions after they have been made
Refusal to provide necessary data for negotiations
15-63
Reaching a Formal Agreement
The union-management contract designates the
formal terms of agreement
The average contract lasts for two or more years
Contract size ranges from a few pages to more
than 100
In general, the contract spells out the authority and
responsibilities of both the union and management
15-64
Reaching a Formal Agreement
Management rights appear in one of two forms:
A statement that control and operation of the business
are the right of management, except in cases specified
by the contract
A list of management activities that are not subject to
sharing with the union
The union’s rights involve such issues as laying off
members, promotion, and transfer
The union stresses seniority as a means of reducing
discrimination and favoritism in HRM decisions
15-65
Contract Ratification
After agreeing on contract language with
management:
The tentative agreement must be submitted to union
members for ratification
Ratification usually requires a simple majority vote
This vote is not a legal requirement, but allows union
leadership to affirm their compact with members
About 10 percent of all tentative agreements are
rejected
15-66
Failure to Reach Agreement
A bargaining impasse occurs when:
Labor and management are unable to reach settlement
on a mandatory bargaining issue
Members refuse to ratify a tentative agreement

Impasses occur for a number of reasons:

The settlement ranges of the parties do not overlap
One or both sides failed to communicate enough
information to reach settlement
The union members feel that union leadership did not
bargain in good faith
15-67
Failure to Reach Agreement

Possible outcomes of a labor impasse:

Work stoppages by either the union (strike) or
management (lockout)
Seeking the help of a neutral third party
Permanent replacements
15-68
Strikes
The threat of a strike is a major bargaining weapon
used by the union
Before striking, the union needs to consider:
The legality of striking
Members’ willingness to endure a long strike
The employer’s ability to operate the organization
without union members
The greater the employer’s ability to operate the
organization, the less chance the union has of gaining
its demands
15-69
Strikes
Types of strikes:
Economic
Jurisdictional
Wildcat
Sitdown

Less than 10% of negotiations end in a strike

If a union mounts a strike, it often uses picketing
15-70
Strikes
Another form of union pressure is the boycott
Primary boycott: union members do not patronize
the boycotted firm (legal)
Secondary boycott: a supplier of a boycotted firm is
threatened with a union strike unless it stops doing
business with the boycotted company (illegal)
Hot cargo agreement: the employer permits union
members to avoid working with materials that come
from employers who have been struck (illegal except
in construction and clothing industries)
15-71
Lockouts
Management’s response to union pressure:
Continue operation with a skeleton crew of managers
Shut down the plant
Lock the employees out

The lockout is an effort to force the union to:

Stop harassing the employer
Accept the conditions set by management

Lockouts are also used to prevent:

Work slowdowns
Damage to property
Violence
15-72
Lockouts
Many states allow locked-out employees to draw
unemployment benefits
This weakens the lockout

Imposition of a lockout can work against the

company’s interests
Workers who are locked out cannot be permanently
replaced, which is one of management’s most potent
anti-labor tools
15-73
Permanent Replacements
Companies facing production losses during a strike
often resort to replacing missing workers
Replacements are terminated as union members
return to their jobs
The National Labor Relations Act does not forbid
companies to:
Hire replacement workers
Make these workers permanent

Striking workers can be permanently replaced;

locked-out workers cannot
15-74
Third-Party Intervention
In the case of an impasse, three types of third-party
interventions are possible:
Mediation
Fact-finding
Interest arbitration

Both parties must agree to any of these solutions

Each one is progressively more constraining on the
freedom of the parties
15-75
Mediation and Fact Finding
With mediation, a neutral third party helps labor
and management reach agreement
It is an inexpensive alternative to strikes

Federal Mediation and Conciliation Service (FMCS)

Independent agency created by the Taft-Hartley Act
Employs approximately 300 mediators
They mediate 15,000 labor disagreements per year
There is no charge for their services

In the rail and air industries, mediation services are

provided by the National Mediation Board
15-76
Mediation and Fact Finding
Mediation is a continuum of techniques that can be
used to persuade the parties to resume negotiations
Conciliation is the first step
The goal is to persuade disputing parties to meet
and discuss their problems
Conciliation was large annulled when the duty to
bargain in good faith was imposed in 1947
15-77
Mediation and Fact Finding

A mediator is a reviewer of facts, a creative

facilitator, and a professional listener
He/she relies on the power of persuasion to get both
parties to settle a dispute
Suggestions made by the mediator may be accepted
or rejected
15-78
Mediation and Fact Finding
A successful mediator has:
Impartiality
Sincerity
Communication skills
Persistence
Self-control
Expertise
Creativity
Acceptability as a neutral party
15-79
Mediation and Fact Finding

In fact-finding, a neutral third party studies the

issues and then recommends a reasonable settlement
Both mediation and fact-find help the union and
management reach their own agreement
15-80
Interest Arbitration
Interest arbitration is the final technique for
resolving an impasse
A neutral third party imposes a settlement on the
disputing parties
Interest arbitration occurs when:
No agreement exists or a change is sought
The parties have an interest in the outcome because
the contract will specify future rights
Interest arbitration is often used to solve impasses in
the public sector
15-81
Administering the Contract
Day-to-day compliance with the provisions of the
contract is an important responsibility of the
supervisor or first-line manager
As the representative of management, the supervisor
must:
Discipline workers
Handle grievances
Prepare for such actions as strikes
15-82
Discipline
Most contracts give management the right to
discipline workers, provided that discipline follows
legal due process
If a worker challenges a disciplinary action, the
burden of proof rests with the company
It is important to act immediately when an employee
breaks rules or performs below standard
Discipline should not be used if the supervisor has:
Failed to make the workplace rules clear
Failed to warn the employee
15-83
Discipline
Many union-management contracts specify the types
of discipline and the offenses for which corrective
action will be taken
Typical infractions:
Incompetence
Misconduct
Violations of the contract
15-84
Grievances
A grievance is a complaint about an organizational
policy, procedure, or managerial practice that
creates dissatisfaction or discomforts
The complaint may be valid or not
It may be made by an individual or by the union

The union contract contains a clause covering:

The steps to be followed to file a grievance
How a grievance will be handled

The number of steps varies from contract to contract

15-85
Grievances
A four-step grievance procedure:
Step 1: The employee meets with the supervisor and
the union steward and presents the grievance
Step 2: If the grievance is not settled, there is a
conference between middle management and union
officials
Step 3: A representative of top management and top
union officials attempt to settle the grievance
Step 4: Both parties turn the grievance over to an
arbitrator, who makes a decision
15-86
Grievances
Important principles for managers to follow:
Take every grievance seriously
Work with the union representative
Gather all information available on the grievance
After weighing all the facts, provide an answer to the
employee voicing the grievance
After the grievance is settled, move on to other
matters
Grievances are more likely to be settled favorably
when the climate is positive
15-87
Arbitration
The grievance procedure doesn’t always result in an
acceptable solution
When a deadlock occurs, most contracts call for
arbitration
With arbitration the parties submit an irresolvable
dispute to a neutral third party for binding
settlement
Employees may file a lawsuit unless arbitration is
specifically required in the arbitration clause
15-88
Arbitration
Procedures for selection of an arbitrator are usually
written into the contract
The typical arrangement is to use a single impartial
arbitrator who hears evidence and renders an award
Or, there may be a tripartite board consisting of:
A management representative
A union representative
An impartial chairperson
15-89
Arbitration
Arbitrators generally come from three sources:
Attorneys who are full-time arbitrators
Academics who are experts in labor law, human
resources management, and labor economics
Respected members of the community

The award is the decision reached by the arbitrator

It conveys the decision, a summary of the evidence,
and the rationale for the decision
15-90
Arbitration
The arbitrator must examine three issues:
Can the dispute be arbitrated?
Did the grievance allege an actual violation of the
contract?
Were the grievance procedures followed in a timely
manner?
Most contracts prohibit arbitrators from adding to
or subtracting from the intent of the contract
15-91
Arbitration
Arbitration can be very expensive
The average fee for the arbitrator is between $400
and $500 per day, plus travel and study time
Both sides usually engage an attorney
Employees involved in the complaint must be paid
their regular wages during the arbitration process
Costs are divided equally between management and
the union
A financially unstable union may be reluctant to
become involved in arbitration at all
15-92
The Changing Climate of Unionization
Union membership increased significantly from
1933 to 1947
In 1933 there were 3 million members
By 1947 there were 15 million members

Unionism in the U.S. peaked in 1955, when 40% of

the civilian labor force worked in manufacturing
Since the 1960s, membership has steadily decreased
By 2010 the early base of unionism will be almost
completely eroded
15-93
The Changing Climate of Unionization
At least five factors are important in the erosion of
union power:
Increased competition in a global market
Shift from manufacturing to an economy based on
service, knowledge, and information
New waves of immigration
Slowing or decreasing demand for union
representation
Growing size of the contingent labor force
15-94
Union Membership Trends
According to the AFL-CIO, many unions have
begun to reclaim lost ground
General attitudes toward unions are improving,
especially among adults aged 18-34
Moreover, a significant number of employees
surveyed indicated that:
Unionized employees were better off than
non-unionized employees, and
Increased union representation would be
good for the U.S.
15-95
Union Membership Trends
African-American men have the highest rate of
union membership
Employees aged 35-64 are more likely to be members
Over 1.7 million workers are represented by a union,
even though they are not union members
Median wages for union members was $781 per
week
Nonunion workers earned an average of $612
15-96
Union Membership Trends
Unions are now trying to organize bargaining units
outside their traditional industries
In 2004, about 7.9% of union members worked in
private industry
37.5% of the remainder were government employees
Protective services (police officers, firefighters) had
the highest proportion of union members
Union membership was lowest in finance, insurance,
and real estate
15-97
Global Unionization
The International Confederation of Free Trade
Unions claims 157 million members in 148 countries
Three regional organizations represent Asia, the
Pacific, Africa, and the Americas
It is also linked to the European Trade Union
Confederation
The U.S. has more unionized workers than any
country except China, Russia, and the Ukraine
In the U.S., union membership is about 12%
China has over 134 million union members
15-98
Global Unionization
The primary functions of Chinese trade unions:
Protect the legitimate interests and democratic rights
of workers
Mobilize workers and staff members to take part in
the construction and reform of economic and social
development
Represent and organize workers and staff members
Educate workers and staff members to improve their
ideological and moral qualities and raise their
scientific and cultural levels
15-99
Global Unionization
In Europe it is common for union contracts cover
even non-union workers
The influence of unions is much greater than would
be suggested by the total union membership
Unions in many countries are more involved in
national politics and issues than those in the U.S.
15-100
Union Organizing Trends

To stop downward membership trends, unions are:

Investing heavily in the organizing function
Utilizing innovative strategies to attract employees
Credit cards, prepaid legal services, term life
insurance, and travel clubs
Using email and the Internet to disseminate messages
15-101
Union Organizing Trends
Unions are allowed to orally solicit employees during
nonwork hours in both work and nonwork areas
Employers may prohibit the dissemination of union
literature in work area
However, an employer cannot ban union literature
while allowing other nonwork-related information
exchanges
15-102
Union Organizing Trends
Suggestions for employers wishing to implement
email policies:
Prohibit all personal, nonwork communications on
the company email system
Communicate to employees that the email system and
email messages are company property
Notify employees that all communication through the
company email system may be monitored
Require employees to read the policy, sign an
acknowledgement of receipt, and agree to adhere to
its rules
15-103
Union Organizing Trends
The future of U.S. unions depends on these factors:
Quality of union leadership
Willingness to experiment with organizing
techniques
Frequent involvement with rank-and-file employees
Ability to appeal to better-educated professional,
service, and knowledge workers
Genuine cooperation with management