1. 4.3 – The Role of Trade Unions
IGCSE Economics
4.3 – The Role of Trade Unions

2. Learning Outcomes
Describe trade Unions and analyse their role in an economy

3. What is a Trade Union?
A trade union is an organisation which represents the interests of its workers in negotiations about improving working conditions with employers and government.

4. What has the Trade Union movement done?
fight and bring to an end child labour in many countries
improve workers’ safety
increase wages for both union and non-unionized workers
improve education and other benefits for many poor and working class families

5. Types of Unions Trade unions may represent:
employees with the same skills or in the same occupation
employees in the same industry
employees with different skills in different occupations and industries
Craft unions
e.g. Union of Operators and Technicians in Cinema and Video Projection (Spain)
Non-manual unions
e.g. German Police Union
Industrial unions
e.g. National Union of Mineworkers in South Africa (NUM)
General unions
e.g. Australian Workers Union

6. Task – Read the ‘Unison Case Study’
Questions:
How has the relationship between trade unions and employers changed over time?
What are the ‘shared goals’ of Trade Unions and Employers?
What are the benefits of Union Membership?
How can unions help in disciplinary/grievance procedures?
How have trade unions worked to ‘Safeguard’ employees rights?
What methods of ‘Industrial Action’ may be taken?

7. Aims of Trade Unions... defending employees’ rights and jobs
negotiating improvements in wages and other non-wage benefits
defending employees’ rights and jobs
improving working conditions, such as securing better hours of work and better health and safety policies
improving pay and other benefits, including holiday entitlement, sick pay and pensions
encouraging firms to increase workers’ participation in business decision making
supporting members who have been dismissed or who are taking industrial action
providing social and recreational amenities for their members
improving employment legislation

8. Questions:
Why are trade unions needed?

9. How do trade unions achieve their Goals?

10. Collective Bargaining
Negotiations take place between trade unions and employers over improvements in wages and other non-wage benefits for employees
Trade unions may seek to improve the wages and other working conditions of their members if:
price inflation is high and rising
other groups of workers have received pay rises
new machinery or working practices have been introduced in the workplace
the profits of the employing organization have increased

11. The Strength of Union Bargaining Power
Strong bargaining position if:
the union represents most or all of the workers in the firm or industry
union members provide essential services such as health care and electricity
the union is able to support its members financially during strike action
Weak bargaining position if:
many workers in the firm or industry do not belong to a union
union members provide non-essential goods or services for which there are many close substitutes
the union lacks financial resources
laws outlaw or severely restrict union activity

12. What if negotiations fail?

13. When negotiations fail…..
If the two parties fail to make an agreement, the negotiations may reach a ‘deadlock’
An independent Arbitrator can be called in to resolve the situation
If this fails, either the workers or the employer may take industrial action to try and get what they want

14. Arbitration
An independent arbitrator is bought in to listen to both sides and make a final decision and recommendation.
The arbitrator’s word is legally binding.
The decision required can either be a compromise or a pendulum arbitration can be required

15. Industrial Action taken by Trade Unions
Action Days – Workers strike for a day or two at a time
Go-slow – Workers carry on working but do the minimum amount
Overtime ban – Workers still get basic pay but refuse to work overtime
Strikes – Workers withdraw their labour and refuse to work
Withdraw goodwill – refuse to attend meetings or do work of absent staff
Work to rule – Follow rule book exactly and do nothing extra

17. Task….
Write lists of the Pros and Cons of workers/trade unions taking industrial action (tip: think about it from the perspective of the workers and the employer)

18. Questions….
Trade Union membership has been on the decline over the last 20 years.
Why might this be the case?