WEEK 5 LABOR RELATIONS BUSN 102 – Özge Can

The Role of Labor Unions  Labor Relations  The relationship between organized labor and management (in its role as the representative of company ownership)  Labor Unions  Organizations that represent employees in negotiations with management Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12-2

Unionization: Employee’s Perspective  Higher compensation  Greater benefits  Influence over hiring, promotions, and layoffs  Working conditions and workplace safety  Formal processes for employee grievances, discipline, and other matters  Solidarity and recognition Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12-3

Unionization: Management’s Perspective  Management wants to:  Minimize costs to maximize profits  Higher flexibility and productivity – but union contracts often include work rules  Work Rules:  A common element of labor contracts that specifies such things as the tasks certain employees are required to do or are forbidden to do Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall 12-4

Outcome of Unionization  Negative or positive outcome?  It depends on your perspective:  For example, higher wages is clearly a negative outcome for shareholders/owners but a positive outcome for workers and the communities they live in 5

Unionization in Historical Perspective  Early guides in Europe that gave craftspeople bargaining power over merchants  Industrial revolution in the second half of 1800s  Great Depression in 1930s  Repeated strikes and protests over very low wages, unsafe working conditions, abusive management practives, long hours, child labor 12-6

Unionization in Historical Perspective  Legislations regarding labor relations policies and procedures for most sectors of industry  Legislations addressing many concerns raised by business owners  Legislations designed to ensure democratic processes and financial accountability within unions 12-7

Types of Unions  Craft Unions  Offer membership to workers with a specific craft or skill, such as carpentry, masonry, or electrical work  Industrial Unions  Seek to represent all workers at a given employer or location, regardless of profession or skill level 12-8

How Unions Are Structured?  Locals: Local unions that represent employees in a specific geographic area or facility  National Union: A nationwide organization composed of many local unions that represent employees in specific locations  They are responsible for: Organizing in new areas and industries, negotiating industrywide contracts, assisting locals with negotiations, administrating benefits, lobbying, lending support for strikes 12-9

How Unions Are Structured?  International Unions: Have members in more than one country  Ex: Service Employees International Union (SEIU)  Labor Federations: Give unified voice for political activities and membership drives worldwide  Ex: AFL, CIO 12-10

The Union Organizing Process 12-11

The Collective Bargaining Process  Collective Bargaining  A negotiation between union and management negotiators to forge the human resources policies that will apply to all employees covered by a contract  Collective Bargaining Agreements (CBAs)  Contracts that result from collective bargaining = Labor Contract  It is a compromise between the desires of the union members and those of management 12-12

The Collective Bargaining Process 12-13

The Collective Bargaining Process 12-14

Negotiating an Agreement  Mediation  Use of an impartial third party to help resolve bargaining impasses to study the situation, explore new options, improve communication and make recommandations  Arbitration  A decision process in which an impartial referee listens to both sides and then makes a judgment by accepting one side’s view  Compulsory or voluntary arbitration 12-15

When Negotiations Break Down: Labor Options 12-16

When Negotiations Break Down: Management Options 12-17

Labor Options  Strike  A temporary work stoppage aimed at forcing management to accept union demands  Boycott  A pressure action by union members and sympathizers who refuse to buy or handle the product of a target company  Injunction  A court order that requires one side in a dispute to refrain from or engage in a particular action  Also: slowdowns and sickouts 12-18

Management’s Options  Strikebreakers  Nonunion workers hired to do the jobs of striking workers  Lockout  A decision by management to prevent union employees from entering the workplace  used to pressure the union to accept a contract proposal  Injunctions 12-19

Grievance, Discipline, and Arbitration Procedures  Unfair Labor Practices: Unlawful acts made by either unions or management  By employers:  Threatening employees with termination or cuts in benefits if they vote for a union or engage in any other activity protected by laws  Threatening to close a facility if employees vote for union representation  Interrogating employees about union sympathies or activities in ways that could “interfere with, restrain, or coerce” employees trying to exercise their legal rights  Punishing employees for unionization activity by transferring them, giving them more difficult work assignments, or terminating them 12-20

Grievance, Discipline, and Arbitration Procedures  Grievance: A formal complaint against an employer  Substantial reasons include:  Clarifying details of the contract  Addressing alleged contract violations by the employer  Laying the ground work for future contract negotiations  Contesting management decisions 12-21

Grievance, Discipline, and Arbitration Procedures  Progressive Discipline: An escalating process of discipline that gives employees several opportunities to correct performance problems before being terminated  Usually starts with an oral warning for the first offense, followed by a written warning, then another written warning and suspension without pay, and finally termination  Arbitrating Disputes: Arbitration can also be used to interpret or apply the provisions of the labor aggreement.  Disputes over wages, seniority, terminations, employee discipline, job posting and the use of subcontractors 12-22

Labor Movement Today  Conflicts within the union or between unions  Decreasing union memberships  Proposed legislation that would significantly alter the union election provisions, making it easier or more difficult for unions to organize groups of workers (Ex: Employee Free Choice Act in the US) 12-23

Next Week’s Topic:  Marketing as a Concept  Read: Chapter 13: The Art and Science of Marketing 24