Chapter 07

Understanding Labor Relations and Collective Bargaining

Suggested Level: Chapter 14, HRM by Decenzo and Robins

Introduction
a union is an organization of workers, acting collectively, seeking to promote and protect its mutual interests through collective bargaining only a small number of private sector organizations are unionized. Whereas the ration of unions is more in public organizations. labor unions normally negotiate on: wages hours terms and conditions of employment

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Why Employees Join Unions

According to the International Labour Organization (ILO) laws, labour working in an organization have a right to form a union by following the legal provisions available according to the law of land.

higher wages and benefits: the strength of large numbers and negotiating skills of professional bargainers give unions an advantage over individuals greater job security: collective bargaining contracts limit managements ability to arbitrarily hire, promote, or fire influence over work rules: unions represent workers and define channels for complaints and concerns

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Why Employees Join Unions

Union Membership
union shops require that all employees hired into positions covered under the collective-bargaining agreement must join the union agency shops require nonunion employees to pay an amount equal to union fees and dues to the certified bargaining unit even if they choose not to join a union.

open shops employees are free to join the union or not and those who decline need not to pay the union fee.
maintenance of membership requires an individual who chooses to join a union to remain in the union for the duration of the existing contract.
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 dues checkoff requires the employers to withhold union dues from members paychecks.

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Unionizing Employees
Union Organizing Process
Unorganized
No union vote for one year
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Authorization card campaign: Did union get 30% or more?

No

Yes
Are authorization cards in order?

No

Yes
Vote taken: Did union receive a majority vote?

No

Yes Certification of bargaining unit

Fundamentals of Human Resource Management, 10/e, DeCenzo/Robbins

Union Organizing Process

Authorization Cards: A card signed by the prospective union members indicating that they are interested in having a union election held at their work site. Representation Certificate: Election process in which union members vote their union as their representative. Representation Decertificate: Election process in which the union members vote their union as not their representative.

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Unionizing Employees
Employees want to form a union. Now what? thirty percent of employees must sign authorization cards indicating their interest in having an election with a representation certification (RC), a secret-ballot election is held if the union is accepted by a majority of eligible voting workers, the union becomes the workers legal representative

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Unionizing Employees
once the National Labor Relations Board certifies a union, each worker must abide by the negotiated contract most organizations managements will try to influence workers against voting for union representation representation decertification (RD) elections can be held to vote unions out RMs are decertification elections initiated by management most agreements oppose the use of decertification elections during the term of a contract
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Collective Bargaining
What is collective bargaining?
the negotiation, administration, and interpretation of a written agreement between two parties, at least one of which represents a group that is acting collectively, that covers a specific period of time

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Collective Bargaining
Objective and Scope of Collective Bargaining
contracts must be acceptable to management, union representatives, and union membership
four issues appear in all labor contracts;

wages grievance procedures

terms and conditions of employment hours

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Collective Bargaining
Collective Bargaining Participants
1. large corporations have HRM departments with industrial relations experts; corporate executives, and company lawyers also participate 2. in small companies, the president typically represents the company 3. union bargaining teams include an officer of the local union, local shop stewards, and reps from the international/ national union 4. government watches to ensure rules are followed 5. financial institutions set limits on the cost of the contract

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Collective Bargaining
The Collective Bargaining Process
Preparing to negotiate
fact-gathering: includes internal information (e.g., employee performance records, overtime) and external (i.e., data on what similar organizations are doing) goal-setting: identify the objectives of the process strategy development: this includes assessing the other sides power.

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Collective Bargaining
The Collective Bargaining Process
Preparation for negotiations

Prepare for next negotiation

negotiation

Agreement
yes

no

Union ratification
yes

no

Contract administration

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Collective Bargaining
Negotiating at the bargaining table
each side usually begins by publicly demanding more than they are willing to accept more realistic assessments and compromises take place behind closed doors after oral agreement, a written contract is submitted to the union for ratification

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Collective Bargaining
Contract administration is the implementation, interpretation, and monitoring of the negotiated contract between labor and management. 1. information dissemination: helping the workers understand the new contract provisions 2. implementation: making the changes to comply with contract terms 3. interpreting the contract and grievance resolution 4. monitoring activities during contract period

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Collective Bargaining
Negotiations Outcomes

Negotiations have only two possible outcomes; 1. Agreement (proffered) 2. Strikes or Lock out

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Failure to Reach Agreement Strikes versus Lockouts economic strikes - labor and management cannot reach agreement, the union leadership advises its members not to work and to leave their jobs. wildcat strikes - unauthorized and illegal strikes that occur because of worker dissatisfaction during an existing contract lockouts - when organizations deny unionized workers access to their jobs during an impasse

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Collective Bargaining
Impasse-Resolution Techniques
used when labor and management cannot agree
conciliation and mediation involve a third party to either keep negotiations going or make nonbinding settlement recommendations
fact-finding involves a neutral third party who conducts a hearing and recommends a nonbinding settlement interest arbitration Involves a panel of one neutral, one management, and one union representative who hear testimony and render a decision to settle a contract negotiation dispute

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Critical Issues for Unions Today

Where have the union members gone?
Reasons for decline in membership include: 1. greater diversity of the workforce

2. growth of the service sector

3. diminished financial resources of unions 4. anti-union pressures resulting from increased

competitiveness
5. layoffs of large numbers of union workers 6. hiring of replacement workers for strikers

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