Transcript Slide 1

Chapter 14
Collective Bargaining and Labor Relations
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Learning Objectives
1. Describe collective bargaining and labor relations.
2. Identify labor relations, goals of management, labor unions
and society.
3. Explain legal environment's impact on labor relations.
4. Describe major labor-management interactions: organizing,
contract negotiations and contract administration.
5. Describe new, less adversarial approaches to labormanagement relations.
6. Explain how changes in competitive challenges are
influencing labor-management interactions.
7. Explain how labor relations in public and private sectors
differ.
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Labor Relations Framework
4 Elements of John Dunlop’s Labor Relations System
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Labor Relations Framework
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Goals & Strategies
 Society - labor unions' major benefit to society has been
balancing power and institutionalization of industrial conflict
in the least costly way.
 National Labor Relations Act (NLRA, 1935) provides a legal
framework conducive to collective bargaining.
 Management - decides to encourage or discourage
unionization.
 Labor Unions - give workers formal and independent voice
through collective action in setting employment terms and
conditions.
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Union Structure, Administration & Membership
 National and International Unions
 Craft unions
 Industrial unions
 Local Unions
 Responsible for contract negotiations and dayto-day contract administration, including
grievance procedure.
 AFL-CIO
 Advances shared interest of its member unions
at the national level.
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Provisions of Collective Bargaining Contracts
• Functions, rights
& responsibilities
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Largest U.S. Labor Unions
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Local Unions
 Negotiation occurs at the local level as well over work
rules and other issues that are locally determined
 Administration of the contract is largely carried out at
the local union level.
 Bulk of day-to-day interactions between labor and
management takes place at the local union level.
 National union provides assistance.
 Most union contact is with the shop steward
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American Federation Of Labor And Congress Of
Industrial Organizations (AFL-CIO)
 AFL-CIO is not a labor union but rather an association that
seeks to advance the shared interests of its member unions at
the national level.
 There are 54 affiliated national and international unions and
thousands of locals.
 Represents labor’s interests in public policy issues such as civil
rights, economic policy, safety, and occupational health.
 Provides information and analysis that member unions can use
in their activities: organizing new members, negotiating new
contracts, and administering contracts
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Reasons for Decline in Union Membership
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Legal Framework
 Wagner Act of 1935 (NLRA) enshrined collective bargaining as
the preferred mechanism for settling labor-management
disputes.
 Section 7 of the NLRA: employees have the
"right to self-organization, to form, join, or assist labor
organizations, to bargain collectively through representatives
of their own choosing and to engage in other concerted
activities for the purpose of collective bargaining."
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Exclusions from NLRA’s Coverage
Table 14.3
NLRA specifically excludes coverage of individuals who are
• Employed as a supervisor.
• Employed by a parent or spouse.
• Employed as an independent contractor.
• Employed in the domestic service of any person or family in
a home.
• Employed as agricultural laborers.
• Employed by an employer subject to the Railway Labor Act.
• Employed by a federal, state, or local government.
• Employed by any other person who is not an employer as
defined in NLRA.
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Unfair Labor Practices (ULPs)
NLRA prohibits certain activities by both employers and labor
unions.
 Employers cannot:
 interfere with, restrain, or coerce employees in exercising

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their Section 7 rights.
dominate or interfere with a union.
discriminate against an individual for exercising his or her
right to join or assist a union.
discriminate against employees for providing testimony
relevant to enforcement of the NLRA.
refuse to bargain collectively with a certified union.
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Unfair Labor Practices of Unions
• outlawed unfair labor union practices.
• regulated unions’ actions and internal affairs (financial
disclosure and conduct of elections).
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Enforcement
 National Labor Relations Board (NLRB) enforces NLRA.
 NLRB is a five-member board appointed by the
president with 33 regional offices.
 NLRB’s major functions:
1. conduct & certify representation elections.
2. prevent unfair labor practices.
 ULP charges are filed and investigated by regional
offices.
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Why Do Employees Join Unions?
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Organizing Process & Legal Framework
 An election may be held if at least 30% of employees in the
bargaining unit sign authorization cards.
 Secret ballot election will be held. The union is certified by
NLRB if a simple majority of employees vote for it.
 Decertification election may be held if no other election has
been held within the year or if no contract is in force.
 Certain categories of employees cannot be included in
bargaining units-agricultural laborers, independent
contractors, supervisors, and managers.
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Organizing Campaigns
 NLRB may set aside election results if the employer
created an atmosphere of confusion or fear of
reprisals.
 Associate union membership-union receives dues in
exchange for services but does not provide
representation in collective bargaining.
 Corporate campaigns bring public, financial or
political pressure on employers during the
organizing and negotiating process.
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To Stay Union-Free Supervisors Should
Report union activity to a core management group.
State and coordinate company’s response to pro-union
arguments to maintain consistency and avoid threats or
promises.
Follow effective management practices:
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Deliver recognition and appreciation.
Solve employee problems.
Protect employees from harassment or humiliation.
Provide business-related information.
Be consistent in treatment of different employees.
Accommodate special circumstances where appropriate.
Ensure due process in performance management.
Treat all employees with dignity and respect.
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What Supervisors Should Avoid to Stay Union Free
Threatening employees with harsher terms and conditions of
employment or employment loss if they engage in union
activity.
Interrogating employees about pro-union or anti-union
sentiments that they or others may have or reviewing union
authorization cards or pro-union petitions.
Promising employees that they will receive favorable terms or
conditions of employment if they forgo union activity.
Spying on employees known to be, or suspected of being,
engaged in pro-union activities.
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Union and Management Interactions:
Negotiation Process
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7 Steps to Prepare
Managers for Negotiations
1. Establish interdepartmental contract objectives.
2. Review old contract
3. Prepare and analyze data.
4. Anticipate union demands.
5. Establish costs of contract provisions.
6. Make preparations for a strike.
7. Determine strategy and logistics.
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Negotiation Stages and Tactics
Early
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Management’s Willingness to Strike
Most negotiations do not result in a strike since it is often
not in the best interest of either party.
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7 Factors Impact Ability to Take a Strike
Product Demand
Product Perishability
Technology
Availability of Replacement Workers
Lack of Substitutes for Products
Integrated Facilities
Lack of Substitutes for Product
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Impasse Resolution Procedures:
Alternatives to Strike
Mediation
Fact
Finder
Arbitration
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Grievance Procedure
 Negotiation process occurs every three years.
 Negotiation & administration processes are linked.
 Effectiveness of grievance procedures’ three criteria:
1. How well are day-to-day problems resolved?
2. How well does the process adjust to changing
circumstances?
3. In multi-unit contracts, how well does the process handle
local contract issues?
 Duty of Fair Representation-all members have equal access to
& representation by the union.
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Grievance Procedure
 Arbitration is a final and binding step.
 7 criteria arbitrators used to reach decisions:
1. Did the employee know the rule & consequences of
2.
3.
4.
5.
6.
7.
violating it?
Was the rule applied in a consistent & predictable way?
Were facts collected in a fair & systematic way?
Did the employee have the right to question facts &
present a defense?
Does the employee have the right of appeal?
Is there progressive discipline?
Are there mitigating circumstances?
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New Labor Management Strategies
Increasing
worker
involvement
& high
performance
work practices
and systems
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Labor Relations Outcomes
 Strikes impose significant costs on union members,
employers, and society.
 Wages and Benefits
 In 2012, private-sector unionized workers received
27% higher wages that nonunion counterparts.
 Productivity effects of unions is debated.
 Profits and Stock Performance may suffer under
unionization if costs are raised.
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Wages and Benefits
 Besides pay and benefits, unions influence the way
pay and promotions are determined.
 Whereas management often seeks to deal with
employees as individuals, emphasizing performance
differences in pay and promotion decisions, unions
seek to build group solidarity and avoid the possibly
arbitrary treatment of employees.
 Although wages & benefits are higher for union
members, job satisfaction is lower.
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International Context
 Except for China, Russia and Ukraine, U.S.
has more union members than any other
country.
 Growing globalization of markets will
continue to put pressure on labor costs and
productivity.
 U.S. differs from W. & N. Europe in formal
worker participation in decision making.
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Public Sector
 In 2012 35.9% government employees were union
members.
 Strikes are illegal at the federal level and in many
states for government workers.
 In 2012, 4 of 19 major work stoppages were in the
public sector.
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Summary
 Labor unions seek to represent their members’ interests
in the workplace.
 May witness diminished ability to compete effectively in
global economy.
 Management in nonunion companies feel compelled to
resist unionization.
 Union has lost membership and bargaining power in the
private sector.
 Management and unions are seeking more effective ways
of working together to enhance competitiveness while
giving employees a voice in workplace decisions.
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