Closed shop and Union Shop

- The trade unions get greater strength and security if they have a contract
over the supply of labour at pre-entry or at least on post-entry in the
industry
- In order to appreciate the feasibility of adopting such a system in India, it is
necessary to examine the concept of closed and union shop
- Closed Shop means a factory or firm in which all the workmen are
members of trade union and it is closed to everyone
- Any newcomer who comes to work they must join the union and if he
refuses to do so, the union members will insist on his dismissal
- They tell the employer to sack him or will go on the strike
- The result is that dismisses the newcomer or joins the union
 As per the government of India, report of the National Commission
on Labour (1969), it explains that the closed shop as an agreement
with the employer or at least his willingness to recruit only trade
union members
On the other hand union shop is one by which new entrants to
employment if they are not union member, must join the union
within a specified period
Unlike the industrially advanced countries like USA or UK, closed shop
or union shop has not gained importance in India
 The committee appointed by the govt. of Bihar in 1956 strongly
opposed the system of closed shop on the ground that the right of
the citizens to seek and get employment is one of the fundamental
rights guaranteed under the Constitution of India, 1950 and any
inference with that right in the shape of prior membership of a trade
union will be an unreasonable limitation on the right to work
This approach also adopted by the National Commission on labour
and as per the commission, closed shop is neither practicable nor
desirable
It is against the fundamental right to association guaranteed under
Article 19(1) of the Constitution.
- A pre-entry closed shop is a form of union security agreement under
which the employer agrees to hire union members only, and
employees must remain members of the union at all times in order to
remain employed.
- This is different from a post-entry closed shop, which is an agreement
requiring all employees to join the union if they are not already
members
- In a union shop, the union must accept as a member any person hired
by the employer
 International Labour Organization covenants do not address the
legality of closed shop provisions, leaving the question up to each
individual nation
The legal status of closed shop agreements varies widely from country
to country, ranging from bans on the agreement to extensive
regulation of the agreement to not mentioning it at all.
USA outlawed the closed shop but permits the union shop. An
employer may not lawfully agree with a union to hire only union
members; it may, on the other hand, agree to require employees to
join the union or pay the equivalent of union dues to it after a set
period of time.
 Similarly, while a union could require an employer that had agreed to
a closed shop contract prior to 1947 to fire an employee who had
been expelled from the union for any reason, it cannot demand that
an employer fire an employee under a union shop contract for any
reason other than failure to pay those dues that are uniformly
required of all employees.
The United States Government does not permit the union shop in any
federal agency regardless of state law allowing for such.
 The status of closed shops varies from province to province within
Canada.
The Supreme Court has ruled that, while Section 2 of the Charter of
Rights and Freedoms guaranteed both the freedom to
associate and the freedom not to associate, employees in a work-
environment largely dominated by a union were beneficiaries of
union policies, and as such should pay union fees, regardless of
membership status.
 All forms of closed shops in the Commonwealth are strictly illegal
under Workplace Relations Act, 1996.
There was an attempt by the Howard Government to change the
definition of what constituted a closed shop under the Workplace
Relations Legislation Amendment (More Jobs, More Pay) Bill 1999.
However the bill was subsequently defeated.
 A union shop is a form of a union security clause under which the
employer agrees to hire either labour union members or non-
members but all non-union employees must become union members
within a specified period of time or lose their jobs.
Use of the union shop varies widely from nation to nation, depending
on the level of protection given trade unions in general.