McGraw-Hill/Irwin Copyright © 2014 by the McGraw-Hill Companies, Inc. All rights reserved.

Need to Know
1. Unions and labor relations’ role in organizations.
2. Labor relations goals of management, labor
unions, and society.
3. Laws and regulations that affect labor relations.
4. Union organizing process.
5. How management and unions negotiate
contracts.
6. Practice of contract administration.
7. Cooperative approaches to labor-management
relations.
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Role of Unions
• In U.S., most workers act as individuals to select jobs
that are acceptable to them and to negotiate pay,
benefits, flexible hours, and other work conditions.
• At times, workers have believed their needs and
interests do not receive enough consideration from
management.
• One response by workers is to act collectively by
forming and joining labor unions.

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Unions and Labor Relations

Unions – organizations Labor relations – field

formed for the purpose that emphasizes skills
of representing their managers and union
members’ interests in leaders can use to
dealing with employers. minimize costly forms of
conflict (such as strikes)
and seek win-win
solutions to
disagreements.

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3 Levels of Labor relations decisions:

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1. Labor relations strategy – For management, the decision involves whether the
organization will work with unions or develop (or maintain) nonunion
operations. For unions, the decision involves whether to fight changes in how
unions relate to the organization or accept new kinds of labor-management
relationships.
2. Negotiating contracts – Contract negotiations in a union setting involve
decisions about pay structure, job security, work rules, workplace safety, and
many other issues. These decisions affect workers’ and the employers’
situation in terms of the contract.
3. Administering contracts – These decisions involve day-to-day activities in
which union members and the organization’s managers may have
disagreements. A formal grievance procedure is typically used to resolve
these issues.

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Figure 14.1: 10 Largest Unions in U.S.

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National and International Unions

 Most Union members belong to a national or

international union that may be:
 Craft unions: members all have a particular skill or
occupation.
 Industrial unions: members are linked by their work in a
particular industry.

Most national unions are affiliated with the American

Federation of Labor and Congress of Industrial
Organizations (AFL-CIO).

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Figure 14.2: Union Membership Density
among U.S. Wage and Salary Workers

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decline in union membership DUE to:

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Figure 14.3: Union Membership Rates
and Coverage in Selected Countries

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Sketch of a Union Worker

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Impact of Unions on Company Performance

•Harley-Davidson and the

International Association of
Machinists and Aerospace
Workers have cooperated to
produce good results.

•Companies wishing to become

more competitive need to
continually monitor their labor
relations strategies.

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Management Goals
• Management goals are to increase organization’s
profits.
• Managers prefer options that lower costs, raise
output and keep organization’s operations flexible.
• When an employer has recognized a union,
management’s goals continue to emphasize
restraining costs and improving output.
• With labor unions, managers prefer to limit
increases in wages and benefits, and retain as
much control as they can over work rules and
schedules.
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Labor Unions Goals

• Obtain pay and working conditions that satisfy

and give members a voice in decisions that affect
them.
• Unions achieve results by gaining power in
numbers.
• Unions want to influence the way pay and
promotions are determined.

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Goals of Labor Unions

• Survival and security of a union depend on its

ability to ensure a regular flow of new members
and member dues to support the services it
provides.
• Unions place high priority on negotiating two
types of contract provisions that are critical to a
union’s security and viability:
 Check-off provisions
 Union membership or contribution provisions

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Goals of Labor Unions
Checkoff Provision Membership Security

Contract provision under •Closed shop

which the employer, on •Union shop
behalf of the union,
•Agency shop
automatically deducts
•Maintenance of
union dues from
employees’ paychecks. membership

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Types of union security agreement
 Closed shop—The employer agrees to hire only union
members. An employee who resigns from the union must be
dismissed.[1]
 Union shop—The employer may hire anyone regardless of
their union membership status, but the employee must join the
union within a set time period (such as 30 days). An employee
who resigns from the union must be dismissed.[1]
 Agency shop—The employer may hire anyone regardless of
their union membership status, and the employee need not join
the union.

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Maintenance of membership shop is a form of union
security. There is maintenance of membership shop
when employees, who are union members as of the
effective date of the agreement, or who thereafter
become members, must maintain union membership as
a condition for continued employment until they
are promoted or transferred out of the bargaining
unit.

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Societal goals

• Activities of unions and management take place

within the context of society.
• Society’s values drive laws and regulations that
affect labor unions.
• Society’s goal for unions is to ensure that
workers have a voice in how they are treated by
their employers.

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Laws Affecting Labor Relations

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Laws Affecting Labor Relations

•Right-to-work laws: state •National Labor Relations

laws that make union Board (NLRB): Federal
shops, maintenance of government agency that
membership, and agency enforces the NLRA by
shops illegal. conducting and certifying
representation elections
and investigating unfair
labor practices.

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Figure 14.4:
States with Right-to-Work Laws

SOURCE: National Right to Work Legal Defense Foundation, “Right to Work States,” www.nrtw.org , accessed
May 3, 2012.

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Test Your Knowledge
 True (A) or False (B)
1. NLRA established unfair labor practices on the part
of the union.
2. NLRB determines which states are Right-to-Work
3. In Right-to-Work states, employees do not have to
become members of the union
4. In states without Right-to-Work laws unions can
refuse to hire non-union members.
5. Protection from union misconduct was established by
the Landrum-Griffin Act.

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Organizing Process

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Signing Authorization Cards

• A document indicating that an employee wants to be

represented by a labor organization in collective
bargaining
• Is there sufficient interest on the part of employees
to justify the unit?
• Evidence of interest when at least 30 % of
employees in a work group sign an authorization
card
• Usually need 50% to proceed

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Figure 14.5: Authorization Card Example

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Election and Certification

• NLRB monitors secret-ballot election on set date

• Board will issue a certification of results to
participants
• Majority of employees vote for union.
• NLRB will certify.
• Process does not require either party to make
concessions; it only compels them to bargain in
good faith.

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Table 14.1: What Supervisors Should
and Should Not Do to Discourage Unions

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Union Strategies

• Organizers call or visit employees at home to talk

about issues like pay and job security.
• Offer workers associate union membership.
• Conduct corporate campaigns.
• Negotiate employer neutrality and card-check
provisions into a contract.

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Union Decertification

• Taft-Hartley Act made it possible for employees to

decertify a union
• Essentially the reverse process that employees must
follow to be recognized as an official bargaining
unit
• Employees have used decertification petitions with
increasing frequency and success

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Collective Bargaining
In collective bargaining a union negotiates on behalf
of its members with management representatives to
arrive at a contract defining:
 Recognition
 Management Rights
 Union Security
 Compensation and Benefits
 Grievance Procedure
 Employee Security

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Table 14.2:
Typical
Provisions in
Collective
Bargaining
Contracts

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Table 14.2:
Typical
Provisions in
Collective
Bargaining
Contracts
Cont.

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Test Your Knowledge: Which is an
Unfair Labor Practice (ULP)?
1. Enforcing disciplinary policies only to those who have
expressed interest in a union
2. Showing employees articles about negative aspects of
unions that occurred elsewhere
3. Email employees asking them to respond with how they
plan to vote in the union election
4. Tell employees the disadvantages of having a union
5. Enforcing disciplinary policies when deserved to a pro-
union employee
6. Promise employees an additional week of vacation if they
vote against the union
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Bargaining Over New Contracts

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 The outcome of contract negotiations can have important consequences for
labor costs, productivity, and the organization’s ability to compete. The
collective bargaining process may involve any combination of these
alternatives. Different situations and goals call for different approaches to
bargaining:
• Distributive bargaining: divides an economic “pie” between two sides.
• Integrative bargaining: looks for win-win solutions, or outcomes in which both
sides benefit.
• Attitudinal structuring: focuses on establishing a relationship of trust.
• Intraorganizational bargaining: addresses conflicts within union or
management groups or objectives. The collective bargaining process may
involve any combination of these alternatives.

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When Bargaining Breaks Down
Strikes Alternatives to Strikes

Strike: a collective •Mediation

decision by union •Fact Finder
members not to work until •Arbitration
certain demands or
conditions are met.

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Figure 14.6: Strikes Involving 1,000 or
More Workers

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Alternatives to Strikes

• Conflict resolution • Third party to • Conflict

procedure in which a collective bargaining resolution
mediator hears views who reports reasons procedure in
of both sides and for a dispute, views which an
facilitates negotiation and arguments of arbitrator or
process but has no both sides, and arbitration
formal authority to possibly a board
dictate a resolution. recommended determines a
settlement, which binding
parties may decline. settlement.

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Contract Administration
Contract Administration
Grievance Procedure

•Carrying out •Process for resolving

agreement’s terms and union-management
resolving conflicts over conflicts over
interpretation or interpretation or violation
violation of the of a collective bargaining
agreement. agreement.

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Figure 14.7: Steps in an Employee-
Initiated Grievance Procedure

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Labor-Management Cooperation

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Test Your Knowledge
True (A) or False (B)
1. Mediation requires each party to abide by the
mediator’s decision.
2. Clearly written contracts require less contract
administration time due to fewer disagreements
over interpretation.
3. Integrative bargaining involves a win-lose approach
because the issues are considered a fixed pie.
4. A union steward represents the issues concerning
union employees and is elected by them.

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Summary
• A union is an organization formed for the purpose
of representing its members in resolving conflicts
with employers.
• Labor relations is the management specialty
emphasizing skills that managers and union
leaders can use to minimize costly forms of conflict
and to seek win-win solutions to disagreements.
• Management goals are to increase organization’s
profits. Managers generally expect that unions will
make these goals harder to achieve.

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Summary
• Labor unions have the goal of obtaining pay and
working conditions that satisfy their members.
They obtain these results by gaining power in
numbers.
• Society’s values have included the hope that
existence of unions will replace conflict or
violence between workers and employers with
fruitful negotiation.
• In contrast to traditional view that labor and
management are adversaries, some
organizations and unions work more
cooperatively.
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