Ch14-Understanding Labor Relations and Collective Bargaining

8/3/2019 Ch14-Understanding Labor Relations and Collective Bargaining

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Labor Relations and

Collective Bargaining

DeCenzo and Robbins


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Industrial Relation

Industrial relations means the nature of

relationship between the employer and

employee in an industrial organization .

According to Prof. Dunlop , Industrial

relations defined as the complex of

interrelations among workers,

managers and Government


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Industrial relations includes--

the relations between employers andemployees at the plant level.

the relation between the various unions. the relations between employers or their

organizations and trade unions at variouslevel (Level of plant, region or industry and

national level) the relation between the state and the unions.

the relation between the employers and thegovernment.

Industrial Relation


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Union

A union is an organization of workers,

acting collectively, seeking to promote

and protect its mutual interests through

collective bargaining.


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Union

Impact of unionization

Only about 13% of the privatesector work force is unionized.

Labor contracts typicallystipulate:

wages

hours terms and conditions of

employment

limit managements discretion


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Why Employees Join Unions

Higher wages and benefits: The

strength of large numbers and

negotiating skills of professional

bargainers give unions anadvantage over individuals.


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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 complaintsand concerns.


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Compulsorymembership

Union shops: The company can hire

nonunion people, but they must join the

union after a prescribed period of time and

pay dues.

Agency shops: Employees who do not

belong to the union still must pay uniondues on the assumption that the unions

effort benefit all the workers.


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Compulsorymembership

Open shops allow union membership to be

totally voluntary to join or not to join those

who do not, do not pay dues. Maintenance ofmembership: Employees

do not have to belong to the union. However,

union members employed by the firm must

maintain membership in the union for thecontact period.


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The negotiation, administration, and

interpretation of a written agreement

between two parties, at least one ofwhich represents a group that is acting

collectively, that covers a specific period

of time.

Collective bargaining The process

through which representatives of

management and the union meet to

negotiate a labor agreement.


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Objective and Scope of CollectiveBargaining

Contracts must be acceptable to

management, union representatives andunion membership.

Four issues appear in all labor contracts.(The first three are mandated by the Wagner

Act) wages

hours

terms and conditions of employment

grievance procedure


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Participants

Management is represented by

senior management for industrialrelations, corporate executives and

company lawyers

In small companies, the president

typically represents the company.


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Collective Bargaining Participants

Union bargaining teams include an

officer of the local union, local shop

stewards and representation from the

international/national union.

Government watches to ensure rules

are followed.

Financial institutions set limits on the

cost of the contract


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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 and the economy).

Goal-setting: Management decides what it can

expect from the negotiation.

Strategy development: This includes assessing

the other sides power and tactics.


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The Collective

Bargaining

Process


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Negotiating at the bargaining table

Each side usually begins bypublicly demanding more than they

are willing to accept. More realistic assessments and

compromises take place behindclosed doors.

After oral agreement, a writtencontract is submitted to the unionfor ratification.


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Contract administration refers to the

implementation, interpretation and

monitoring of the negotiated contract

between labor and management. Information dissemination includes helping

staff and workers understand the new

contract provisions. Implementingrefers to making the changes

to comply with contract terms.


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Monitoring

Both union and management keep track of how

effective the current contract is and any need

for changes.


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Failure to Reach Agreement

Strikes versus lockouts- strike is a withdrawalof labor

Econom

ic strikes - a strike that results from afailure to agree on the terms of a contract thatinvolve wages, benefits, and other conditions ofemployment.

Wildcat strikes - unauthorized and illegal

strikes that occur because of workerdissatisfaction during an existing contract.

Lockouts - when organizations deny unionizedworkers access to their jobs during an impasse.


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Failure to Reach Agreement

Impasse-Resolution Techniques:

Used when labor and management

cannot reach agreement. Conciliation and mediation involve a third

party to either keep negotiations going or

make non-binding settlement

recommendations. Fact-finding involves a neutral third-party

who conducts a hearing and recommends a

non-binding settlement.


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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.

Primarily in public-sector bargaining.

Binding only if there is unanimous

agreement.

Ch14-Understanding Labor Relations and Collective Bargaining

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