fundamentals of

Human Resource Management 4th edition

by R.A. Noe, J.R. Hollenbeck, B. Gerhart, and P.M. Wright

CHAPTER 14
Collective Bargaining and Labor
Relations
McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All Rights Reserved. 14-1
 What Do I Need to Know?

1. Define unions and labor relations and their

role in organizations.
2. Identify the labor relations goals of
management, labor unions, and society.
3. Summarize laws and regulations that affect
labor relations.
4. Describe the union organizing process.

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 What Do I Need to Know? (continued)

5. Explain how management and unions

negotiate contracts.
6. Summarize the practice of contract
administration.
7. Describe more cooperative approaches to
labor-management relations.

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 Role of Unions
• In the 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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Labor relations involves three levels of
decisions:

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 National and International Unions

• Most Union members belong to a national or

international union. These unions may be:
– Craft unions: labor unions whose members all
have a particular skill or occupation.
– Industrial unions: labor unions whose 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 14.1: 10 Largest Unions in the
United States

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Figure 14.2: Union Membership Density among
U.S. Wage and Salary Workers, 1973-2009

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The decline in union membership has
been attributed to:

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Figure 14.3: Union Membership Rates and
Coverage in Selected Countries

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Many Union Workers Hold
Government Jobs

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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.
• In general, though,
companies wishing to
become more competitive
need to continually monitor
their labor relations
strategies.

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 Goals of Management
• Management goals are to increase the
organization’s profits. Managers tend to prefer
options that lower costs and raise output.
• When an employer has recognized a union,
management’s goals continue to emphasize
restraining costs and improving output.
• Managers prefer to keep their organization’s
operations flexible.

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 Goals of Management (continued)

• In their labor relations, 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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 Goals of Labor Unions

• Labor unions have the goals of obtaining pay

and working conditions that satisfy their
members and of giving members a voice in
decisions that affect them.
• They obtain these goals by gaining power in
numbers.
• Unions want to influence the way pay and
promotions are determined.

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 Goals of Labor Unions (continued)

• The 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:
– Checkoff provisions
– Union membership or contribution provisions
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 Goals of Labor Unions (continued)

Checkoff Provision Membership Security

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

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 Goals of Society

• The activities of unions and management take

place within the context of society.
• Society’s values drive the 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 (continued)

• Right-to-work laws: • National Labor

state laws that make Relations Board
union shops, (NLRB): Federal
maintenance of government agency that
membership, and enforces the NLRA by
agency 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

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 Test Your Knowledge

True (A) or False (B)

1. The NLRA established unfair labor practices on the part
of the union.
2. The 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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The Process of Organizing

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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 percent
of the employees in a work group sign an
authorization card
• Usually need 50% to proceed
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Figure 14.5:
Example of an Authorization Card

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 Petition for Election

• After authorization cards have been signed, a

petition for election is made to the regional
NLRB office

• NLRB will ordinarily direct that an election be

held within 30 days

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 Election and Certification

• NLRB monitors the secret-ballot election on

the set date
• Board will issue a certification of the results to
the participants
• Majority of the 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 of the 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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 Decertification Procedure

• At least 30 percent must petition for election

• Petition submitted 60-90 days prior to
expiration of current contract
• Schedule decertification election
• If majority votes against union, employees will
be union free

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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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 Test Your Knowledge: Which of the Following
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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 When Bargaining Breaks Down

Strikes Alternatives to Strikes

• Strike: a collective • Mediation
decision by union • Fact Finder
members not to work • Arbitration
until 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

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 Contract Administration
Contract Administration
Grievance Procedure
• Includes carrying out • The process for
the terms of the resolving union-
agreement and management conflicts
resolving conflicts over over interpretation or
interpretation or violation of a collective
violation of the 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 the organization’s
profits. Managers generally expect that unions will
make these goals harder to achieve.

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 Summary (continued)
• 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 the
existence of unions will replace conflict or violence
between workers and employers with fruitful
negotiation.
• In contrast to the traditional view that labor and
management are adversaries, some organizations
and unions work more cooperatively.

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