Labour Industrial Relations - Essay Example

LABOR RELATIONS ………………………….. College ……………………………… ……………….. Words- 1987 Introduction The contemporary global economy presents many opportunities and challenges for both employers and employees. Business organisations need to use their resources both effectively and efficiently, and therefore, managers take higher tension over how best to manage human capital and its power to benefit both ownership and employees (Holley, Jennings and Wolters, 2011). In order to maintain an organisation’s competitiveness and sustainability, it is critically important to effectively manage its human capital. Building as well as maintaining a positive relationship between employer and employee is one of the most important strategic functions of human resource management. This paper will critically evaluate the potential features of labor relations to find out how joining a union will potentially benefit employees. Labor Relations Labor relation represents any activity or agreement between management and unions or employees related to negotiating or implementing a collective bargaining agreement. In the human resource management perspective, labor relation is a field that emphasizes skills and talents that managers and union leaders are able to use to avoid costly forms of conflicts such as employees’ strike by seeking solutions to disagreements (Noe, Hollenbeck and Gerhert, 2003). Unions play critical role in maintaining relationship between employer and employees, because some degree of conflicts is inevitable between workers and employers. For instance, managers may be forced to increase profits by reducing employees’ pay. But in some cases, for instance the organization faces lower profits driven by higher pay to employees, lower pay is justified. As unionization of workers became more common in recent years, various universities designed and launched courses specifically to provide training in how to manage union and management interactions. Joining a Labor Union Unionized workers are found to receive higher pay than their non-unionized counterparts. The pressure for higher pay is greater among unionized workers due to international competition as well. In the competitive business landscape, it is critically important that employers needed to compete with companies that have entirely different pay scales and work related rules, and this is how US companies get some additional advantages (Noe, et al, 2003). Paying fees or dues to unions seems to be an additional cost, but it ensures that employees will be paid according to their requirements. Unionization and its impact on organization’s performance is another important area to be discussed. Researchers identified that organizations can positively influence the performance through skillful labor relations. How unions impact employees’ productivity has also been widely debated and studied. The argument that unionization may cause decrease in productivity has been purely based on work rules and limits on workloads that are set by union contracts. However, unionization is found to impact productivity positively, because unionization can reduce turnover by ensuring that employees get a route for resolving issues (Noe, et al, 2003). Unions emphasize pay system based on seniority which in turn causes removing of incentives for employees to compete rather than cooperate. In short, joining a union will be advantageous to an employee in terms of gaining higher pay and maintaining equity and justice in the workplace. Similarly, it is beneficial for the organization because of that unionization impacts productivity positively. Private sector unions: History and Law Same sort of people and occupations are involved in government and corporate jobs. It is difficult to distinguish the day-to-day task related activities of a welder, or a class room teacher, or a vehicle operator or an information technology specialist between private and public sectors. However, some differences exist between private and public sector in terms of financial settings and incentives, nature of works and role of politics (Kearney and Mareschal, 2014). Private sector unions in America are regulated by the National Labor Relations Act (NLRA). The right to strike for unions is perceived to be a fundamental and legitimate part of private sector labor relation (Kearney and Mareschal, 2014). The history of private sector labor relation can be traced from the growth and developments of national unions. Therefore, the growth of National labor unions founded in 1866, National Colored Labor Union, Molly Maguires, Railway Strike in 1877, Hay Market Square Riot in 1886, Homestead Strike in 1892, Pullman Strike in 1894 and Ludlow Massacre in 1914 are part of the history of private sector labor relation. Public sector unions: History and Law Union membership for workers in private sector has been steadily decreasing in the US but union membership among government workers has been steadily growing for last many years. It is illustrated with the help of a diagram below. Over one-third of government employees are union members, and thus a greater share is covered by collective bargaining agreements. One fundamental reason for this growth was that government regulations and laws have been supporting the right of public sector employees to organize (Noe, et al, 2003). From this trend, it is clear that joining unions in public sector is more important than joining a union in private sector. The history of public sector labor relation is linked to Pendleton Act, The New York Letter Carriers IN 1863, the National Association of Letter Carriers in 1890, The Hatch Act in 1939, The Executive Order signed by John F. Kennedy in 1962, Postal Reorganization Act of 1970, The Civil Service Reform Act in 1978, and the amended Hatch Act in 1993. Bargaining Unit and Organizing Campaign A specific group of workers should be identified for the purpose of collective bargaining. This group of employees is the bargaining unit. This group will be either 1) specified by a state public employee relations board or other administrative agency, or 2) arrived at through adjudication on a case-by-case basis. In private sector, the bargaining unit determination depends on the type of organization and its functions (Kearney and Mareschal, 2014). Basically, the bargaining unit is determined by the National Labor Relations Board. The bargaining unity possesses the right to select their bargaining representative. It is critically important that only those employees who have substantial mutuality of interest in wages, hours and working conditions can be assigned with the task of bargaining unit. The dissatisfied employees or union organizer may organize a campaign by submitting a representation petition to the National Labor Relations Board. Organizing the campaign involves four steps, building an organizing committee, determining the issues, choosing a union recognition strategy and determining the union recognition status. Negotiating Model and Bargaining Tactics There are six stages in negotiation model; they are the opening statement, the first negotiation session, Negotiating minor issues first, negotiating key issues, responding to proposals and the closing stage. In the opening statement, key issues related to the relations will be evaluated. The first negotiation session will ask the other party to present their proposals. At the third stage, minor issues will be negotiated, and the major will be considered in the next stage. The responding to proposal will be related to evaluating a proposal. There are basically two strategies for collective bargaining; Distributive strategy and Integrative strategy. Distributive Strategy is the classic and old-school approach wherein both parties- union and management- perceive the process of collective bargaining as negotiation to divide up a pie of fixed size (Kaps, Hamilton and Bliss, 2012). This method is described as win-lose situation. Each side wishes to maximize its share. This approach is always confrontational since it is characterized by mutual hostility, posturing and table-pounding. In the integrative bargaining approach, both parties, in contrast, view the process of collective bargaining as a concerted effort to enlarge a pie so that labor’s demands may be met along with the intention to improve productivity to at least pay for labor’s gain (Kaps, Hamilton and Bliss, 2012). This approach is highly cooperative in nature, and it requires full disclosure and open communication between parties. Wage and Salary Issues Perhaps, one major issue that comes under bargaining is related to wages and salary. Employees consider wages or salary as their basic identity of status, goodwill, income level etc. When it comes to the issues of wages and salary, there are basically three issues; equity issues, ability to pay issues and standard of living issues. As related to equity, unions want wages for jobs that they represent to exceed or at least equal with those jobs of the equivalent non-union jobs in the firm. Equivalence in insurance benefits across the jobs is also demanded. As related to the ability to pay issue, the concern is basically about firm’s profitability. When profit increases, unions expect to receive pay increases. They don’t like to accept reduced pay even when profits decline, but they may concede when employers have incurred substantial losses and the only solution is job loss to overcome the issue. As related to standard of living issue, the unions want proportionate increase in pay with increases in things an average employee buys for his living purposes (Fossum, 2009). The wages and salary related issues and basic determinants of these issues are illustrated below with the help of a diagram. Employee Benefits There are many benefits unions want their employee to gain. These benefits are required benefits, negotiated benefits, income maintenance plans, health care benefits, premium pay etc. Required benefits include unemployment insurance and social security systems, which is supported by equal contribution from employer and employee to provide retirement income, survivor benefits and Medicare benefits. Negotiated benefits include 1) income maintenance plans such as pension, wage employment guarantees and supplemental unemployment, 2) Employee health care such as health insurance, dental or wellness programs, employee assistance program etc, 3) Pay for time not worked such as paid holidays, paid vacation, sick leave, paid leave etc, 4) Premium pay such as reporting pay and travel pay, and 5) Employee services such as Child care, credit unions etc. Job Security and Seniority Seniority issues may come across several situations of economic and non-economic bargaining issues. Seniority often entitles employees to higher pay levels or to overtime or other types of preferences such as length of vacation or eligibility for promotion etc. seniority provisions are found to positively influence the pay ranges of blue-collar employees represented by unions (Fossum, 2009). Seniority is an important determinant of job security. But, from the human resource management perspective, the management would consistently use performance appraisal and other strategic methods to evaluate the performance of employees and to give importance to productivity as well as performance regardless of senior or junior workers. Job security is about workers’ demand for guarantee of work and to remain employed during times of layoffs. Senior workers are normally secure in their jobs, but in recent years, due to performance appraisals and other techniques to evaluate performance, management is forced to take decisions about who to remain in the work. Grievance and Disciplinary Procedures Under the contract administering, the process of resolving a conflict is called grievance procedure. A grievance procedure may be started by an employee or discharged employee who assumes that his employer has violated the contract or by a union representative on behalf of a group of workers. Grievance and disciplinary procedures are high priority issues for unions as they allow employees to object to unilateral management action during the tenure of the agreement (Fossum, 2009). Conclusion This paper critically evaluated various features of labor relations and various union structures, by discussing bargaining units, negotiating models, wage and salary issues, employee benefits and job security. This paper critically evaluated the union membership trends for last many years, as private sector membership has been steadily decreasing whereas the membership in public sector unions has been growing. This paper suggests that joining a union in both private and public sector will be advantageous to the employee. However, it is important to note that human resource management in private sector takes quite strong approach to measuring performance and evaluating employees’ work related performance to combat with changing business and competitive environment, and therefore, membership in private sector has been declining for many years. References Fossum, J. A, 2009, Labor Relations; Development, Structure, Process, Tenth Edition, McGraw Hill Companies Holley, W, Jennings, K and Wolters, R., 2011, The Labor Relations Process, Tenth edition, Cengage Learning Kaps, R.W, Hamilton, J. S and Bliss, T.J., 2012, Labor Relations in the Aviation and Aerospace Industries, SIU Press Kearney, R. C and Mareschal, P. M., 2014, Labor Relations in the Public Sector, Fifth Edition, CRC Press Noe R.A, Hollenbeck J.R and Gerhert B, 2003, Fundamentals of Human Resource Management, The McGraw−Hill Companies, Irwin Read More