Unions and Collective Bargaining - Case Study Example

UNIONS AND COLLECTIVE BARGAINING Name: Lecturer: Course: Date: Introduction Unions and collective bargaining is an integral aspect of the industrial relations policy. For several years employees have joined unions to act as a mechanism of collective bargaining. The process of collective bargaining is mainly concerned with negotiations between a group of employees or their union and their employer in order to determine effective conditions of employment. It is evident that the Austrian industrial relations policy has acknowledged the indispensable role that is played by unions in collective bargaining. Nevertheless, a major challenge facing unions and collective bargaining in Australia today is a decline in the number of workers that belong to unions or what is referred to as union density. This paper seeks to present a submission to the minister of Employment, Senator the Hon. Eric Abetz, to highlight the importance of Unions and collective bargaining. The paper will examine the issue of declined membership in unions, citing the causes of the decline and the relevant changes that can be adopted to address the issue. The importance of Unions and Collective Bargaining Over the previous decade, industrial relations and labour laws in Australia have experienced increased transformation. A case in point is the Fair Work Act 2009,which has promoted the use of Unions and collective bargaining as a method of improving industrial relations (Waugh, 2010). Unions and collective bargaining has therefore been very significant to workers, employers and even the government. A significant contribution of unions and collective bargaining is that it has promoted the freedom of association. In order for freedom of association to prosper there is need for employees to be vastly unionized. Furthermore, the industrial system should also encourage collective bargaining. International law offers a fertile understanding into the scope and nature of the issue of the freedom of association of employees. In 1948 countries of the world adopted the first international convention that dealt with the protection of the freedom of association. The freedom of association was therefore viewed as a fundamental human right and a bold move towards improving social justice. For instance, Convection 98 of the ILO, sorts to protect the rights of employees to organize and also bargain collectively. Australia ratified the convention thus resulting to the implementation of the freedom of association of employees (Waugh, 2010). Unions and collective bargaining is also essential in terms of improving the working conditions of employees. The working conditions offered to employees by some employers may at times be non- conducive. This has often resulted to a state of lack of contentment by many workers. Additionally, more employees continue to fall ill as a result of working in toxic and dangerous environments. Employees are also subjected to excessive stress in the workplace, low wages and other poor working conditions which deprive them from enjoying their work. Trade unions are therefore an essential mechanism that can be used by employees to improve their working conditions. For instance; unions have been proactive in ensuring that employers adhere to occupational health issues in the work environment such as; respiratory diseases, stress, occupational cancer, noise and various types of injuries. Also it is through the use of unions that employers who breach the occupational health legislation are prosecuted. Thus, unions have been useful in improving the working conditions of employees. Apart from the benefits derived by employees, unions and collective bargaining also act as incentives for employers. OECD (2010) discloses that when employers accept collective bargaining they are also bound to get benefits of improved performance. If the management acknowledges the employees chosen representatives (unions) as a bargaining partner that has equal standing, consent can be attained leading to increased compliance with the objectives of the company. Compliance with the goals of the company is therefore bound to lead to the increased productivity and thus improving the performance of the company. Recent research also reveals that there has been a positive contribution of unions in assisting to resolve disputes that exist in the workplace. A study conducted by Saundry et al., (2011) discloses that union representatives have played a constructive function in resolving disputes and proceedings that involve discipline in the workplace. Managers in workplaces that are union recognized held the sentiment that union representatives assisted to ensure that hearings involving discipline were undertaken in a more efficient and fair manner. Such occurrences took place essentially in organizations where managers greatly trusted union representatives (Saundry et al., 2011). Thus, unions have been effective in assisting the management of organization to resolve disputes within the organization. Aside from the interests that employers may gain, unions and collective bargaining is frequently valuable to the overall society and even the government. For instance, labour legislations usually act as the foundation for collective bargaining. This has therefore ensured the existence social peace and stability essentially when employers and unions disagree on certain issues. Also, the regulation of conditions of employment by a strong bargaining partner such as the use of unions is able to free the government from the role of being a mediator in negations and thus improving democracy (OECD, 2010). The Reduction of trade union membership or trade Union Destiny Trade union membership or density which is the total number of employees that belong to the trade unions is an indicator of the trade union strength. Nevertheless, despite the significant contribution of trade unions to employees, employers and the state, there has been a significant reduction in employees joining unions and those maintaining their membership. Several surveys and studies have disclosed the fact that there has been a decline in union membership. The Australian Bureau of Statistics discloses that membership in trade unions has reduced since the year 1992. From August 1992 to August 2011, the percentage of workers who were members of trade unions reduced from 43% to 18%. Following the passage of the Fair Work Act 2009 by the Rudd government a new regime for industrial relations was established. Unions were therefore enthusiastic based on the fact that membership was bound to increase. The total membership increased from 1,752,900 in 2008 to 1,835,100 in 2000. The increase was mostly recorded in the public sector where the density of unions increased from 41% to 46 %. However, by the end of 2010 a decline was noted in union membership (Bowden, 2010). In general it can be stated that following the recent financial crisis to the present, there has been a reduction in the percentage of membership in trade unions by 18% (ABC, 2014). One potential cause of the reduction of union membership has been instigated by changes in employment patterns. In the recent years there has been an increase in outsourcing and the use casual staff which has resulted to a reduction in union membership. In order to reduce costs and also deal with the changes in the economic environment, many employers prefer to recruit employees on temporary basis. Bamberry, (2008) discloses that the use of part time workers has continuously influenced a decline in union membership. For instance in 2006 a 7.4% decline in union membership was recorded due to a 73% increase in employment of part time workers who were basically non- union members. According to Davis (2010) the falling membership in unions is predominately a structural factor. The shape of Australian workforce has radically been transformed in the previous couple of decades. Expansion in employment has been greater in sectors that are poorly unionized such as the service sector while the well-organized sectors such as manufacturing have experienced a decline the employment rates. The existence of such structural changes has therefore influenced a slow growth in union membership. Also political and institutional factors have played a contributory role in leading to the reduction in union membership and also collective bargaining practices. Most of the legislations that exist today continue to favor agreements that involve individual employment as opposed to collective bargaining. This therefore makes it difficult for organizers of unions to integrate themselves in workplaces therefore leading to the decline in membership. Government policies on the other hand have directly affected the activities of unions essentially in the public sector; this has therefore resulted to a situation whereby employers in the private sector pursue management approaches that will corrode the influence of unions (Davis, 2010). Another factor influencing the reduction in union membership is the transformed nature of employment relations. Changes such as the disintegration of national bargaining structures and restrictions on industrial actions have resulted to a situation whereby employers acknowledge that unions cannot decide on union membership as a precondition of employment. The emergence of such decisions by employers concerning unions has resulted to a reduction in the proportion of employees willing to be covered by collective bargaining agreements. Consequently, the preferred way of regulating pay for workers has therefore been enterprise bargaining and individual contracts. This therefore implies that union membership has definitely declined (Wright, 2011). Employees also tend to withdraw their membership from unions a factor that has also instigated a decline in union membership. The employees provide reasons such as disenchantment with the unions. Other employees also leave unions due to dissatisfaction with the activities of the union. A study by Bamberry, (2008) reveals that workers who left unions provided reasons such as; the unions were not serving their interests. Also a larger proportion of employees also left unions as a result of changing jobs or moving to higher management positions within the same organization. Other cited the lack of access to union representation as a major factor influencing their departure from unions. Addressing the Reduction in Union membership In order to address the issue reduced union membership/ union density the first approach is through policy formulation. With the continued decline in trade union membership, the government should take a leading role in ensuring that trade unions remain relevant as a symbol of democracy. As argued by Cordova, (1990) trade unions and collective bargaining is a fundamental element of industrial democracy. Foremost, there is need to ensure that the Fair Work Act is effectively implemented within the industrial relations systems. Collective bargaining has been undermined in various regions of the world. However, Australia is an exemplary nation that has spearheaded reforms in the system of industrial relations. Between the year 2007 and 2009, the labor party government adopted the Fair Work Act, 2009 with the objective of restoring collective bargaining. This policy direction has indeed brought about significant changes such as; eliminating state sanctioned anti-unionism and restricted collective bargaining (Colvin, 2014). Despite the changes brought about by the passing of the Fair Work Act, it is essential for the ministry of labour to ensure that the Act is being implemented effectively. As noted by the causes of the reduction of union membership, there are some political and institutional factors that have contributed to undermine collective bargaining. This is because the industrial system still continues to implement legislations that favor individual representation as opposed to collective bargaining. Such practices undermine the existence of unions which makes workers to see no need of joining unions or maintaining their membership in unions. There is therefore need for the ministry of Employment to ensure that the proposals of the Fair Work Act in terms of collective bargaining are fully implemented. One of the primary objectives of FWA is to ensure collective bargaining (Waugh, 2010). Thus, as the minister Employment there is need for you to propose for additional clauses in the Fair Work Act which ensure that the role of unions in collective bargaining is not undermined by the existing policies but rather unions remain relevant. Also as noted, another cause of the decline in union membership is the reduction in employment rates by employers. Most employers today prefer contractual and part time workers. The basic demerit of using contractual and part time workers is that the workers do not see the need of joining unions as a platform to fight for fighting for their rights based on the fact that their jobs can be terminated at any time. However, what is evident is that contractual and part time workers also face difficulties that can actually be addressed by unions. It is therefore essential for the Fair Work Act to integrate clauses that support the assertion that employers should recruit their workers on permanent basis instead of part time and contract basis as witnessed in the recent years. Also, the Act should incorporate the idea that in the event that employers prefer casual or contractual workers, the workers should be given an opportunity to be members of a union and also they should be able to maintain their membership in those unions. Developing a union recruitment culture is another viable strategy in which the issues of reduced union density can be addressed. In order for Australian unions to remain relevant there is need for new members to be recruited. In addition the existing members should also maintain their membership. Union density is an essential indicator of the characteristics of the industrial relations system of a country. The extent in which workers are covered by collective bargaining agreements at various levels for instance, national, company, sectorial or even regional, is a significant attribute of a system whereby the employment conditions and wages are set. Therefore, there is need to maintain and increase union density in order ensure that the industrial relations system is functional (OECD, 2010). The ministry of labour can take a leading role increasing union density by ensuring that a union recruitment culture is adopted in the industrial relations system. One of the approaches is through recruiting and training field organizers who will work towards increasing the mobilizing workers to join unions. The ministry can also develop specific recruitment campaigns that aim at mobilizing workers to join unions. The promotion of grass root unionism is another workable approach that can be used in advancing union membership. The focus should be to educate employees concerning the significance of unions. Although employees sometimes hold negative views concerning unions, it is vital to undertake grass root campaigns that aim at encouraging their union membership. For instance; employees are usually against the assertion that they have to pay union dues or face the risk of losing their jobs. Also employees tend to oppose the agenda held by unions such as the idea that contracts made by unions prevent workers from earning performance based incentives (Sherk and Kloster, 2014).Despite of the existence of such views among employees, it is vital for the ministry to promote grass root unionism essentially in public service organization. Conclusion The above paper has presented a submission paper to the minister of Employment, Senator the Hon. Eric Abetz. The main agenda discussed is the issues of declined membership in unions. The paper takes note of the fact that unions are an essential element of collective bargaining. In addition, unions and collective bargaining is a basically a symbol of democracy in the industrial relations system. What is evident is that the industrial relations policy cannot do away with unions. Although, the decline in membership is an impending challenge, there is need for the ministry of Employment to intervene and assist in resolving the problem. References Australian Bureau of Statistics 2013, Decline in trade Union membership, ABS. Bamberry, L, 2008, Propensity to Join and Maintain Membership of Unions amongst Casual School Teachers in NSW, The Centre for Applied Social Research. Bowden, B, 2010, The Rise and Decline of Australian Unionism: A History of Industrial Labour from the 1820s to 2010, Griffith Business School. Cordova, E, 1990, Collective Bargaining, Denventer Kluwer. Colvin, A, 2014,Rediscovering collective Bargaining ; Australia’s Fair Work Act in International Perspective , ILR Review , 67(1), p 274- 286. Davis, M 2010, Unions face fight on a new front, The Sydney Morning Gerald. Organization for Economic Co‑operation and Development, 2010, Collective Bargaining Levels and Coverage, OECD. Saundry, R, Jones, C and Antcliff, V, 2011, ‘Discipline, representation and dispute resolution – Exploring the role of trade unions and employee companions in workplace discipline’, Industrial Relations Journal, 42(2): 195-211. Sherk, J and Kloster, A, 2014, Local Governments Can Increase Job Growth and Choices by Passing Right-to-Work Laws, Heritage Foundation. Waugh, B, 2010, Trade unions and the Freedom of association, a Comparative analysis of work choices, Centre for employment and Labor relations. Wright, C , 2011, What role for trade unions in future workplace relations? University of Cambridge. Read More