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PART FIVE EMPLOYEE AND LABOR RELATIONS
C H A P T E R
T h i r t e e n
Labor Relations and
Collective Bargaining
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Lecture Outline
I. The Labor Movement
A. Why Do Workers Organize?
II. Employee Engagement Guide for Managers:
Employee Engagement and Unionization
A. What Do Unions Want?
B. The AFL-CIO and the SEIU
III. Unions and the Law
A. Period of Strong Encouragement: The Norris-
LaGuardia Act (1932) and the National Labor
Relations Act (1935)
B. Period of Modified Encouragement Coupled
with Regulation: The Taft-Hartley Act (1947)
C. Period of Detailed Regulation of Internal Union
Affairs: The Landrum-Griffin Act (1959)
IV. The Union Drive and Election
A. Step 1. Initial Contact
B. Step 2. Authorization Cards
C. Step 3. The Hearing
D. Step 4. The Campaign
E. Step 5. The Election
F. How to Lose an NLRB Election
E. Bargaining Stages
F. Impasses, Mediation, and Strikes
G. The Contract Agreement
H. Contract Administration: Dealing with
Grievances
VI. What’s Next for Unions?
A. Why the Union Decline?
B. What Are Unions Doing About It?
C. Cooperative Labor-Management Relations
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ANNOTATED OUTLINE
I. The Labor Movement
Almost 15 million U.S. workers belong to a union—around 11.1% of all men and
women working in this country.
A. Why Do Workers Organize? — The urge to unionize often seems to boil down to
the belief on the part of workers that it is only through unity that they can get their
fair share of the pie. It is sometimes the result of workers trying to protect
themselves from management’s whims. Union workers tend to receive
II. Employee Engagement Guide for Managers: Employee Engagement and
Unionization
One cannot assume that engaged employees are less likely to support a unionization
effort in their companies, but studies show that the same sorts of policies (such as
good benefits, building trust, and guaranteeing fair treatment) that improve employee
engagement may also reduce the likelihood of being unionized.
A. What Do Unions Want? — Unions have two sets of aims, one for union security
1. Union Security — The five types of union security are: closed shop, union
2. Improved Wages, Hours, Working Conditions, and Benefits for Members —
The typical labor agreement also gives the union a role in other HR activities,
including recruiting, selecting, compensating, promoting, training, and
discharging employees.
B. The AFL-CIO and the SEIU
The American Federation of Labor and Congress of Industrial Organizations
(AFL-CIO) is a voluntary federation of about 56 national and international labor
unions in the United States. The AFL and CIO merged in 1955. The three layers
of structure in the AFL-CIO are: (1) the local union (a single chapter in a national
union), (2) the national union, and (3) the national federation. The Service
III. Unions and the Law
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There were no special labor laws until about 1930, so employers were virtually
unrestrained in their behavior toward unions and employees. Since the Great
Depression, in response to changing public attitudes, values, and economic
conditions, labor law has gone through three clear changes: from strong
encouragement of unions, to modified encouragement coupled with regulation, and
finally, to detailed regulation of internal union affairs.
A. Period of Strong Encouragement: The Norris-LaGuardia Act (1932) and the
National Labor Relations or Wagner Act (1935) — The Norris-LaGuardia Act
guaranteed to each employee the right to bargain collectively free from
interference, restraint, or coercion; but it did little to restrain employers from
fighting labor organizations. The National Labor Relations (Wagner) Act of 1935
(1) banned certain unfair labor practices; (2) provided for secret-ballot elections
and majority rule for determining whether a firm’s employees were to unionize;
and (3) created the National Labor Relations Board (NLRB) for enforcing these
two provisions.
1. Unfair Employer Labor Practices — As deemed by the Wagner Act: (a) it is
unfair for employers to interfere with, restrain, or coerce employees in
exercising their legally sanctioned right of self-organization; (b) it is unfair for
2. From 1935 to 1947 — Union membership increased quickly after the
passage of the Wagner Act in 1935, but the tide had begun to turn by the
mid-1940s.
B. Period of Modified Encouragement Coupled with Regulation — The Taft-Hartley
Act (1947) amended the Wagner Act with provisions aimed at limiting unions in
four ways: (1) by prohibiting unfair union labor practices, (2) by enumerating the
1. Unfair Union Labor Practices — (a) unions cannot restrain or coerce
employees from exercising their guaranteed bargaining rights; (b) unions
2. Rights of Employees — The Taft-Hartley Act protects employees from their
unions.
3. Rights of Employers — The Taft-Hartley Act explicitly gives employers full
freedom to express their views concerning union organization. The only
major restraint is that employers must avoid threats, promises, coercion, and
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4. National Emergency Strikes — The Taft-Hartley Act allows the U.S. president
to intervene in national emergency strikes. The president may appoint a
board of inquiry and, based on its report, apply for an injunction restraining
C. Period of Detailed Regulation of Internal Union Affairs — The Landrum-Griffin Act
(1959) (officially, the Labor Management Reporting and Disclosure Act), an
amendment to the Wagner Act, is aimed at protecting union members from
1. Labor Law Today — Unions are pushing for new legislation that would
substantially improve unions’ efforts but shrinking state budgets and
increased competitive pressures [along with more right–to-work states] and a
new Republican administration may (or may not) dampen union efforts.
IV. The Union Drive and Election
A. Step 1. Initial Contact — The union determines the employees’ interest in
organizing a union, and an organizing committee is established. The initiative for
the first contact between the employees and the union may come from the
employees, from a union already representing other employees of the firm, or
from a union representing workers elsewhere. Once an employer becomes a
target, a union official usually assigns a representative to assess employee
interest. He or she identifies employees who would make a good organizing
committee, and educates them on the benefits of forming a union, the law,
procedures involved in forming a local union, and the issues management is
likely to raise during a campaign. The union must follow certain rules when it
starts contacting employees.
1. Labor Relations Consultants — Are outside advisors (such as law firms,
2. Union Salting — Is an organizing tactic by which full-time undercover union
organizers are hired by unwitting employers. A U.S. Supreme Court decision
held the tactic to be legal. Critics claim “salts” interfere with business
operations and harass employees.
B. Step 2. Authorization Cards — Before the union can petition the NLRB for the
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C. Step 3. The Hearing — One of three things can occur once the union collects the
authorization cards: (1) no hearing is needed if the employer chooses not to
contest union recognition, and a consent election is held immediately; (2) if the
employer chooses not to contest the union’s right to an election, or scope of the
bargaining unit, or which employees are eligible to vote in the election, no
hearing is needed and the parties can stipulate an election; or (3) if an employer
does wish to contest the union’s right, it can insist on a hearing to determine
D. Step 4. The Campaign — During this stage, the union and the employer appeal
to employees for their votes, but neither side can threaten, bribe, or coerce
employees.
1. The Supervisor’s Role in the Campaign — Supervisors are the first line of
defense when it comes to the unionizing effort. Supervisors need some
2. Rules Regarding Literature and Solicitation — Employers can do the
following: always bar nonemployees from soliciting during their work time
(when the employee is on duty and not on a break); usually stop employees
E. Step 5. The Election — The election by secret ballot is held within 30 to 60 days
after the NLRB issues its Decision and Direction of Election. The NLRB provides
the ballots as well as the voting booth, and ballot box, and counts the votes and
certifies the results of the election. The union becomes the employees’
representative if it wins the election by a majority of the votes cast.
F. How to Lose an NLRB Election
1. Asleep at the switch — Executives caught unaware.
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1. Strikes — A strike is a withdrawal of labor. There are four types of strikes:
economic strike, unfair labor practice strike, wildcat strike, and sympathy
2. Other ways to deal with an impasse — Breaking an impasse includes
corporate campaigns. A corporate campaign is an organized effort by the
union that exerts pressure (such as a boycott) on the corporation by
G. The Contract Agreement — May be 20 to 30 pages or longer, and the main
sections cover these subjects: (1) management rights, (2) union security and
H. Contract Administration: Dealing with Grievances — Grievance handling,
because no labor contract can ever be so complete that it covers all
contingencies and answers all questions. Employees may use just about any
factor involving wages, hours, or conditions of employment as the basis of a
grievance.
1. The Grievance Process — Is specified in most collective bargaining
contracts, which specifies the various steps in the procedure, time limits, and
specific rules. Union grievance procedures differ from firm to firm. It is
VI. What’s Next for Unions?
A. Why the Union Decline? — The 1980s and 1990s were hard times for unions.
About 35% of the nonfarm U.S. workforce belonged to unions by the 1960s.
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B. What Are Unions Doing About It? — Unions are becoming more aggressive,
pressuring employers through class action lawsuits and pushing Congress to
1. Recent Trends in Labor Laws — Under the Obama administration, unions
were permitted to focus on small “micro” groups within the employer’s workforce
and to call “quickie” union elections in as little as 13 days. Some of these recent
changes may be reversed following the appointment of a Republican to the
NLRB.
C. Cooperative Labor-Management Relations — News reports tend to highlight
adversarial labor-management relations but examples of cooperation do exist.
General Motors and Toyota created a joint venture they called New United Motor
KEY TERMS
Closed shop
A form of union security in which the company can hire only union
members. This was outlawed in 1947 for interstate commerce but still
exists in some industries (such as printing).
Union shop
A form of union security in which the company can hire nonunion
people, but they must join the union after a prescribed period of time
and pay dues. (If they do not, they can be fired.)
Agency shop
A form of union security in which employees who do not belong to the
union must still pay union dues on the assumption that union efforts
benefit all workers.
Preferential shop
Union members get preference in hiring, but the employer can still hire
nonunion members.
Maintenance of membership
arrangement
Employees do not have to belong to the union. However, union
members employed by the firm must maintain membership in the
union for the contract period.
Right to work
The public policy in a number of states that prohibits union security of
any kind.
Norris-LaGuardia Act
This law marked the beginning of the era of strong encouragement of
unions and guaranteed to each employee the right to bargain
collectively “free from interference, restraint, or coercion.”
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Wagner Act
This law banned certain types of unfair labor practices and provided
for secret-ballot elections and majority rule for determining whether or
not a firm’s employees want to unionize.
National Labor Relations
Board (NLRB)
The agency created by the Wagner Act to investigate unfair labor
practice charges and to provide for secret-ballot elections and majority
rule in determining whether a firm’s employees want a union.
Taft-Hartley Act
A law prohibiting union unfair labor practices and enumerating the
rights of employees as union members. It also enumerates the rights
of employers.
National emergency strikes
Strikes that might “imperil the national health and safety.”
Landrum-Griffin Act
A law aimed at protecting union members from possible wrongdoing
on the part of their unions.
Union salting
A union organizing tactic by which workers who are employed by a
union as undercover union organizers are hired by unwitting
employers.
Authorization cards
In order to petition for a union election, the union must show that at
least 30% of employees may be interested in being unionized.
Employees indicate this interest by signing authorization cards.
Bargaining unit
The group of employees the union will be authorized to represent.
Decertification
In labor law, the process that enables employees to terminate legally
(decertify) their union’s right to represent them.
Collective bargaining
The process through which representatives of management and the
union meet to negotiate a labor agreement.
Good-faith bargaining
A term that means both parties are communicating and negotiating
and that proposals are being matched with counterproposals with both
parties making every reasonable effort to arrive at agreements. It does
not mean that either party is compelled to agree to a proposal.
Voluntary (permissible)
bargaining items
Items in collective bargaining over which bargaining is neither illegal
nor mandatory—neither party can be compelled against its wishes to
negotiate over those items.
Illegal bargaining items
Items in collective bargaining that are forbidden by law; for example,
the clause agreeing to hire “union members exclusively” would be
illegal in a right-to–work state.
Mandatory bargaining items
Items in collective bargaining that a party must bargain over if the
other party introduces them—for example, pay.
Mediation
Labor relations intervention in which a neutral third party tries to assist
the principals in reaching agreement.
Fact-finder
In labor relations, a neutral party who studies the issues in a dispute
and makes a public recommendation for a reasonable settlement.
Arbitration
The most definitive type of third-party intervention, in which the
arbitrator usually has the power to dictate the settlement terms.
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Economic strike
A strike that results from a failure to agree on the terms of a contract
that involve wages, benefits, and other conditions of employment.
Unfair labor practice strike
A strike aimed at protesting illegal conduct by the employer.
Wildcat strike
An unauthorized strike occurring during the term of a contract.
Sympathy strike
A strike that takes place when one union strikes in support of another.
Boycott
The combined refusal by employees and other interested parties to
buy or use the employer’s products.
Lockout
A refusal by the employer to provide opportunities to work.
Co-determination
Employees have the legal right to a voice in setting company policies.
Workers elect their own representative to the supervisory board of the
employer.
DISCUSSION QUESTIONS
13–1. Briefly describe the history and structure of the U.S. union movement. (LO 13.1: Briefly
13–2. Discuss the nature of the major federal labor relations laws. (LO 13.3: Discuss the nature of
13–3. Discuss the main steps in the collective bargaining process. (LO 13.5: Discuss the main
13–4. Explain why union membership dropped, and what the prospects are for the union
movement. (LO 13.6: Explain why union membership dropped and what the prospects are for
the union movement.) The 1980s and 1990s were hard times for unions. About 35% of the
13–5. Why do employees join unions? What are the advantages and disadvantages of being a
union member? (LO 13.1: Briefly describe the U.S. labor movement.) Workers join unions
13–6. What actions might make employers lose elections? (LO 13.4: Describe the process of a
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13–13. The Kaiser Permanente Health System is often held out as an employer with very good
labor relations. What can you discern from websites such as
www.kaiserpermanentejobs.org/jobs.aspx that might explain such a reputation? (LO 13.2:
13–14. What does www.seiu.org/ tell you about this union’s aims and how they intend to achieve
them? (LO 13.6: Explain why union membership dropped and what the prospects are for the
13–15. For this activity, you will need the documents titled (1) “HRCI PHR® and SPHR®
Certification body of Knowledge” and (2) “About the Society for Human Resource
Management (SHRM) Body of Competency and KnowledgeTM Model and Certification
Exams.” Your instructor can obtain these documents from the Pearson Instructor
Resource Center and pass them on to you. These documents list the knowledge someone
studying for the HRCI or SHRM certification exam needs to have in each area of human
resource management (such as in Strategic Management, and Workforce Planning). In
groups of several students, do four things: (1) review the HRCI and/or SHRM documents;
(2) identify the material in this chapter that relates to the required knowledge the appendix
lists; (3) write four multiple-choice exam questions on this material that you believe would
be suitable for inclusion in the HRCI exam; and (4) if time permits, have someone from
your team post your team’s questions in front of the class, so the students in other teams
can take each other’s exam questions. (Covers all learning objectives) The material in this
Students can find the following assisted-graded writing questions at
13-16. Explain in detail each step in a union drive and election. (LO 13.4: Describe the process of a
13-17. Briefly illustrate how labor law has gone through a cycle of repression and encouragement.
HR in Action Case Incident 1: Negotiating with the Writers’ Guild of America
13–18. The producers said the WGA was not bargaining in good faith. What did they mean by
that, and do you think the evidence is sufficient to support the claim? (LO 13.5: Discuss the
APPLICATION EXERCISES
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13–19. The WGA did eventually strike. What tactics could the producers have used to fight back
once the strike began? What tactics do you think the WGA used? (LO 13.5: Discuss the
13–20. This was basically a conflict between professional and creative people (the WGA) and TV
and movie producers. Do you think the conflict was therefore different in any way from the
conflicts between, say, the auto workers or teamsters unions against auto and trucking
companies? Why? (None) Students’ answers will vary. Although the negotiation process is the
13–21. What role did negotiating skills seem to play in the WGA–producers’ negotiations?
Provide examples. (LO 13.5: Discuss the main steps in the collective bargaining process.) It
HR in Action Case Incident 2: Carter Cleaning Company: The Grievance
13–22. Do you think it is important for Carter Cleaning Company to have a formal grievance
process? Why or why not? (LO 13.5: Discuss the main steps in the collective bargaining
13–23. Based on what you know about the Carter Cleaning Company, outline the steps in what
you think would be the ideal grievance process for this company. (LO 13.5: Discuss the
13–24. In addition to the grievance process, can you think of anything else that Carter Cleaning
Company might do to make sure that grievances and gripes such as this one are
expressed and also are heard by top management? (LO 13.5: Discuss the main steps in the
Experiential Exercise: An Organizing Question on Campus
Purpose: The purpose of this exercise is to give you practice in dealing with some of the elements of a
union organizing campaign.
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Required Understanding: You should be familiar with the material covered in this chapter, as well as the
following incident.
Art Tipton is a human resources director of Pierce University, a private university located in a large urban
city. Ruth Ann Zimmer, a supervisor in the maintenance and housekeeping services division of the
university, has just come into his office to discuss her situation. Zimmer’s division of the university is
responsible for maintaining and cleaning physical facilities of the university. Zimmer is one of the
department supervisors who supervise employees who maintain and clean on-campus dormitories.
In the next several minutes, Zimmer proceeds to express her concerns about a union-organizing
campaign that has begun among her employees. According to Zimmer, a representative of the Service
Workers Union has met with a number of the employees, urging them to sign union authorization cards.
She has observed several of her employees “cornering” other employees to talk to them about joining the
How to Set Up the Exercise/Instructions: Divide the class into groups of four or five students. Assume
that you are labor relations consultants retained by the college to identify the problems and issues
involved and to advise Art Tipton about what to do next. Each group will spend about 45 minutes
discussing the issues and outlining those issues as well as an action plan for Tipton. What should he do
now? If time permits, a spokesperson from each group should list on the board the issues involved and
the group’s recommendation.
1. Look at the careers sections of websites for several companies abroad, such as for Wal-mart
China (www.wal-martchina.com/english/career/career.htm). What differences possibly caused
by cultural differences do you see from what you might expect in the U.S. units of these
companies? It appears that issues such as employee respect, ongoing sustainability programs,
WEB-e’s (WEB EXERCISES)