Labor Unions infringe on business owners’ freedom to make decisions; they are unethical in protecting laziness, lack of synergy in the workplace, and stagnates workflow due to employers’ failure to compensate the productivity of employees. It goes without saying that labor unions do have great importance in their role in society, more specifically, the economic world; the labor market cannot simply function on its own, operating unethically at times. Correspondingly, a labor union represents the workers and officially should do everything in its power to aid the workers in any situation possible. However, these same unions are granted powers by the government to collect payments from every employee which, in turn, they get to enjoy privileges permitted by the law.
Labor union laws were established to protect and represent both employees and employers. A contributing factor are federal labor laws that have been set forth to give rights and representation of both parties in order for them to come to an agreement, or collective bargaining. One of the earliest labor union court rulings was Vegelahn v. Guntner. According to Harvard Law Review (1958) “a majority of the court found peaceful picketing for the purpose of dissuading the plaintiff’s employees from working for him an unlawful means of securing the union’s objective of higher wages for the industry” (p.355). One of the first laws enacted was the The Norris-LaGuardia Act. Enacted in 1932, the act allowed employees to strike, boycott, and picket an organization albeit peacefully (Cross, Miller, 2013). In 1935, the National Labor Relations Act (NLRA) was enacted giving employees the right of striking and collective bargaining, while also defining unreasonable actions in reference to an employer (Cross, Miller. 2013).
Furthermore, collective bargaining was established under The Wagner Act, which required employers to bargain with unions to secure suitable employment and compensatory conditions (Kuhlmann, 2000). The National Labor Relations Act deemed necessary for both the employer and unions to engage good faith bargaining. The main purpose of good faith bargaining is to introduce equality of power to both parties, allowing for a collective agreement where both parties find a agreed-upon beneficial solution. It is beneficial for both parties to come to an agreement with good faith bargaining to avoid loss of wages to employees and loss of productivity for the business. If a party chooses to not comply by good faith bargaining, it is considered an unfair labor practice dealt with by the NLRA (Cross, Miller. 2013).
Labor unions actually have positive impacts on the labor market in general. If they are applied appropriately, they can be an advantageous to both employers and employees when they are working hand in hand to improve the convenience of their industry. As part of the labor union, people are assured that their job would be protected without cause. If they choose whom to protect they would be defeating the purpose of the organization. It is crucial that labor union do their best in order to guarantee that all workers are given the chance to settle for a stable employment. Moreover, another advantage of having a labor union would be for an employer, who gets a simplified negotiation process with their employees. By simply having the employer explain an issue to the head of labor union, that person would spread the word to the workforce making it more efficient and avoiding a slow negotiation. Another important benefit of labor unions is that it leads to having fewer turnovers in an organization. Due to the fact that employees pay charges to the union, they would be less likely to leave their job. As a result, it saves money for the organization in the long run by not having to train new employees more often (Walter & Michel 2003).
In the other hand, labor unions have a few cons. One disadvantage as, described by Richberg (1957) on p.95, is that sometimes the “bosses” of the labor unions are demanding the members to protest such as to go on strikes even though some employees are not willing to give in on the demands. Sometimes the union creates certain situations and obstructions just to prevent the employees from going to work and to get “their work” done. The employees do not benefit from strikes at all because usually they do not get paid for the time they are on strike and even if the labor union decides to pay the members on strike, the “wage” the labor union pays is usually much lower than the wage the workers earn. Some unions use violence if things do not go their way even though they claim that they do not engage in violent activities but rather want to settle things peacefully (Richberg, 1957, p.97). A good example which brought the violent tactics that labor unions have used since the previous decades is the Kohler strike to public attention.
Another disadvantage is that members of labor unions experience their work environment differently than employees who are not part of a labor union. In 2010, a research was conducted by the Gallup-Healthways Well-Being Index, in which almost one hundred and fifty thousand employees were interviewed, and asked several questions which included the question if they were part of a labor union. According to the research, union members say that they get treated like employees by a “boss” and non-members say that they are treated like partners by their boss. Another difference in the way union members and non-members experience their work environment is the way their supervisor creates a trusting and open environment. According to the research, 66% of the union members say that they work in such an environment whereas 80% of the non-members say that they work in such an environment. There is a significant difference in the numbers thus it is safe to say that there is a quite big difference in union members’ perception of their workplace and non-members’ perception of their workplace. It seems like employees who are not part of a labor union are more satisfied with their working conditions than employees who are a part of a labor union.
The union dues can also be a disadvantage of labor unions for employees. Some employees find the dues too much. It can also be the case that in order to support members on a strike, the union can increase the dues of all other workers in order to support the strikers. This is an unfair tactic practiced by some labor unions (Richberg, 1957, p. 106). In addition, labor unions can cause the employer losses especially during strikes. (Richberg, 1957, p. 106). For example strikes can cause a delay or even an interruption in production, which can cause the company to operate at a loss. Some strikes can cause problems for an entire industry which can prove to be a disadvantage for not only employers and companies but also for customers and consumers especially in service-oriented industries. (Richberg, 1957, p.106).
The notion of a business owner’s free will and free market economy derives from the very foundation of this nation. The truth behind a union workplace revolves around enforcing policy wherein the business owner may not agree with and handing out punishment in which the owner has no voice. Ultimately the decision should only be the duty of a superior such as a manager to say whether the synergy of his or her workplace is being intruded by a “bad coworker.” The government grants power to these labor unions so the entity itself may serve the public interest. Nevertheless, many times the labor unions issue mandates that help the various work environments but in most cases, firing the wrong people, the unions do not help. The obligations should only always fall to the owner; with good work, doing it satisfactory, being respectful and accountable to all, a successful business shall thrive.
Labor unions place an undue burden on the business owner. According to Lott (2011), “ If the union members won’t work, the law makes it extremely difficult for anyone else to step in and do their jobs. As a result, union workers have little competition — so they can demand higher wages and do less work” (p.1). Does this demand for higher pay for less work by union members have a negative effect on non-union or members who are not as superior within companies? They absolutely do.
When layoffs must happen within companies, usually the newest employees are the first ones to go. This is directly related to labor unions. These are not the employees that are making the most money, or better yet, the employees that are solely underperforming. These unions are not to the benefit of all employees. They only protect the seniors with superiority. If a labor union is fighting for a 30% increase in wages, but that would mean that 20% of the staff would have to be laid off in order to accommodate the new increase, the lowest on the totem pole will ultimately fail to support this. However, the other 80% who have been with the company for many years will support it as they know that their jobs are secured (Lott, 2011).
This isn’t fair to new employees or even the employees who do their job. This system only protects those who are more loyal to the company in terms of time employed and those who are receiving the most compensation. It also protects those who may have been with the company the longest, but underperform daily. These employees get rewarded with more benefits, higher pay, and security in knowing that in the event of a lay off- their job is not on the line.
Some critics in favor of labor unions will argue that although they have many benefits, they cannot protect you from poor work ethic or unprofessionalism in the workplace; that employers still have a voice in the decisions. The language of these collective agreements (contracts) outlines processes and “progressive discipline” in the event of underperforming employees (“Straight Talk,” 2014). However, is this enough for the business owner, manager, or superior to terminate an employee that is part of a labor union without the fear of backlash and public ridicule?
While it may appear that most laws are passed to protect unions from employers, the Labor-Management Relations Act (LMRA) was created to prevent unions from conducting unfair practices as well. The act denied labor unions to practice a closed shop, which required employees or potential candidates to be part of a labor union. The act instead conserved a union’s ability to have a ‘union shop’, which doesn’t require an employee to be affiliated with a union, but tends to demand an employee to join the labor union within a time frame of employment (Cross, Miller 2013). Another positive aspect for equality of bargaining power between union’s and employers are right-to-work laws. Chaison (2012) states “Right-to-work laws – state laws that bar unions and employers from requiring that workers join unions or pay unions dues without joining”(p.20). Negating the need to join a labor union, though it may come with a ‘free rider’ cost to the labor unions that have bargaining agreements with an employer (Chaison, 2012).
The Labor-Management Reporting and Disclosure Act, 1959 (LMRDA) established an employee bill of rights and reporting requirements for unions activities. The act regulates union’s internal business procedures, including elections. For instance, the LMRDA requires unions to hold regularly scheduled elections of officers using secret ballots. (Cross, Miller, 2013). The positive effect of this law is to regulate the relationship between union and its members. A Bill of Rights for union members was established by this act, which ensures disclosure of information and union funds and provides freedom of speech and participation in elections to union workers. This act defends the workers from corruption and enables the union to run democratically and provide rights to them and safeguard their interests within labor organizations. Under section 501 of the LMRDA, officers of labor unions are held to the highest standard of responsibility and ethical conduct in administering the affairs of their unions. (Cross, Miller, 2013).
An example of an industry that has suffered tremendously due to labor union laws has been the U.S. auto industry. Labor unions have been present within automakers pretty much since Ford started selling the model T. The United Automobile Workers (UAW) union has been representing auto workers from the Big 3 (General Motors, Ford, and Chrysler), has been known historically for a union that withholds labor (Cutcher-Gershenfeld). According to Dr. Gomis Porqueras, over the past decade, the Big 3 has lost 10 percent of market to foreign rivals such as Toyota, Nissan, and Honda. Furthermore, labor unions have caused U.S. auto industry to become less competitive and companies with unionized workers are losing market share to those without.
Another example of institutions that suffers tremendously from labor unions are public institutions. One of the members of Law Firm 4, Al Shelton, works for a public educational agency. In an interview with him, he states the problems that he sees with the unions. “The employees of public agencies have been working there probably 20 or 30 years. They have been doing the same thing over and over again. When a new director comes in, and tries to fix the problems and improve a department, the first thing people say is: we have been doing it this way forever, does this mean we are going to lose our jobs? Given that they cannot just get fired and there is no incentive to do better, there is no improvement all around.” Al Shelton also mentioned that salaries and wage increases are negotiated by the unions, instead of it being performance based as in the private industry. Furthermore, he states that: “We had an employee that did no job for two years, which affected the schools and the students directly. Since March, management has been trying to fire him, and the unions have put quite a fight to protect him. To this date (December 4, 2016), his employment is yet to be terminated”
In conclusion, the purpose of labor unions is improving the conditions of the employees they represent and while they have made improvements to the working environment, with the regulation of safety, environment, labor and wage; labor unions also have caused incompetence. When all workers receive the same pay and raises, there is no incentive for a person to work harder than necessary at their job. When there is less worked hours, productivity is reduced, and the total revenue generated is reduced, which means hiring less people and investing in less to improve the workplace. When workers go on strike, it hurts the supply chain. Union protection makes it difficult for employers to discipline, terminate or even promote employees. The pros and cons of labor unions are largely a matter of position and perception. Unions do offer distinct advantages to employees, but those advantages may no longer suffice in the modern workplace.