13.10: Labor Relations

Labor law affects the working relationship of employees who are represented by a union in their workplace. A union is an organization formed to negotiate with employers, on behalf of workers collectively, about job-related issues such as salary, benefits, hours, and working conditions. Labor law essentially creates a framework for employers, employees, and unions to create a contract unique to that business for the purpose of regulating the employment relationship and resolving disputes.

National Labor Relations Act

The first unions in the United States were formed after the Civil War and began to flourish during the Industrial Revolution. In 1935, Congress enacted the National Labor Relations Act (NLRA) to provide workers three important rights:

1. The right to organize;
2. The right to collectively bargain; and
3. The right to strike.

The NLRA also prohibits employers and unions from engaging in unfair labor practices. Unfair labor practices by employers include:

• Interfering with protected employee rights, such as the right to self-organize;
• Discriminating against employees for union-related activities;
• Retaliating against employees who invoke their labor rights;
• Refusing to engage in collective bargaining;
• Interfering with the administration of a union; and
• Discouraging employees from forming or joining a union.

Unfair labor practices by unions include:

• Causing an employer to discriminate against an employee who is not a union member;
• Engaging in an illegal strike or boycott;
• Requiring an employer to hire more employees than necessary (called featherbedding);
• Coordinating a secondary boycott (an action against a third party who deals with the employer but has no direct contact with the union);
• Refusing to engage in collective bargaining; and
• Charging excessive dues.

Most states also have laws that make it illegal for an employer to mandate union membership as a condition of employment.

The NLRA also states that supervisors are not employees and do not have a right to join a union. Supervisors are individuals with the authority to make independent decisions on hiring, firing, disciplining, or promoting other employees.

Under the NLRA, a validly recognized union is the exclusive representative of the employees. This means that the union represents all the employees, even if a particular worker is not a member of the union or has not paid dues. The employer may not bargain directly either with employees or with another organization representing the employees.

Unions have a duty of fair representation, which requires unions to treat all members fairly, impartially, and in good faith. A union may not favor some members over others and may not discriminate against members based on their membership in a protected class, such as race or gender.

Organizing a Union

A union trying to represent employees follows these steps:

1.	Campaign	Union organizers try to persuade employees to form a union. An employer may not restrict organizing discussions unless they interfere with business operations. An employer may present anti-union views but may not use threats or rewards to defeat a union drive.
2.	Authorization Cards	Union organizers ask employees to sign authorization cards stating that they want the union to represent them.
3.	Petition	If a union obtains authorization cards from 30% of the workforce, it may petition the NLRB for an election.
4.	Election	If more than 50% of the employees vote for the union, the NLRB designates it as the exclusive representative of the employees.

Figure 13.8 Process of Union Organizing

Collective Bargaining

Once a union is formed, the employer and union must negotiate to create a new employment contract that regulates employment conditions called a collective bargaining agreement (CBA). The bargaining unit is a group of employees authorized to engage in collective bargaining on behalf of all of the employees of a company or an industry sector.

The NLRA allows the parties to bargain almost any subject they wish but it requires them to bargain wages, hours, and other terms and conditions of employment. Conditions of employment include:

• Benefits;
• Retirement benefits;
• Order of layoffs and recalls;
• Production quotas;
• Work rules, such as safety practices; and
• Onsite food service and prices.

The parties are not required to reach an agreement but they are required to bargain in good faith. In other words, they must meet with open minds and make a reasonable effort to reach a contract.

Concerted Activity

Concerted activity is an action by employees concerning wages or working conditions. It is action taken by members of a union to gain a bargaining advantage. Concerted activity is protected by the NLRA and cannot be used as a basis for disciplining or discharging an employee.

The most common forms of concerted activity are strikes and picketing. A strike is an organized cessation or slowdown of work by employees to compel the employer to meet the employees’ demands. The NLRA protects the employees’ right to strike when:

• The parties are unable to reach a CBA;
• The employer engages in an unfair labor practice; or
• The employer is considering sending work elsewhere.

However, a strike is illegal when:

• The union does not provide the employer with sixty days notice (when issue is modifying or terminating a CBA);
• The union represents public employees;
• The union engages in a sit-down strike, in which employees stop working but physically block replacement workers from taking their places; and
• The union engages in partial strikes, in which employees strike intermittently to disrupt operations but prevent the employer from hiring replacement workers.

When unions go on strike, employers have the right to hire replacement workers to keep the business operating. If the union engages in an economic strike to obtain increased wages and benefits, the employer may hire permanent replacement workers. When an economic strike ends, the employer is under no obligation to lay off replacement workers to allow strikers to return to work. However, if and when the employer hires additional employees, it may not discriminate against the employees who went on strike. If the union engages in an unfair labor practices strike to protest an employer’s unfair labor practice, union members are entitled to their jobs after the strike ends.

Picketing is the demonstration by one or more employees outside a business to protest its activities or policies and to pressure it to meet the protesters’ demands. The power of picketing is to publicize a labor dispute and influence the public to withhold business from the employer. Picketing is usually lawful, as long as the picketers do not prevent other employees, replacement workers, or customers from entering the business.

Employers have their own form of legal pressure on union members called a lockout. A lockout occurs when an employer closes a business or prevents workers from entering the premises and earning their paychecks because of a labor dispute. By withholding work and wages, the employer tries to pressure the union to bargain less aggressively. Most lockouts are legal.

Grievance Procedure

One of the main benefits to union members is that they are able to participate in a grievance procedure when issues at work exist. A grievance is a formal employee complaint about a violation of a workplace policy or the collective bargaining agreement between the union and employer.

Figure 13.9 Grievance Procedure

The grievance procedure defines the rules and process for documenting, presenting, and resolving workplace disputes. The exact steps are usually defined in the collective bargaining agreement. However, most grievance procedures start with a discussion between the employee and his or her manager, often with a union representative present. Issues often are resolved informally at this step.

If the issue is not resolved, then the employee may write a formal grievance, which is then sent to management. After receiving a written grievance, management of the company investigates and discusses how to address the issues contained in the grievance. This process often involves the human resource department, union representatives, and consultation with legal counsel.

Management will then issue a written decision. If the union is not satisfied with the company’s response, it may decide to refer the grievance to the national union. If the national union decides to pursue the issue further, then arbitration before the NLRB or a private arbitrator often occurs.