Introduction to Unions and Labour Relations

Friday, November 19, 2010

Outline of presentation
1. 2. 3. 4. Introduction Historical snapshot Union structure: local, national Union actions:
a) Union organizing b) Collective bargaining c) Education and political action

5. Union impacts 6. Trends in union membership and density 7. The future

What does labour want?

We want more schoolhouses and less jails; more books and less arsenals; more learning and less vice; more leisure and less greed; more justice and less revenge; in fact, more of the opportunities to cultivate our better natures.
Samuel Gompers (1850-1924) First President of the American Federation of Labor

20th Century union growth at a glance

Union density in Canada since 1920
40 35 30 25

20 15 10 5 0 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

Source: Government of Canada, Labour Policy and Workplace Information; Arrowsmith (1990).

Historically, unionization in Canada has occurred in waves:

Industrial unions, 1930s 1950s Public sector unions, 1960s 1970s

Will there be another wave?

Historical evolution of the law on union recognition

1.

Repression
Combination Acts
Law used as tool to limit workers rights to unionize: combinations of workers illegal

2.

Toleration
Trade Unions Act (1872)
Workers could no longer be criminally prosecuted merely for attempting to unionize, but nothing in law required employers to recognize unions; employers could still fire or refuse to hire union members

3.

Recognition
The Industrial Disputes Investigation Act (1907) The Wagner Act in the United States (1935) P.C. 1003 in Canada (1944) Rand formula (1945) Post-war provincial labour legislation Public sector legislation
e.g., Federal Public Service Staff Relations Act (1967)

Impact of the Charter of Rights and Freedoms

On June 8, 2007 the Supreme Court of Canada released its decision in Health Services and Support Facilities Subsector Bargaining Assn v. British Columbia
Held that freedom of association guaranteed by section 2(d) of the Charter includes a procedural right to collective bargaining Earlier decisions that had held that collective bargaining was not protected by the Charter were overturned The right defined by the court does not guarantee a particular model of collective bargaining, or a certain outcome from that process B.C. legislation voiding public sector collective agreement provisions was found to violate the Charter

A seismic decision! But full implications remain to be seen

Canadian union structure

Compared to other jurisdictions, union structure in Canada is highly fragmented and decentralized. Over 500 labour organizations across Canada, including national and international unions and independent local unions. Most key functions (i.e., meetings, bargaining, dealing with grievances) take place at the local level. Over 15,000 union locals in Canada.

The union local

May include workers at a particular site or within a certain geographical area, and may be restricted to a certain occupation. Leadership elected by members. May employ a staff representative or business agent to act as chief negotiation spokesperson, deal with members problems, and liaise with other unions. Shop stewards are local officers whose major responsibilities include:
Investigating grievances Representing members at grievance hearings May recruit new members or encourage participation in union meetings

A huge amount of union work [in some cases the vast majority] is performed by activists, volunteers, elected stewards and local leaders rather than full-time union staff.

Parent unions
Most Canadian union locals are affiliated with parent unions that:
Coordinate bargaining activities Provide assistance for bargaining and grievance handling Provide support during strikes/lockouts (central strike fund) Offer training and education programs Engage in research (e.g., industry trends, work organization) Provide specialized advice and support on issues such as health & safety Represent the union in political action Conduct organizing activities to recruit new members

National union leaders typically elected by delegates at convention.

Example: One Canadian unions national office departments

Communications Education Economic, Social & Sectoral Policy Legal Health, Safety & Environment Mobilizing, Campaigns and Government Relations Strike Insurance

Human Rights

International & Social Justice Fund Recreation

Organizing

Skilled Trades

Pension & Benefits

Retired Workers Womens

Work Organization & Training

Labour federations
Unions are typically (but not always) affiliated with central labour organizations at the national, provincial, and municipal levels:
Canadian Labour Congress
Represents 3 million union members. Brings together Canadas national and international unions, provincial and territorial federations, and 136 district labour councils.

Ontario Federation of Labour

Represents 700,000 Ontario workers in more than 1,500 affiliated local unions. Gained new members in recent years from affiliation of teachers and nurses unions, but does not include the CAW.

District Labour Councils

Vary considerably in size and structure. The Toronto and York Region Labour Council is the largest in Ontario, representing 195,000 members belonging to affiliated local unions.

Union actions union power

Triangulation of three factors

Political Action
Ability to have an Impact on larger society

Organizing
Ability to attract new members

Collective Bargaining
Ability to win gains for members

Union actions: Organizing

Unions must constantly organize [recruit] new members The certification process in Ontario:
Begins with an application from a union to the Ontario Labour Relations Board [OLRB] to represent the workers in a proposed bargaining unit The union must demonstrate a threshold level of support (40%) to trigger a vote Votes must be held generally within five business days To be certified the union requires a majority of ballots cast

Protecting the right to organize

The Ontario Labour Relations Act [LRA] bars employers from
Interfering with trade unions Discriminating against union members Using threats, intimidation, coercion, promises, or undue influence to prevent workers from joining unions Unilaterally changing working conditions during statutory freeze period

The OLRB has recognized that certain employer actions (e.g., dismissal of union supporters) are likely to have a chilling impact on the union campaign Union unfair labour practices are also prohibited (e.g., using coercion to recruit members) but this has been rarely found by OLRB

Union Organizing: Employer Rights

Express views on unions State position on remaining non-union Prohibit union activity on company property/time Increase wages in normal course of business Gather employees to state companys position if:
purpose stated in advance attendance optional no threats/promises

Employer tactics found to chill organizing campaigns*

Firing union supporters Captive audience meetings, letters, and other direct communication Hiring consultants to run anti-union campaigns Threatening to close the plant or spreading rumours that this will happen Promising increased pay or benefits if the union is defeated Filing repeated objections or requesting postponements to delay the certification process
* Although not necessarily illegal.

Organizing across Canada

Workers Covered by New Certifications and Organizing Rate
120000 100000 2.0 1.8 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0

W orkers Covered

b New y

80000 60000 40000 20000 0

19 9 6

19 81

19 86

19 91

Year
Workers Oranized Organizing Rate

Note: Organizing Rate is the the number of workers covered by new certifications as a proportion of non-union workforce Source: Kumar, 2008

20 01

Organizing Rate

Certifications

Union actions: Collective bargaining

Collective bargaining is the negotiation process through which the terms and conditions of employment for unionized staff are determined Conducted within a well-defined legal framework Right to collectively bargain terms and conditions of employment represents one of the fundamental differences between unionized and non-unionized workplaces Without common interests there is nothing to negotiate for; without conflict there is nothing to negotiate about.
Peach and Kuechle (1975)

Distinctive features of the collective bargaining process

1. Complex: involve a broad range of issues concerned with regulating human behaviour 2. Parties conduct is more strictly regulated legally during bargaining 3. Conducted by representatives of the parties who have final approval; i.e., agreements must be ratified by union members / shareholders / city councillors 4. Union-management relationships are long term

Collective bargaining process at a glance

Collective Bargaining
(Initiated by Notice to Bargain)

No Agreement Reached Conciliation Mediation Voluntary/Legislated Arbitration Agreement Imposed Strike/Lockout

Agreement Reached

Ratification

Implementation

Other relevant legislative frameworks

In addition to the LRA, specialized legislation exists governing labour relations for certain occupations in the public sector:
 Firefighters  Police  Hospitals  Crown employees  Ambulance services  Teachers  College faculty and staff

} } }

No right to strike. Bargaining disputes must be resolved through arbitration. Right to strike, but workers must continue to provide essential services.

Right to strike.

Bargaining strategies
Distributive
Competitive Focuses on ones own substantive outcomes Used when resources are (believed to be) fixed and the parties interests are in conflict
e.g., wages versus profit margins

Goal in process is to find the other sides resistance point

Integrative
Collaborative Focuses on joint outcomes when the parties basic interests are not fundamentally opposed Goal in process is joint problem-solving

Preparation for bargaining

Notice to bargain
Must notify the other party of intention to bargain [LRA, ss. 16, 59] Notice may be given by either party in the period 90 days before the expiry of the contract Generally union notifies Required to commence bargaining in good faith within 15 days after receipt of notice [LRA, s. 17] but no mandatory timeframe for completion of negotiations

Finding the agreement zone

To reach agreement resistance points must overlap to some degree Zone of potential agreement area of overlap A non-quantifiable principle may prevent a positive settlement zone
Issues of fundamental principle (e.g., the unions right to exist) which are of an either/or nature, are generally not amendable to the sort of trade-off inherent in the very notion of a settlement zone A good reason for some issues (e.g., human rights, health & safety) to be established by legislation rather than left to bargaining

Potential Zone of Agreement

Maximum management will offer

Managements Preferred Outcome

Unacceptable to the union

Potential Zone of Agreement

Unacceptable to Management

Unions Preferred Outcome

Minimum Union will accept
Min Value Max Value

Top 10 Current Negotiation Issues

Management Issues Wages Productivity Flexible Work Practices Health, Pensions, Benefits Organizational Change Business Competitiveness Training & Skills Development Outsourcing/Contracting Out Employment Security Employment/Pay Equity Technological Change Variable Pay Union Issues Wages Employment Security Health, Pensions, Benefits Employment/Pay Equity Outsourcing/Contracting Out Organizational Change Flexible Work Practices Training & Skills Development Business Competitiveness Variable Pay Technological Change Productivity

Note: Respondents [n=199] were provided with a list of 12 possible choices (plus other) and asked to indicate the top three negotiation issues. Source: Industrial Relations Outlook 2010, Conference Board of Canada

Strikes & Lockouts, 1982 2008

Source: Industrial Relations Outlook 2010, Conference Board of Canada

Union actions: Education

The labour movement engages in a broad range of education activities
Core issues; i.e., organizing, collective bargaining Leadership development; i.e., public speaking Technical topics; i.e., health & safety Human rights

Representing a major investment of union resources and a significant source of hidden knowledge in the workplace

Union education (cont.)

CAW Family Education Centre, Port Elgin, ON
UFCW Locals 175 & 633 Training and Education Centre (supplemented by Mobile Computer Training Labs)

LIUNA Local 183 Life Long Learning Centre

http://www.caw.ca/en/about-thecaw-caw-family-educationcentre.htm http://www.ufcw175.com/Educati on/index.shtml http://www.183training.com/

Union actions: Political action

Theres a direct relationship between the bread box and the ballot box, and what the union fights for and wins at the bargaining table can be taken away in the legislative halls. Walter Reuther, UAW President (1946-1970) Most Canadian unions engage in some form of political action
Through publicity / lobbying campaigns Through alliance with NDP Through community coalitions Through protests and demonstrations International development work through Humanity / Social Justice Funds

Union impacts
Unions have an impact on:
Members wages and working conditions Productivity and performance of firms Canadian economy Canadian society as a whole

Wage impacts
Direct wage impact
Unionized workers in all industries, occupations, and regions tend to earn more than their non-union counterparts. Varies considerably by industry and occupation. Overall, the union wage premium has declined since the 1980s, possibly due to:
Decreased bargaining power for unions; Strategic reorientation of unions to objectives other than wages (i.e., job security).

In 1999 the average union/non-union gap was 7.7% (Fang & Verma, 2002).

Wage impacts (cont.)

Fringe benefits
Unionized employers tend to pay greater portion of total compensation in fringe benefits
Unionized workers have greater confidence in the receipt of benefits.

Gap in fringe benefits is greater than wage gap, and it is not decreasing.
Benefits Coverage: Union vs. Non-union (%)
Medical Plan 57.4 83.7 45.4 Dental Plan 53.1 76.3 42.6 Life/Disability Insurance 52.5 78.2 40.8 Pension Plan 43.3 79.9 26.6

All Employees Unionized Non-Unionized

Source: Akyeampong (2002)

Wage impacts (cont.)

Wage dispersion
Widespread collective bargaining tends to raise the wage floor for relatively unskilled and lowwage workers. There is less of a gap between the highest wage and lowest wage among unionized workers than is the case for non-union workers. Unionization increases the earnings, on average, of female workers more than that of male workers, which tends to narrow male-female earnings differences. Overall, unions tend to reduce wage dispersion throughout economy as well as within organizations.

Productivity impacts
Considerable disagreement
Neoclassical economists argue that unions reduce productivity Monopoly
Non-competitive wages Strikes Restrictive work rules

HR specialists also note negative effects Collective Voice

Force management to keep workers who should be let go Stand in the way of incentive programs

IR perspective argues that unions have positive effects

Improve morale, reduce turnover Spur better training, policies, production methods Worker-management communication / cooperation

Labourmanagement relationship may be most important factor

Impacts on management of organization

Impacts are substantial
Collective agreements regulate many aspects of behaviour. Significant limitation on managements freedom. Biggest impact through grievance processes, work rules, and joint participation on committees. May be positive (by providing certainty, predictability to management processes) or negative (by emphasizing legalistic observance of contract, stifling creativity and innovation). Again, overall impact likely depends on the labour management relationship in each case.

Impacts on society as a whole

Economic impacts:
Neoclassical economists link unionization unambiguously to higher unemployment Empirical evidence is not as clear

Social and political impacts:

Publicly-funded medical care Unemployment insurance Public pensions

Raised profile of safety issues Trendsetter on human rights Foster human capital (e.g., training) and social capital (i.e., interconnectedness)

Trends: Falling union density

Trends in Union Membership and Density
4500 4000 3500 3000 25.0% 2500 20.0% 2000 15.0% 1500 1000 500 0 1981 1984 1986 1989 1993 1997 2003 2007 10.0% 5.0% 0.0% 40.0% 35.0% 30.0%

Membership Overall Union Density Private Sector Union Density

Source: Kumar, 2008

Declining union strength is an international phenomenon

Union density in selected countries, 1990 and 2003 2003 1990
Sweden Norway Belgium Ireland New Zealand Australia United Kingdom Italy CANADA Germany Japan Netherlands United States France 0 20 40
%

60

80

100

Source: Visser, Jelle (2006), Union membership statistics in 24 countries, Monthly Labor Review (January): 38-49.

Factors contributing to union decline worldwide

UP Globalization Deregulation, privatization Nonstandard employment White collar technical professional and service sector jobs Employer opposition Sophisticated HRM strategies Tech change Diversity DOWN Stable, full-time employment Blue collar industrial jobs Union organizing success Union bargaining power Supportive labour legislation (e.g., card certification) Relatively homogeneous workforce

Summary of trends in organizing and union density

All of the environmental factors facing unions have tended to undermine density.
E.g., employment has shifted to sectors and types of work where unions are weak, and union density has also fallen within key industries such as manufacturing.

Union organizing efforts are rowing against the tide. A turnaround in the downward trajectory of private sector union density is unlikely without:
A major change in the public policy environment, or Changes in union strategies that dramatically increasing their level of organizing success.

The Future: Union renewal?

Union renewal is Organizational change in response to fundamentally different external and internal environment. Reflected in one or more measures of effectiveness including, Membership density Bargaining power Political power Union innovation Openness to change

Organizational and political change

Union renewal focuses on those changes over which the unions has some direct control and therefore ability to change and act in new ways.
Expand union capacity to response to organizing challenges Bargain to meet unfilled needs of diverse workforce Devise new ways to shape public policy Initiate structural change to encourage participation in decision making Build a work-centered view Strengthen community links/networks

Changing composition of CAW membership

1987 143,000 members
Primary industries, 9% Other, 2% Other services, 22% Manufacturing, 47%

2008 255,000 members

Health & Soc. Services, 9%

Manufacturing, 89%

Transportation, 19%

Source: CAW convention reports

Primary industries, 3%

The future for unions:

Downhill all the way?
Trade unionism is slowly being limited in influence by changes which destroy the basis on which it is erected. I see no reason to believe that American trade unionism will so revolutionize itself within a short period of time as to become in the next decade a more potent social influence. We may take it as probable that trade unionism is likely to be a declining influence in determining conditions of labor.
George Barnett American Economic Association Presidential Address

December 29, 1932 within six months, a wave of union organizing and labour unrest began to sweep the U.S. (and Canada), climaxing a few years later with the birth of a new labour federation [CIO], the unionization of much of the industrial sector, and a three-fold jump in union density.
See: Kaufman, 2004