Management and Union Security
When management and unions bargain
they must also consider survival.
A union cannot achieve advantages for its
members unless it continues to exist.
Management’s survival in collective
bargaining refers to it ability to remain master
in its own house and to retain managerial
authority.
1
Management Security
Management security refers to the
freedom of management to make
managerial decisions………
To perform the “functions of
management” without interference
from the union.
2
Management Security
The traditional division of decisionmaking authority in the United States
was codified in the Wagner Act.
Management was required to bargain
with unions over wages, hours, and
other terms and conditions of
employment.
3
Management Security
All other decisions, such as level
of employment, production
methods, product design, plant
location, pricing, and
advertising, were traditionally
considered strictly management
prerogatives.
4
Management Security
An example of a management
security clause:
“The right to hire, lay off, discharge for
cause, promote, or transfer employees
is the exclusive prerogative of
management, except as otherwise
provided in this contract.”
5
Management Security
There are three kinds of decisions
found in the employer-employee
relationship:

Unilateral Management Decisions

Joint Decisions

Unilateral Union Decisions
6
Management Security
The law divides the three types of
decisions into the following bargaining
subjects:
Mandatory - Permissive - Illegal
7
Management Security
Among companies and unions engaged
in a high level of cooperation, the
issues of scope of bargaining, and of
management prerogative may be of
lesser significance than for the vast
majority of unions and employers, for
whom these subjects are very
important.
8
Subjects of Bargaining
The only topics over which bargaining
is legally (mandatory) required are
included under the heading “wages,
hours, and other terms and conditions
of employment”.
All other legal subjects of bargaining
are referred to as permissive because
bargaining over them is not mandated
by law.
9
Subjects of Bargaining
It is an unfair labor practice for either
side to unilaterally change a condition
of employment that is a mandatory
subject of bargaining without first
bargaining to the point of impasse.
It is also illegal to bargain to the point
of impasse over a permissive subject.
10
Subjects of Bargaining
Over the years, the scope of mandatory
topics of bargaining has expanded
significantly.
See page 174 of the course text for a
current list of acceptable mandatory
and permissive subjects of bargaining.
11
Subjects of Bargaining
Permissive subjects include:
Benefits to retirees, employer advertising
practices, discontinuation of product lines,
partial closing of a business, when not
motivated by antiunion animus, business
relocation, introduction of automation, and
various kinds of subcontracting decisions.
12
Subjects of Bargaining
Permissive subjects :
However, the effects that such
unilateral decisions may have on
employees can be a mandatory subject
of bargaining.
13
Rationales for Management
Prerogatives
Economic Efficiency
Assumes that bargaining slows down
the allocation of resources to their most
productive uses and that labor can
generate no information or ideas for
alternatives that might contribute
efficiency,
14
Rationales for Management
Prerogatives
Private Property
Owners (or managers) should have
unrestricted authority over their own
property and should not have to
bargain over business decisions
15
Rationales for Management
Prerogatives
Presumed Futility of Bargaining
Sound business decisions based on
conditions faced by the firm should
not be reversed as a result of labor
negotiations. Labor lacks the
expertise to participate fully in today’s
complex economic environment.
16
The Problem of Prerogatives
There apparently is little, if anything,
that can be classified unequivocally as
the sole prerogative of either side for
all times and situations, so long as
employers are free to select who shall
work for them and employees are free
to choose whether they will work for a
particular employer.
17
The Problem of Prerogatives
In a free economy, it is pointless for
either side to claim inherent rights to
bargain about any particular subject.
18
The Problem of Prerogatives
Unilateral Control of Strategy
If bargaining is to have any meaning,
each party must control its own
strategy and leadership in dealing with
the other.
19
The Problem of Prerogatives
Interest and Decision Making
The attempt to settle problems on the
basis of Prerogatives or “inherent
rights” holds the prospect of
extending futile disagreement. An
approach based on Interests can bring
a logical and realistic settlement.
20
The Problem of Prerogatives
Ability and Decision Making
Either party will tend to insist on
participation in a decision in
proportion to its ability in the subject
matter involved - assuming that it
also has an interest.
21
The Problem of Prerogatives
Modification of the Ability Criterion
There is a presumption that employees
or unions should not participate in top
management decisions, since they are
not in a position to make those
decisions wisely.
22
Inherent Divergence of Interests


A simple way to discover that the need for
strong management security is based on
something more than abstract “rights of
ownership” is to assume that the employees
purchase a controlling share of stock of the
corporation they work for.
All said and done, the officers elected by the
employees are ultimately found to behave like
management, for the simple reason that they
are management.
23
Inherent Divergence of Interests


Their desire for freedom to make decision
grows from their interest in the job they do, not
from the nature of the group they represent.
Rank-and-file workers often find that their
interest as owners come in conflict with their
interest as workers. Since wage income is
probably many time higher than dividend
income, the worker’s interest greatly outweighs
the owners interest.
24
Inherent Divergence of Interests
Many employees of unions are also
organized and bargain collectively with
the union that employs them.
25
Secure vs Insecure Management
Under a strong management clause,
rigorously guarded and enforced, the
executives are free to study that environment
and decide how best to live with it, and then
carry out those decisions without interference
from the union.
That is the core of management security.
26
Secure vs Insecure Management
A typical management clause:
Section 2.1 Management of the Company. The
management of the Company and the direction of the
work force is vested exclusively in the company
subject to the terms of this Agreement. All matters
specifically and expressly covered or treated by the
language of the Agreement may be administered for
its duration by the Company in accordance with such
policy or procedure as the Company from time to
time may determine.
27
Secure vs Insecure Management
In practice the defense of management
security hinges on two critical points:
Can management prevent wildcat strikes?
And
Can management prevent insubordination?
28
Secure vs Insecure Management
The answer is “Yes” assuming that:
Management is successful in negotiating
a “No-Strike” clause
and
They are effective in establishing and
enforcing discipline.
29
Patterns and Trends in Management
Security
Some contracts place definite
restrictions on managerial prerogatives.
Some contracts contain a general
statement limiting managerial rights,
others set restrictions in such areas as
subcontracting, performance of work by
supervisors, technological changes, and
plant shutdown or relocation.
30
Union Representation on Corporate
Boards
Traditionally, labor unions and
employers in the United States have
objected to union presence on corporate
boards of directors.
The most noted exception in this country
has been the appointment of the head of
the UAW to the board of Chrysler.
31
Union Representation on Corporate
Boards
The growth of European-owned industry
in the United States could also
encourage the importation of
codetermination or representation by
workers on boards of directors, into this
country, since union members on the
boards of directors of European
companies may favor codetermination
for the U. S. subsidiaries.
32
Overview of Some Legal and Practical
Aspects


To the degree that the law requires
management to bargain at all,
management security is reduced.
The precise boundary line
between what management will
and will not be required to bargain
about is determined by the NLRB
and the courts.
33
Overview of Some Legal and Practical
Aspects


It should be remembered that a
legal obligation to bargain is
explicitly not an obligation to
concede.
The indications are that the future
will bring considerable diversity in
approaches to management
security. (Saturn Contract)
34
Union Security
The meaning of union security:
It refers to the continued existence
of the union as the bargaining
agent for each bargaining unit it
represents.
35
The Meaning of Union Security
It can also be defined as the union’s
freedom to perform the function of
collectively representing employees
without interference from management
or other sources.
36
The Meaning of Union Security
The final definition parallels that of
management security in that both
are defined in terms of freedom to
act.
37
Some Threats to Union Security





The non-essentiality of unions.
Management opposition.
Anti-union activities.
Decertification elections.
Loss of membership.
38
The Non-essentiality of Unions
Unions unlike management are
dispensable.
This subordinate position is the
starting point of the problem of union
security and partially explains many
characteristics of union behavior.
39
Management Opposition
In many places management dislike
takes active forms and keeps the
union’s existence in perpetual
jeopardy.
Antiunion labor attorneys help
employers operate within the law,
while at the same time making it very
difficult for unions to gain recognition.
40
Anti-Union Activities
The use of union busting consultants
who specialize in defeating unions
include lawyers, employer and trade
associations, psychologists,
detectives, and nonprofit antiunion
organizations.
41
Anti-Union Activities
Reasons for Anti-Union activities:



Resistance in the antiunion South.
Organizational activities of large
unions are more threatening.
Anti-Union methods are much
more sophisticated.
42
Decertification Elections
After one year employees can request a
decertification election provided no
contract is in force.
A contract can act as a bar to a
decertification election for up to three (3)
years.
43
Decertification Elections
Decertification elections must be
requested during the 30 day period from
90 to 60 days before the contract
expiration date.
There are also special circumstances
under which employers could file for a
representation election.
44
Decertification Elections
Under Taft-Hartley employees can
petition the NLRB to conduct a union
shop deauthorization poll. A winning
vote for deauthorization gives the
employees the right to remove the union
shop provision from the labor contract.
45
Loss of Membership and Income
A union’s ability to organize workers and
collect dues is complicated further by
right-to-work laws, which prohibit
compulsory union membership.
46
Loss of Membership and Income
By a ruling of the NLRB, the union, as
exclusive bargaining agent, must
process the grievance of any individual
employee against the employer,
including arbitration if necessary, even if
the employee is not a member of the
union and pays no dues.
47
Loss of Membership and Income
Although nonmembers cannot vote in
elections for union officers or on
contract ratification, the number of
employees placing a high value on that
privilege is not large enough to alter this
particular situation.
48
Loss of Membership and Income
While some employees desire to “ride
free” others avoid the union because:
They object on principle.
 The dues are too high and misused.
 Some see the unions as having no
value.
 Some don’t want to upset the boss.
 Inertia.

49
-SecuritySatisfactory Union Performance
Union leaders without disciplinary
powers lack the authority to effectuate
the strategy for which they are
responsible.
For the union, the discrepancy between
authority and responsibility can be
substantial in the area of contract
enforcement.
50
-SecuritySatisfactory Union Performance
Whether disciplinary power is needed
for the orderly execution of bargaining
tactics or the faithful observation of the
contract, the ultimate discipline in all
organizations except the government is
expulsion.
But as long as union membership is
voluntary, expulsion from union
membership is an ineffectual
disciplinary action.
51
-SecuritySound Industrial Relations
It is suggested that sound relations
between union and management are
impossible unless both parties possess
a rather high degree of security.
The insecure union, like the insecure
individual, often tends to be
permanently aggressive and belligerent.
52
-SecuritySound Industrial Relations
Many employers see distinct advantages
in a secure union. This attitude is more
marked in large firms and among those
who have dealt longest with unions.
In many ways union security leads to a
less hostile, and distractive work
environment.
53
-SecuritySound Industrial Relations
Once management accepts that the
union will be with it indefinitely the
alternatives change.
54
The Forms and Extent of Union
Security






Closed Shop
Union Shop
Modified Union Shop
Agency Shop
Maintenance of Membership
Dues Checkoff
55
The Basic Controversy in Union
Security
The basic conflict over union
security is now clear. On the one
hand, union security seems to be a
requisite condition for sound
industrial relations.
On the other, compulsory
membership curtails the individual’s
freedom of choice.
56
The Basic Controversy in Union
Security
Most legislation about union security
since World War II has moved in the
direction of prohibiting compulsory
membership.
This, of course, prevents the abuse of
the union’s disciplinary power by
abolishing it.
57