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Outline Decline of Organized Labor Explaining the Decline Structure, Management and Unions Growing Inequality Walmart Video Clip Exam??? Fair, unfair, all exams suck Mid Term…Mostly Very Good 40 Multiple Choice Questions High Score 39…98% Median Score: 34…85% 4.5 4 3.5 3 2.5 2 A AB+ B C+ C- 1 D+ 0 Questions on questions? C 1.5 0.5 B- 3 w < 50% correct13, 25, 37 D F Essay Numbering mistake All received one free point Other three worth 3 each Bonus Points: 5 events one assignment point or ¼ test point for each… no limit: 5 pts for assignments or 1.25 lift to final grade You can pick and choose…indicate on paragraph you hand in Attend event…write a paragraph connecting what you learn to this class Our class has come a long way…From Conspiracy to Collective Bargaining… From Unions as illegal combinations of individuals who are violating a key tenet of capitalism… individual bargaining Wages, hours and working conditions set via competition between individuals in the labor market To federal legislation sanctioning and encouraging the formation of unions that engage in collective bargaining Wages,hours and working conditions set via collective bargaining and negotiation between organization representing workers (unions) and firms From open class warfare to a bargaining table… 1. We considered the “Treaty of Detroit” prior to break. Please tell me once again what the “Treaty of Detroit” was and explain how it functioned to provide more of society’s wealth and income to ordinary Americans? Treaty of Detroit Becomes the Pattern 1) “Treaty of Detroit” between corporations and unions tied wages to productivity… Translation: 1947 Joe produced 100 widgets a day and was paid $100 1975 Joe produced 200 widgets a day and was paid $200 We Used to Grow Together Real Family Income Growth Adjusted for Inflation 92% 1973-2000 1947-1973 117% 104% 98% 103% 64% 88% 75% 36% 26% 18% 1% Poorest 20% Richest Top 20% 5% Poorest 20% Source: U.S. Census Bureau. Based on mean family income. Richest 20% Top 5% Union Help Facilitate the “Great Compression” & the creation of the American Middle Class And Things Change: Move from Collective Bargaining back to Individual Bargaining… 2010: 11.9% union density 2010: 6.9% private sector 2. What happened to inequality in American when the “Treaty of Detroit” was rescinded? Be sure to cite the text in your answer. Unions are weak and workers Are No Longer Sharing In Productivity Gains Translation: 1975 Joe produced 200 widgets a day and was paid $200 2003 Joe produced 400 widgets a day and was paid $205 The New Inequality Growing Inequality The Great Divergence We Used to Grow Together, Now We’re Growing Apart Real Family Income Growth Adjusted for Inflation 92% 1973-2000 1947-1973 117% 104% 98% 103% 64% 88% 75% 36% 26% 18% 1% Poorest 20% Richest Top 20% 5% Poorest 20% Source: U.S. Census Bureau. Based on mean family income. Richest 20% Top 5% 1. We considered the “Treaty of Detroit” prior to break. Please tell me once again what the “Treaty of Detroit” was and explain how it functioned to provide more of society’s wealth and income to ordinary Americans? How did it restrain the pay of executives? Be sure to cite the text in your answer Winners and Losers Business Week, Fall 2004 Inequality is Highest in the US… Ratio of Top 10% to Bottom 10% Explaining the New Inequality Multiple causes, but the subject of this class is a major one “The decline in unions contributed to the increase in inequality. Since unions increase the pay of their members, who are primarily in the middle class, and reduce the dispersion of pay among members, the shift from union wage setting to market wage setting added to inequality” (Freeman 2007: 50). Paul Krugman, Nobel Prize Winning Princeton Economist Institutions Matter Union Decline Facilitates Inequality in Three important ways 1) Declining union power alters the balance of power in the economy 2) Decline in unions results in political shifts that facilitate inequality Workers simply have less bargaining power or leverage Change in tax codes, trade policies and other policies 3) Decline of unions results in changed norms about fairness and equality Unions are committed to norms of fairness and equality…as unions have receded, these norms have grown weaker Different Institutions, Different Norms, Outcomes General Motors, 1969 Walmart, 2005 Salary in today’s dollars, $4.3 million Salary in 2005, $23 million Workers salary, $40,000 + health care and pension A Middle Class Wage 5 times what GM CEO took Workers salary, approximately $18,000 Most lack health care and pensions A Poverty Wage Different Institutions, Different Norms…Different Outcomes So…Lots of questions What explains the decline of unions in America? As Freeman asks…who “did in the unions?” Freeman, Where Have All the Unions Gone 4.Freeman argues that “The decline in private sector unionism is not a mechanical story of employment shifting from blue collar mining and manufacturing, where unions had great strength, to white collar service sectors, where union were weaker.” What evidence does he provide to support this assertion. Be sure to cite the text in your answer, but also be sure to explain what his evidence means in your own words. Structural Explanation for Union Decline “The first and simplest explanation in unionism is that resulted from broad economic changes, which reduced the proportion of the workforce in groups traditionally highly unionized and increased the proportion in groups traditionally nonunion.” (Freeman 1984: 224) So when you shift from ____________ to ________________ you get fewer union members From Blue collar to white collar (this is usually emphasized) From Men to women… Less educated to more educated workforce… There Have Been Structural Changes in the Economy: Manufacturing Changes Replace labor via automation Technological innovation 120,000 workers 20,000 workers Yet same output US Steel, 1980 US Steel, 1990 Fewer steel workers, more computer programmers Similar trends in auto and other manufacturing sectors Large Structural Change in the Overall Economy: From Industrial to Post Industrial Society… Post Industrial Society society characterized by the production of services and information rather than finished goods. 80 70 60 50 Manufacturing Service 40 30 20 10 0 1900 1920 1960 1980 1998 Strutural Changes to Bring Loss of Union members… Close a GM plant with 30,000 unionized workers…union movement loses 30,000 union members The Structural Shifts Explain Some of the Decline…But The Explanation Has Problems 1) Post Industrial transformation has occurred in all advanced industrial capitalist nations, but union density has not fallen in the same way. Canada is particularly troublesome for the structural argument, since its economy contains so many of the same companies 2) Women and College Graduates actually more likely to be union members than White men Union Density, Late 1990s 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Union Density Sweden Denmark Finland Italy Canada USA The Decline of Organized Labor… 3) Structural argument can’t explain uptick in unionization among some service sector workers: Government workers Public Sector Growth…From almost nothing in the 1960s to almost 50% now… Poses a Puzzle: Why didn’t unorganized private sector service workers organize at the same rate? The Decline of Organized Labor… “The problem is that the structuralist explanation assumes, erroneously, that structural changes are the sole determinants of unionization and does not allow other factors…” Freeman estimates that it accounts for less than 20 % of the decline (Freeman 2007: 79) 7. Freeman suggests that there are three primary suspects for “doing in the unions.” One likely suspect is workers. Please Freeman’s findings with regard to whether workers still want unions. Be sure to cite the text in your answer. The Decline of Organized Labor… New workers (young, women, minority) express no less interest in unionization than traditionally organized white men Freeman & Rogers (my advisor in graduate school) Survey 32% of non-union private sector workers desire unionization In 2003 and 2005, more than 50% of non-union workers said they would vote for a union Yet less than 7% of private sector workers are in unions Called the “representation gap” …Millions of people who are not in unions would like to be in a union “if workers had their way, private sector union density would be on the order of 40 percent…” (Freeman 2007: 83) Freeman, Where Have All the Unions Gone 6. Freeman suggests that there are three primary suspects for “doing in the unions.” One likely suspect are unions themselves. What does Freeman think unions have done, or not done, to help do themselves in. Be sure to cite the text in your answer. Once Again…Choices… It’s 1985, and you are a union leader committed to addressing issues of inequality in society. You believe that all workers should make a decent living, and have decent hours and working conditions. The manufacturing industries that were once the backbone of the labor movement are disappearing, and service sectors jobs ranging from janitors, waiters and sales clerks to lawyers, computer technicians and software designers are expanding. Some of these jobs are good, a lot of these jobs are awful. As a union leader, what do you do to reverse the decline of unions so you can protect working families? Unions Drop the Ball… George Meany, President of the AFL-CIO dismissed concerns about organizing new workers “I don’t know, I don’t care…Why should we worry about organizing groups of people who do not appear to want to be organized...I used to worry about…the size of the membership…I stopped worrying because it doesn’t make any difference…The organized fellow is the fellow that counts” (Freeman 2007: 77) Interest in organizing waned and money spent on organizing dropped 30% between the 50s and the 70s… Faced with crisis…Unions actually organize less… Few resources devoted to organizing new workers Fewer elections for union representation held Year 1950 # of Elections for union representation 5619 1960 5428 1970 7543 1980 7021 1990 3423 1995 2716 Fewer Elections, Covering Fewer Workers, with Fewer Victories 600000 Number of Union Representation Elections 500000 400000 Number voted 300000 200000 Number Won 100000 0 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 Years 3-26 And unions won less… Year 1950 1960 1970 1980 1990 1995 # of Elections % Won Union 5619 5428 7543 7021 3423 2716 74.5 62.8 55.1 49 47.6 48.2 New Members 77,689 66,753 So workers say that want unions, but are unions winning fewer elections: Why? 5. Freeman suggests that there are three primary suspects for “doing in the unions.” One likely suspect is management. Please summarize Freeman’s argument about the role of management in “doing in the unions.” Be sure to cite the text in your answer. Outline Avoiding Unions in the US Organizing Unions Today Path 1: NLRB Elections Differences Across Nations Thinking About Competitive Disadvantage Rules and Response Path 2:Voluntary Recognition Corporate Campaigns Card Check Neutrality Agreement Management Opposition Union Prevention/Avoidance “Positive Labor Relations” Legal anti-union activities Illegal anti-union activities Lets explore via Walmart… Do the Wiggle…Don’t Eat the Banana Walmart…union substitution or Positive Labor Relations Good Human Resource Management Happy “Associates” feel they’re getting fair wages & benefits; open door policies; wiggle.... Aggressively Anti Union Walmart…union substitution or Positive Labor Relations Good Human Resource Management Happy “Associates” feel they’re getting fair wages & benefits; open door policies; wiggle.... Walmart… union avoidance & prevention Very aggressive legal anti-union campaigns “dirt” to fire; handbooks; toll free #; one on ones; videos Very Aggressive illegal Anti-union campaigns Surveillance, firing… “…managerial opposition to unionism, and illegal campaign tactics in particular, are a major, if not the major, determinant of NLRB election results” (Freeman 1984: 233) Worth Noting the Differences… “Managers in other countries do not fight unions with anything like the resources and zeal of American managers” (Freeman 2007: 81) In Denmark, Freeman asks to meet with anti-union firms…told that would not be possible, there are none. German workers I met in a “video conference”…shocked Even small businesses prefer collective bargaining…they level the playing field for firms to compete on non-wage dimensions? Translation? High Union Density Impacts Employer Behavior If labor market is organized “wall to wall,” or union contracts are extended to all firms, no one is at a competitive disadvantage Walmart’s spread is threat to non-Walmart workers 96% of Supermarkets in NJ are unionized (PI 2/01/05) Union Stores (Acme, Shoprite, Pathmark, etc.) are demanding concessions to remain competitive A level playing field…Pathmark, Shoprite, Acme all compete…but not on the backs of their workers Also encouraging UFCW to organize Walmart UFCW (United Food and Commercial Workers) has got a problem…We’ll see if they solve it… Union Density Compared Union Density, 2002 US was 13.3% Why Do Workers Organize? Why Do Workers Organize? Dissatisfaction with wages, hours, working conditions spur union drives But research finds most drives due to “soft issues” Feeling overworked, under appreciated, humiliated, lied to, unfairly treated Nurses in “Why Organize”: “The total lack of respect for us as professionals…the inconsistency in the way rules were applied”(Clawson 2003: 4) Freeman & Rogers Survey findings: Why vote for a union? Relations with Management Bad ; Don’t trust management Management shows little concern for workers or won’t share power Dislike their job Not enough influence The Organizing Process Collective Bargaining cannot take place until a bargaining representative has been certified To gain certification, unions pursue one of two paths Path 1: Normally, a union must win an election to be certified as the exclusive representative of the employees Path 2: An employer may voluntarily recognize a union if the union can demonstrate that it represents a majority of the employees Path 1: The Organizing Process Initial Contact by Employees or Union Organizer Union Creates Strategy to Organize Employees Management Creates Strategy to Keep Union Out Representation Petition (Authorization Cards) Campaign by Both Sides Representation Election Union Certification Collective Bargaining Union Rejected 3-20 Organizing the Unorganized Step 1: Begin an Organizing Drive Union organizer Full-time, salaried staff member who generally represents a national union Sometimes aided by rank and file workers from union Tries to convince workers about benefits stemming from unionization Organizers Contact Workers Katz & Kochan, 2002 The Organizing Process The NLRB is responsible for scheduling representation elections Law requires that at least 30 percent of the election unit must have signed an authorization card Most unions will not file without 50% or more… Organizers usually want 65% Organizing the Unorganized Step 2: Contact Natioinal Labor Relations Board NLRB regional director determines whether to conduct an election Checks appropriateness of bargaining unit..more on this in a moment…this can be tricky NLRB decides on a case by case basis Hospital: Registered Nurses, Nurse Practitioners, Nurses Aides…One unit or 3 units? Defining a Bargaining Unit Key for NLRB: mutuality of interest in wages, hours and working conditions Greater the mutuality = greater likelihood that members will agree on things, and thus CB will work better Definition is of strategic interest for both union and firm Union wants unit that will help win election, Management wants units that will make victory less likely In many cases, management will challenge appropriateness of unit to delay election Organizing the Unorganized Step 3: Election Campaign Union must build support…but communicating with workers is a problem? • If you were a union organizer, how might you contact members? • Organizing the Unorganized Step 3: Election Campaign • Access to workers is a problem for unions • • Non-employees not permitted into factory or building Outreach in a parking lot: law does not permit Even banned from retail public parking lot (Lechmere Decision) That leaves: lunch hour; after work; house visits We’ll discuss this more next week Election Campaign As the Walmart video showed, management is rarely a passive observer in the election process Management tries to undercut support. Broad array of strategies and tactics Google union prevention Election Campaign…Management tries to undercut support. How? Delay the Election Challenge Research Structure of Bargaining Unit finds: Longer the delay, the less inclined workers are to vote for the union Election Campaign…Management tries to undercut support. How? Delay Election Challenge Structure of Bargaining Unit Persuade Employees that Unionization is bad Captive Audience meetings mandatory Can meetings during work (law permits) be held up to 24 hrs before vote Election Campaign…Management tries to undercut support. How? Delay Election Challenge Structure of Bargaining Unit Persuade that Unionization is bad Captive Audience meetings-mandatory meetings during work (law permits) Threats to close facility (not permitted by law) “If you vote for the union, we’ll move to Mexico” Research shows that it is commonly done Election Campaign…Management tries to undercut support. How? Promote union activists (permitted by law) Interrogate employees (permitted by law) One on one meetings Election Campaign…Management tries to undercut support. How? Dismissal of union supporters (illegal)…but happens a lot… 1991 Study finds it occurs in 1 out of 3 organizing drives 1 out of 36 pro-union voters discharged 2007 study suggests that 1 in 5 organizers or activists can expect to be fired due to union activity (Freeman 2007: 80) 2000 Study estimates “that as many as 25 percent of employers facing a union drive fire at least on worker for union activity (Freeman 2007: 157) Cost to Employer if caught breaking the law? Election Campaign…Management tries to undercut support. How? Dismissal of union supporters (illegal)…but happens a lot… Cost to Employer if Caught Breaking the Law? Back wages minus what worker has earned while fired… Since most workers must take other jobs, this amounts to a paltry fine…it becomes economically rational to break the law and fire workers Organizing the Unorganized Step 4: Secret Ballot Election – NLRB ensures that representation election is fair and honest Win or Lose… Year 1950 1960 1970 1980 1990 1995 # of Elections % Won Union New Membs 5619 74.5 5428 62.8 7543 55.1 7021 49 3423 47.6 77,689 2716 48.2 66,753 Organizing the Unorganized Step 5: Certification of Election Results – NLRB satisfied that results reflect the employees’ free choice – Certification—variety of benefits to union exclusive for for representation rights one year, employer obligated to bargain one year, no other union can challenge representation rights Video Clip on Organizing Smithfield Pork vs. the United Food and Commericial Workers Path 1: The Organizing Process Initial Contact by Employees or Union Organizer Union Creates Strategy to Organize Employees Management Creates Strategy to Keep Union Out Representation Petition (Authorization Cards) Campaign by Both Sides Representation Election Union Certification Collective Bargaining Union Rejected 3-20 Video Clip on Organizing Smithfield Pork vs. the United Food and Commercial Workers Two ways to address the “labor problem” Provide examples of people in the video who suggest exit and of people who suggest collective voice Issues that spur organizing drive? Union Tactics? Employer Tactics? Outcome of Elections? Workers at huge Smithfield meat plant vote for union Thu, Dec 11 2008 By Bob Burgdorfer CHICAGO, Dec 11 (Reuters)- Meat cutters at the world's largest pork plant in Tar Heel, North Carolina, voted to be represented by the United Food and Commercial Workers union, a decision that should end more than 10 years of bitter fighting between the union and the plant's owner, Smithfield Foods Inc. Smithfield and the UFCW confirmed the results of the voting, which began on Wednesday and concluded on Thursday night. The tally was 2,041 in favor of the union and 1,879 against. "We will be meeting in 30 to 60 days to set up a timetable to start contract negotiations," said Dennis Pittman, a Smithfield spokesman. Smithfield is the largest U.S. hog and pork producer with annual sales of about $11 billion. The Tar Heel voting was supervised by the National Labor Relations Board. A union contract at Smithfield Packing: It only took 17 years (7/01/09) (TAR HEEL NC)—Five Thousand workers at the world’s largest pork processing plant have their firstever union contract, after a majority of workers ratified the agreement over a two-day vote. Members of UFCW Local 1208 will join more than 10,000 other Smithfield workers, and more than 240,000 others who work in the meat packing and food processing industry who have a UFCW union contract. The new contract includes: * Wage increases of $1.50/hour over the next four years; * Continued company-provided affordable family health care coverage.; * Improved paid sick leave and vacation benefits. * Retirement security through protection of the existing pension plan; * Continued joint worker/management safety committee, including company funded safety training for workers; * Guaranteed weekly hours that protect full-time, family supporting jobs in the community; * A system to resolve workplace issues.; * 24 hours of paid funeral leave following the death of immediate family members. This is the first contract covering the hourly production and maintenance workers at the Tar Heel facility and will take effect July http://www.indyweek.com/gyrobase/blogs/Post?id=triangulator&year=2009&month=07&day=01&basename=a-union-contract-at-smithfield-packing-it-only-took-17-years&mode=print Start with 65%…but lose half of elections… Year 1950 1960 1970 1980 1990 1995 # of Elections % Won Union New Membs 5619 74.5 5428 62.8 7543 55.1 7021 49 3423 47.6 77,689 2716 48.2 66,753 Once Again…Choices… It’s 1995, and you are a union leader committed to addressing issues of inequality in society. You believe that all workers should make a decent living, and have decent hours and working conditions. The manufacturing industries that were once the backbone of the labor movement are disappearing, and service sectors jobs ranging from janitors, waiters and sales clerks to lawyers, computer technicians and software designers are expanding. Some of these jobs are good, a lot of these jobs are awful. Efforts to organize these new sectors have been stymied by aggressive anti-union campaigns by management. You now lose about ½ of the elections that you initiate. The labor movement is in steep decline. As a union leader, what do you do to reverse the decline of unions so you can protect working families? The Organizing Process Collective Bargaining cannot take place until a bargaining representative has been certified To gain certification, unions pursue one of two paths Path 1: Normally, a union must win an election to be certified as the exclusive representative of the employees Path 2: An employer may voluntarily recognize a union if the union can demonstrate that it represents a majority of the employees Path 2: Voluntary Recognition Many of the most successful unions are no longer pursuing NLRB elections…they’re demanding voluntary recognition or card check… Voluntary recognition- employer recognizes the union without an election Why in the world would an employer do that? There are few reasons… Voluntary Recognition… Cost to company finances, reputation, brand outweigh recognizing the costs of recognizing the union… Corporate campaigns force voluntary recogniztion efforts to bring public, financial, or political pressure to bear on a company Crash weddings, picket in front of homes, boycott related companies, try to use politics to create problems for firm, hold hearings with local clergy and politicians… The Justice for Janitors Campaign SEIU does not use NLRB elections to gain union representation Put pressure on building owners that use non-union subcontractors for janitorial services Form alliances with community groups such as churches to gain public support for organizing Create social, political and economic pressure that: Forces cleaning companies to accept the union Forces owners to accept union contractors, and that Bread and Roses Video…whole thing…today and part of Thursday… Worksheet will be graded…1 point for each question
