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Environmental/Contextual Issues. Social, Legal, Economic and Political. Social Environment for Collective Bargaining in the U.S. Individualism Rights of individuals superior to other rights Property rights as a derivative of individual rights Corporations are legal individuals

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environmental contextual issues

Environmental/Contextual Issues

Social, Legal, Economic and Political

social environment for collective bargaining in the u s
Social Environment for Collective Bargaining in the U.S.
  • Individualism
    • Rights of individuals superior to other rights
    • Property rights as a derivative of individual rights
    • Corporations are legal individuals
      • Chartered by state
      • Collectivities of shareholders
      • Perpetual life
      • Limited liability
the employment relationship
The Employment Relationship
  • An economic exchange transaction
    • Between two individuals
    • Basically, perceived as no different than purchasing a commodity
unions and individualism
Unions and Individualism
  • Collectivities
    • Collectivizing what we view as natural individual economic transaction
    • At a disadvantage vis-à-vis those exercising rights
      • Corporations – legal individuals
      • Employees – actual individuals
  • Skeptical About Governmental Protection
other values
Other Values
  • Europe
    • Class – based collectivistic values in Europe
  • Asia
    • Confucianism based principles of obligation and harmony
implications of social environment for collective bargaining
Implications of Social Environment for Collective Bargaining
  • Strong management and employers
    • Property rights
    • Individualism
    • Job provider
    • Resistance to unionism
  • Unionism
    • Struggle for legitimacy
    • Difficulty in staying organized
legal environment
Legal Environment
  • Basic Principles of Legal Environment
    • Accessible
    • Wide Coverage
    • Public
    • Mandatory Procedures
historical overview
Historical Overview
  • 1806 - 1842: Conspiracy Doctrine
  • 1842 - 1932: Decline of Conspiracy Doctrine - Legal Focus on Union Tactics
    • Through 1870’s: Damage Suits
    • 1880’s - early 1930s: Injunction
  • 1932 - 47\55: Legal Environment Favorable to Unions and CB
  • 1947\55 - Present: Legal Environment Neutral to Pro-Employer

Legal Framework

basic legal framework
Basic Legal Framework
  • National Law in U.S. for Private Sector
    • Mixed Federal\Provincial in Canada
  • Employee Choice
  • Some Exclusions
    • Some Employers
      • Railway Labor Act
    • Some Employees
  • Broad Definition of “Labor Organization”
  • Representation by “Bargaining Unit”
    • Majority Rule
    • Exclusive Representation
  • Administration by political appointees (on NLRB)
basic legal framework cont
Basic Legal Framework (cont.)
  • Unfair Labor Practices
  • Bargaining
    • Limited to terms and conditions of employment in U.S.
    • Broader in Canada
  • Use of Economic Weapons to Determine Outcomes
  • Administration by an administrative agency
    • NLRB in U.S.
    • Comparable bodies in Canadian
basic legal framework cont1
Basic Legal Framework (cont.)
  • Determining Representation
    • Elections in U.S.
    • Elections and card checks
  • Recent Legal Issues
    • Organizing
    • Duty to Bargain
    • Striker Replacement
    • Employee Involvement in Nonunion Firms

Legal Framework

implications of legal doctrine
Implications of Legal Doctrine
  • Union Organizing
    • Evolution
      • Employer noninvolvement, 1935-41
      • Employer involvement but required to permit union on premises to present views, 1941-53
      • Union exclusion
        • From presenting views, 1953
        • From coming on premises (generally)
          • 1956
          • 1992
    • Development of employer union resistance tools by mid-1950’s
implications of legal doctrine cont
Implications of Legal Doctrine (cont.)
  • Bargaining
    • Board not involved in determining terms and conditions of employment
    • Mandatory and nonmandatory subjects
      • Corporate restructuring
    • Defaults to an adversarial system
    • Bargaining power
      • Implementation at impasse
      • Strikers and replacements
      • Flexibility in paying strike replacements
    • No subsystem to prevent employer pyramiding legal rights to deunionize
implications of legal doctrine cont1
Implications of Legal Doctrine (cont.)
  • Remedies
    • Little disincentive
  • Delay
  • Minimal government involvement
    • Favors economically stronger party
economic environment
Economic Environment
  • Macro-Level Focus
    • Determinants of Union Growth
      • Shifts in Structure of Employment
      • Business Cycle
  • Micro Level Focus
    • Labor and Product Markets\Firm
      • skilled - hard to replace workers
      • inelastic demand for union product
      • inelastic supply of substitutes for union labor
      • ratio of labor costs to total costs (“importance of being unimportant”)
    • Take Wages out of Competition - Organize the Product Market
product market
Product Market
  • Successful organization of product market key to union success during period 1945-75
    • Autos
    • Steel
    • Airlines
    • Trucking
    • Paper
    • Construction
  • Union Taking Wages (labor costs) Out of Competition
u s employment absolute numbers in 1 000 s
U.S. Employment(absolute numbers in 1,000’s)

SOURCE: U.S. Bureau of Labor Statistics

product market1
Product Market
  • Implications
    • As entry increases, union power declines
      • Wages and labor costs
    • If employers can remove themselves from unionized sector, union power declines
      • spatial limitations
        • Longshoring
        • Public Employment
  • Post 1975
    • Increasing foreign competition - “nonunion”
      • autos: less than 5% market share in late 60’s to roughly 35% today
      • steel: increase in worldwide capacity
    • Deregulation - airlines and trucking
product market cont
Product Market (cont.)
  • Employer Removal - rubber
  • Spatial Characteristics - longshoring
microeconomic principles
Microeconomic Principles
  • Consumer Welfare
    • Efficiency is desirable
    • Efficiency is determined by low prices to consumers
    • Work is for the purpose of generating income so that individuals can consume
      • Labor supply
    • Labor an input to production
implications
Implications
  • More competitive product markets due to entry of unorganized firms reduces union power
  • Unionized employer capability of removal from union sector reduces union power
  • Both happened in period 1975-2005
political environment
Political Environment
  • Political linkages
    • Unions – Democratic Party
    • Employers – Republican party
  • Republican party rise over last 25 years
    • Favorable to Business
      • Flexibility
    • Reduction of Legal Constraints
      • Minimalist government
linkages to other three environments
Linkages to Other Three Environments
  • Social
    • Reinforces individualism Legal
    • Legislation
    • Appointments
      • Administrative
      • Judicial
  • Economic
    • Fewer constraints on business
    • Willingness to let “market” work