Role of Labor Unions in Labor Markets - Essay Sample

Introduction

Labor unions are organizations formed by employees that purpose to use their collective power to better compensation benefits and their working conditions. This is done to improve individual, family and community well-being. It is done through bargaining to bring fairness in the workplace by providing mechanism processes. The employees' interests are represented in political processes. Traditionally, economists take on unions was that they act as monopolies for labor markets since they increase wages above the markets' set competitive level (Milkman Gonzalez, & Ikleler, 2012). They argue that labor unions invent inefficiencies that result in unemployment and income inequalities that are great. Due to this, economists view unions as an undesirable interference in the operation of the market. Labor unions have negative impacts, but economist argues that the positive impacts overweigh them. The paper, therefore, seeks to discuss the role of labor unions and the impact they have on both the labor market and contemporary society. Firstly it will discuss on the historical development on unions and why they exist, their structure and how they are governed, the three-step industrial relations process, the role and the impacts and finally to conclude the subject matter.

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Reasons for Creation of Unions

Unions are created by employees that wish to better their working conditions and compensation benefits to increase fairness in the workplace by providing mechanism processes. When employees have unique skills or talents, they have greater chances to influence their colleagues to have the power to improve their working conditions (Rosenfield, 2014). When workers group themselves, they can apply collective pressure that is directed towards the employer and forces some specific demands of employees. Political and legislative processes can also be improved through collective power.

Historical Development of Labor Unions

The original union was first formed by shoemakers (cordwainers) 1792 Philadelphia and was banned by the court in 1806 together with other unions to restrain conspiracy. In 1842, the decision was overruled, and the government sought ways to discourage union formations. The police and military interjected demonstrations and strikes; employers strategized on how to blacklist and sack union activist members, eviction of their families as well from housing owned by the company and acts of violence were engaged in employees who tried to organize the unions. Employees did not give up despite the heavy efforts to eradicate unions (Western & Rosenfeld, 2011). They formed small defensive local and national unions which were weak.

The National Labor Relations Act which is abbreviated as (NLRA) was passed during President Franklin Roosevelt's reign as he altered the public policy on unions. In 1937 the NLRA through the Supreme Court constitutionally confirmed that the federal government would protect employees rights to form unions, bargain, and strike rather than agreeing with employers to be against unions. The NLRA thus came up with rules that governed how employers and unions would cope with each other in the future. The system is still in use up to date, and the unions and employers work under the law and strikes, and employee lockouts are a last resort to the labor unions. The historical development of labor unions formed the contemporary American movement that gave rise to public sector unions in 1962.

Structure and Governance of Labor Unions

The structure and governance of unions will help bring an understanding of how they function as organizations. Unions are structured and governed in similar ways that include three stages; local, regional and national. A local union consists of employees in one workplace like an office or factory and is also referred to as a branch. However, it can represent more than a single work area or in large working areas. This is the main place where employees can interact with and experience the union. A local constitution governs the local union that elaborates on how the union should be run like the election of officers, terms of office, duties, how administrative decisions are made, contract bargaining and calling off strikes. Parent organizations such as national or international unions influence the local union. The regional or state stage is an intermediate level the second level that is a link between the local and national level. The regional level brings local and international unions together in a certain location for mutual benefits. It also provides expert representatives of the unions who are experienced to assist in activities such as organizing, giving advice, contract negotiations, providing assistance as well as grievance arbitration.

The third level is the national or international stage which brings together the local unions in the state. The national stage carries out many functions inclusive of bringing together locals to utilize their collective strength in negotiating with high ranked employers both nationally and multinational, it provides a formal platform for the interests of members to be voiced, heard, and addressed together with other issues. National level provides services like educational and legal, to support the needs and initiatives of local and regional unions. These unions are mandated by federal law to run in a democratic manner. Federation acts as a fourth stage but is different from the above three stages as it acts a body and not a union. It brings the other unions together into one alliance that is loosely formed. The alliance allows the unions to function as independent unions that aim to pursue their interest while bringing resources together, sharing information, and collective power amongst the unions.

The Three Steps of Industrial Relations Process

Employees use a certain process to form unions so that they can carry out functions such as contract negotiations and resolution of daily disputes with employers. These steps are well stipulated in the NLRA, and they are as follows; organization of the union, collective bargaining and contract administration (Landsbergis, Gryzywacz & Montagne, 2014). The organization of the union takes place in two ways; signing representation cards by the majority of the employees which make the employer to willingly recognize the union or presentation of these cards by employees if the employer refuses to recognize the union. An election is scheduled to be held once the cards are verified. Campaigns are held before the election is held to convince employees to vote against or for the union. The union is only certified after a majority of votes are for the formation of the union. The employer is bound to engage in the bargains of the union once it is certified.

Collective bargaining is the second step that involves the employer and union representatives to meet to confer on compensation benefits and working conditions for the employees within the union. Proposals are presented for the benefits and increased wages and the response from the employer on these improvements. They both seek to reach an agreement on the new terms, and if they do not reach one, then each side persuades or forces the other to change its view on the contract (Lynessa et al. 2012). The members of the union may go on a strike so that the employers can cave to their demands or the employers can close down their businesses to deprive employees of their salary. However, many negotiations end up with an agreement of the contract which has a fixed period either between 2-5years.

The third step is contract administration that seeks to implement grievance procedure mechanisms. It entails solving disputes that could have risen in terms of the contract or instances of misinterpretation or misunderstanding of incidences by either the union or the employer in a section of the contract. Disputes might also rise if the union views that the employers not following the stipulated contract and can even lead to a strike by the union. The disputes are solved in a continuous number of meetings with different union and management representatives.

Roles of Labor Unions

The labor unions strive to achieve proper compensation benefits, working conditions, disciplinary actions, local practices, grievance processes for the union members. They are usually in contracts. They achieve this by ensuring that the following things are included in contracts of employment for employees by the management;

Compensation -The unions fight for the fact that employees are prohibited from externalizing their payments by having them pay for work-related training, materials as well as training. The employer should pay for such related activities or if the employee pays for them then he/she should be compensated with the same value of money spent or with time.

Income- all contracts contain a minimum wage of the employee including overtime hours with time one's income and overtime wage increases. Income is equated with covering the specific work done and its expenses. However, some income does not relate to the work done as some employees do a lot of donkey work and are paid poor or the minimum wage limit. The union thus strives to fight for such employees and to include the minimum wage limit in contracts.

Healthcare coverage -this is a susceptible part s health coverage has its benefits to employees. It covers inpatient and outpatient medical care, acquiring of treatment and medication, covers some chronic diseases, and it can cover the family members of the employee. Though the employers have to look at this part according to the affordability, some dependents covered or comprehensiveness since trusts usually manage them. Paid time off- during leaves, maternity or bereavement offs, or rest periods should have an annually paid leave clause. Most employers ignore these part and refuse to pay their employees when they go for leave or rest periods. However, some live like bereavement should be for specific family members and some are inclusive of a variety of relationships.

Retirement and pension- they are mostly in the form of trusts just like healthcare coverage. Every profession has a different retirement age which the employee and management manage benefits and money. Retirement is required to be comfortable to the employee due to one's pension as well as savings (Keane & Pacek, 2012). The predictable and fair increases-wage increment is provided in contracts, and it is usually under the basis of duration, duties, responsibilities, and qualifications. Many at times employees increase their income by adding their training, assuming more responsibilities, working overtime or undesired hours, taking leadership roles, mentoring others, etc. to date paychecks include normal working hours, overtime, sick days off or holidays for transparency and easy calculations of earned income.

Health and safety- unions ensure that the safety and health of their members are adhered to. Workers should work in safe working conditions that promote good health. Tools such as helmets, dust coats, facemasks should be provided if employees require them. The union is also allowed to relay information of safety measures to its members without restraint through the website or even memos. Training and mentorship-it are important for employees to seek further training as the world is changing day in day out. There are technical advancements or even to further education which should not be denied to employees. The senior employees should act as mentors to the new employees within the organization for support and to take up new roles as well. Democratic participation- it is fair that employees should take part in union activities such as making decisions, choosing representatives, making policies and strategies...