Labor Relations

I

Introduction

Labor Relations, broadly, all dealings, transactions, and activities affecting the determination and enforcement of the terms and conditions of employment.

The relations between employers and employees developed differently in various parts of the world. In particular, the goals and activities of European trade unions differ considerably from those of trade unions in the U.S. In Europe customs and laws bearing on labor relations are often basically dissimilar even in neighboring countries. European trade unions are primarily national organizations allied closely with political movements and parties. By contrast, the trade union movement in the U.S. developed with a marked degree of uniformity. The typical U.S. trade union is primarily a local organization devoted to the advancement and protection of the economic interests of its members. It usually has national and statewide affiliations but no loyalty to a particular political ideology. This article is concerned mainly with labor relations developments in the U.S.

II

History

In the early 19th century, before the growth of the factory system, wages and hours of work were usually arranged in direct dealings between employers and individual employees. The prevailing legal and social opinions and the economic situation did not favor the development of workers' organizations. Because the disparity in bargaining power between employers and employees caused many abuses, however, the workers in various industries organized trade unions, which demanded better terms of employment and enforced their demands by means of the strike. In addition, three types of regulation—protective legislation, labor relations legislation, and collective agreements between unions and employers—were developed to remedy abuses and preserve industrial peace.

Protective legislation, the earliest type of regulation, was enacted by states and to a lesser extent, by the federal government, principally during the early 20th century. Such legislation regulated the maximum hours of work and minimum wages of women and minors and hazardous practices affecting them as employees. Some of these protections were extended later to adult male employees. Under another type of protective legislation industrial employees become entitled to benefits. Such legislation includes laws guaranteeing workers' compensation for industrial accidents and social security legislation, such as unemployment insurance, old-age insurance, survivors' insurance, and disability insurance. Since 1945 numerous statutes have forbidden discrimination in employment and, increasingly, in union membership, removing restrictions that are based on such criteria as age, race, and sex.

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Federal and state labor relations laws guarantee to workers the right of free association in unions, establish procedures for determining appropriate bargaining units and selecting unions as exclusive bargaining agents, and outlaw certain unfair practices of employers. The principal statutes of this type are the National Labor Relations Act of 1935 and the Labor-Management Relations Act of 1947, which amends the former by requiring employers and unions to bargain in good faith and enumerating practices prohibited to each group. The Labor Management Reporting and Disclosure Act of 1959 includes a series of measures protecting employees from unfair practices on the part of either the employer or the union and extending the rights of union members to participate in the decision-making processes of the union. The act also prohibits the closed-shop agreement, in which union membership is required as a condition of employment. Pension benefit plans are regulated by the Welfare and Pension Plan Disclosure Act of 1959.

Labor relations legislation requires that employers and unions deal and bargain with each other, but does not itself fix terms and conditions of employment as did the earlier protective legislation. The bargaining of employers and unions results in collective agreements setting forth the principal terms and conditions of work. Thus the most important determinant of these matters in the more highly industrialized states is no longer protective legislation but the collective-bargaining agreement. During the 1960s the right to collective bargaining, but without the right to strike, was extended to employees in the public service.

III

Modern Practices

The larger employers of labor now have labor relations, or industrial relations, departments dealing with problems in the negotiation and administration of agreements. Such departments are usually divided into two branches, one responsible for day-to-day administration of agreements relating to wages and salaries, the other responsible for such matters as assignments to work, schedules of work, layoffs, promotions, discipline, grievances, and arbitration. Many international unions adapted their organizational structures to those of the principal companies with which they deal. These unions have specialists trained and assigned to deal with management specialists in matters relating to negotiations, grievances, arbitration, legal services, social security and welfare services, industrial engineering, economics, and public relations.

When the employees in a plant are not represented by a union, the terms and conditions of employment are usually determined by direct arrangements between plant management and employee. A union seeking to deal with an employer as the exclusive bargaining representative of its employees may try to persuade the employer to recognize it on the basis of authorization cards signed by a majority of employees in an appropriate bargaining unit and signifying the desire of these employees to be so represented. Failing such recognition, the union may file a representation petition with the appropriate federal or state agency. The agency will then proceed to determine the unit appropriate for collective bargaining and, if warranted, conduct a secret-ballot election among the employees in that unit.

Management is obliged to bargain in good faith with the union selected by the employees. The Labor-Management Relations Act requires that a notice of contract negotiations be given to The Federal Mediation and Conciliation Service and to the state mediation agency, where one exists. These agencies make available the services of their staff mediators to assist the parties in achieving agreement if their unassisted negotiations are not fruitful. Such services are optional; neither party to a negotiation is required to accept them. If agreement on contract terms cannot be reached through bargaining, the union is allowed to strike, except in certain industries, such as the railroads, in which strike action is delayed because a strike would be against the public interest. Most agreements provide for the filing of grievances by employees and by the union with respect to alleged violations of the agreement and require consideration of a grievance in prescribed time sequence by union and management officials with progressively greater authority. The agreements provide also that a grievance not so resolved may be appealed to arbitration for a final decision. A party to such an agreement may call upon federal and state courts to compel the other party to arbitrate.

Arbitrators of labor-management disputes are impartial, disinterested professionals chosen directly by the parties involved or selected from lists of nominees as submitted, for example, by the American Arbitration Association. In some instances arbitration is conducted by a board of arbitrators of which all members except a neutral chairperson with the deciding vote are interested individuals. Arbitration is conducted either by an arbitrator selected especially for a case or by an umpire, referee, or chairperson designated for the duration of the collective agreement. Arbitrators' awards are enforceable, when filed, as judgments of a court of law, and may be set aside only for specific causes, such as lack of authority, fraud, interest, or misconduct by the arbitrator.

Dealings between most modern-day representatives of management and unions have been characterized by mutual respect, the product of years of negotiation and joint administration of agreements. This attitude of mutual confidence has fostered more cooperative labor relations than formerly prevailed. Labor-management arbitration has also contributed to industrial peace because it substituted the binding award of a respected neutral for the exertion of economic force during the term of a collective agreement. Although labor and management continue to differ on various economic problems, they generally realize that neither group can reach its goals without the assistance of the other.

By the mid-1980s the power of organized labor had decreased markedly. With more and more people employed in service occupations rather than in manufacturing, union membership declined—and so did union strength in labor negotiations. This process was exacerbated by other economic and political factors.

See also Trade Union; Trade Unions in the United States.

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