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Unions and Management Negotiations between Labor and Management • Wages and Fringe Benefits • Wages are set by labor contracts and vary based-type of position, years on the job. • Years of experience=more $ • Contracts also include cost-ofliving adjustment (COLA). • A COLA automatically raises employee wages to match widespread price increases, allowing workers to maintain their purchasing power. • Fringe Benefits include nonwage payments such as; paid sick days, holidays, vacation days, health and life insurance, savings and retirement plans. • Cont. Wages and Fringe Benefits • Many companies provide profit sharing & employee stock ownership plan. • Working Conditions • Desirable working conditions include a clean and safe workplace, clearly defined work responsibilities, and reasonable working hours. Job Security and Union Security • Under the legal system the law prohibits an employer from firing an employee because of race, sex, religion, age, or union activity. • Seniority is the holding of privileges based on the number of years a worker has been employed by a firm. • Employees with the least seniority are the first to lose their jobs in a company. • Union security provides workers with the right to organize and join a union. The right is enforced by the National Labor Relations Board (NLRB). Grievance Procedures • Grievances, or formal complaints, usually are resolved by committees made up of representatives of the union and the management. • If this procedure does not resolve the problem, a negotiator it brought in by the NLRB. • Both union and management must agree to give the negotiator all applicable information and to abide by the negotiator’s decision. Contact Negotiations • Collective Bargaining: Union and management representatives meet to discuss their goals and offer solutions and compromises. In most cases, collective bargaining results in a contract settlement. • Mediation: Negotiators call in a neutral third party, or mediator, to listen to the arguments of both sides and to suggest ways in which an agreement may be reached. • Arbitration: Like mediation, arbitration calls for the assistance of a negotiator to arrive at a contract. An arbitrator, like a mediator, is a neutral third party. Unlike in mediation, an arbitrator’s decision is legally binding. Union Tactics • When unions and management cannot reach an agreement, unions use the STRIKE tactic in which union members stop working until contract demands are met. • Most strikes are over wage disputes, working conditions, lack of benefits, and unfair management practices. Three Strike Tactics • Picketing: The tactic is to inform the public that a strike is in progress. Picketing may arouse public support and some members of the public will identify with the problems of the striking workers. Picketing discourages nonstrikers from entering the plant. However, those workers who cross the picket line, called scabs, are often insulted by strikers. Boycotts • A primary boycott is an organized effort to stop purchases of a firm’s products • In the 1960s Cesar Chavez led the National Farm Workers Association in an attempt to improve the wages and working conditions of migrant agricultural laborers. • The United Farm Workers (UFW) in 1965 organized a primary boycott of grapes. Millions of consumers across the U.S. supported the union by refusing to buy grapes. • A secondary boycott is a refusal to buy the goods or services of any firm that does business with a company whose employees are on strike. Coordinated Campaigning • Coordinated campaigning: involves the use of picketing as well as boycotts. Management Responses • Replacement Workers: Finding qualified workers can be difficult because picketing workers often intimidate strikebreakers as they attempt to go to work. • Lockouts: A lockout occurs when an employer closes a company’s doors to striking workers until negotiators reach a contract agreement that is satisfactory to management. Employers may lose money if they are unable to hire other workers and production stops. • Injunctions: A court order to prohibit the workers from striking. There are restrictions on injunctions – the Taft-Hartley Act permits the issuing of an injunction when a strike threatens the health or safety of the public.