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12-11-1

McGraw-Hill/IrwinUnderstanding Business, 8e © 2008 The McGraw-Hill Companies, Inc., All Rights

Reserved.

Nickels McHugh McHughNickels McHugh McHugh

**Dealing With Dealing With

Employee-Employee-ManagementManagement Issues and Issues and

RelationshipsRelationships12

CH

AP

TE

R*

* *

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12-2

U.S. Workers Unionized U.S. Workers Unionized

12.5%13.2%

14.9%16.0%

18.0%20.1%

13.5%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

1983 1985 1990 1995 2000 2002 2005

Source:Source: Bureau of Labor Statistics News, January 20, 2006

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12-3

Union InvolvementUnion Involvement

Why Employees Join Why Employees Join UnionsUnions

• Pro-union attitudes

• Poor management/ employee relations

• Negative organizational climate

• Poor work conditions

• Union’s reputation

• Job security

Why Employees Don’t Join Unions

• Anti-union attitude

• Good management/ labor relations

• Positive organizational climate

• Good work conditions

• Union’s reputation

• Peer pressure

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12-4

History of Labor UnionsHistory of Labor Unions

• Craft Union OrganizedCraft Union Organized

• Knights of LaborKnights of Labor

• AFL OrganizedAFL Organized• Industrial unionsIndustrial unions

• CIO OrganizedCIO Organized

• AFL/CIOAFL/CIO

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12-5

Legislation &Legislation & Collective BargainingCollective Bargaining

• Norris-La Guardia ActNorris-La Guardia Act

• National Labor Relations ActNational Labor Relations Act

• Fair Labor Standards ActFair Labor Standards Act

• Labor-Management Labor-Management Relations ActRelations Act

• Labor-Management Labor-Management Reporting and Disclosure Reporting and Disclosure ActAct

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12-6

2005 Union Membership2005 Union Membership by Industryby Industry

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

ManufacturingConstructionInformationTransportationGovernment

Source: Source: Bureau of Labor Statistics News, January 20, 2006

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12-7

Objectives ofObjectives of Organized LaborOrganized Labor

• 1970s- Pay/Benefits1970s- Pay/Benefits

• 1980s- Job Security & 1980s- Job Security & Union RecognitionUnion Recognition

• 1990s-2000s- Job 1990s-2000s- Job Security/ Global Security/ Global CompetitionCompetition

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12-8

Organized Labor IssuesOrganized Labor Issues

• Union Security ClausesUnion Security Clauses

• Closed ShopClosed Shop

• Union ShopUnion Shop

• Agency ShopAgency Shop

• Right-To-Work Laws & Open ShopRight-To-Work Laws & Open Shop

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12-9

Grievance ResolutionGrievance Resolution Process Process

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12-10

Mediation/ArbitrationMediation/Arbitration

• Bargaining ZoneBargaining Zone

• Mediation/Mediator- Mediation/Mediator- suggestionssuggestions

• Arbitration- binding decisionArbitration- binding decision

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12-11

Union TacticsUnion Tactics

• StrikeStrike

• Cooling-off PeriodCooling-off Period

• BoycottBoycott• PrimaryPrimary

• SecondarySecondary

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12-12

Management TacticsManagement Tactics

• LockoutsLockouts

• InjunctionInjunction

• StrikebreakersStrikebreakers

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12-13

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%

New Jersey

Michigan

Alaska

Hawaii

New York

Most Unionized Most Unionized StatesStates

Source: Source: Investor’s Business Daily, January 24, 2006

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12-14

0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0%

Utah

Virginia

Arkansas

N. Carolina

S. Carolina

Least Unionized Least Unionized StatesStates

Source: ISource: Investor’s Business Daily, January 24, 2006

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12-15

Controversial Employee -Controversial Employee -Management IssuesManagement Issues

• Executive Executive CompensationCompensation

• Pay EquityPay Equity

• Sexual Sexual HarassmentHarassment

• Child CareChild Care

• Elder CareElder Care

• Drug TestingDrug Testing

• Violence in Violence in WorkplaceWorkplace

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12-16

Executive $Executive $

• In 2005, CEOs of 500 biggest companies In 2005, CEOs of 500 biggest companies received an aggregate 6% pay raise.received an aggregate 6% pay raise.

• Average paycheck in 2005: $10.9 millionAverage paycheck in 2005: $10.9 million

• Top 3 earners in 2005:Top 3 earners in 2005:• Richard Fairbanks, Capital One Financial, Richard Fairbanks, Capital One Financial,

$249.3 million$249.3 million• Terry Semel, Yahoo!, $231 millionTerry Semel, Yahoo!, $231 million• Henry Silverman, Cendant, Henry Silverman, Cendant,

$140 million$140 million

Source: Forbes, April 20, 2006

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12-17

CEO PensionsCEO PensionsCEOCEO Company NameCompany Name Pension ValuePension Value

Lee R. RaymondLee R. Raymond Exxon Mobil Corp.Exxon Mobil Corp. $8.1M$8.1M

Henry A. McKinnellHenry A. McKinnell Pfizer Inc. Pfizer Inc. $6.5M$6.5M

Edward E. Whitacre Edward E. Whitacre Jr.Jr.

AT&T Inc.AT&T Inc. $5.4M$5.4M

William W. McGuireWilliam W. McGuire UnitedHealth Group UnitedHealth Group Inc.Inc.

$5.0M$5.0M

Robert L. NardelliRobert L. Nardelli Home Depot Inc. Home Depot Inc. $4.6M$4.6M

Source: www.aflcio.org

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12-18

Equal Pay Act Based On…Equal Pay Act Based On…

• SkillSkill

• Effort Effort

• ResponsibilityResponsibility

• Working ConditionsWorking Conditions

• EstablishmentEstablishment

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12-19

Earnings GapEarnings Gap(What women of various races earn, compared (What women of various races earn, compared

with a dollar earned by a white male)with a dollar earned by a white male)

0.00 0.20 0.40 0.60 0.80

Asian-American

White

African-American

Native-American

Hispanic

Source: Source: Business Week, June 7, 2004

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12-20

Sexual Harassment Sexual Harassment ChargesCharges

0

2000

4000

6000

8000

10000

12000

14000

16000

18000

1995 1999 2003

Charges

AmountFiled ByMales

Source: The U.S. Equal Employment Opportunity Commission StatsSource: The U.S. Equal Employment Opportunity Commission Stats

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12-21

You Make the CallYou Make the Call

1.1. Two colleagues walk by you as one delivers Two colleagues walk by you as one delivers the punch line to a very dirty joke. You feel the punch line to a very dirty joke. You feel the joke is inappropriate. Is this sexual the joke is inappropriate. Is this sexual harassment under the law?harassment under the law?

2.2. An employee meets with you and tells you An employee meets with you and tells you that, five years ago, a then-supervisor was that, five years ago, a then-supervisor was sexually harassing him. What do you do?sexually harassing him. What do you do?

3.3. An employee thinks she may have been An employee thinks she may have been sexually harassed. She explains the sexually harassed. She explains the circumstances to you and asks, “Wouldn’t circumstances to you and asks, “Wouldn’t you be upset?” What should be your you be upset?” What should be your response?response?

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12-22

You Make the CallYou Make the Call

4.4. You’re investigating a sexual harassment You’re investigating a sexual harassment claim, and all five of the witnesses you’ve claim, and all five of the witnesses you’ve interviewed so far have backed up the claim interviewed so far have backed up the claim of sexual harassment. Should you continue of sexual harassment. Should you continue to interview others?to interview others?

5.5. After conducting a thorough investigation, After conducting a thorough investigation, you conclude that sexual harassment has not you conclude that sexual harassment has not taken place. What’s next?taken place. What’s next?

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12-23

Amount Injured Per Amount Injured Per Every 1000 WorkersEvery 1000 Workers

0 50 100 150 200 250 300 350

Bartender

Prison Guards

Taxi Drivers

Privat SecurityGuards

Police Officers

Source: Crimeprevention.rutgers.edu Source: Crimeprevention.rutgers.edu