Outline Decline of Organized Labor Growing Inequality Explaining the Decline Structure, Management and Unions Walmart Video Clip Exam??? Fair,

Outline

Decline of Organized Labor Growing Inequality

Explaining the Decline Structure, Management and Unions

Walmart Video Clip

Exam??? Fair, unfair, all exams suck

Mid Term…Mostly Very Good

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40 Multiple Choice Questions High Score 39…98% Median Score: 34…85%

Questions on questions? 3 w < 50% correct13, 25,

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Essay Numbering mistake All received one free point Other three worth 3 each

Bonus Points: 5 events one assignment point

or ¼ test point for each…

no limit: 5 pts for assignments or 1.25 lift to final grade

You can pick and choose…indicate on paragraph you hand in

Attend event…write a paragraph connecting what you learn to this class

Our class has come a long way…From Conspiracy to Collective Bargaining…

From Unions as illegal combinations of individuals who are violating a key tenet of capitalism… individual bargaining Wages, hours and working conditions set via

competition between individuals in the labor market

To federal legislation sanctioning and encouraging the formation of unions that engage in collective bargaining Wages,hours and working conditions set via

collective bargaining and negotiation between organization representing workers (unions) and firms

From open class warfare to a bargaining table…

1. We considered the “Treaty of Detroit” prior to break. Please tell me once again what the “Treaty of Detroit” was and explain how it functioned to provide more of society’s wealth and income to ordinary Americans?

Treaty of Detroit Becomes the Pattern

1) “Treaty of Detroit” between corporations and unions tied wages to productivity…

Translation: 1947 Joe produced 100 widgets a day and was paid $100 1975 Joe produced 200 widgets a day and was paid $200

1%

18%26%

36%

64%

92%

We Used to Grow Together

Richest 20%

Poorest 20%

Richest 20%

Poorest 20%

Real Family Income Growth Adjusted for Inflation

1947-1973

Source: U.S. Census Bureau. Based on mean family income.

1973-2000

Top5%

Top 5%

117%

98% 103% 104%88%

75%

Union Help Facilitate the “Great Compression” & the creation of the American Middle Class

And Things Change: Move from Collective Bargaining back to Individual Bargaining…

2010: 11.9% union density 2010: 6.9% private sector

2. What happened to inequality in American when the “Treaty of Detroit” was rescinded? Be sure to cite the text in your answer.

Unions are weak and workers Are No Longer Sharing In Productivity Gains

Translation: 1975 Joe produced 200 widgets a day and was paid $200 2003 Joe produced 400 widgets a day and was paid $205

The New Inequality

Growing Inequality

The Great Divergence

1%

18%26%

36%

64%

92%

We Used to Grow Together, Now We’re Growing Apart

Richest 20%

Poorest 20%

Richest 20%

Poorest 20%

Real Family Income Growth Adjusted for Inflation

1947-1973

Source: U.S. Census Bureau. Based on mean family income.

1973-2000

Top5%

Top 5%

117%

98% 103% 104%88%

75%

1. We considered the “Treaty of Detroit” prior to break. Please tell me once again what the “Treaty of Detroit” was and explain how it functioned to provide more of society’s wealth and income to ordinary Americans? How did it restrain the pay of executives? Be sure to cite the text in your answer

Winners and Losers

Business Week, Fall 2004

Inequality is Highest in the US… Ratio of Top 10% to Bottom 10%

Explaining the New Inequality Multiple causes, but the subject of this class is a major

one

“The decline in unions contributed to the increase in inequality. Since unions increase the pay of their members, who are primarily in the middle class, and reduce the dispersion of pay among members, the shift from union wage setting to market wage setting added to inequality” (Freeman 2007: 50).

Paul Krugman, Nobel Prize Winning Princeton Economist Institutions Matter

Union Decline Facilitates Inequality in Three important ways

1) Declining union power alters the balance of power in the economy Workers simply have less bargaining power or

leverage

2) Decline in unions results in political shifts that facilitate inequality Change in tax codes, trade policies and other policies

3) Decline of unions results in changed norms about fairness and equality Unions are committed to norms of fairness and

equality…as unions have receded, these norms have grown weaker

Different Institutions, Different Norms, Outcomes

General Motors, 1969

Salary in today’s dollars, $4.3 million

Workers salary, $40,000 + health care and pension A Middle Class Wage

Walmart, 2005

Salary in 2005, $23 million 5 times what GM CEO

took

Workers salary, approximately $18,000 Most lack health care

and pensions A Poverty Wage

Different Institutions, Different Norms…Different Outcomes

So…Lots of questions

What explains the decline of unions in America?

As Freeman asks…who “did in the unions?”

Freeman, Where Have All the Unions Gone 4.Freeman argues that “The decline in

private sector unionism is not a mechanical story of employment shifting from blue collar mining and manufacturing, where unions had great strength, to white collar service sectors, where union were weaker.” What evidence does he provide to support this assertion. Be sure to cite the text in your answer, but also be sure to explain what his evidence means in your own words.

Structural Explanation for Union Decline

“The first and simplest explanation in unionism is that resulted from broad economic changes, which reduced the proportion of the workforce in groups traditionally highly unionized and increased the proportion in groups traditionally nonunion.” (Freeman 1984: 224)

So when you shift from ____________ to ________________ you get fewer union members

From Blue collar to white collar (this is usually emphasized)

From Men to women… Less educated to more educated workforce…

There Have Been Structural Changes in the Economy: Manufacturing Changes

Replace labor via automation

Technological innovation US Steel, 1980 120,000 workers US Steel, 1990 20,000 workers

Yet same output Fewer steel workers, more computer programmers

Similar trends in auto and other manufacturing sectors

Large Structural Change in the Overall Economy: From Industrial to Post Industrial Society…

Post Industrial Society society characterized by the production of

services and information rather than finished goods.

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ManufacturingService

Strutural Changes to Bring Loss of Union members… Close a GM plant with 30,000 unionized

workers…union movement loses 30,000 union members

The Structural Shifts Explain Some of the Decline…But The Explanation Has Problems

1) Post Industrial transformation has occurred in all advanced industrial capitalist nations, but union density has not fallen in the same way. Canada is particularly troublesome for the

structural argument, since its economy contains so many of the same companies

2) Women and College Graduates actually more likely to be union members than White men

Union Density, Late 1990s

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Sweden Denmark Finland Italy Canada USA

Union Density

The Decline of Organized Labor…

3) Structural argument can’t explain uptick in unionization among some service sector workers: Government workers

Public Sector Growth…From almost nothing in the 1960s to almost 50% now…

Poses a Puzzle: Why didn’t unorganized private sector service workers organize at the same rate?


“The problem is that the structuralist explanation assumes, erroneously, that structural changes are the sole determinants of unionization and does not allow other factors…”

Freeman estimates that it accounts for less than 20 % of the decline (Freeman 2007: 79)

7. Freeman suggests that there are three primary suspects for “doing in the unions.” One likely suspect is workers. Please Freeman’s findings with regard to whether workers still want unions. Be sure to cite the text in your answer.


New workers (young, women, minority) express no less interest in unionization than traditionally organized white men

Freeman & Rogers (my advisor in graduate school) Survey 32% of non-union private sector workers desire unionization

In 2003 and 2005, more than 50% of non-union workers said they would vote for a union

Yet less than 7% of private sector workers are in unions

Called the “representation gap” …Millions of people who are not in unions would like to be in a union “if workers had their way, private sector union density would

be on the order of 40 percent…” (Freeman 2007: 83)

Freeman, Where Have All the Unions Gone 6. Freeman suggests that there are

three primary suspects for “doing in the unions.” One likely suspect are unions themselves. What does Freeman think unions have done, or not done, to help do themselves in. Be sure to cite the text in your answer.

Once Again…Choices…

It’s 1985, and you are a union leader committed to addressing issues of inequality in society. You believe that all workers should make a decent living, and have decent hours and working conditions. The manufacturing industries that were once the backbone of the labor movement are disappearing, and service sectors jobs ranging from janitors, waiters and sales clerks to lawyers, computer technicians and software designers are expanding. Some of these jobs are good, a lot of these jobs are awful.

As a union leader, what do you do to reverse the decline of unions so you can protect working families?

Unions Drop the Ball…

George Meany, President of the AFL-CIO dismissed concerns about organizing new workers

“I don’t know, I don’t care…Why should we worry about organizing groups of people who do not appear to want to be organized...I used to worry about…the size of the membership…I stopped worrying because it doesn’t make any difference…The organized fellow is the fellow that counts” (Freeman 2007: 77)

Interest in organizing waned and money spent on organizing dropped 30% between the 50s and the 70s…

Faced with crisis…Unions

actually organize less… Few resources

devoted to organizing new workers

Fewer elections for union representation held

Year # of Elections for union representation

1950 5619

1960 5428

1970 7543

1980 7021

1990 3423

1995 2716

Fewer Elections, Covering Fewer Workers, with Fewer Victories

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And unions won less…

Year # of Elections % Won Union New Members

1950 5619 74.5 -

1960 5428 62.8 -

1970 7543 55.1 -

1980 7021 49 -

1990 3423 47.6 77,689

1995 2716 48.2 66,753

So workers say that want unions, but are unions winning fewer elections: Why?

5. Freeman suggests that there are three primary suspects for “doing in the unions.” One likely suspect is management. Please summarize Freeman’s argument about the role of management in “doing in the unions.” Be sure to cite the text in your answer.

Outline

Avoiding Unions in the US Differences Across Nations Thinking About Competitive Disadvantage

Organizing Unions Today Path 1: NLRB Elections

Rules and Response Path 2:Voluntary Recognition

Corporate Campaigns Card Check Neutrality Agreement

Management Opposition

Union Prevention/Avoidance “Positive Labor

Relations” Legal anti-union

activities Illegal anti-union

activities

Lets explore via Walmart…

Do the Wiggle…Don’t Eat the Banana Walmart…union substitution or Positive Labor Relations

Good Human Resource Management Happy “Associates” feel they’re getting fair wages &

benefits; open door policies; wiggle....

Aggressively Anti Union Walmart…union substitution or Positive Labor Relations

Good Human Resource Management Happy “Associates” feel they’re getting fair wages & benefits;

open door policies; wiggle....

Walmart… union avoidance & prevention Very aggressive legal anti-union campaigns

“dirt” to fire; handbooks; toll free #; one on ones; videos Very Aggressive illegal Anti-union campaigns

Surveillance, firing…

“…managerial opposition to unionism, and illegal campaign tactics in particular, are a major, if not the major, determinant of NLRB election results” (Freeman 1984: 233)

Worth Noting the Differences… “Managers in other countries do not fight unions

with anything like the resources and zeal of American managers” (Freeman 2007: 81)

In Denmark, Freeman asks to meet with anti-union firms…told that would not be possible, there are none. German workers I met in a “video conference”…shocked

Even small businesses prefer collective bargaining…they level the playing field for firms to compete on non-wage dimensions? Translation?

High Union Density Impacts Employer Behavior

If labor market is organized “wall to wall,” or union contracts are extended to all firms, no one is at a competitive disadvantage A level playing field…Pathmark, Shoprite, Acme all compete…but not on the

backs of their workers

Walmart’s spread is threat to non-Walmart workers 96% of Supermarkets in NJ are unionized (PI 2/01/05)

Union Stores (Acme, Shoprite, Pathmark, etc.) are demanding concessions to remain competitive Also encouraging UFCW to organize Walmart

UFCW (United Food and Commercial Workers) has got a problem…We’ll see if they solve it…

Union Density Compared

Union Density, 2002

US was 13.3%

Why Do Workers Organize?

Why Do Workers Organize?

Dissatisfaction with wages, hours, working conditions spur union drives

But research finds most drives due to “soft issues”

Feeling overworked, under appreciated, humiliated, lied to, unfairly treated Nurses in “Why Organize”: “The total lack of respect for us as

professionals…the inconsistency in the way rules were applied”(Clawson 2003: 4)

Freeman & Rogers Survey findings: Why vote for a union? Relations with Management Bad ; Don’t trust management Management shows little concern for workers or won’t share power Dislike their job Not enough influence

The Organizing Process

Collective Bargaining cannot take place until a bargaining representative has been certified

To gain certification, unions pursue one of two paths

Path 1: Normally, a union must win an election to be certified as the exclusive representative of the employees

Path 2: An employer may voluntarily recognize a union if the union can demonstrate that it represents a majority of the employees

Path 1: The Organizing Process Initial Contact by

Employees orUnion Organizer

Union Creates Strategyto Organize Employees

Management Creates Strategyto Keep Union Out

Representation Petition(Authorization Cards)

Campaign by Both Sides

Representation Election

Union Certification

Collective Bargaining

Union Rejected

3-20

Organizing the Unorganized

Step 1: Begin an Organizing Drive

Union organizer Full-time, salaried staff member who

generally represents a national union

Sometimes aided by rank and file workers from union

Tries to convince workers about benefits stemming from unionization

Organizers Contact Workers

Katz & Kochan, 2002


The NLRB is responsible for scheduling representation elections

Law requires that at least 30 percent of the election unit must have signed an authorization card

Most unions will not file without 50% or more…Organizers usually want 65%

Katz & Kochan, 2002


Step 2: Contact Natioinal Labor Relations Board

NLRB regional director determines whether to conduct an election

Checks appropriateness of bargaining unit..more on this in a moment…this can be tricky

NLRB decides on a case by case basis Hospital: Registered Nurses, Nurse Practitioners,

Nurses Aides…One unit or 3 units?

Defining a Bargaining Unit

Key for NLRB: mutuality of interest in wages, hours and working conditions

Greater the mutuality = greater likelihood that members will agree on things, and thus CB will work better

Definition is of strategic interest for both union and firm Union wants unit that will help win election, Management

wants units that will make victory less likely

In many cases, management will challenge appropriateness of unit to delay election


Step 3: Election Campaign

• Union must build support…butcommunicating with workers is a problem?

• If you were a unionorganizer, how might youcontact members?


Step 3: Election Campaign• Access to workers is a problem for unions

• Non-employees not permitted into factory or building Outreach in a parking lot: law does not permit

Even banned from retail public parking lot (Lechmere Decision)

• That leaves: lunch hour; after work; house visits

We’ll discuss this more next week

Election Campaign

As the Walmart video showed, management is rarely a passive observer in the election process

Management tries to undercut support.

Broad array of strategies and tactics

Google union prevention

Election Campaign…Management tries to undercut support. How?

Delay the Election

Challenge Structure of Bargaining Unit

Research finds: Longer the delay, the less inclined workers are to vote for the union


Delay ElectionChallenge Structure of Bargaining Unit

Persuade Employees that Unionization is bad Captive Audience meetings

mandatory meetings during work (law permits)

Can be held up to 24 hrs before vote


Delay Election Challenge Structure of Bargaining Unit

Persuade that Unionization is bad Captive Audience meetings-mandatory

meetings during work (law permits)

Threats to close facility (not permitted by law)“If you vote for the union, we’ll move to Mexico”Research shows that it is commonly done


Promote union activists (permitted by law)

Interrogate employees (permitted by law)

One on one meetings

Election Campaign…Management tries to undercut support. How? Dismissal of union supporters (illegal)…but

happens a lot…

1991 Study finds it occurs in 1 out of 3 organizing drives 1 out of 36 pro-union voters discharged

2007 study suggests that 1 in 5 organizers or activists can expect to be fired due to union activity (Freeman 2007: 80)

2000 Study estimates “that as many as 25 percent of employers facing a union drive fire at least on worker for union activity (Freeman 2007: 157)

Cost to Employer if caught breaking the law?


Dismissal of union supporters (illegal)…but happens a lot…

Cost to Employer if Caught Breaking the Law?

Back wages minus what worker has earned while fired…

Since most workers must take other jobs, this amounts to a paltry fine…it becomes economically rational to break the law and fire workers


Step 4: Secret Ballot Election

– NLRB ensures that representation election is fair and honest

Win or Lose…

Year # of Elections % Won Union New Membs

1950 5619 74.5 -

1960 5428 62.8 -

1970 7543 55.1 -

1980 7021 49 -

1990 3423 47.6 77,689

1995 2716 48.2 66,753


Step 5: Certification of Election Results

– NLRB satisfied that results reflect the employees’ free choice

– Certification—variety of benefits to union

exclusive representation rights

for one year, employer obligated to bargain

for one year, no other union can challenge representation rights

Video Clip on Organizing

Smithfield Pork vs. the United Food and Commericial Workers

Path 1: The Organizing Process Initial Contact by

Employees orUnion Organizer

Union Creates Strategyto Organize Employees

Management Creates Strategyto Keep Union Out

Representation Petition(Authorization Cards)

Campaign by Both Sides

Representation Election

Union Certification

Collective Bargaining

Union Rejected

3-20

Video Clip on Organizing Smithfield Pork vs. the United Food and Commercial Workers

Two ways to address the “labor problem” Provide examples of people in the video who suggest exit and of

people who suggest collective voice

Issues that spur organizing drive?

Union Tactics?

Employer Tactics?

Outcome of Elections?

Workers at huge Smithfield meat plant vote for union Thu, Dec 11 2008 By Bob Burgdorfer

CHICAGO, Dec 11 (Reuters)- Meat cutters at the world's largest pork plant in Tar Heel, North Carolina, voted to be represented by the United Food and Commercial Workers union, a decision that should end more than 10 years of bitter fighting between the union and the plant's owner, Smithfield Foods Inc.

Smithfield and the UFCW confirmed the results of the voting, which began on Wednesday and concluded on Thursday night. The tally was 2,041 in favor of the union and 1,879 against.

"We will be meeting in 30 to 60 days to set up a timetable to start contract negotiations," said Dennis Pittman, a Smithfield spokesman.

Smithfield is the largest U.S. hog and pork producer with annual sales of about $11 billion.

The Tar Heel voting was supervised by the National Labor Relations Board.

A union contract at Smithfield Packing: It only took 17 years (7/01/09)

(TAR HEEL NC)—Five Thousand workers at the world’s largest pork processing plant have their first-ever union contract, after a majority

of workers ratified the agreement over a two-day vote. Members of UFCW Local 1208 will join more than 10,000 other Smithfield workers, and more than 240,000 others who work in the meat packing and food processing industry who have a UFCW union contract.

The new contract includes: * Wage increases of $1.50/hour over the next four years; * Continued company-provided

affordable family health care coverage.; * Improved paid sick leave and vacation benefits. * Retirement security through protection of the existing pension plan; * Continued joint

worker/management safety committee, including company funded safety training for workers; * Guaranteed weekly hours that protect full-time, family supporting jobs in the community; * A system to resolve workplace issues.; * 24 hours of paid funeral leave following the death of immediate family members.

This is the first contract covering the hourly production and maintenance workers at the Tar Heel facility and will take effect July

http://www.indyweek.com/gyrobase/blogs/Post?id=triangulator&year=2009&month=07&day=01&basename=a-union-contract-at-smithfield-packing-it-only-took-17-years&mode=print

Start with 65%…but lose half of elections…

Year # of Elections % Won Union New Membs

1950 5619 74.5 -

1960 5428 62.8 -

1970 7543 55.1 -

1980 7021 49 -

1990 3423 47.6 77,689

1995 2716 48.2 66,753

Once Again…Choices…

It’s 1995, and you are a union leader committed to addressing issues of inequality in society. You believe that all workers should make a decent living, and have decent hours and working conditions. The manufacturing industries that were once the backbone of the labor movement are disappearing, and service sectors jobs ranging from janitors, waiters and sales clerks to lawyers, computer technicians and software designers are expanding. Some of these jobs are good, a lot of these jobs are awful. Efforts to organize these new sectors have been stymied by aggressive anti-union campaigns by management. You now lose about ½ of the elections that you initiate. The labor movement is in steep decline.

As a union leader, what do you do to reverse the decline of unions so you can protect working families?


Collective Bargaining cannot take place until a bargaining representative has been certified

To gain certification, unions pursue one of two paths

Path 1: Normally, a union must win an election to be certified as the exclusive representative of the employees

Path 2: An employer may voluntarily recognize a union if the union can demonstrate that it represents a majority of the employees

Path 2: Voluntary Recognition

Many of the most successful unions are no longer pursuing NLRB elections…they’re demanding voluntary recognition or card check…

Voluntary recognition- employer recognizes the union without an election

Why in the world would an employer do that?

There are few reasons…

Voluntary Recognition…

Cost to company finances, reputation, brand outweigh recognizing the costs of recognizing the union…

Corporate campaigns force voluntary recogniztion- efforts to bring public, financial, or political

pressure to bear on a company

Crash weddings, picket in front of homes, boycott related companies, try to use politics to create problems for firm, hold hearings with local clergy and politicians…

The Justice for Janitors Campaign

SEIU does not use NLRB elections to gain union representation

Put pressure on building owners that use non-union subcontractors for janitorial services

Form alliances with community groups such as churches to gain public support for organizing

Create social, political and economic pressure that: Forces cleaning companies to accept the union Forces owners to accept union contractors, and that

Bread and Roses

Video…whole thing…today and part of Thursday…

Worksheet will be graded…1 point for each question

Documents

Outline Decline of Organized Labor Growing Inequality Explaining the Decline Structure, Management and Unions Walmart Video Clip Exam??? Fair,