Theories 1

ECONOMIC VIEW OF COLLECTIVE BARGAINING

• Unions a Disruption to Competitive Markets

• Cause a Misallocation of Resources

Theories

Wn

Wu

Eu En

UNIONIZEDSECTOR

NONUNIONSECTOR

Sn

Su

Wn

Wu

Wu Wn

Theories 3

Management Perspective• Flows from Economic Perspective

• Firm (management) has knowledge and legal authority/responsibility to allocate resources (capital and labor) efficiently in best interests of stakeholders and customers of firm

Theories 4

INDUSTRIAL RELATIONS SYSTEMS

• OUTCOMES ARE RULES– PROCEDURAL RULES– SUBSTANTIVE RULES

• HOW ARE RULES ESTABLISHED?– MANAGEMENT– GOVERNMENT– WORKERS HIERARCHY– MANAGEMENT-WORKERS– MANAGEMENT-WORKERS-GOVT

Theories 5

INDUSTRIAL RELATIONS SYSTEMS (CONT.)

• ACTORS– MGMT, GOVT, WORKERS/ORGS

• CONTEXTS– TECHNOLOGICAL

• TYPE OF PRODUCT OR SERVICE

– AIR TRAVEL• GEOG DISPERSION• VARIABLE HOURS, ETC.

– MANUFACTURING (PAPER)• GEOG CONCENTRATION,• LONGER SHIFTS (ETC.)

Theories 6

INDUSTRIAL RELATIONS SYSTEMS (CONT.)

• CONTEXTS (CONT.)– MARKET/BUDGETARY

• SHELTERED

• COMPETITIVE

• LOCUS OF POWER IN SOCIETY– OUTSIDE IR SYSTEM

• POLITICAL INFLUENCE OF UNIONS– CANADA - PARLIAMENTARY SYSTEM & NDP– U.S. - LINK TO DEMOCRATIC PARTY

• EMPLOYER LINK TO REPUBLICAN PARTY

Theories 7

INDUSTRIAL RELATIONS SYSTEMS (CONT.)

• WHAT ARE THE RULES– SUBSTANTIVE

• COMPENSATION IN ALL FORMS

• DUTIES AND PERFORMANCE OF WORKERS

• RIGHTS OF WORKERS

– PROCEDURAL• FOR RESOLVING DISPUTES

• CHANGING THE RULES

Theories 8

INDUSTRIAL RELATIONS SYSTEMS (CONT.)

• IDEOLOGY– A SET OF COMMON BELIEFS THAT HOLDS

SYSTEM TOGETHER– ACTORS’ IDEOLOGIES MUST BE

COMPATIBLE– EXAMPLES

• EUROPE – CLASS LINES

– COLLECTIVE WORKER ACTIVITY A NATURAL COROLLARY TO CLASS

Theories 9

INDUSTRIAL RELATIONS SYSTEMS (CONT.)

– EXAMPLES (CONT.)• UNITED STATES

– INDIVIDUALISTIC

– LESS COMFORTABLE WITH COLLECTIVISM AND UNIONISM, ESPECIALLY IF IMPOSED ON UNWILLING INDIVIDUALS (FREEDOM OF ASSOC.)

– A NECESSARY EVIL

– COMPOSITIONAL ISSUES

• WHAT IS GOOD FOR EVERYONE IS NOT NECESSARILY GOOD FOR EVERY ONE

– SCOPE OF INCLUSION

• EXTENSION TO ALL EMPLOYERS IN EUROPE

• UNIT BY UNIT CHOICE IN U.S.

Theories 10

Bilateral Perspective

• Cooperation and Conflict– Mixed Motive approach

• Inequality – Status– Bargaining Power

• Balance Required

Theories 11

GOVERNANCE VIEW• Focuses on how decisions are made

– no CB - unilaterally– CB - jointly

• Permits workers to participate in decisions affecting them

• Transference of notions of democracy to the workplace– property rights only provide authority over property– does not necessarily provide authority over people

Theories 12

ACTIONS ASSOCIATED WITH EMPLOYEE

DISSATISFACTION• Economic View - Exit

• Governance View - Voice

Theories 13

INDUSTRIAL DEMOCRACY VIEW

• Workplace is analogous to society

• Cannot have democracy in society without democracy in the workplace

Theories 14

Law and Values View• Values in United States

– Individualism• rights of individuals superior to other rights

• property rights a derivative of individual rights

• individuals free to order economic transactions so long as no laws are broken - freedom of contract

– Corporations are Legal Individuals

– Purchase and sale of labor an exchange transaction

– Unions attempt to collective an individual transaction

Theories 15

Law and Values View (CONT.)• Values in U.S. and Law

– Unequal status of employers and unions• conflicts between ind\property rights and collective

rights usually resolved in favor of ind rights• “reserved rights” theory of management

• Impact on IR System– Unions– Employers\Corporations– Product Market