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*Chapter Twelve
Dealing with Employee-
Management Issues and
Relationships
Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin
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*ROGER GOODELL
National Football League (NFL)
• Started with the NFL as a public relations intern in 1982.
• Named COO in 2001 and became League Commissioner in 2006.
• Revised the league’s conduct policy and is negotiating a new collective bargaining agreement between players and teams.
Profile
12-2
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*GOALS of ORGANIZED LABOR
• To work with fair and competent management.
• Be treated with human dignity.
• Receive a reasonable share of wealth in the work it generates.
Employee -Management Issues
LG1
12-3
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*ORGANIZED LABOR
• Unions -- Employee organizations whose main goal is to represent members in employee-management negotiations of job-related issues.
• Labor unions were responsible for:- Minimum wage laws
- Overtime rules
- Workers’ compensation
- Severance pay
- Child-labor laws
- Job-safety regulations
LG1
Employee - Management Issues
12-4
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*HISTORY of
ORGANIZED LABOR
• Craft Union -- An organization of skilled specialists in a particular craft or trade.
• As early as 1792, shoemakers in a Philadelphia craft union met to discuss fundamental work issues.
LG1
The Early History of Organized Labor
• Work weeks were 60+ hours, wages were low and child labor was rampant.
12-5
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*EMERGENCE of LABOR
ORGANIZATIONS
• Knights of Labor -- First national labor union; formed in 1869.
LG1
The Early History of Organized Labor
• Knights attracted 700,000 members but fell from prominence after a riot in Chicago.
• American Federation of Labor (AFL) -- An organization of craft unions that championed fundamental labor issues; formed in 1886.
12-6
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*INDUSTRIAL UNIONS
• Industrial Unions -- Labor unions of unskilled or semiskilled workers in mass production industries.
• Congress of Industrial Organizations (CIO) -- Union organization of unskilled workers; broke away from the AFL in 1935 and rejoined in 1955.
• The AFL-CIO today has affiliations with 56 unions and about 10.5 million members.
LG1
The Early History of Organized Labor
12-7
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*EFFECTS of LAWS on
LABOR UNIONS
• Labor unions’ growth and influence has been very dependent on public opinion and law.
• The Norris-LaGuardia Act helped unions by prohibiting the use of Yellow-Dog Contracts -- A type of contract that required employees to agree to NOT join a union.
• Collective Bargaining -- The process whereby union and management representatives form an agreement, or contract, for employees.
LG2
Labor Legislation and Collective Bargaining
12-8
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*FORMING a UNION in the
WORKPLACE
• The National Labor Relations Board (NLRB) was created to oversee labor-management issues and provide guidelines for unionization.
• Certification -- The formal process by which a union is recognized by the NLRB as the bargaining agent for a group of employees.
• Decertification -- The process whereby employees take away a union’s right to represent them.
LG2
Labor Legislation and Collective Bargaining
12-9
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*WHY JOIN a UNION?
• Pro-union attitudes
• Poor management/employee relations
• Negative organizational climate
• Poor work conditions
• Union’s reputation
• Job security
Labor Legislation and Collective Bargaining
LG2
12-10
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*LABOR/MANAGEMENT
AGREEMENTS
• Negotiated Labor-Management Agreement (Labor Contract) -- Sets the terms under which labor and management will function over a period of time.
• Union Security Clause -- Stipulates workers who reap union benefits must either join the union or pay dues to the union.
LG3
Objectives of Organized Labor
12-11
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*UNION SECURITY AGREEMENTS
• Closed Shop Agreement -- Specified workers had to be members of a union before being hired for a job.
• Union Shop Agreement -- Declares workers don’t have to be members of a union to be hired but must agree to join the union within a specific time period.
• Agency Shop Agreement -- Allows employers to hire nonunion workers who don’t have to join the union but must pay fees.
LG3
Objectives of Organized Labor
12-12
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*RIGHT-to-WORK LAWS
• Right-to-Work Laws -- Legislation that gives workers the right, under an open shop, to join or not to join a union.
• The Taft-Hartley Act of 1947 granted states the power to outlaw union shop agreements.
• Open Shop Agreement -- Agreement in right-to-work states that gives workers the right to join or not join a union, if one exists in their workplace.
LG3
Objectives of Organized Labor
12-13
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*STATES with
RIGHT-to-WORK LAWSLG3
Objectives of Organized Labor
12-14
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*WORKERS of the WORLD, UNITE
(Reaching Beyond Our Borders)
• As markets become borderless, labor unions are embracing the idea of global unions.
• The global workforce has doubled in size but the numbers of workers in unions has declined.
• Union leaders from 64 countries have formed the Council of Global Unions.
• Many companies are strongly opposed to global unions and have promised to fight them.
12-15
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*RESOLVING DISAGREEMENTS
• Labor contracts outline labor and management’s rights and serves as a guide to workplace relations.
• Grievances -- A charge by employees that management isn’t abiding by the terms of the negotiated agreement.
• Shop Stewards -- Union officials who work permanently in an organization and represent employee interests on a daily basis.
LG3
Resolving Labor-Management Disagreements
12-16
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*USING MEDIATION and
ARBITRATION
• Bargaining Zone -- The range of options labor and management have between initial and final contract offers that each side will consider before an impasse is reached.
• Mediation -- The use of a third party to encourage both sides to keep negotiating to resolve key contract issues.
• Arbitration -- An agreement to bring in a third party to render a binding agreement.
LG3
Mediation and Arbitration
12-17
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*The GRIEVANCE RESOLUTION
PROCESS LG3
Mediation and Arbitration
12-18
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*TACTICS USED in CONFLICTS
• Weapons used by labor unions include:
- Strikes
- Boycotts
- Work Slowdowns
- Pickets
LG4
Tactics Used in Labor-Management Conflicts
12-19
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*STRIKES and BOYCOTTS
• Strikes -- A strategy in which workers refuse to go to work.
• Primary Boycott -- When a union encourages both its members and the general public to not buy the products of a firm in a labor dispute.
• Secondary Boycott -- An attempt by labor to convince others to stop doing business with a firm that’s the subject of a primary boycott.
LG4
Union Tactics
12-20
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*TACTICS USED in CONFLICTS
• Weapons used by management include:
- Lockouts
- Injunctions
- Strikebreakers
LG4
Tactics Used in Labor-Management Conflicts
12-21
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*LOCKOUTS, INJUNCTIONS and
STRIKEBREAKERS
• Lockout -- An attempt by management to put pressure on workers by closing the business thus cutting off workers’ pay.
• Injunction -- A court order directing someone to do something or refrain from doing something.
• Strikebreakers -- Workers hired to do the work of striking workers until the labor dispute is resolved; called scabs by unions.
LG4
Management Tactics
12-22
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*WHEN DO YOU CROSS the LINE?
(Making Ethical Decisions)
• Shop-Til-You-Drop is seeking workers to fill the jobs of striking workers.
• Many students at your college are employees and others are supporting the strike.
• You need money and legally it’s permissible to replace striking workers.
• What will you do? What are the consequences?
12-23
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*CHALLENGES FACING LABOR
UNIONS
• The number of union workers are falling.
• Many workers (like airline employees) have agreed to Givebacks -- Gains from labor negotiations are given back to management to help save jobs.
LG4
Future of Unions and Labor-Management Relations
12-24
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*LABOR UNIONS in the FUTURE
• Union membership will include more white-collar, female and foreign-born workers than in the past.
LG4
Future of Unions and Labor-Management Relations
• Unions will take on a greater role in training workers, redesigning jobs and assimilating the changing workforce.
• Unions will seek more job security, profit sharing and increased wages.
12-25
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*UNION MEMBERSHIP by STATE
LG4
Future of Unions and Labor-Management Relations
12-26
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*NURSING THE UNIONS
BACK to HEALTH(Spotlight on Small Business)
• Aging Baby Boomers promise to increase the number of needed healthcare workers.
• More than 500,000 nurses currently belong to unions but over 1 million nurses could be part of unions by 2016.
• Issues important to nurses include safe staffing, a voice in hospital policy and increased pay.
12-27
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*PROGRESS ASSESSMENT
• What are the major laws that affected union growth, and what does each one cover?
• How do changes in the economy affect the objectives of unions?
• What are the major tactics used by unions and by management to assert their power in contract negotiations?
• What types of workers do unions hope to organize in the future?
Progress Assessment
12-28
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*COMPENSATING EXECUTIVES Executive
Compensation
LG5
• CEO compensation used to be determined by a firm’s profitability or increase in stock price.
• Now, executives receive stock options and restricted stock that’s awarded even if the company performs poorly.
12-29
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*PLAY BALL!
Minimum Salaries in Four Professional SportsLG5
Executive Compensation
Source: World Features Syndicate.
League Amount per Week
National Hockey League (NHL)
$8,654
National Basketball Association (NBA)
$8,215
Major League Baseball (MLB)
$7,500
National Football League (NFL)
$5,401
12-30
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*TAKE ME OUT to the BALL GAME
Biggest Contracts in Major League Baseball (2008)LG5
Executive Compensation
Source: World Features Syndicate.
Player Amount per Day
Alex Rodriguez $69,041
Manny Ramirez $54,795
Derek Jeter $51,781
Todd Helton $43,075
12-31
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*PAYING for INCOMPETENCE
(Legal Briefcase)
• Some companies defy common sense by rewarding failure.
• CEOs like Robert Nardelli and Stanley O’Neal walked away with mega millions after lackluster performances.
• “Corporate Benevolence” even extends beyond the grave due to controversial provisions called “golden coffins.”
12-32
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*COMPENSATING EXECUTIVES
in the FUTURE
Executive Compensation
LG5
• Boards of directors are being challenged concerning executive contracts.
• Government and shareholders are putting pressure to overhaul executive compensation.
• Financial crisis of 2008-2009 strengthened the argument of shareholders concerning limits on compensation.
12-33
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*The QUESTION of PAY EQUITY Pay Equity
LG5
• Women earn 78.7% of what men earn.
• This disparity varies by profession, experience and level of education.
• The 2009 Paycheck Fairness Act strengthened protections against compensation discrimination.
12-34
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*EQUAL PAY for EQUAL WORK
Equal Pay Act Factors that Justify Pay Differences
• Skill
• Effort
• Responsibility
• Working Conditions
Pay Equity
LG5
12-35
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*THE SALARY GENDER GAP
LG5
Source: U.S. Census Bureau.
Age Average Salary
15 to 24Women - $23,357
Men - $26,100
25 to 44Women - $41,558
Men - $55,286
45 to 64Women - $44,808
Men - $67,040
Pay Equity
12-36
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*WHAT’S SEXUAL HARASSMENT
Sexual Harassment
LG5
• Sexual Harassment -- Unwelcomed sexual advances, requests for sexual favors or other verbal or physical conduct that creates a hostile work environment.
• Sexual harassment laws cover men, women and foreign companies doing business in the U.S.
• Violations can be extremely expensive for businesses.
12-37
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*KINDS of SEXUAL HARASSMENT
Sexual Harassment
LG5
• Quid pro quo sexual harassment involves threats like “Go out with me or you’re fired.” An employee’s job is based on submission.
• Hostile work environment sexual harassment is conduct that interferes with a worker’s performance or creates an intimidating or offensive work environment.
12-38
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*YOU MAKE the CALL…
1. Two colleagues walk by you as one delivers the punch line to a very dirty joke. You feel the joke is inappropriate. Is this sexual harassment under the law?
2. An employee thinks she may have been sexually harassed. She explains the circumstances to you and asks, “Wouldn’t you be upset?” What’s your response?
Sexual Harassment
LG5
12-39
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*FACING CHILDCARE ISSUES Child Care
LG5
• The number of women in the workforce with children under three-years-old has increased.
• Childcare related absences cost businesses billions of dollars each year.
• Who should pay for the cost of childcare - a dividing issue among employees and businesses.
12-40
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*BUSINESSES RESPONSE to
CHILD CARE
Child Care
LG5
• Firms have established discount arrangements with national childcare providers.
• Employees are given vouchers that offer payment toward childcare.
• Referral services identify high-quality childcare facilities to employees.
• On-site childcare centers and sick-child centers have been established at some companies.
12-41
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*INCREASING ELDER CARE
CHALLENGES
Elder Care
LG5
• Households with at least one adult providing elder care has tripled.
• About 20 million workers provide care which costs companies $11 billion a year in absenteeism, reduced productivity and turnover.
• Costs could rise up to $25 billion.
12-42
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*DRUG USE in the WORKPLACE
Drug Testing
LG5
• Alcohol is the most widely used drug - 6.2% of full time employees are considered heavy drinkers.
• Over 8% of workers aged 18-49 use illegal drugs and are more likely to be in workplace accidents.
• Drug abuse costs the U.S. economy $276 billion in lost work, healthcare costs and crime.
• Over 70% of major companies drug test workers.
12-43
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*VIOLENCE in the WORKPLACE
Violence in the Workplace
LG5
• OSHA reports homicides account for 16% of workplace deaths.
• Violence is the number one cause of death for women in the workplace.
• Companies have taken action to deal with potential problems by using focus groups and other interactions.
12-44
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*WARNING SIGNS of POSSIBLE
WORKPLACE VIOLENCE LG5
Violence in the Workplace
• Unprovoked outbursts of anger or rage
• Threats or verbal abuse
• Repeated suicidal comments
• Paranoid behavior
• Increased frequency of domestic problems
12-45
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*PROGRESS ASSESSMENT Progress
Assessment
• How does top-executive pay in the U.S. compare with top-executive pay in other countries?
• What’s the difference between pay equity and equal pay for equal work?
• How is the term sexual harassment defined and when does sexual behavior become illegal?
• What are some of the issues related to childcare and elder care and how are companies addressing those issues?
12-46
