Right to Form Unions in the Private Sector | DCR Workforce Blog

Right to Form Unions in the Private Sector

F. D. Roosevelt had said “It is one of the characteristics of a free and democratic nation that is have free and independent labor unions.” The National Labor Relations Act (NLRA) protects the right of workers to organize unions and to engage in similar concerted activity for mutual aid or protection. In a move intended to promote the formation of unions in the private sector, NLRA now requires all private employers in is control to put up notices by April 30, 2012 to inform employees of their rights to unionize.

The stringent deterrents aimed at any failure to post the notice have been removed and not putting up the notice will not be considered an Unfair Labor Practice, as declared earlier. The six month statute of limitations shall also not be tolled for any case at a site where the Notice was not posted by the employer. However, Employers had better take note that this may or may not preclude the Board from rejecting/accepting a limitations defense – when an employer ‘failed to post the notice’.

Union Activities:

Most unions focus on bargaining for better wages, benefits and working conditions for their members. They also represent the members in any disputes over contract violations with the management. Union workers in general are found to enjoy higher pay, in what is a much-researched phenomenon called union wage premium. They represent a formidable factor in politics by not owing any allegiance to a specific party and enjoy strong presence in various lobbies. This explains why some employers have been known to dissuade pro-union employees from forming unions using various deterrents like harassment, all the way to severance. This has led to private sector union membership declining steadily since mid-50s while public sector unions managed to grow slowly and steadily.

This enforcement of union formation using employers must have been considered necessary in view of the steadily dwindling numbers in private sector union membership. Time was when private sector union membership was as high as 34% but has been declining in the USA to 7.2% while public unions have been steadily growing from 9.8% to a respectable 36%.  The total labor union density of workers in the United States was at 11.4% in 2010, when Canada has 27.5% and Finland 70%.

Unions have been praised for making extensive concessions to their employers to ensure that they remained competitive in negative market conditions. They have also been blamed for being excessively greedy and forcing costly labor agreements on employers forcing them closer to bankruptcy.

Factors behind the Decline:

Most industrialized countries have seen a decline in unionization, but none so steep as what the United States has witnessed. The reasons attributed are complex and many. Let us look at some of them here to understand the situation a little better:

  • Public approval for unions declined with recessionary pressures and high/low unemployment rates and inflation.
  • Unions enjoyed a threat perception, the power to distribute unemployment insurance and used a centralized collective bargaining at the national or industry level.
  • The Taft-Hartley Act had halted the growth by its sanctions against mass picketing, secondary strikes of neutral employers and sit downs. It also ended ‘card checks’ and put a lot of process in place to have any union gain recognition making it possible for employers to threaten workers and dissuade them from unionizing by using repressive measures.
  • Changing labor markets due to globalization, increased competition, transition to a service economy, greater reliance on contingent workers have also created an impact on the growth of unionization.
  • The unyielding stand taken by unions on significant initiatives such as the North American Free Trade Agreement (NAFTA) and the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA) led to serious rifts within the unions and undermined them.

Way Ahead:

Employees will benefit by having access to education programs which help them to deal with important contemporary workplace and labor law issues of the day, spanning a wide variety of labor and employment issues from union pension investment funds to the effects of new innovations and developments on labor markets and the workplace.

Once a union gets formed officially, the management is obligated to the union rather than the individual employees, and required to accept its presentation of employee interests as representing all of them. The onus of ensuring that the unions work alongside of them to secure a win-win solution for both parties would lie with the employers and their management capabilities. It seems inadvisable to defy the NLRB and resort to measures like refusing to post the notice unless further developments in the matter make it safer to do so.

Would you say that the higher wages negotiated by unions would not affect the bottom lines of businesses as they will also ensure higher productivity?

The content on this blog is for informational purposes only and cannot be construed as specific legal advice or as a substitute for competent legal advice. They reflect the opinions of DCR Workforce and may not reflect the opinions of any individual attorney. Do contact an attorney for advice specific to your issue or problem.
Lalita is a people/project manager with extensive experience in operations, HCM and training and development across industries like banking, education, business consulting, BPO and information technology. She believes in a dynamic approach to life and learning as change is the only constant.