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1. What are the underlying principles that give rise to labor union?
Labor unions commonly arise from manufacturing firms. Since factories offer
lower basic pay on workers than those in offices, management often neglects the
status of their rank and file. So to have leverage in all labor aspects and to push
for the workers rights, three important principles were conceived by the union:
Bargaining Power
It is the power to negotiate. Bargaining Power is the ability for firms or workers to
get what they want.
An example of bargaining power is related to the power of trade unions. If a
single worker works for a monopsonistic employer, its bargaining power is very
weak and he is likely to get paid a low salary.
However, if workers join a trade union and achieve 100% density (i.e. everyone
in the firm joins) then they have the capacity to influence the wage making
process.
Bargaining power of Trade Unions will increase when
100% Density
Low Rates of Unemployment
Profitable Firm
Political support for Union
Union funds for a long term strike
If they are producing a key good
Political Power
The labor movement is one of the important ways that individuals can feel
connected to each other in ways that makes political activity seem relevant.
A strong union movement does more than give people the kind of life
experiences than affects their identities and builds a sense of connectedness and
solidarity. It also solves crucial organizational problems. Unions provide
information to their members helping to mitigate the problem of rational
ignorance around political issues, and they lower significantly the individual costs
of active participation. Unions typically become, as organizations, directly
involved in political parties. In electoral campaigns this helps parties solve a
crucial problem mobilizing people for electoral campaigning, both as voters and
as volunteer campaign workers. A strong union movement can help provide the
volunteer legwork for practical electoral activities and in this way counteract the
influence of money in campaigns. This is an important reason why, where unions
are strong, voter participation rates are higher and public policies tend to serve
the wider interests of ordinary citizens rather than just elites.
Case Analysis:
Give your own analysis of the following:
The president/owner of a company was so disgusted over the unreasonable
demands of the union. He was also incensed by the arrogant behavior of the union
officers. A day before the start of the CBA negotiations, without consulting his Board
of Directors, he decided to lockout all employees, close shop, stop the entire
business operations of the company. Is the lockout legal or illegal?
declared to have lost his employment status: Provided, That mere participation of a
worker in a lawful strike shall not constitute sufficient ground for termination of his
employment, even if a replacement had been hired by the employer during such
lawful strike.
Analysis:
At first glance, the company could have violated the unions right to Collective
Bargaining. Unless there were previous talks related to the CBA prior to the
bargaining which are integral part of the agreement and unless a notice of lockout
was sent to the Department of Labor by which the union was also served a copy, the
lockout was legal.
Most CBAs today do pre-Bargaining Talks to feel out each sides bargaining
leverage. It can be used by either side to posture or commit any disputable acts by
which only the court can decide.
Lockout is the anti-thesis of strike. It is the ultimate weapon the management uses
against a very strong union. Legal or illegal, it greatly affects the living conditions of
the locked employees. All labor cases go the full distance in court, taking years to
resolve unless it is classified as national interest. A simple lockout when challenged
in court can put the union in hunger. It is an effective strategy being used by
companies to weaken a strong union.
In my opinion, the company has violated the Labor Code and has committed an
unfair labor act based on the short case presented.
But there are other things to consider, other incidents that can put this matter to light
before it is proven illegal.
Let the courts decide.