Understanding

Labor Relations
and CBA

Learning Objectives:
Define labor union and labor relations
Why employees join union
Types of union security
Key federal labor laws
Sources of laws,rules and regulations under the present labor relations
Unionizing employees US
Union organizing Philippines Setting
Effect of labor union in the company

.Definition of Collective Bargaining Agreement (CBA)

Advantages /Disadvantages of CBA - Employer
Advantages/Disadvantages of CBA Employee
Elements / Issues to deal with
Objectives of CBA
CBA process

LABOR UNION
an association, combination, or organization of employees who band together to

secure favorable wages, improved working conditions, and better work hours,
and to resolve grievances against employers.

organizations formed for the purpose of representing their members interests

and resolving conflicts with employers.

Structurally and functionally, is an institution which involves more than the

private or personal interests of its members. It represents organized,

institutional activity, as contrasted with wholly individual activity. This difference
is as well defined as that existing between individual members of the union. The
union's existence in fact, and for some purposes in law, is as perpetual as that of
any corporation, not being dependent upon the life of any member. It normally
operates under its own constitution, rules and bylaws, which, in controversies
between member and union, are often enforced by the committees.

UNION vs LABOR RELATIONS

Unions

organizations
formed for the purpose of
representing
their
members
interests
in
dealing with employers

Labor

relations

emphasizes
skills
that
managers and union leaders
can use to foster effective
labor-management
cooperation, minimize costly
forms of conflict (such as
strikes),and seek win-win
solutions to disagreement

Three (3) levels of decisions of Labor

Relations:
Labor relations strategy - the decision involves whether the organization will
work with unions or develop (or maintain) nonunion operations.This decision is
influenced by outside forces such as public opinion and competition. For unions,
the decision involves whether to fight changes in how unions relate to the
organization or accept new kinds of labor-management relationships.

Negotiating contracts contract negotiations in a union setting involve decisions

about pay structure, job security, work rules, workplace safety, and many other
issues. These decisions affect workers and the employers situation for the term
of the contract.

Administering contracts These decisions involve day-to-day activities in which

union members and the organizations managers may have disagreements. Issues
include complaints of work rules being violated or workers being treated unfairly
in particular situations. A formal grievance procedure is typically used to resolve
these issues

WHY EMPLOYEES JOIN LABOR

UNION?
1) Higher wages and benefits
- The power and strength of numbers sometimes help
unions obtain higher wages and benefit packages for their
members than employees can negotiate individually.
- Additionally, professional bargainers employed by the
union may negotiate more skillfully than any individual
could on his or her own behalf.

WHY EMPLOYEES JOIN LABOR

UNION?
2) Great Job Opportunity
- Unions provide their members with a sense of
independence from managements power to arbitrarily hire,
promote, or fire. The collective-bargaining contract will
stipulate rules that apply to all members, thus providing
fairer and more uniform treatment

WHY EMPLOYEES JOIN LABOR

UNION?
3) Influence over work rules
Where a union exists, workers can help determine the
conditions under which they work and have an effective channel
through which they can protest conditions they believe are
unfair. Therefore, a union not only represents the worker but also
provides rules that define channels in which worker complaints
and concerns can be registered. Grievance procedures and rights
to third-party arbitration of disputes are examples of practices
typically defined and regulated as a result of union efforts.

WHY EMPLOYEES JOIN LABOR

UNION?
4) Compulsory Membership
- union security arrangements - Labor contract provisions
designed to attract and retain dues-paying union members.
a) union shop This arrangement stipulates that employers,
while free to hire whomever they choose, may retain only union
members. That is, all employees hired into positions covered under
the terms of a collective-bargaining agreement must, after a
specified probationary period of typically thirty to sixty days, join
the union or forfeit their jobs.

 b) closed shop - Union security arrangement under which a person must be

a union member before being hired; illegal for those covered by the National
Labor Relations Act.

c) agency shop - A union security arrangement whereby employees must pay

union dues to the certified bargaining unit even if they choose not to join the
union.

d) open shop - Employees are free to join the union or not, and those who
decline need not pay union dues.

e) maintenance of membership - Because unions must administer their

operations in an open shop once someone joins the union, they must maintain
their union affiliation and pay their dues for the duration of the contract. At
the end of the contract, an escape period exists in which those desiring to
leave the union may do so.

WHY EMPLOYEES JOIN LABOR

UNION?
5) Dissatisfaction with the Management
- Among various reasons why employees join a union, we see one
common factor: management, especially the first-line supervisor.
If employees are upset with the way their supervisor handles
problems, upset over how a co-worker has been disciplined, and
so on, they are likely to seek help from a union. In fact, it is
reasonable to believe that when employees vote to unionize, its
often a vote against their immediate supervisor rather than a
vote in support of a particular union.

Key Federal
Labor
Laws
Railway Labor Act
- 1926

Norris-LaGuardia
Act - 1932

Wagner Act - 1935

Landrum-Griffin
Act - 1959

Managing Human Resources, 12e, by Bohlander/Snell/Sherman 2001 South-Western/Thomson Learning

Taft-Hartley Act 1947

1

Major Labor Laws and Their Purposes

LAW
Railway Labor Act (1926)
Norris LaGuardia Act (1932)
(Anti-Injunction Act)
Wagner Act (1935)
(National Labor Relations Act)
Taft-Hartley Act (1947)
(Labor Management Relations Act)
Landrum-Griffin Act (1959)
(Labor Management Reporting and
Disclosure Act)
Civil Service Reform Act of 1978

PURPOSE
Protect railway and airline employees
and union members from actions of their
employers
Restricts use of injunction in labor
disputes
Protests employees and union members
from actions of their employers
Protects employers from actions of
unions
Protects union members from actions of
their leaders
Protects bargaining rights of federal
employees

UNION ORGANIZING
1.Authorization cards

two ways:

a) consent selection - the employer and the union seeking

representation arrive at an agreement stating the time and
place of the election, the choices included on the ballot, and a
way to determine who is eligible to vote

b) stipulation selection - the parties cannot agree on all of

these terms, so the NLRB dictates the time and place, ballot
choices, and method of determining eligibility.

 2) On the ballot, workers vote for or against union representation, and

they may also have a choice from among more than one union. If the
union (or one of the unions on the ballot) wins a majority of votes, the
NLRB certifies the union. If the ballotincludes more than one union
and neither gains a simple majority, the NLRB holds a runoff election

3) After certification, there are limits on future elections. Once the

NLRB has certified a union as the exclusive representative of a group

of employees, it will not permit additional elections for one year. Also,
after the union and employer have finished negotiating a contract, an
election cannot be held for the time of the contract period or for three
years, whichever comes first.

UNION STRATEGIES
Beyond encouraging workers to sign authorization cards and vote
for the union, organizers use some creative alternatives to
traditional organizing activities

1.Associate membership - Alternative form of union membership

in which members receive discounts on insurance and credit cards
rather than representation in collective bargaining.

2.Corporate campaigns - Bringing public, financial, or political

pressure on employers during union organization and contract
negotiation.

LABOR UNION IN THE

PHILIPPINES
Labor Code of the Philippines took effect November 1,
1974

Implementing rules and regulations took effect February

3, 1975
- most of the existing unions today are still creations of tihe
Industrial Peace Act - otherwise known as the Magna Carta
of Labor. These unions are undergoing the current
transition period which is expected to culminate in the
restructured trade union movement in the country as
envisioned by the Labor Code

SOURCES OF LAWS,RULES AND

REGULATIONS GOVERNING LABOR UNION
UNDER PRESENT LABOR RELATIONS:
1.The (New) Constitution of the Philippines
2. Labor Code of the Philippines
3. Rules and Regulations Implementing the Labor Code of
the Philippines

4. Jurisprudence

RIGHTS OF LEGITIMATE LABOR ORGANIZATIONS

Art. 242. Rights of legitimate labor organizations. A legitimate labor
organization shall have the right:
To act as the representative of its members for the purpose of collective
bargaining;

To be certified as the exclusive representative of all the employees in an

appropriate bargaining unit for purposes of collective bargaining;

To be furnished by the employer, upon written request, with its annual audited
financial statements, including the balance sheet and the profit and loss statement,
within thirty (30) calendar days from the date of receipt of the request, after the
union has been duly recognized by the employer or certified as the sole and
exclusive bargaining representative of the employees in the bargaining unit, or
within sixty (60) calendar days before the expiration of the existing collective
bargaining agreement, or during the collective bargaining negotiation;

RIGHTS OF LEGITIMATE (cont.)

To own property, real or personal, for the use and benefit
of the labor organization and its members;

To sue and be sued in its registered name; and

To undertake all other activities designed to benefit the
organization and its members, including cooperative,
housing, welfare and other projects not contrary to law.

UNION ORGANIZING - PHILIPPINES

1.Requirements of registration - Any applicant labor organization, association or group of
unions or workers shall acquire legal personality and shall be entitled to the rights and privileges
granted by law to legitimate labor organizations upon issuance of the certificate of registration
based on the following requirements.

Fifty pesos (P50.00) registration fee;

The names of its officers, their addresses, the principal address of the labor organization, the
minutes of the organizational meetings and the list of the workers who participated in such
meetings;

The names of all its members comprising at least twenty percent (20%) of all the employees in the
bargaining unit where it seeks to operate; (As amended by Executive Order No. 111, December 24,
1986)

If the applicant union has been in existence for one or more years, copies of its annual financial
reports; and

Four (4) copies of the constitution and by-laws of the applicant union, minutes of its adoption or
ratification, and the list of the members who participated in it. (As amended by Batas Pambansa
Bilang 130, August 21, 1981)

UNION ORGANIZING PHILIPPINES (cont..)

2. Action on application - Bureau shall act on all

applications for registration within thirty (30) days from
filing.

3. Denial of registration - The decision of the Labor

Relations Division in the regional office denying
registration may be appealed by the applicant union to the
Bureau within ten (10) days from receipt of notice thereof.

UNION ORGANIZING PHILIPPINES (cont..)

4.Additional requirements for federations or national unions.
Subject to Article 238, if the applicant for registration is a federation
or a national union, it shall, in addition to the requirements of the
preceding Articles, submit the following:

Proof of the affiliation of at least ten (10) locals or chapters, each of

which must be a duly recognized collective bargaining agent in the
establishment or industry in which it operates, supporting the
registration of such applicant federation or national union; and

The names and addresses of the companies where the locals or

chapters operate and the list of all the members in each company
involved.

GROUNDS FOR
CANCELLATION OF UNION
REGISTRATION

Misrepresentation, false statement or fraud in connection with the adoption or ratification

of the constitution and by-laws or amendments thereto, the minutes of ratification and the
list of members who took part in the ratification;

Failure to submit the documents mentioned in the preceding paragraph within thirty (30)
days from adoption or ratification of the constitution and by-laws or amendments thereto;

Misrepresentation, false statements or fraud in connection with the election of officers,

minutes of the election of officers, the list of voters, or failure to submit these documents
together with the list of the newly elected/appointed officers and their postal addresses
within thirty (30) days from election;

Failure to submit the annual financial report to the Bureau within thirty (30) days after the
closing of every fiscal year and misrepresentation, false entries or fraud in the preparation
of the financial report itself;

GROUNDS(cont..)
Acting as a labor contractor or engaging in the "cabo" system, or otherwise engaging
in any activity prohibited by law;

Entering into collective bargaining agreements which provide terms and conditions of
employment below minimum standards established by law;

Asking for or accepting attorneys fees or negotiation fees from employers;

Other than for mandatory activities under this Code, checking off special assessments
or any other fees without duly signed individual written authorizations of the
members;

Failure to submit list of individual members to the Bureau once a year or whenever
required by the Bureau; and

Failure to comply with requirements under Articles 237 and 238.

Impact of Union on Company

Performance
Positive
They can reduce turnover by giving employees a route for resolving
problems.

Unions emphasize pay systems based on seniority, which remove

incentives for employees to compete rather than cooperate.

The introduction of a union also may force an employer to improve its

management practices and pay greater attention to employee ideas.

Negative
Decrease productivity because of work rules and limits on
workloads set by union contracts and production lost to
such union actions as strikes and work slowdowns.

Companys profits may still suffer if unions raise wage and

benefits costs by more than the productivity gain.Thus
giving a negative impact on the companys profit.

COLLECTIVE BARGAINING
AGREEMENT
refers to the negotiation, administration, and interpretation
of a written agreement between two parties that covers a
specific period of time. This agreement, or contract, lays out
in specific terms the conditions of employmentthat is,
what is expected of employees and any limits to
managements authority.

ADVANTAGES EMPLOYER
Both sides know exactly what to expect from the other;
They could both resort to some degree of protection
Gives employer the benefit of dealing with a few
representatives

Consistency in the delivery of work by labor forces

Ethical on the part of employer.

DISADVANTAGES TO
EMPLOYER

Only a few decides for the majority

Unity in the company suffers
Costly
Restricts the power of employers
Non-agreement could result to strikes

PROS FOR EMPLOYEES

Legally based relationship between employer and employee.
Bargain for wages and work practices
Employees take part in decision-making
Management authority can be questioned, when employees
feel injustice
Favoritism and victimization is reduced.

CONS FOR EMPLOYEES

Decisions by the union do not necessarily represent individual employees
Employees may lose beneficial and constructive development program of
employers

Disproportionate effects between active and inactive member employees

Bad work culture and inefficiency developed in employees
Protects status quo, inhibits innovation
Huge amounts spent by management in negotiations and agreements

ESSENTIAL ELEMENTS
1)Legal
2)Economic
3)Political
4)Moral

ISSUES TO DEAL WITH

ECONOMIC
Check off (payment of union fees)
Working & hours
Salary increases/ allowances / bonuses, profit sharing
Leaves
Overtime/holiday/shift premiums
Employee welfare hospitalization benefits, dental benefits

NON-ECONOMIC ISSUES

Union recognition/coverage
Definition of employees category
Union security
Rights &responsibilities of parties
Security of tenure
Seniority

Grievance machinery
Arbitration
Job evaluation wage/salary administration
Employees services (education, job enrichment
No strike / no lockout

Objective of CBA
to agree on a contract acceptable to management, union
representatives, and the union members.

Collective Bargaining Agreement

Participants
1. Labor
2.Management

CBA PROCESS
Preparation

Research & Data gathering

Discussion/Arguing/Goal Setting
Strategy Development/Signaling and notice
Packaging

CBA PROCESS
Negotiation / Bargaining

-Soft Negotiation
-Hard negotiation
-Interest-Based negotiation
-Closing
-Agreeing

CBA PROCESS
3) Contract Implementation & Administration - once a contract is agreed on and ratified, it must be administered

a)Providing agreement information to all concerned requires both parties to ensure that changes in contract language are
clearly explained.

b)Implementing the contract ensures that all communicated changes take effect and that both sides comply with the
contract terms.

c)Interpreting the contract and grievance process is probably the most important element of contract administration.
Almost all collective-bargaining agreements contain formal procedures for resolving grievances of contract interpretation
and application. These contracts have provisions for resolving specific, formally initiated grievances by employees
concerning dissatisfaction with job-related issues. It is necessary for the con- tract to spell out the procedures for
handling contractual disputes.

d)Monitoring activities covered by the contract - the company and union can assess the effectiveness of the current

contract, recognize when problem areas or conflicts arose, and indicate what changes might need to be made in
subsequent negotiations