What is the possible downside of having a union in the organization?

Since the 18th century, labor unions have been involved with employers to help protect worker rights. This was especially important during the development of the industrial revolutions in Europe and the United States. Although governmental reforms have helped to reduce the power and presence of labor unions, public sector unions have a consistent pattern of growth and private sector unions help to train people to become skilled workers in a specific career.

The advantages and disadvantages of labor unions show us that there are positive and negative outcomes which are generated when any group can wield power. Here are some of the key points to consider.

What Are the Advantages of Labor Unions?

1. Labor unions promote higher wages.
In a majority of US jobs and careers, union representation helps workers bring in significantly higher wages. From data provided by the US Bureau of Labor Statistics in 2010, unionized workers brought in an extra $800 per month over non-unionized workers. The average union member earned $917 per week before taxes, while the average non-union worker earned $717 per week before taxes.

2. Labor unions help workers get better benefits.
When workers are employed and unionized, they have a much better chance to receive essential benefits from their employer. Over 90% of unionized workers were entitled to medical benefits, while about 70% of non-union workers were entitled to the same benefit. Unionized workers usually pay less of a share of the benefits they receive, earn more vacation days, and have better access to sick days compared to non-union workers as well.

3. Labor unions help families receive better benefits.
Domestic partnerships are on the rise in the United States, often with children, but non-union workers can struggle to have this family structure protected with benefits like medical care. When family care is considered, union workers had 89% of their benefit costs covered by their employers, while non-union workers had just 66% of their benefit cost covered.

4. Labor unions provide better access to a funded retirement.
Over 90% of unionized workers have access to a retirement benefit that is provided by an employer. This may include access to a 401k or IRA contribution plan, a pension plan, or a combination of both. Their non-union counterparts have access to retirement benefits through an employer just 64% of the time.

5. Labor unions provider worker protections.
In most states in the US, non-union workers are typically employed in what is called an “at-will” environment. This means an employer can fire someone for virtually any reason. Only limited exceptions are in place, which often involve discrimination or whistleblowing. Any reason outside of the limited exceptions will qualify as a legal termination. At best, a fired employee would have access to unemployment benefits. Unionized workers can only be fired for what is called a “just cause.” There must be evidence of misconduct and any disciplinary action can usually go through arbitration or a grievance procedure.

6. Labor unions create an opportunity to negotiate frequently.
Most unions operate under a bargaining agreement that is renegotiated after a certain amount of time. Some operate on yearly contracts, but most workers tend to operate on agreements which are 2-5 years in length. This allows workers to negotiate for better wages and conditions, while providing an employer the opportunity to negotiate for concessions. When done correctly, a balance between worker and employer can be achieved where both parties can be happy.

What Are the Disadvantages of Labor Unions?

1. Labor unions can discount worker education and experience.
Many jobs that are offered in a unionized environment come through seniority instead of education and experience. This means someone who has been at a specific job or company the longest will automatically have the first option to receive a promotion or a job transfer. This also works in reverse. If there are layoffs that have been agreed upon, the least senior person is the first one to go, even if they are the most qualified.

2. Labor unions require ongoing dues and may require initiation fees.
Union dues are often deducted from a worker’s salary automatically and is a percentage of that worker’s salary. In most circumstances, the dues are 1.5-2.5% of what the union worker earns. There may also be initiation fees which must be paid to join the union in the first place. These fees can reduce a lot of the salary gains that workers experience by being in a unionized environment.

3. Labor unions may participate in activities that workers disagree upon.
Most states in the US allow unions to spend money on political lobbying and internal lobbying for specific causes. Not every worker may agree with the candidates that a union may endorse or a cause that the union may lobby for, but their dues are still being spent on those causes. A few states have allowed workers to opt out of that portion of their union dues if there is disagreement, but that is an exception more than a rule.

4. Labor unions discourage individuality.
There is strength in numbers, which is a tremendous advantage for worker safety and security. Working in groups also tends to generate “group think,” which limits individual creativity. Workers are often bound by the decisions a union will make, even though they disagree with them. All it may take is a majority vote for an action to be taken and then you’re stuck with that decision unless you decide to resign.

5. Labor unions offer job bumping arrangements.
If there is a layoff that is authorized, a position that may not be eliminated can still cause a low-seniority worker to be laid off because of a process that is known as “bumping.” Senior workers who have a job removed can transfer to a position not experiencing a layoff thanks to a provision in a CBA which is often negotiated. The senior worker takes the job and the other worker loses it. If that other worker has more seniority than another, then they can “bump” into another position as well. Eventually, the least senior person tends to be the one without employment.

6. Labor unions can have a poor public reputation.
In 2012, Governor Scott Walker of Wisconsin had a fundraising chairman send out emails that called union workers an “evil” part of society. Many union workers are blamed for a lack of revenue, especially when it is a public union, and this political animosity can be experienced in real life.

7. Labor unions are a hierarchal environment.
Many union workers feel like their supervisor treats them as if they were a boss instead of an equal partner in the business. Non-union workers experience this outcome 12 percentage points less often than their union counterparts. Non-union workers, by 9 percentage points, are also more likely to say that their supervisor creates an environment that is trusting and open.

What Happened To The American Labor Union? | TIME

Unions can do great things for workers’ rights, as they are usually formed with that sole purpose in mind. Still, businesses are often hesitant about unionization. They are concerned about the potential for increased costs due to regulations as well as increased wages and benefits for employees.

While it’s true that much of what labor parties generally fight for can require extra resources from employers, this is only half of the story. Companies with good union relationships can benefit significantly from reduced employee turnover, employee training, and even increased productivity while simultaneously providing their employees with a voice at the table.  

The history of organized labor is filled with significant accomplishments for workers’ rights across the world. Unions have the potential to benefit more than just employees, though. 

Labor parties want to see the companies they work with succeed. They know that the well-being of those they represent is closely linked with the success of their employers. When businesses and labor parties forge good relationships, it can benefit employers and employees alike.

Despite Their Benefits, Unions are in Decline

Despite the many benefits of unions, they have declined in popularity in the United States over the years. This is mainly due to the large number of manufacturing jobs that are being sent overseas or replaced by automation, deregulation, and resistance to unionization. There are currently only half as many Americans in organized labor jobs now as in the 1980s.

Despite their reduced presence, labor parties continue to fight for worker’s rights. They do so by supporting equality and protecting workers from discrimination, ensuring worker health and safety, and providing workers with a voice through collective bargaining. Organized labor has been shown to reduce the gender wage gap and provide legal protections for those victims of discrimination.

While unions usually do great work, they are limited to industries where workers have gone through the lengthy unionization process. This process has often been resisted by business owners who are worried about a loss in profitability. 

The complex unionization process combined with the typical resistance from employers limits the number of workers who can benefit from being part of a labor party. Therefore, for the benefits of unions to reach as many workers as possible, businesses must recognize the many ways in which they can benefit from cultivating good relationships with labor parties.

Some companies are waking up to the need for organized labor. Starbucks’ baristas have recently started a union that might end the companies’ long-held resistance to unionization. Starbucks has attempted to work closely with employees to avoid organized labor. Yet, employees have made it clear that they want the benefits that come with collective bargaining power.

In a cautionary tale of what can happen to companies that are too resistant to organized labor, Southwestern airlines have entered a lawsuit with a group of pilots. These pilots are raising grievances with the airline over its alleged unwillingness to bargain with employees. These grievances are directly related to the Southwest’s response to the COVID-19 pandemic.

Unions and the Fight for Workers’ Rights

To better understand the role of organized labor today, it’s essential to be aware of their history advocating for workers’ rights. Labor parties existed in a limited capacity since the beginning of the 1800s. It was not until the National Labor Relations Act of 1935 that employers were required by law to allow workers to unionize and negotiate on hours, pay, and more.

In 1938, the Fair Labor Standards Act created the 8-hour workday, overtime regulations, banned child labor, and set the first minimum wage, which was just 25 cents at the time. Shortly after, the first worker’s safety laws were passed by the federal government.

These pieces of legislation, passed under Franklin Roosevelt’s presidency in response to the great depression, were genuinely meaningful. They represented a paradigm shift within the United States regarding workers’ rights and industry regulation. As part of Roosevelt’s New Deal, these laws were just one step among many towards a government more inclined towards social programs and regulation.

While they are generally advocating in good faith, unions have not always been without fault. Pre-WWII organized labor organizations, for example, were known for their rampant discrimination against African Americans.

Despite this history, unions currently work in opposition to racial, sexual, and other forms of discrimination. Organized labor doesn’t just work to guarantee access to equal wages and benefits for all. They also protect workers from being fired for unjust causes including, race, sexual identity, religion, and disability.   

Today’s unions continue to negotiate wages, hours, and safety, just as they have since their beginning. They have taken on several new campaigns as well. For instance, labor parties are currently working to secure paid maternal leave for employees. Throughout the COVID-19 pandemic, unions have also worked to ensure safe working conditions for frontline employees. 

How Businesses Benefit from Building Strong Relationships with Unions

The benefits of unions are primarily intended for workers, but the effects reverberate throughout the community and businesses. For example, employees in labor parties tend to have lower turnover rates than their non-union counterparts because of their increased bargaining power. Employees who are members of labor parties tend to stay with a company for longer. This is partly because organized labor jobs generally pay more, offer better benefits, and provide workers with a voice in the business. 

Lower employee turnover saves businesses money in a variety of ways. For instance, companies with lower turnover save money on hiring and training new employees. 

Long-term employees also become more experienced and productive in their role within the business. They become faster and produce higher quality work due to the experience accumulated throughout their time at the company. This reduced turnover and increased employee productivity can bring considerable benefits to any busyness. 

Businesses that work with unions also benefit when hiring new employees. Companies with labor parties tend to both attract and retain talented and educated workers. Organized labor positions are often more highly sought-after than similar non-union positions, which helps attract qualified applicants.

Many businesses also rely on organized labor to train and educate a pool of talented workers who can fill positions in the industry. Unions are the primary source of educated workers in many industries. Unions offer classes and training that prepare individuals for a career in specific industries. These arrangements benefit businesses greatly by guarantying future employee productivity.    

The beneficial reputation that labor parties provide to businesses is partly the result of their duty to engage with the needs of employees more actively. Union jobs are often thought of as superior workplaces. Workers feel that companies will have their best interests in mind and will be protected against discriminatory practices. 

Organized labor can also help companies become more efficient by dealing with issues early and in standardized ways before they become significant problems. For example, unions tend to standardize wages, saving managers time by eliminating individual negotiations with each employee. Similarly, when employees have grievances, unions have standardized ways of addressing them before they become arguments. 

Organized labor is also good for the economic health of their communities. This is because unions don’t just improve the wages of union employees. They also improve the wages of all jobs in the community. 

Competing businesses tend to raise wages even if they are not part of a labor party because they need to remain competitive for workers. As this additional wealth makes its way into the larger community, it positively impacts the economic health of all businesses.

Benefits of Unions vs. its Disadvantages 

There are compelling arguments both in favor as well as against organized labor. The following are just some of the pros and cons that come with labor parties.

Benefits of Unions:

• Increased wages
• Better healthcare
• Pensions and retirement funds
• Increased negotiating power
• Safer working conditions
• Regulated scheduling and overtime
• Legal protection from wrongful termination
• Legal protection when businesses violate labor laws
• Discounts on training and education
• Long term employment

Disadvantages of Unions:

• Union fees
• Union negotiations may not reflect your opinion
• Increased competition for jobs
• No individual negotiations
• Promotions sometimes based on seniority
• The structure can be more hierarchical, less equality between management and other staff

Although union jobs often have increased competition, they are generally beneficial to employees. They generally offer higher wages, better healthcare, pensions, better working conditions, and more. 

That said, employees who join labor parties must pay regular fees to maintain their membership. Union members also agree to abide by any conditions that are negotiated between the union and businesses. Individual negotiations are generally not accepted. 

This means that all union employees follow the same standards and are required to strike when the decision is made. Whether or not a union job is right for you depends on your specific needs.     

The number of union jobs has been steadily declining. The percentage of Americans represented by organized labor has dropped from 27% to 11.6% between 1979 and 2019. This drop is mainly because the manufacturing jobs that have historically made up a large portion of US union jobs are being moved overseas or lost to automation. Also, many businesses are resistant to organized labor and often locate themselves in areas with low union density to discourage unionization.

A lack of voter turnout has also affected the number of labor parties. By educating your friends, family, and self on proposed local and national legislation, you can help ensure these critical laws get the attention and response they need. 

As an employee, you can start a labor party or organize the workers at your job. If you want to unionize your place of work, many organizations provide guidance on how to go about that. The United Food and Commercial Workers International Union (UFCW) offers a comprehensive guide for unionization.

Communities as a Whole Benefit From Unions

Throughout their history, organized labor has been responsible for shaping the lives of working people worldwide through their fight for workers’ rights. Unfortunately, the benefits of unions are limited by the hesitancy of companies worried about the increased cost of doing business that can come with labor parties.

While the benefit of unions is directed toward the employee, the reality of the situation is that they can change their entire communities for the better. Labor parties provide benefits to businesses in the form of reduced turnover, increased employee productivity, and much more.

These potential benefits highlight the need for mutually beneficial relationships between unions and companies to provide workers a voice while protecting their profitability.