Industrial Relations in USA

Seminar on Comparative IR

Presented By:

Nidhi Grover &

Nimisha Gupta
 Flow of the Presentation

Worke
Intro Empl Colle
Labo Labo r’s
ducti Evol oyer ctive partici Con
ur ur
on to ution Asso Barg pation clusi
Unio Law in
IR in of IR ciati ainin on
ns s Manag
USA ons g ement
Introduction to IR in USA
• US industrial relations have been shaped by a wide
variety of broad historical happenings
• From 1790 to present, US labour relations have evolved
within the framework of a capitalist economy
• Basic Characteristics of US labour relations system:
– Bilateral process governed by a framework of labour laws
– A highly decentralized bargaining structure
– Majority rule and exclusive bargaining representation
– Use of economic pressures
– Use of final and binding arbitration
– Significant employer opposition

• USA Today:
– GDP = 2.8% in Q4 (Dec 2010)
– Unemployment rate (Feb 2011) = 8.9%
– Inflation rate (Jan 2011) = 1.6%
– U.S. nonfarm payroll employment increased by 192,000 in Feb 2011
Evolution of IR
●
● Emergence of craft unions in large East-
Late 1700s
coast cities (New York, Philadelphia, etc.)

●
● Free labour and the birth of labour movement
Early 1800s ●
● Lowell, Massachusetts.

●
● National
National labour
labour Union(NLU)
Union(NLU)
●
● The
The Knights
Knights Of
Of labour
labour
Late 1800s ●
●

●
●
The
The Great
The
Great Railroad
The Pullman
Railroad strike
Pullman strike
strike
strike
●
● American
American Federation
Federation of
of Labour
Labour (AFL)
(AFL)

●
● Women’s
Women’s trade
trade union
union league
league formed
formed at
at AFL
AFL convention
convention
●
● The
The Lawrence
Lawrence strike
strike

Early 1900s The Miner’s

Miner’s program
program
●
●
The
●
● National
National Labor
Labor Relations
Relations Act
Act and
and Social
Social Security
Security Act
Act passed.
passed. Committee
Committee for
for Industrial
Industrial Organization
Organization (CIO)
(CIO) formed
formed within
within
AFL
AFL
●
● Taft-Harley Act,1947
Taft-Harley Act,1947

●
● AFL-CIO
AFL-CIO merger
merger
The
The Memphis
Memphis sanitation
sanitation strike
strike
Late 1900s
●
●

●
● PATCO
PATCO strike
strike 1981
1981
●
● Threat
Threat of
of International
International Trade
Trade
Labour Unions
• Labor unions in the United States are legally recognized as
representatives of workers in many industries
• American unions also remain an important political factor, both
through mobilization of their own memberships and through
coalitions with like-minded activist organizations
• Today most unions are aligned with one of two larger umbrella
organizations:
– AFL-CIO created in 1955
– Change to Win Federation, which split from the AFL-CIO in 2005

• American union membership in the private sector has in recent

years fallen under 9%
• Private sector union members are tightly regulated by the
National Labor Relations Act (NLRA), passed in 1935. The law is
overseen by the National Labor Relations Board (NLRB), an
independent federal agency.
• Public sector worker unions are governed by labor laws and
labor boards in each of the 50 states. Northern states typically
model their laws and boards after the NLRA and the NLRB. In
other states, public workers have no right to establish a union
as a legal entity. (About 40% of public employees in the USA do
not have the right to organize a legally established union.)

• To join a traditional labor union, workers must either be given

voluntary recognition from their employer or have a majority of
workers in a bargaining unit vote for union representation. In
either case, the government must then certify the newly formed
union

• Other forms of unionism include minority unionism, Solidarity

unionism, and the practices of organizations such as the
“Industrial Workers of the World”, which do not always follow
traditional organizational models.
Membership:
• Union membership had been steadily declining in the US since 1983. In
2007, the labor department reported the first increase in union
memberships in 25 years and the largest increase since 1979.
• At the apex of union density in the 1940s, only about 9.8% of public
employees were represented by unions, while 33.9% of private
• In 2009, the union density for private sector stood at 7.2%

Possible causes of drop in union density:

• the fluctuations of business cycles, particularly the rise and fall of
unemployment rates and inflation
• 1947 Taft-Hartley Act, which greatly reduced the power of unions, to
support each other in strikes, made it harder to form new unions, and
eventually encouraged employers to attack existing unions
• In the United States in particular, which has traditionally had relatively
low levels of union density, globalization did not appear to significantly
affect union density.
• the role of repressive employer strategies in reducing unionization, and
the state ideology of anti-unionism tacitly accepted these strategies
Employer Associations
• Evolved as a reaction to the growing trade union organizations
• During the depression of 1907-08 a no. of these organizations sprang up
• The “Employer’s Association of Dayton” was one such organization that
came up during this period
• In USA, the employers organized at the regional or industrial level and the
National level.
• An employers association is not required to register under any law in the
US.
• However under the Taft Harley Act,1947 the working of multi-employer
associations as bargaining agent is subject to certain regulations. The law
recognizes a negotiating association having a history of bargaining as multi-
employer bargaining unit.
• At the National Level, the employees are organized in an association called
the National Association of Manufacturers(NAM) and the Chambers of
Commerce of United States.
• NAM=economic matters ; CCU=aspects related to national or international
trade

• NAM acts as the main spokesman on Labour Management issues.

 Legal framework

Until 1920 After 1920 Enactment of

various Laws

●
Role of Govt. ●
With increased
industrialization
●
Narris-La
confined to
and increasing Guardia Act
prevent any
industrial (1932)
distress
disputes, govt. ●
Wagner Act
caused to started active (1935)
public due to regulation of ●
Taft-Harley
industrial industrial Act (1947)
disputes relations
 Taft Harley Act (1947)

o Unfair Labor Practices

o Unlawful to base
staffing decisions on
basis of union
membership
o Employers cannot
refuse to bargain on
mandatory bargaining
issues – wages,
bonus , terms of
employment
Landrum-Griffin Act (Labor Management
Reporting and Disclosure Act)
o Gives rights to union members such as equal rights in
voting in union representation, freedom of speech in
union matters & right to sue their unions
o Union and Management are forbidden from having
financial dealing with each other
o Union offices are required to report annually the
financial transactions of unions
o National unions are required to elect their officers
every five years, and local unions every three year
o National unions were restricted from taking over local
unions
• The Age Discrimination in Employment Act (1967)
– Prohibits employment discrimination on the basis of age with
respect to employees 40 years of age or older
– to help employers and workers find ways of meeting problems
arising from the impact of age on employment as well as
productivity
• The Fair Labor Standard Act (1938)
– Regulate child labor by setting minimum ages for hazardous and
all other jobs
– Fixes minimum wages ($7.25 per hour) And overtime wage which
is not less than one and a half of wage for more than 40 hours of
work
– For young , Minimum wage is $ 4.25 per hour for employees
under 20 years of age.
 Collective bargaining

• Collective bargaining is
done at plant or
enterprise level
• USA follows deadline
agreements
• National Labor
Relation Board is
Constituted to regulate
the labor management
relationships
The National Labor Relations Act or Wagner Act
Regulating Collective bargaining

• This act recognizes an employee’s right to engage in

union activities, to organize and to bargain collectively
without any coercion of employer
• This act gave unions power to elect worker’s bargaining
representative who will act as negotiating agent
• Bargaining is done at various issues like wages, hours,
benefits, and other terms & conditions of employment
• Once worker’s committee and management agrees on
a contract, then it is put to vote by all the workers
• If approved, then it is put on contract
• If any dispute arises the it is put on Arbitration
 Worker’s Participation in Management

• There is no worker’s participation at

board level
• Worker’s participation in management
has been ensured through collective
bargaining only
• There is no Legal framework for
worker’s participation in management
also
• But attempts have been made to
promote close labor management
cooperation in American industry by
promotion of Joint committees to
encourage suggestions from workers
 Conclusion

• Unions are now reducing

• U.S. have a large number of
Immigrants, which make up of
14% of labor force
• This has started unrest in workers
due to increased unemployment
in current scenario
• Workers management
cooperation is increasing now
• The unions have started
participating in managerial
decision making which affect the
workers
 References

• Holley, W. H., Jennings, K. M., & Wolters, R. S. (2008). The Labor

Relations Process (9th ed.). USA: Cengage Learning.

• Beik, M. A. (2005). Labor relations. Greenwood Publishing Group.

• Mamoria, C. B., Mamoria, S., & Gankar, S. V. (2009). Dynamics of

Industrial Relations. Mumbai: Himalya Publishing House.

• http://en.wikipedia.org/wiki/Labor_history_of_the_United_States

• http://www.eurofound.europa.eu/eiro/2004/11/feature/us041110
1f.htm

• http://en.wikipedia.org/wiki/Labor_unions_in_the_United_States

• Http://www.aflcio.org/aboutus/history/history/timeline.cfm
THANK YOU