Benefits, Role and Criticisms of Labor Unions Term Paper

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Role of Labor Unions in Industrial Relations

In their definition, labor unions have always been known as organizations that have always aimed at getting their members both financial and non-financial benefits. The role of labor unions is however bigger than that and they have been known to aid in helping employers improve the productivity and discipline of their workers. Labor unions respond to issues differently. This is explained by the differences in industrial relations contexts and also policies of different states as well as strategies of the various employers around the country.

Employees come together to form a labor union to achieve a common goal. Labor unions have several goals. Some of the goals include agitating for higher retirement benefits as well as other benefits for its members. They also seek to increase the number of workers assigned for specific job tasks. They ensure that employees work under good and healthy conditions with good safety measures put into place. The elaborate structures of leadership, as in collective bargaining, in labor unions allow them to negotiate effectively with employers on labor contracts. They engage employers on various issues like bettering the working conditions of workers, hiring procedures, rules at work, salaries and wages, employee benefits, firing of employees and policies at places of work (Srivastava, 2007).

The Australian Bureau of Statistics, as per 'World Labor Report 1997 -1998 of ILO', defines unions as "an organization consisting predominantly of employees, the principle activities of which include the negotiation of pay and conditions of employment for its members" Ghayur, a Pakistani author, points out that these unions can hamper the smooth functioning of organizations. What he doesn't realize are the immense contributions that labor unions have made in the workplace. Employers share his line of thinking and think that the unions have always agitated for workers rights without emphasizing on the need for employees to meet their obligations. This has resulted in low and dismal productivity. This paper seeks to find the truth in these allegations. The function of labor unions in the U.S. obtaining welfare and health benefits for the union's members, according to Buchmuller et al. (1999), can be traced back to the 18th century. In fact, Munts (1967) states that the initial function of these unions was to obtain these benefits. It is only later that they started agitating for better wages. Knowles and Eade (n.d) state that the main functions of a labor union is to organize and push for better and fair working conditions and also make negotiations on behalf of workers as well as provision of needed services, mobilize and network (Khan & Khan, 2011).

This means that only those organizations that are agitating for employee benefits like a raise in salaries and wages, allowances, bonuses, insurance benefits, compensations for overtime worked, as well as other non-monetary benefits like job security, safe and comfortable places of work and the reduction of fear of the employer by way of collective bargaining can be considered as trade unions. Nevertheless, some studies have also shown that some unions play a role in increasing the efficiency and productivity of workers. These unions also increase the discipline of workers, the harmony at the workplace and the needed participation of employees in the making of decisions (Khan & Khan, 2011).

Role of Labor Unions

Labor unions have the following functions:

1. Market Role - the leadership of labor unions do intervene in the bargaining for better wages. Comparative shifts have stressed the need to shift to decentralized bargaining, the deregulation of labor markets and product flexibilisation in Europe. They consider these to be the main challenges to labor relation in the region dating back to the 1980s (Baglioni and Crouch, 1990; Katz, 1993). With growing constraints in budgets and global competition, attempts have been made to negotiate long-term binding tripartite agreements aimed at achieving moderation of wages (Khan & Khan, 2011).

2. Political Role - labor unions use the power of numbers to be major influencers in the society. Since they are movements in their own accord, they can assume political roles to reform the welfare of the society. They defend the interests of their members, current and former workers, against policies that may harm them. The recent past has seen some trade unions block reform efforts. In some cases, they have been involved in various negotiations that have resulted in the adaptation of social and labor policies in the prevailing global challenges.

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Weak unions in terms of number of members or other factors can still make significant impacts by way of organized and accommodating employer organizations or by getting support from the state through offering of collective agreements to non-organized employees as well as non-unionized employers. Also, the welfare state may give 'security' to the unions by having friendly relations with the unions or by giving subsidies to the collective insurance schemes that unions run. Furthermore, in those nations that social partnership exists, the state has always delegated certain public policy concerns to these partners, specifically in matters social policy and also in the labor market (Khan & Khan, 2011).

3. Welfare Function - the unions give social assistance to various workers. Discussions on CSR and 'social partnership' are gaining ground in Europe, especially in Nordic and Anglo-Irish circles (Kjaergaard and Westphalen, 2001). The public sector has become an attractive place of employment due to a host of factors (Keller, 2001). The sector is more accommodating of unions and its employees can join any of the available relevant unions. The sector has regulated pay schemes and advancement prospects; its bureaucratization is higher on average while involved unions have a bigger voice in issues of policy concerning its staff. Further, the welfare state has great influence on national labor relations, often giving good conventions and also remaining as union movements' stronghold (Traxler, 1999).

4. Democratizing Role - the unions also aim at creating democratic workplaces. Many people see unionism as a bad interference in the smooth operations of companies or organizations. They don't see the many benefits that accrue due to unionism such as workplace harmony, progress and peace. Employers have always complained that the unions' focus is the rights of the workers while ignoring the obligations that those workers have. Their belief is that unionism has resulted in a drop in productivity. The notoriety of unions in misbehaving with the employers of their members especially with the management of corporations and institutions in the public sector while protecting ill-mannered workers has painted the movement in bad light (Khan & Khan, 2011).

5. Service Role - the unions help in the promotion of the intervention of members. As per the Conference on Sustainable Development (CSD 2001), trade unions are aiming at working with various partners such as governments and various agencies with global operations to bring forth decision making patterns that are in line with sustainable growth and development. The unions may also help employers achieve better time flexibility by having them implement work shifts and more flexible scheduling of shifts and they can also permit employers to have compulsory overtime when giving very good pay (Khan & Khan, 2011).

6. Enhancement Role - the leadership in unions provide help in developing human potential among the union's members (Singh, 2009). Through peaceful ways like reconciliation, negotiation, arbitration and court suits, unions achieve objectives of the workers they represent. In Japan, for instance, the unions have made employers improve working hours, house welfare programs and fringe benefits by using collective bargaining. The efforts made by unions are increasingly become more significant (Inoue, 1999)

7. Regulatory Role- labor unions have set certain standards for given jobs' terms and conditions. Jose (2000) recognizes that the significance of collective action as taken by unions in helping organizations attain given goals is now being realized by various players. Nonetheless, unions have adopted voice in place of collective bargaining in Japan and continental Europe because of the unionism density. Trade unions are growing from collective bargaining to voice and worker representation. They are stronger and have more bargaining power due to the broader membership they now command and the successes of the promotion of equitable distribution in key enterprises and sectors of the economy (Khan & Khan, 2011).

Challenges Faced By Labor Organizations

1. Emerging economies' social and economic development pose implementation challenges in having the rates of unionization raised nationally and globally. The development of a European social and economic model presents challenges for trade unions in Europe. On the other hand, the demand to strengthen the European integration project's dimension is fast growing but it cannot be realized single-handedly through the efforts of one nation. It is troublesome since trade unions identify with their specific countries and institutions and this makes it hard for the implementation of a European social model that is common to all (Khan & Khan, 2011).

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