Chapter Twelve Dealing with Employee-Management Issues and Relationships McGraw-Hill/Irwin Copyright © 2010 by the McGraw-Hill Companies, Inc All rights reserved ORGANIZED LABOR • Unions Employee organizations whose main goal is to represent members in employeemanagement negotiations of job-related issues • Labor unions were responsible for: - Minimum wage laws Overtime rules Workers’ compensation Severance pay Child-labor laws Job-safety regulations 12-2 PUBLIC SECTOR LABOR UNIONS • Public sector union members work for governments as teachers, firefighters, police officers, etc • Many states face serious debt problems and want to cut labor costs But states with public sector unions have limited ability to cut those costs 12-3 GOALS of ORGANIZED LABOR • To work with fair and competent management • To be treated with human dignity • To receive a reasonable share of wealth in the work it generates 12-4 Labor Union History 12-5 HISTORY of ORGANIZED LABOR • Craft Union An organization of skilled specialists in a particular craft or trade • As early as 1792, shoemakers in a Philadelphia craft union met to discuss fundamental work issues • Work weeks were 60+ hours, wages were low and child labor was rampant 12-6 EMERGENCE of LABOR ORGANIZATIONS • Knights of Labor First national labor union; formed in 1869 • Knights attracted close to 800,000 members but fell from prominence after a riot in Chicago • American Federation of Labor (AFL) An organization of craft unions that championed fundamental labor issues; formed in 1886 12-7 INDUSTRIAL UNIONS • Industrial Unions Labor unions of unskilled or semiskilled workers in mass production industries • Congress of Industrial Organizations (CIO) Union organization of unskilled workers; broke away from the AFL in 1935 and rejoined in 1955 • The AFL-CIO today has affiliations with 56 unions and about 12.2million members 12-8 Labor Legislation 12-9 EFFECTS of LAWS on LABOR UNIONS • Labor unions’ growth and influence has been very dependent on public opinion and law 12-10 LABOR UNIONS in the FUTURE • Union membership will include more white-collar, female and foreign-born workers than in the past • Unions will take on a greater role in training workers, redesigning jobs and assimilating the changing workforce • Unions will seek more job security, profit sharing and increased wages 12-40 COMPENSATING EXECUTIVES • CEO compensation used to be determined by a firm’s profitability or increase in stock price • Now, executives receive stock options and restricted stock that’s awarded even if the company performs poorly 12-41 COMPENSATING EXECUTIVES in the FUTURE • Boards of directors are being challenged concerning executive contracts • Government and shareholders are putting pressure to overhaul executive compensation • Financial crisis of 2008-2009 strengthened the argument of shareholders concerning limits on compensation 12-42 The QUESTION of PAY EQUITY • Women earn 81% of what men earn • This disparity varies by profession, experience and level of education 12-43 EQUAL PAY for EQUAL WORK Equal Pay Act Factors that Justify Pay Differences • Skill • Effort • Responsibility • Working Conditions 12-44 THE SALARY GENDER GAP Age Average Salary Women - $23,357 15 to 24 Men - $26,100 Women - $41,558 25 to 44 Men - $55,286 Women - $44,808 45 to 64 Men - $67,040 Source: U.S Census Bureau, www.census.gov, accessed June 2011 12-45 WHAT’S SEXUAL HARASSMENT • Sexual Harassment Unwelcomed sexual advances, requests for sexual favors or other verbal or physical conduct that creates a hostile work environment • Sexual harassment laws cover men, women and foreign companies doing business in the U.S • Violations can be extremely expensive for businesses 12-47 KINDS of SEXUAL HARASSMENT • Quid pro quo sexual harassment involves threats like “Go out with me or you’re fired.” An employee’s job is based on submission • Hostile work environment sexual harassment is conduct that interferes with a worker’s performance or creates an intimidating or offensive work environment 12-48 CHILDCARE ISSUES • The number of women in the workforce with children under three-years-old has increased • Childcare related absences cost businesses billions of dollars each year 12-49 BUSINESSES RESPONSE to CHILD CARE • Benefits can include: - Discounts with childcare providers Vouchers that offer payment for childcare Referral services identify high-quality childcare facilities - On-site childcare centers Sick-child centers 12-50 FACING CHILDCARE ISSUES • Who should pay for the cost of childcare - a dividing issue among employees and businesses, and in the workplace 12-51 INCREASING ELDER CARE CHALLENGES • 29% of the adult population are providing some care to an elderly person • Care giving obligations cause employees to miss about 15 million days of work per year • Costs could rise up to $35 billion annually 12-52 ELDER CARE in the MODERN HOUSEHOLD • More and more boomers are taking care of their parents while still working - 31% say that may delay their retirement - The average cost of taking care of an aging parent is $5,534 - 76% say they enjoy taking care of their parents - 54% say it made them closer Source: Money, June 2010 12-53 DRUG USE in the WORKPLACE • Alcohol is the most widely used drug - 6.5% of full time employees are considered heavy drinkers • Over 8% of workers aged 18-49 use illegal drugs and are more likely to be in workplace accidents • Drug abuse costs the U.S economy $414 billion in lost work, healthcare costs and crime • Over 80% of major companies drug test workers 12-54 VIOLENCE in the WORKPLACE • OSHA reports homicides account for 16% of workplace deaths • Violence is the number one cause of death for women in the workplace • Companies have taken action to deal with potential problems by using focus groups and other interactions 12-55 ... STATES with RIGHT-to-WORK LAWS 12-26 LABOR / MANAGEMENT AGREEMENTS 12-27 LABOR /MANAGEMENT AGREEMENTS Negotiated Labor -Management Agreement (Labor Contract) Sets the terms under which labor and management. .. debt problems and want to cut labor costs But states with public sector unions have limited ability to cut those costs 12-3 GOALS of ORGANIZED LABOR • To work with fair and competent management. .. The CBA 12-28 Using Mediation and Arbitration 12-29 USING MEDIATION and ARBITRATION • Bargaining Zone The range of options labor and management have between initial and final contract offers that