Working without Trade Unions Essay Example | Topics and Well Written Essays - 1500 words

Working without Trade Unions - Essay Example Trade unionism has been in existence in the UK for more than 200 years, as illegal associations at first but gained legal recognition later (Trade Unions 1980). In 1978, statistics revealed that membership with numerous trade unions total to around 13 million workers (Trade Unions 1980). Unions existing at present serve the interests of particular type of workers or industry (Theses on the Trade n.d.). Through the unions, the workers can bargain with the employers to grant them increases in wages or salaries, specific working hours, benefits, or day-off from work. Negative Impact of Trade Union Unionism was primarily established to protect the interests of the workers. However, it has also been used by workers to blackmail employers. Running a company would entail a lot of factors to consider and has to maintain a certain margin of profit in order to survive the competition. Workers and employees though would want to get more from their employers by using various legal modes to get m ore benefits. Thus, at a slight movement in the economy or inflation, they would lay down their demands to the companies. There is a collective bargaining agreement or CBA that governs the relationship of employers and workers. The CBA is a contract of labour between the company and the workers. It exists at a certain period of time after which, it has to be renegotiated by both parties. At such renegotiation, the workers present their new demands which the employer may or may not concede. At the renewal of the CBA contract, the workers would push hard so that their demands will be granted by the employer. Companies that operate well and earn more profits may grant the economic demands of the workers. However, with the erratic economic conditions resulting from the recent global slump that affected banking and financial institutions, as well as several industries, CBA renegotiation or too much demand from the workers can tilt the operations of companies. Radical or extreme unionism that tends to disrupt company operations is bad for the economy and the company. It also fosters unhealthy employee-employer relationship that breeds distrust on the part of both parties. According to Naylor and Santoni (2003, cited in Radulescu & Robson 2006), there would be lesser foreign investments in a country where the bargaining power of trade unions on the aspect of wage is strong. There are studies though that do not support this position. Cooke (1997, cited in Radulescu & Robson 2006) and Cooke and Noble (1998, cited in Radulescu & Robson 2006) said that multinational firms in the US tend to invest in countries with decentralised wage bargaining process, and veer away from strong trade unionism. The Workplace Employee Relations Survey revealed that from 1990 to 1998, companies with unions undergo more closures than plants without unions (Millward, Forth & Bryson, 2001). Generally, companies without unions boomed at an average of 1.4 percent per year within the same period (Millward, Forth & Bryson, 2001). In contrast, firms with unions had been shrinking at an average of 1.8 percent yearly (Millward, Forth & Bryson, 2001). Addison and Belfield (2002) said that the prevailing trend seen in unionised companies is its slowed effect upon employment growth. UKs 1998 Workplace Employee Relations Panel Survey (WER-PS), lasting for eight years, that contained around 50 percent of the 1990 Workplace Industrial Relations Survey (original companies surveyed totals 2,016) revealed that firms that have labour unions existing for a very long time have weak labour productivity (Addison & Belfield 2002). On the