The State of Organized Labor in the U.S.: An Abbreviated FAQ

This past week I had the pleasure of speaking about the current state of labor relations to a local community group. It was great to see their interest in the topic, and the audience asked many good questions and had numerous important observations. I wasn’t sure how to structure my presentation, but they had provided me with a list of possible questions so I decided to approach it like a “State of Organized Labor FAQ.” Here are some highlights:

1. How many union members are there in the United States? What is the trend is union density (the fraction of workers who are union members?

We can answer these questions by this graph I’ve constructed:

The total area shows the number of union members. While less than its peak membership 45 years ago, there are still a lot of union members in the United States (over 14 million, roughly even split between private and public sector workers). Trends in union density (the fraction of workers who are unionized) are indicated by the blue (private sector) and green (public sector) lines. There is a clear divergence in these two trends over the past 50 years. Specifically, public sector density has been relatively stable at around 35 percent for a couple of decades, while private sector union density has been falling since the 1950s, and now stands around 6.5 percent. Comparing the red area with the blue line, we can that the decline in union density is less about losing members and more about failing to keep pace with employment growth.

[Update: On January 18, 2019, the Bureau of Labor Statistics released its annual statistical report on union membership. For 2018, total union membership is 14.7 million, with density rates of 6.4 and 33.9 percent in the private and public sectors, respectively.]

2. Why has union membership declined, or not?

Again, looking back at the graph, union density decline is a private sector issue. By why? For starters, note that the decline in private sector density started way back in the 1950s. So this is a long-term issue which likely reflects a combination of factors, and we can’t blame recent things (even as far back as President Reagan’s firing of the air traffic controllers) for the entire decline. Commonly-cited factors include structural change (e.g., decline of manufacturing, demographic shifts, globalization), decreased demand for union representation (e.g., laws and paternalistic human resource management provide some of the protections that unions provide, or unions have failed to keep up with what workers want), and most controversially, employer opposition (legal and illegal). In the final analysis, it’s likely to be a combination of these factors.

But why the stability in public sector? That sector has also experienced demographic shifts (making it a less satisfactory explanation for the private sector decline), but the economic shifts have been less pronounced in this sector (e.g., the decline of manufacturing is purely a private sector issue). Moreover, robust union density in the public sector also seems to undermine demand-based explanations for the private sector decline. But due to differential norms and an inability to shift much of public sector work (e.g., schools need to remain in their district), there might be less scope for union opposition by public sector managers. This might be a key reason for the difference in the private and public sector trends.

3. Is it imaginable that the software engineers in Silicon Valley could be unionized?

Sure. There are many independent-minded skilled workers who are unionized, such as airline pilots, university faculty, and lawyers. Actors and professional athletes are also unionized. And the recent walkout among Google employees to protest Google’s handling of sexual harassment indicate that collective action is one strategy these workers are already using.

4. Has immigration (documented and undocumented) been a plus or minus or a zero for unions?

Yes. Wait a minute, which is it? This isn't a yes or no question. Well...like many other things in labor relations, it’s complicated. There are cases in which immigration can be bad for organized labor, whether because of desperate workers willing to work for less, immigrant workers who are fearful of being deported and therefore don’t want to make waves, prejudice against immigrant workers by union leaders or members, or other reasons. But there is another side to this story. Many immigrants to the United States come from cultures that are more collectivist and less individualistic than in the United States, and shared experiences of living and working together in specific neighborhoods and jobs can provide a strong sense of solidarity. Indeed, in Minneapolis, CTUL has been very successful in building collective power among janitors and other low-wage workers, many of whom are Latinx, Somali, or members of other non-majority groups, and Somali workers recently forced Amazon to negotiate with them. We should not dismiss immigration as entirely a negative for the labor movement--indeed, quite the contrary. 

5. Do unions make their firms or industries less productive and hence less competitive? Do unions put firms out of business?

A common stereotype about unions pertains to extensive, restrictive work rules, which might reduce productivity. But once again, there is another side to the story and there are ways in which unions might increase productivity (e.g., workers protected by a grievance procedure might feel empowered to speak out about work practices more honestly than nonunion workers). What happens in practice? Everything. In some cases, unionized workplaces are less productive; in other cases, it’s the reverse, or in some cases there aren’t meaningful differences. So it’s really about the nature of any particular situation. Moreover, from a pluralist perspective in which unions are necessary to better balance an otherwise unequal employment relationship, unions are not intended as productivity-enhancing devices so this should not be a major element on which they are judged.

In terms of whether unions put companies out of business, that too is always a complicated story. Sometimes a strike might prove to be the final straw, but there could have been business-related problems for a longer period of time. In the 1990s in the Twin Cities, Country Club Markets closed after a strike, but there were many factors at play, including a lack of investment back into the business. Indeed, it’s not in a union’s self-interest to systematically put companies out of business, and research does not find that unions destroy firms.  

6. Can unions engage with younger workers?

Yes. In fact my own research suggests that we overstate the labor movement’s lack of connections with younger workers. For details, see my blog post on unions having more younger workers than they think.

7. Where is Jimmy Hoffa buried?

Envision here a picture of the end zone at Giant’s Stadium in New Jersey. But of course I don’t have an answer to this, but given that some people in audience grew up in Detroit, I thought this would be funny to throw in. Moreover, it gave me the opportunity to point out the following. In response to some union corruption (which it’s important to not overstate), the Landrum-Griffin Act was passed in 1959 and essentially has the philosophy that requiring greater disclosures and transparency among unions will prevent union fraud (it’s harder to commit fraud when others can see what’s going on). Sounds sensible, but it took lawmakers until 2002 to treat companies in the same way (that is, Sarbanes–Oxley has essentially this same underlying logic). Seems like a big double-standard. In contrast, what I often emphasize is that unions are like other private, public, and nonprofit sector organizations: most are effective, most are good, but a small number are not. The same can be said for leaders of unions, businesses, public sector agencies, and non-profits. Unions should not be singled out, especially when it comes to corruption or other negative behaviors.

8. Why the controversies over right-to-work laws, free riders, and agency fees (fair share fees)?

Misleading named, right-to-work laws prevent unions from negotiating contract clauses that require workers from paying any union dues, even though the union has a legal obligation to represent them. Most right-to-work laws were passed in the 1940s and 1950s. But the issue sparked back to life around 2012 when a number of Republican governors and state lawmakers began championing laws in states with traditionally strong labor movements, such as Wisconsin and Michigan. Debates over right-to-work laws are very divisive, with proponents arguing that they are necessary to protect individual liberty and opponents countering that the true goal is to weaken unions. The controversies have become amplified because it now really more of a political issue than an economic one, with some conservative strategists being bold in revealing their desire to destroy the Democratic Party. In addition to state-level legislative initiatives, there has also been a paired movement to achieve right-to-work through the courts--a movement that achieved success when the Supreme Court made the entire public sector a right-to-work jurisdiction with its 2018 ruling in Janus v. American Federation of State, County, and Municipal Employees, Council 31. Though in the longer-run, this Janus decision could actually make unions stronger. 

9. Is labor relations still relevant.

YES! See my blog entry on why students should study labor relations. Or my posting on why HR-OB still needs IR. 

And finally, in my presentation I emphasized what I have long emphasized: to really understand labor unions (and many other employment-related things), we need to appreciate different frames of reference. These provide competing lenses through which one can evaluate labor unions in very different ways. That’s essential for understanding, and for evaluation.

What Happens in the Aftermath of the Janus Ruling?

In 2018, all eyes in the labor relations community were focused on the Supreme Court in anticipation of its ruling in Janus v. American Federation of State, County, and Municipal Employees, Council 31. Workers who are represented by a labor union cannot be forced to join a union and pay full dues, but in the absence of a right-to-work law, it has been possible to require them to pay an agency fee (equivalently, “fair-share fee”) to cover the costs of representing them. The question in Janus was whether mandatory agency fee arrangements in the public sector violate an individual’s free speech rights. This is only a question relevant to the public sector because the Constitution only prohibits the government from infringing on speech—there are no prohibitions against a private sector employer limiting an employee’s speech.

The free-speech argument against public sector agency fees is that mandating these payments means that a governmental body is forcing someone who does not belong to the union to subsidize the speech of others (the union) who they don’t agree with. Note carefully that this requires seeing public sector collective bargaining as rising to the level of public expression that enjoys constitutional protections. Opposed to this view is a counter-argument based on seeing collective bargaining as part of the employment relationship, not part of public discourse. So if states want to allow agency fees and prevent free-riding, then this should continue to be within their authority as regulators of the public sector employment relationship, consistent with other precedents in which public sector employees do not have free speech rights when speaking as workers rather than citizens.

When the Janus decision was issued last week, no one was surprised by the verdict: five conservative justices outnumbered four liberal justices in declaring that mandatory  agency fee arrangements in the public sector are unconstitutional free speech violations. This makes the entire U.S. public sector a right-to-work sector in which public sector unions will only be financially supported by union members. As such, this is arguably the most significant Supreme Court ruling affecting labor relations in a long time. It is also a highly-charged decision because Janus and related cases have been funded by conservative political groups seeking to weaken the labor movement as a counterweight to Republicans in the political arena. Indeed, President Trump’s tweet in support of the ruling boasted “Big loss for the coffers of the Democrats!”:

So this case is about much more than individual free speech. But will it be successful in weakening the labor movement?

In the short-term, Janus is likely to reduce the financial strength of public sector labor unions in non-right-to-work states (agency fees were already prohibited in right-to-work states) as nonmembers stop paying dues. Labor unions might also have to spend more time and money fighting additional lawsuits that will likely be filed by conservative groups seeking to get previously-paid agency fee amounts returned to workers. But it might not be all bad news for organized labor.

Some states might take legislative steps to lessen the impact of the Janus ruling. Possibilities include not requiring unions to represent nonmembers in grievance hearings; allowing unions to charge nonmembers for specific services such as grievance representation or arbitration; giving unions time during new employee orientation to meet new workers; making it difficult for anti-group workers to contact workers; and giving union members paid release time to recruit others into the union. It might also be legal for public sector unions to negotiate an agency fee arrangement that includes an opt-out clause allowing objectors to donate their fee to a charity.

At an even more fundamental level, recall that the Janus decision relies on elevating collective bargaining to a level of public speech that is entitled to constitutional protection. Ironically, then, this could bring new levels of legal protection to public sector collective bargaining. For example, state laws that restrict collective bargaining to narrow occupations or prohibit it altogether might be now be unconstitutional violations of free speech. Attempts to legislate further limitations on public sector bargaining, as in the case of Wisconsin, could also be challenged on this same basis. These issues will take years to work through the legal system, however.

So without waiting for favorable legislative or legal action, what can the labor movement do? The labor movement has had several years to prepare for this kind of ruling, and the primary response is to focus on internal organizing. This emphasizes relationship-building with bargaining unit members so that workers feel that they are a necessary part of a vibrant organization that effectively represents their interests. When this is successfully, not only will workers join their union and pay dues, but they will also be more engaged which further creates a more dynamic organization. Janus might also contribute to a feeling among public sector workers that they are under attack, making them receptive to collective action, as was demonstrated earlier this year in the statewide teacher strikes in West Virginia, Oklahoma, and Arizona. So there is the distinct possibility that the labor movement ends up stronger than it was before the Janus decision.

Minnesota Legislature: Respect U of M Contingent Faculty By Letting Them Decide Whether or Not to Unionize

Whether a group of employees wants to form a union to represent them in collective bargaining is a decision that those employees should be entitled to make. Unfortunately, contingent faculty (non-tenure-track instructors, lecturers, and teaching specialists) at the University of Minnesota will likely not get to make that decision themselves. Rather, the Minnesota State Legislature effectively prevented them from being able to make this decision when it enacted an unnecessary provision in state law over 35 years ago. In the wake of a state appeals court ruling earlier this month upholding this strange legislative provision, it’s time for the legislature to correct its earlier mistake and repeal this provision.

Perhaps some background is needed. When some employees want to form a union, an appropriate bargaining unit needs to be defined in order to specify exactly what positions would be represented by a union if an organizing drive is successful. Standard practice is for the employees or their desired representative (a specific labor union) to initially propose this definition. If an employer objects and prefers a broader or narrower definition, then a neutral, expert governmental agency investigates and determines the exact definition of the appropriate bargaining unit based on input and evidence. This is exactly what happens in the U.S. private sector (with the National Labor Relations Board empowered by federal law to handle unit determination questions based on its judgement of which employees share a “community of interest”), and, as far as I can tell, in almost all public sector jurisdictions in the United States (for example, see South Dakota's Public Employment Labor Relations Act section 3-18-4 or Iowa's Public Employment Relations Act section 20.13).

When the Minnesota Public Employment Labor Relations Act (PELRA) was first enacted in 1971, this standard practice was adopted by empowering the Bureau of Mediation Services (BMS) to determine appropriate bargaining units when a public sector employer objects to the workers’ proposed definition. For state agencies, the law contained a proviso that an appropriate bargaining unit should consist of “all the employees under the same appointing Authority” unless “professional, geographical or other considerations affecting employment relations clearly require” some other appropriate unit (section 179.74). As is common elsewhere, there were no special provisions for the University of Minnesota, school districts, or others covered by PELRA.

In 1980, however, the Minnesota State Legislature deviated from common practice by changing PELRA to specify 16 (now 17) state bargaining units and 12 (now 13) University of Minnesota bargaining units (see Minnesota Session Laws 1980 c 617 s 40) (in later years, court units were also specified). This has long puzzled me, especially because it runs contrary to standard practice, and it is likely rooted in a desire to impose operational stability or convenience by limiting the number of bargaining units that a state agency or the University of Minnesota has to deal with. But the effect is to impose an outdated occupational structure on contemporary realities and to deny employees their rights to form unions and engage in collective bargaining. This is clearly not the way to balance efficiency, equity, and voice—a principle that I have long advocated as the key objective of work-related public policy (also see this, and this).

Getting back to the plight of contingent faculty at the University of Minnesota, the way the process should have worked was for BMS to have had the discretion to use its expert judgement decide whether it was best to include contingent faculty with tenure-track faculty, or to define two separate units, based on input, hearings, and the facts of this particular situation at this particular time. But with the unit definitions pre-specified by state law, contingent faculty are not allowed to have their own unit, and the state appeals court ruled that they are not part of the tenure-track unit. So this ruling means that contingent faculty are included in a catch-all unit of all professional and administrative employees at the University of Minnesota. The diversity of this unit is hard to grasp. By one count, there are over 300 job titles in it, presumably many more than in 1980. By my reckoning, this will kill the contingent faculty union drive because  in order to unionize they'll need to get a majority of accountants, cartographers, athletic trainers, and numerous others to all vote for a single union, which is close to impossible. It strains credulity to think that this diversity (a) represents a community of interest for these employee groups and (b) serves anyone’s interests except the administration of the University of Minnesota because it makes unionization almost impossible (which might explain why the administration spent 18 months trying to get this ruling).  

The processes of labor relations work best when they are allowed to be dynamic and to adapt to changing situations by those directly involved. Collective bargaining has proven to be adaptable to many industries and occupations, and can handle economic, technological, and other changes when labor and management negotiators have the freedom to determine the scope and tenor of their negotiations. Similarly, determining appropriate bargaining units should be a flexible process in which a neutral, expert agency has the ability to adjust to changing trends based on input from the relevant parties, hearings, and evidence about the particular realities of each case. The world of work has changed significantly since 1980, and it’s silly to think that even a well-intentioned legislative intervention in 1980 is still the best approach today (exhibit A: the tremendous rise of contingent faculty at the University of Minnesota).

But there is an easy solution: simply repeal sections 179A.10 Subd. 2 (defining state units), 179A.101 Subd. 1 (defining court units), and 179A.11 Subd. 1 (defining University of Minnesota units). No language is needed to replace these unnecessary passages. In their absence, the authority to determine appropriate bargaining units on a case-by-case basis will revert back to BMS under sections 179A.04 Subd. 2 and 179A.09, and common sense practice found throughout the rest of the state and most of the country will be restored. And contingent faculty at the University of Minnesota, and perhaps other employee groups, too, will be able to act like the autonomous, dignified human beings that they are and make a decision whether to unionize or not.

Why Study Labor Relations?

It’s always interesting getting a new book, but it’s particularly exciting and rewarding when it’s the product of your own work! So I was thrilled when earlier this month I received a copy of the fifth edition of my textbook, Labor Relations: Striking a Balance, that is published by McGraw-Hill. But some might be thinking…labor relations?...people still study that?

Some dismiss labor unions as relics from a bygone era and therefore consider studying labor relations unimportant for business careers in the 21st century. Yes, unions represent a small percentage of the U.S. workforce, but this is still a large number of workers (> 16 million) in many of the country’s leading companies and in a broad range of occupations, including doctors, nurses, lawyers, writers, professional athletes, and even graduate students. Some local businesses—a Starbucks, a Target or Walmart, or a local hotel, for example—might have some employees who are thinking about unionizing, or at least some managers who are worrying about this possibility. Labor relations are therefore a relevant and dynamic area of study and practice.

All managers and business professionals can benefit from learning about labor relations, whether or not they plan to work in companies where unions are present. Studying labor relations reveals the consequences of poorly managing a workforce. Also, U.S. labor law is very relevant for all workplaces, including nonunion ones. This is because a union does not have to be a large, formal, bureaucratic organization; a union is simply a group of workers acting together to influence their working conditions. So as just one example, it’s illegal to prohibit workers from discussing their wages and benefits with other employers, because this is a basic form of worker self-protection.

  

Studying labor relations can also help one appreciate the broader historical, social, and political influences on business and thereby help people better deal with the realities of managing a business in a complex world. Organizations are embedded in a complex environment, and at various points in my textbook, market forces, individual emotions, managerial strategies, forms of work organization, constitutional and legal issues, history, questions of human rights, negotiation and conflict resolution strategies, debates over globalization, pressures of financialization, ethical challenges, and other things are all shown to affect work and employee relations. For others who are interested in work and workers, labor relations offer an engaging subject for thinking about the world of work—what we want to gain from work, defining societal objectives for the employment relationship (striving for employment with a human face through balancing efficiency, equity, and voice--of course!), how to measure worker well-being, how work should be structured, the rights of labor, how to define and create public value(s), and other questions that greatly affect the type of society we live in.

On an intellectual level, stylized economic models conveniently assume a tidy world of rational agents interacting in perfectly competitive economic markets; most business courses consider only the objectives of businesses and consumers. In contrast, the study of labor relations considers the goals of workers and society, and it does not shy away from the conflicts that can arise between competing groups, especially in a real world characterized by imperfect competition. Labor relations can therefore help everyone understand and resolve conflict—in the workplace, in business relationships, and in everyday personal interactions. Moreover, an emphasis in my approach to labor relations is on understanding alternative intellectual perspectives rooted in different assumptions about the nature of the employment relationship. This is typically the only place in a human resource management curriculum that students consider alternative models of the employment relationship, such as unitarism and pluralism. In this way, studying labor relations remains essential for understanding HRM.

Lastly, studying labor relations should be intellectually stimulating and even fun. Labor relations have been influenced by everything from violent strikes to religious writings, from libertarians to Marxists, from radical union leaders to great industrialists. Studying labor relations draws on scholarship in industrial relations, management, economics, history, psychology, sociology, political science, law, working class and women’s studies, and philosophy. In my textbook, students encounter two characters named Big Bill, the brazen yet grandmotherly Mother Jones, and the still-missing Jimmy Hoffa—not to mention the colorful language of labor relations, which includes yellow dog contracts, the blue flu, hot cargo, whipsawing, and a narcotic effect. You can even read my book while listening to union folk songs or other songs about the working class. And then take a break by watching movies such as Norma Rae, On the Waterfront, Matewan, Billy Elliot, and Pride. Who says labor relations has nothing left to offer? Far from it.

And the University of Minnesota faculty organizing drive drags on, or, bananas aren’t apples, but they are more like apples than like airplanes

When I taught labor relations last winter, the union organizing drive among University of Minnesota faculty was a very timely topic. After having been away for the summer, some of the students from that class asked whether faculty were unionized yet. But the answer brings to life one of the realities of union organizing in the United States—it’s a slow process. SEIU Local 284 filed a petition seeking an election with the State of Minnesota’s Bureau of Mediation Services (BMS) on January 20, 2016. Over 34 weeks later, an election is not yet in sight.

In any union representation election, the election unit needs to be defined. That is, what jobs are included and excluded from what will be the bargaining unit if the union wins. This definition is initially presented by the union when requesting an election, but an employer can object on the basis of there not being a “community of interest” among all of the included workers. A major sticking point in the faculty organizing drive is whether the bargaining unit should only include tenured and tenure-track faculty (the University’s position) or should also include full-time and part-time instructors (“contract faculty”) (the union’s position). In other words, the University asserts that regular faculty and contract faculty do not share a community of interest whereas the union argues that they do. Undoubtedly, regular and contract faculty have things in common (an educational focus, instruction, academic achievement as a position requirement) and not (tenure versus annual contracts, sharply different degrees of research responsibilities). So where to draw the line?

Unfortunately, an already-slow process has been made worse by the curious choice of the Minnesota legislature to enshrine the University of Minnesota bargaining units in state law over 30 years ago. It’s clear that tenured and tenure-track faculty are in what the law defines as Unit 8. But what about contract faculty? The University claimed that they are in the “Academic Professional and Administrative Staff” unit (Unit 11) by law, so there is nothing for BMS to decide. The union claimed that the law is so old that contract faculty are new positions that need to be classified by BMS. Over multiple objections by the University, BMS agreed with the union. So a lengthy hearing was held last spring, and BMS finally issued its ruling earlier this week.

In its ruling, BMS largely sided with the union and placed contract faculty into Unit 8 along with regular faculty (although extension faculty were excluded because they are not located on the Twin Cities campus). So unless the University is successful in an appeal, an election will occur some day and will uniquely include regular and contract faculty in the same unit. But that’s still a ways off because (a) the University will probably appeal, and (b) there still needs to be more hearings over excluding supervisors (which could include me as department chair) and determining whether instructors who teach minimal classes are real employees and therefore included. So again, union organizing can often be a lengthy process.

So what about the BMS ruling? How could they put regular and contract faculty together? If this occurred in the private sector, my guess is that they wouldn't have been placed together because they would have been seen as having distinct communities of interest. But in the private sector (and probably in most states), nothing is pre-specified so the National Labor Relations Board (NLRB) could put them together, or keep them separate. What the University seemingly failed to appreciate in this case is that Minnesota law has already limited the bargaining units. So BMS really wasn't deciding whether faculty and instructors go together, it was really deciding whether instructors go with faculty or go with the “everything else leftover” professional and administrative unit that also includes accountants, cartographers, athletic trainers, and over 300 other job titles. The university kept arguing that instructors aren’t faculty. But BMS ruled that they are even less like accountants and athletic trainers. Or the way I’ve bastardized it, bananas aren’t apples, but they are more like apples than like airplanes.

So whether or not this ruling makes it more or less likely that the faculty will vote to unionize remains to be seen. And if the faculty do unionize, it will undoubtedly be an interesting case study of how to include regular and contract faculty interests in bargaining and representation. In the meantime, the events of this year clearly illustrate how this can be a drawn-out process. And at a broader level, this also illustrates why legislators should be careful not to overly prescribe matters and to instead craft laws in ways that are flexible and adaptable.

Labor Relations 101 as Told Through the Musical Newsies

I’m not sure whether to hope that my labor relations students saw the musical Newsies at the Orpheum during its stop in Minneapolis. On the one hand, it would be great if they had because it presents some enduring and important themes. On the other hand, how can my lectures compete with the highly-entertaining songs, dances, and staging? So maybe it’s better if they don’t see it…

In either case, an important labor relations theme brought to life is that a labor union is most fundamentally a group of workers who want to collectively improve how they are treated. In Newsies, the newspaper boys ("newsies") want to protest a hike in the price they are charged for buying papers to sell in 1899 in New York City. Someone points out that this would be a strike, but they think they can’t strike because they aren’t a union. They don’t have official leaders or rules. But lead character Jack Kelly corrects this mistaken view when he sings,

Even though we ain't got hats or badges,

we're a union just by sayin' so...

Another important labor relations theme is that wages and monetary items are important, but so too, are voice and dignity. The newsies sing this loud and proud:

Pulitzer and Hearst, they think we're nothin'.

Are we nothin'?

No!

…

Pulitzer may own the world, but he don't own us.

Pulitzer may crack the whip, but he won't whip us.

But why collective action? Jack reminds us of a key industrial relations assumption. The newsies are living day-to-day and can’t go without work very long, whereas owners and employers like Joseph Pulitzer have extensive resources and can hold out longer. So individual workers are typically at a distinct bargaining power disadvantage. Unionization is simply a way to try to balance this uneven playing field. Well, as illustrated in Newsies and in many real-life situations, maybe not so "simple." And a value or approach certainly not universally-shared. But seeing institutions as important mechanisms for helping remedy bargaining power imbalances is a key industrial relations principle.

Lastly, another lesson is that strikes and the threat of being replaced can be a deeply conflictual and highly emotionally-charged situation. Even in the artistic venue of musical theater, this energy is channeled into probably the most powerful dance numbers I’ve seen—not only in Newsies, but even more so in Billy Elliot. Yes, the alignment-of-interests-unitarist-HRM numbers in Kinky Boots are highly entertaining. But not as powerful. Now if only I could figure out how to write Hormel: The Musical. Wouldn’t “Cram Your Spam” be a catchy number?

Why So Many Lockouts? Means, Motive, and Opportunity

It has been an eventful year in labor relations: attacks on the NLRB, controversial ballot initiatives, strikes at Hostess and elsewhere, and, most recently, an attempt to push through controversial right-to-work legislation in Michigan. But to me, the most striking trend (sorry for the pun) is the continued heightened use of lockouts. A lockout is an employer-initiated work stoppage that stems from a failure to negotiate a collective bargaining agreement. Unlike a strike, locked out workers cannot be permanently replaced so they are entitled to their jobs when the lockout ends. Being able to use permanent strike replacements had been seen as a major employer advantage, so why the increase in lockouts? It comes to down to means, motive, and opportunity.

At first glance, the ongoing and recent lockouts might look dissimilar--professional football referees, professional hockey players, orchestra musicians from the Minnesota Orchestra, St. Paul Chamber Orchestra, and elsewhere, and sugar-processing workers from American Crystal Sugar. But dig deeper and we can see that in all of these cases, employers are particularly vulnerable at particular points in time--the playoffs in the professional sports, the concert season for orchestras, harvesting time for sugar beets. Rather than being caught in a strike at an especially vulnerable time--as happened to the baseball owners in 1994 when the lucrative World Series was cancelled--employers are using lockouts to preempt strikes and control the timing of when a work stoppage occurs.

I think this is an important motivation, but by itself, timing cannot explain the sharp increase in lockout activity over the past two years or so because the same was true 5, 10, and 25 years ago. So what's different now? For starters, the global financial crisis. This provides both motive and opportunity. Motive in that employers perceive intense competitive pressure. But again, this is hard to fully accept in many cases--the labor costs of football referees are probably the size of rounding error in the financial statements of the nearly $10 billion a year business of the NFL, and the NHL owners and players face little competition except each other.

So this brings us to opportunity and means. The global financial crisis and the anti-labor / anti-worker political environment provides a ripe opportunity for employers to wrest concessions from their workers. And increased publicity around lockouts has highlighted lockouts as a viable means of pursuing these concessions. In the 1980s, Phelps Dodge demonstrated that it was possible to win a long strike using permanent strike replacements, and many companies followed suit as awareness of this tactic spread. I believe we are witnessing the same thing today with lockouts. Other lockouts have revealed this as a means that other companies can try for themselves.

Unfortunately, this trend is clearly not good for workers, and it's questionable at best for employers--the NHL might very well lose an entire season and with it, many fans, while profits at American Crystal Sugar are down by nearly 30 percent. Hopefully 2013 will bring an end to these lockouts, and a renewed attempt at crafting more productive labor relations strategies. For that, there should always be means, motive, and opportunity.

Labor Relations Advice: The Importance of Being Level-Headed and Respectful

As an author of a comprehensive labor relations textbook (Labor Relations: Striking a Balance, McGraw-Hill), I was recently asked to provide some general advice for future human resources and labor relations managers. Issues within the labor relations arena can often be laden with highly-charged and volatile emotions. For complex reasons, the mere mention of labor unions can raise passions, if not outright hostility, among business leaders and others to a much greater extent than many other business and economic issues. Managers should avoid these traps, and instead approach issues in labor relations in a level-headed and respectful manner.

An important part of being level-headed is seeking to truly understand other perspectives. Business and labor leaders frequently disagree on key issues, and there is a tendency for each side to dismiss the other side as greedy, short-sighted, and other negative attributes. What's overlooked is that business and labor leaders typically have different underlying frames of reference--that is, different implicit assumptions about the workings of the employment relationship. By embracing contrasting frames of reference, business and labor leaders effectively see the world through different lenses, and therefore have contrasting views on best business practices. It is important for managers to understand these frames of references in order to approach labor relations issues wisely.

With respect to the employment relationship, business leaders typically have an interest-alignment frame of reference. From this perspective, it is assumed that the interests of employers and employees can be aligned by well-designed human resource management practices. A pay-for-performance system, for example, can serve employers' interests for high levels of employee performance while simultaneously fulfilling employees' interests in greater rewards. Labor leaders, in contrast, typically have a plurality of interests frame of reference. From this perspective, the employment relationship is seen as having complex stakeholders with multiple interests that cannot always be aligned--higher dividends for shareholders mean less compensation available for employees, longer work hours yield higher profits, but more employee stress, and so on.

Even though these two different ways of seeing the employment relationship are usually implicit rather than explicitly articulated, they yield sharply contrasting views on labor unions. From an interest-alignment perspective, labor unions are seen as unnecessary. Human resource management practice is based on the interest-alignment assumption that what's good for employees is good for business, and vice versa. If there is conflict in the workplace, it is believed that improved human resource management practices will resolve this.

Moreover, if markets are seen as ideally competitive, as in the basic textbook model of economics, then any employer that tries to exploit its employees will not be able to recruit and retain employees. Indeed, if markets are competitive in the ideal sense, then labor unions are seen as worse than unnecessary--they are seen as monopolizing organizations that distort the operation of competitive markets to the benefit of union members and at the expense of all others. It bears repeating that this perspective reflects a particular frame of reference that rests on a belief that markets are competitive in the ideal case of the basic economic model.

From a plurality of interests perspective, labor unions are seen in a very different light. Specifically, the belief that conflicts of interest invariably exist in the employment relationship means that employers will not always act in the best interests of its employees. Labor unions are therefore seen as an important voice mechanism that represents employees' interests when decisions are made. Moreover, economic markets are not believed to be competitive in the ideal textbook sense. Rather, employers are seen as having bargaining power advantages over individual employees. Labor unions are therefore seen as a necessary vehicle for striking a better balance between employers' interests and employees' interests when markets favor employers over individual employees. It is this frame of reference, not an interest-alignment frame of reference, that is widely embraced by labor leaders, that provides the intellectual foundation for labor laws that protect employees' right to form unions, and also that helps us understand why employees try to form unions.

Appreciating these contrasting perspectives is a key element of being a level-headed manager within the labor relations domain. At the same time, recognizing these different perspectives is not a magic solution. It does not make the differences between the business and labor perspectives disappear. But it does provide the basis for a rational understanding of the different perspectives. Rather than dismissing labor leaders as selfish or short-sighted, they should be respected for pursuing what they believe is a socially beneficial path. This more respectful view, in turn, provides the foundation for developing a productive rather than destructive dialogue with labor leaders and like-minded employees. Ultimately, whether a labor union is good or bad from a business perspective depends on the specific labor-management relationship within a particular organization. To create a productive relationship, managers should avoid the emotional rhetoric that too often accompanies labor relations issues, and instead should be level-headed and respectful.

When dealing with labor leaders during negotiations and when handling grievances, it is also important for managers to remain level-headed and respectful. In these contexts, managers and unions leaders both have constituencies that they are trying to satisfy. Managers want the approval of other managers and their bosses; union leaders need the approval of the rank and file union members. The difference is that these concerns are played out in a more public fashion on the union side. A disapproving executive can quietly reprimand a labor relations manager, but an unpopular labor leader will be publicly voted out of office.

So managers need to remember that part of what happens during bargaining and grievance handling is a performance to demonstrate strength to the rank and file union membership. Managers therefore should avoid getting emotionally involved in these incidents. Table pounding, yelling, even personal attacks are likely a "show" for the rank and file. Level-headed managers know their roles and the nature of the entire performance, and wait for their opportunities to deal productively with the labor leader out of the public spotlight. In multiple ways, then, remaining level-headed and respectful is a key route to success in the labor relations arena.

Note: For more on the importance of frames of reference in human resources and labor relations, see John W. Budd and Devasheesh Bhave (2010) "The Employment Relationship," in Adrian Wilkinson, Tom Redman, Scott Snell, and Nicolas Bacon, eds., Sage Handbook of Human Resource Management (London: Sage), pp. 51-70.