Labour is the effort, both physical and mental, made by human beings in production. It is the 'human' element which is important.
Because people have feelings and their response to economic is different from that оf machines. First, whereas a machine which proves profitable can be reproduced fairly easily and quickly, the overall supply of labour does not depend upon its earnings. Second, the effort of labour is not determined solely by the reward offered. The method of payment may affect effort, while raising wages may result in less work being offered. Third, labour does not move readily, either occupationally or geographically, in response to the offer of a higher reward. Fourth, workers can combine together in trade unions. Finally, if unemployed for long periods, workers deteriorate physically and mentally.
Both firms and government must have policies which take account of these special characteristics. Training schemes are essential to improve the skill of workers and thus their productivity. Finns must pay particular attention to psychological and social factors in an effort to motivate workers, e.g. by profit-sharing schemes. Furthermore, they must endeavour to co-operate with the workers’ trade-union representatives.
A labor union is a group of individuals working together to achieve shared job-related goals, such as higher pay, shorter working hours, more job security, greater benefits, or better working conditions. Labor relations describe the process of dealing with employees who are represented by a union.
There are two basic types of labor unions — craft and industrial. A craft union is an organization of workers with specific stills, like carpenters or pilots. An industrial union, on the other hand, is an organization of all workers at all levels with one given industry.
Labor unions grew in popularity in the United States in the nineteenth and early twentieth centuries.13 The labor movement was born with the Industrial Revolution, which also gave birth to a factory-based production system that carried with it enormous economic benefits. Job specialization and mass production allowed businesses to create ever-greater quantities of goods at ever-lower costs.
There was a dark side to this era. Workers became more dependent on their, factory jobs. Eager for greater profits, some owners treated their workers like other raw materials: resources to be deployed with little or no regard for any individual worker's well-being. Many businesses forced employees to work long hours - 60-hour weeks were common, and some workers were routinely forced to work 12 to 16 hours a day. With no minimum-wage laws or other controls, pay was also minimal and safety standards virtually nonexistent. Workers enjoyed no job security and received few benefits. Many companies, especially textile mills, employed large numbers of children at poverty wages. If people complained, nothing prevented employers from firing and replacing them at will.
Unions appeared and ultimately prospered because they forced management to listen to the complaints of all workers rather than to just the few who were brave (or foolish) enough to speak out. The power of unions, then, comes from collective action. Collective bargaining (which we discuss more fully later in this chapter) is the process by which union leaders and managers negotiate common terms and conditions of employment for the workers represented by unions. Although collective bargaining does not often occur in small businesses, many midsize and large businesses must engage in the process.
Although, the percentage of workers who have joined unions may be declining somewhat, the total number of union workers is substantial. There are several reasons for this substantial membership.
1. Unions are seen as helping workers get higher wages and fringe benefits.
2. Unions are seen as helping workers improve working conditions.
3. Unions are seen as protecting workers from unfair management.
4. Unions are seen as possessing political power.
Trends In Union-Management Relations. The gradual decline in unionization in the United States has been accompanied by some significant trends in union-management relations. In some sectors of the economy, perhaps most notably the automobile and steel industries. Labor unions still remain quite strong. In these areas, unions have large memberships and considerable power in negotiating with management.
In most sectors, however, unions are clearly in a weakened position, and as a result, many have taken significantly more conciliatory stances in their relations with management. This situation contrasts sharply with the more adversarial relationship that once dominated labor relations in this country. Increasingly, for instance, unions recognize that they don't have as much power as they once held and that it is in their own best interests, as well as in those of the workers they represent, to work with management instead of working against it. Ironically, then, union-management relations are in many ways better today than they have been in many years. Admittedly, the improvement is attributable in large part to the weakened power of unions. Even so, however, most experts agree that improved union-management relations have benefited both sides.
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