Wages are the single topic most associated with collective bargaining. However, the process has transformed the American workplace over the last one hundred years in a wide variety of ways. Collective bargaining, most simply, allows employees and employers to negotiate the terms of their workplace.
Wages remain a critical component of collective bargaining. At the outset of a negotiation, the union establishes with its bargaining committee a goal for what would be an acceptable increase in wages to reach an agreement with their employer. Their goal, depending on the what industry the bargaining takes place in is set forth, as either a percentage or a cents per hour figure. In a mixed skill level bargaining unit a percentage figure is more advantageous to the high earner. For examples, if Fred earns $10.00 per hour, and Sara earns $20 per hour, a 3% increase raises Fred’s salary to $10.30, while Sara’s salary goes to $20.60 per hour, thus widening the differential in a salary from $10 to $10.30 per hour. A cents per hour increase works the opposite way. Assume a .45 cent target. Now, Fred winds up with $10.45 per hour while Sara goes to $20.45 per hour, keeping the differential at $10 per hour.
The union usually decides to push for the best outcome for the majority of the employees it represents which tends to lead to a cents per hour formula.
It is very important for the employer to know exactly where its costs are and how to best navigate to a good result.
Health and Safety:
Within the last fifteen years, “fringe benefits” have become a critical component of collective bargaining. Health care, pensions, savings plans, and time-off have taken center stage. Cost to the employer can be hidden and quite expensive. Further, staying in compliance with federal state and local government regulations has become a nightmare. Safety has also become a very important issue for both worker and employee. Federal and State OSHA compliance is mandatory and sometimes the employers must force the employee to comply, for example, wearing a safety harness, etc.
To further illustrate this point, take a group of unionized firefighters who may wish to negotiate a better system for communication between firefighters during active duty. While the firefighters may already possess working equipment, they may wish to upgrade to better technology that provides more immediate results. This deal, if successful, would not only provide a safer atmosphere for the firefighters to work, it would also improve the quality of their labor to the public, as well.
Safety concerns apply to all employees however the unionized employees that bargain safety issues have an additional remedy vehicle for a violation. Bargaining for health care plans including retiree health care is a big draw for employees to unionize. Employers beware–keep up with what your unionized competitors provide and take some or better.
Just like health and safety policies, time off procedures were once considered minor fringe benefits. Today, unionized workers get approximately 25% more paid time off than their counterparts. This time off may include vacation, holidays, sick day, and family leave. Employees who receive a generous time off policy are able to balance their work and personal lives more efficiently.
While union workers may experience better workplace benefits, their efforts continue to shape the structure for all companies, regardless of unionization. Employers who have a non-union workforce and want to keep it that way must keep up with these benefits.