Unions are organized associations of employees, workers, or laborers. They can be public employees or private employees. The goal of a union is to help workers have one combined voice, instead of many voices, to increase the influence because they work as a combined group. This, in turn, helps workers be able to protect their rights within their workplace.
The historical influence of unions has been profound on the societies of the developed world. They have help to provide safer working environments, reduce child labor, and provide benefits to workers that are now considered standard for a job offer, such as healthcare insurance.
Unions have also been known to create contracts which reduce the effectiveness of a business, sometimes driving costs up so high that the business owner goes into bankruptcy.
As more legislation is introduced to consider limiting the rights of unions, here are some of the pros and cons to think about and discuss.
List of the Pros of Unions
1. Worker protections are enhanced by the presence of a union.
Employment is provided with an at-will contract in many areas of the developed world. That means a worker can be fired for virtually any reason, including actions that do not take place at work. With the presence of a union, workers are more likely to have a system of due process which allows them to retain their employment. That means there must be evidence of incorrect action or inappropriate behavior to initiate a termination.
2. Workers can defend themselves.
If a worker in a non-union environment receives a disciplinary action statement regarding their conduct, then their only recourse is to provide a written response that attaches to the statement. It doesn’t even need to be signed or acknowledged to be included in that worker’s employment file. In a union environment, workers have a grievance process that can be followed, which may lead to arbitration, if they disagree with a disciplinary action that is taken against them.
3. It increases the power of negotiation for the workers.
Unionized workers are able to negotiate contracts or a collective bargaining agreement as a combined unit. Without the presence of a union, workers are forced to negotiate their wages and benefits on their own. That limits their power. Employers can look for qualified workers who are willing to be paid less or receive fewer benefits as a way to save money, forcing individuals to accept a substandard wage for their education or experience.
4. Workers have a better chance at a meaningful retirement.
Employees that are represented by a union in the workplace have better access to retirement benefits. Just 7% of workers that are actively employed within a unionized workplace to not have access to retirement benefits. 36% of non-unionized workers do not have access to a retirement benefit. It’s not just a 401k or an IRA with an employer match that is available either. Union workers are more likely to have access to a pension when they retired when compared to non-union workers.
5. Workers receive a guaranteed advocate.
Unions create a system where there is local advocacy for them when there are workplace concerns present. This advocacy does more than provide an enhanced level of job security. It also promotes a working environment that is fair for each worker. If one employee receives more working assignments than others or is treated in a manner that is different, an advocate can step into the situation to correct the issue on the worker’s behalf.
6. Workers can provide better benefits for their families.
When a worker finds employment in a unionized environment, 9 out of 10 of them will have access to meaningful benefits that are provided to their families. These benefits may include medical insurance, life insurance, and disability protections. About 90% of the benefits provided to families have their costs covered by the employer. For non-union workers, just two-thirds of family benefits are covered, and fewer workers have access to family-related benefits because of their employment.
7. Workers earn more when a union is present.
In the United States, a worker who is represented in their workplace by a union are paid about $200 more per week, before taxes. They receive better benefits when compared to non-union workers as well, such as improved healthcare coverage, more vacation days, more paid holidays, and more sick days. Union workers have access to the same overtime rules as non-union workers.
8. Workers are not subjected to personal favoritism.
Union workplaces are based on a promotion and relegation system that is based on seniority, then experience. Workers can be hired into high-level positions within a union if they have the provable experience to hold that position. Promotions occur because of seniority instead of because someone is the relative or friend of someone in the C-Suite. There is a clear chain-of-command that is followed when layoffs occur as well. Everyone is on the same page because everyone knows what the rules are before they start working.
9. Workers are often subjected to a probationary period in a new position.
One of the conditions of employment within a unionized workplace is a probationary period. These periods may reflect a 90-day period or last for 12-18 months, depending upon the demands of the job. When workers are within this probationary period, the full rights of union representation may not apply. Workers can often be terminated for lack of performance much more easily if they are in their probationary period compared to workers who have already made it through.
List of the Cons of Unions
1. Unions do not provide representation for free.
Belonging to a union requires workers to pay a portion of their salary for the benefits of representation. Most unions keep the percentage required for dues to 2.5% or less, with some workers paying as little as 1.5%. It is not unheard of, however, for some unions to charge 3.5% or more in dues, plus require a yearly fee or verified participation in a union event. There may also be initiation fees or apprenticeship fees that must be paid, which can take a severe bite out of a worker’s paycheck.
2. Unions do not always look for the most experienced workers.
The structure of a union may create a level playing field for workers, but this comes with a catch. Because seniority is emphasized often within the structure of a union, there is no guarantee that a worker who receives a promotion will have the skills necessary to get the job done. The most senior worker who applies for a promotion will be the most likely to receive it. At the same time, the least senior worker, no matter what their experience may be, will be the first to receive a layoff notice.
3. Unions participate in actions that may go against worker wishes.
Many unions are politically active and lobby governments at the local, state, and national level. The costs for these lobbying efforts often comes out of the dues which are paid by the workers to the union. Although court rulings have allowed workers to opt-out of political spending costs from their dues, the union may still take a political position that it asks them to support, even though they disagree with it. Many unions even ask their members to lobby for specific causes, at their own expense, to support these efforts.
4. Unions can negotiate powerful contracts that limit employer influence.
For a unionized work environment to be beneficial for everyone, each party must have adequate representation at the negotiating table. What happens, more often than not, is that the employer places themselves at a disadvantage because of providing inadequate representation here. When this happens, it can be difficult for a worker to be terminated, even if they are performing poorly. It can also be difficult to change the contracts that are negotiated, even if they are found to be harmful to the long-term financial health of the business.
5. Unions discourage individual identities.
Unions encourage workers to come together as one voice to maximize their power as a group. Although this can be beneficial, there are some drawbacks to this structure as well. Workers lose their individuality in this type of environment, which can reduce the overall creativity found in daily production. Workers may even find themselves forced to follow decisions made by the union regarding job performance. Many unions require nothing more than a majority vote to proceed on core issues.
6. Unions encourage dissent within the workplace.
A unionized workplace creates an us vs. them environment between the management of the company and the individual workers. Each party feels like the other is out to get them in some way, so each person does their best to limit the influence of the other. Instead of working toward something that is mutually beneficial, each group tends to look out for themselves only, and that hurts the overall productivity for the business.
7. Unions use seniority for multiple purposes.
When layoffs occur within a business, they can affect everyone. The difference is that an employee laid-off with seniority often has the right to bump someone else out of a position that hasn’t been terminated. That process continues until the least senior worker is bumped or there are no other available positions. Instead of the worker losing their position, they go into a different job and someone else loses their position instead. That leaves a level of unpredictability within the workplace that can be difficult for some new workers to accept.
8. Unions can sometimes play by a different set of rules.
Legislation in the United States allows a union to operate as a tax-exempt organization. Some earn millions of dollars through various sources of income that do not reach the general tax pool of funds for the country each year. This structure allows the leadership of a union to become wealthy and powerful, sometimes at the expense of the workers they represent. That forces some workers into a decision: keep their job and deal with the union or quit their job without a guarantee of future employment.
9. Unions can make taxpayers foot the bill.
Public unions work with employees that are generally hired for government-based work. Their contracts are negotiated between union members and politicians. If the politicians strike a “bad” deal, then it is the taxpayers which will foot the bill for it – not the politicians themselves. Private unions may cause a business to increase their prices to support the higher wages or better benefits being offered, which also causes taxpayers to foot the bill in the long run.
The pros and cons of unions are important to evaluate because we are at a transition point in our labor force once again. Some see unions as a way to create an unfair advantage for some workers. Some suggest that legislation requires safe working conditions already, which negates the need to have a union present. By evaluating each key point, we can all work together to determine what future unions will have in the workplace.
Blog Post Author Credentials
Louise Gaille is the author of this post. She received her B.A. in Economics from the University of Washington. In addition to being a seasoned writer, Louise has almost a decade of experience in Banking and Finance. If you have any suggestions on how to make this post better, then go here to contact our team.