This is a case study of a collective bargaining agreement between McNeil-PPC, Johnson & Johnson Customer & Logistics Services and United Steel, Paper and Forestry, Rubber Manufacturing, Energy Allied Industrial and Service Workers International Union concerning their business in Lititz, Pennsylvania. The study details the terms and conditions of the work between the union and the contracting companies.
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What is it that accounts for the relatively recent infatuation with the term “social dialogue”? This is the question posed by the contributors Ozaki and Rueda-Catry, and also tackled by all the others from their respective standpoints as trade union leaders in confederations active at the national, regional and world levels and as specialists with an interest in labour relations issues.
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If the presence of a union in a workplace or firm raises the pay level, unless productivity rises correspondingly, financial performance is likely to be worse. If the product market is uncompetitive this might imply a simple transfer from capital to labour with no efficiency effects, but is probably more likely to lead to lower investment rates and economic senescence. Therefore the impact of unions on productivity, financial performance and investment is extremely important. This paper distils evidence on such effects from six countries: USA, Canada, UK, Germany, Japan and Australia. It is not possible to use theory to predict unambiguously any union effect on productivity because unions can both enhance and detract from the productivity performance of the workplace or firm. The evidence indicates that, in the USA, workplaces with both high performance work systems and union recognition have higher labour productivity than other workplaces. In the UK previous negative links between unions and labour productivity have been eroded by greater competition and more emphasis on ”partnership” in industrial relations but there is a lingering negative effect of multi-unionism, just as there is in Australia. In Germany the weight of the evidence suggests that the information, consultation and voice role of works councils enhances labour productivity particularly in larger firms. In Japan unions also tend to raise labour productivity via the longer job tenures in union workplaces which makes it more attractive to invest in human capital and through the unpaid personnel manager role played by full-time enterprise union officials in the workplace. Unions will reduce profits if they raise pay and/or lower productivity. The evidence is pretty clear cut: the bulk of studies show that profits or financial performance is inferior in unionised workplaces, firms and sectors than in their non-union counterparts. But the world may be changing. A recent study of small USA entrepreneurial firms found a positive association between unions and profits and in the UK the outlawing of the closed shop, coupled with a lower incidence of multi-unionism has contributed to greater union-management cooperation such that recent studies find no association between unions and profits. North American and German evidence suggests that unionisation reduces investment by around one fifth compared with the investment rate in a non-union workplace. In both Canada and the USA this effect is even felt at low levels of unionisation. The UK evidence is mixed: the most thorough study also finds that union recognition depresses investment, but this adverse effect is offset as density rises. The exception is Japan where union recognition goes hand-in-hand with greater capital intensity.
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This paper examines the construction equipment resale market to assess whether equipment produced by the world’s largest manufacturer of construction machinery, Caterpillar, experienced lower product quality in facilities that underwent contract disputes during the 1990’s. Analysis of auction data reveals that resale market participants significantly discounted machines produced in these dispute-affected facilities. Additionally, pieces of equipment produced in facilities undergoing unrest were resold more often, received worse appraisal reports, and had lower list prices. Taken together, the evidence supports the hypothesis that workmanship at dispute-affected facilities declined, and that the resulting impact on the economic quality of the equipment produced was significant. The dispute was associated with at least $400 million in lost service flows due to inferior quality equipment alone.
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This paper provides a case study of the effect of labor relations on product quality. We consider whether a long, contentious strike and the hiring of replacement workers at Bridgestone/Firestone’s Decatur, Illinois, plant in the mid-1990s contributed to the production of defective tires. Using several independent data sources and looking before and after the strike and across plants, we find that labor strife at the Decatur plant closely coincided with lower product quality. Monthly data suggest that defects were particularly high around the time concessions were demanded and when large numbers of replacement workers and returning strikers worked side by side.
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This analysis examines how changes in major industrial relations policies affected productivity over the years 1974–91 at one of the most important manufacturing plants in the United States. The authors find that productivity fell greatly, both in percentage terms and in absolute dollars, during strikes and a slowdown and during the terms of office of tough union leaders. In contrast with much of the firm performance literature, they find only small initial productivity effects of a movement from adversarial labor-management relations, which is the norm in this industry, to total quality management (TQM) and back again. How and why TQM is adopted, the authors suggest, may be as important as whether it is adopted. Finally, major industrial relations events like strikes, a slowdown, and the TQM program did not have long-term productivity effects; the firm returned to pre-event levels of productivity within one to four months.
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The impact of unions on productivity is explored using meta‐analysis and meta‐regression analysis. It is shown that most of the variation in published results is due to specification differences between studies. After controlling for differences between studies, a negative association between unions and productivity is established for the United Kingdom, whereas a positive association is established for the United States in general and for U.S. manufacturing.
Is this a situation you recognise? For some years you have been negotiating with the branch or a supplier of a large international company which by now has also firmly established itself in the ‘low wage countries’. You negotiate about collective bargaining agreements and you can’t manage to reach a good consensus about wages and working conditions for employees. Even though you know that the company
has arranged these things properly in its country of origin. So what do you do?
As a trade union leader you have a particular responsibility within your company, sector or industry: you protect and promote labour rights. It’s certainly not easy to protest against abuses or wrongs at the local branches of foreign companies.
With the help of your international network of trade union organisations and your status as a partner organisation of CNV Internationaal, you can in fact play an important role here. That’s because the CNV trade unions work to benefit people and the environment, and look further than the national boundaries. After all, CNV leaders, officials or members of the Works Council are active within international companies in the Netherlands that also operate branches abroad or purchase from foreign suppliers. Sustainability and international solidarity are two of CNV’s core values. We believe it is important that employees’ human rights are respected all over the world.
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The paper analyses examples of companies in which management, in collaboration with workers’ representatives and unions, has designed and implemented socially responsible enterprise restructuring plans. The selected examples show that by creating space for dialogue and (self-)regulation aimed at protecting the levels, as well as the terms and conditions, of employment in specific plants (plant-level agreements) or across different operations of multinational companies (transnational company agreements), win-win situations can emerge, even in times of crisis.
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This paper looks at past economic crises to identify lessons that can be learned from industrial relations developments in different regions and varying circumstances. The paper describes the development of social dialogue in the early period of the current crisis in order to inform the reader about the forms and content of crisis-related social dialogue in different parts of the world and to provide national examples. It concludes by suggesting policy options. The paper also contains tables of national and enterprise-level cases documenting the role of social dialogue and industrial relations in addressing the employment impact of the crisis.
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