Deck 13: Labor Relations

Question 1

What was the impetus for the Amalgamated Clothing and Textile Workers Union (ACTWU) organizing effort at SGA Industries?
2. Discuss SGA's strategy in managing the representation campaign.
3. Discuss any potential unfair labor practice charges SGA management might face as a result of their campaign strategy.

Answer 1

1.Drastically decrease in wage rates, elimination of perks and de-motivating decision by S industries triggers ACTWU to organize an event for union election. According ACTWU, workers at S was continuously exploited. Their basic pay was even below the industry standards. Therefore, according to ACTWU in order to protect workers from the exploitation union must be formed.
2.Along with P, TW was leading anti-union campaign in order to demolish union making efforts by ACTWU. The anti-union strategy framed by Atlanta law firm consists of extensive meeting with community, business leaders and religious leaders in an attempt to influence workers viewpoint for union. Letters were sent to worker's home stating the need of teamwork instead of union. Management has started responding quickly on every issue related to workers.
3.Frequently visits to plants by P and TW in order to influence workers disturb them psychologically. Employee newsletter was filled with anti-union letter written by workers and community members. Anti-union films organized during business hours are few examples of unfair labor practice done by S industries.

Question 2

What are the pros and cons of North American Tire's strategy of hiring replacement workers? How ethical is the behavior of management?
2. Assuming that the firm's goal is to break Local 974 of United Tireworkers of America, what are the advantages and disadvantages of this strategy?
3. What standard should the firm use in setting wage rates (industry or geographic)?

Answer 2

1.NAT's strategy of hiring replacement workers provides numerous benefits to the company such as:
• Resuming of blocked production in the factory,
• New employees agreed to work on Company's conditions,
• Injection of new and upgraded talent in the company, and
• Relief from strike's consequences on production.
Company by executing replacement hiring policy may face several disadvantages such as:
• De-motivation of existing workers,
• Management may face more powerful resistance from workers,
• Legal consequences of breaking contract with union workers, and
• Additional cost involved in hiring new workers.
As per federal law, strike is one of the main rights of the worker. Through strike, workers communicate the dissatisfaction for the employer. Hiring replacement worker is not ethical because instead of listening to the problem of the workers, management indirectly terminating them by hiring new workforce. This kind of behavior of management is considered as immoral and violates the provision of federal labor laws.
2.In order to break local 974, hiring replacement worker as a strategy of management produces both advantages and disadvantages to the company.
Benefits to the company are:
• Resuming of blocked production in the factory trigger workers of union to get back to work which tempers the unity of the workers.
• Injection of new and upgraded talent in the company establishes threat for existing workers of loosing job which helps in breaking the strike.
Disadvantages of hiring strategy are:
• De-motivation of existing workers and management,
• More powerful resistance from workers, and
• Legal consequences of breaking contract with union workers.
3.In order to attain win-win situation for both the parties, management should redesign the wage rates according to the industry and labor laws. The wage rates should not be below industry standards. When company set the standard wages rate, it would give no option to the employees to go on strike.