1 / 12

Union Role in Wage and Salary Administration

Chapter. 15. Union Role in Wage and Salary Administration. Median Weekly Earnings of full-time wage and salary workers by union affiliation and industry, 2005. Union Nonunion Private wage and salary 757 615 (23% premium) Mining 905* 865* Construction 933 590

jaclyn
Télécharger la présentation

Union Role in Wage and Salary Administration

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Chapter 15 Union Role in Wage and Salary Administration

  2. Median Weekly Earnings of full-time wage and salary workers by union affiliation and industry, 2005 UnionNonunion Private wage and salary 757 615 (23% premium) Mining 905* 865* Construction 933 590 Manufacturing 722 667 Transportation and utilities 864 676 Wholesale and retail trade 615 562 Government 850 692 * (2004 data) Percentage increase, 2004-05, private sector Union: 2.4% Nonunion: 1.8% Source: U.S. Department of Labor, Bureau of Labor Statistics, January 2006.

  3. Union Impact on General Wage Levels • Unions do make a difference in wages • Union workers earn between 8.9% and12.4% more than nonunion workers • Size of gap varies from year to year • During periods of higher unemployment, impact of unions is larger • During strong economies, union-nonunion gap is smaller • Union-nonunion wage differentials in public sector • Union employees earn about 16 – 19%more than their nonunion counterparts

  4. Structure of Wage Packages • Three dimensions related to wage structure • Division between direct wagesand employee benefits • Evolution of two-tier pay plans • Relationship between worker wages and pay of managers in union and nonunion environments

  5. Wage Structure: Two-Tier Pay Plans • Two-tier pay structures are a phenomenon of union sector • Contract differentiates pay based upon hire date • Employees hired after a target date will receive lower wages than their higher-seniority peers in similar jobs • From management’s view, wage tiers are a viable alternative pay strategy • Cost control strategy to allow expansion or investment • Cost-cutting device to allow economic survival • From a union’s perspective, wage tiers are viewed as less painful than • Wage freezes • Staff cuts among existing employees • However, tradeoff bargained away equivalent wage treatment for future employees

  6. Two-Tier Pay Plans • Recent two-tier agreements • Delphi, Visteon/UAW • Caterpillar/UAW • S. Cal grocery ers/UFCW • Workers on lower tier have more negative attitudes • Effects of permanent and temporary plans differ • Perceived employment mobility moderates attitudes • Low mobility workers had more positive attitudes than high mobility • Source: Townsend and Partridge (1999)

  7. Union Impact: The Spillover Effect • Employers seek to avoid unionization by offering workers wages, benefits, and working conditions won in rival unionized firms • Outcomes • Nonunion management continuesto enjoy freedom from union“interference” in decision making • Workers receive “spillover” of rewards obtained by unionized counterparts

  8. Role of Unions in Wage andSalary Policies and Practices • Role of unions in administering compensation is outlined in contract • Basis of pay • Regular pay • Overtime pay • Pay for nonstandard shifts • Incentive pay • Occupation-wage differentials • Experience/merit differentials • Automatic progression based on seniority • Merit • Combination of automatic and merit progression

  9. Role of Unions in Wage andSalary Policies and Practices (cont.) • Other differentials • Pay to unionized employees employed by firm in different geographic areas • Part-time and temporary employees • Vacations and holidays • Wage adjustment provisions • Deferred wage increases • Re-opener clauses • Cost-of-living adjustments (COLAs) or escalator clauses

  10. Unions and Alternative Reward Systems • When employers face extreme competitive pressures, unions are receptive to alternative reward systems linking pay to performance • Union stipulations • Equity issue involves use of group-based measures with equal payouts • Minimize bias • Use of objective performance measures in unionized firms • Use of measures based on past performance • 20 percent of all U.S. collective bargaining agreements permit some alternative reward system

  11. Types of Alternative Reward Systems • Lump-sum awards • Given in lieu of merit increases • Employee stock ownership plans (ESOPs) • Give employees part ownership in company • Pay-for-knowledge plans • Pay employees more for learning a variety of different jobs or skills • Gain-sharing plans • Align workers and management in efforts to streamline operations and cut costs • Profit sharing plans • Allows union members to share wealth with more profitable firms

More Related