The Correlation Between Unionization and Productivity

Before a proper analysis can be completed on the current issue of whether unions are more productive, it is necessary to develop an understanding on what effects they have on the workplace and how it impacts management decisions and in particular the policies that will be created as well as enforced by human resource management so that the organization is compliant will all aspects of the collective agreement, should one be in force at the time. This agreement is at the core of the employer-union relationship since it expressly outlines all benefits of workers as well as the necessary behaviour of management, anything outside of this legal arrangement falling onto the authority of the employer under the context of “management’s rights”. (Verma, 2005, p. 418) Taking this newfound relationship into consideration, the realistic effect that unions now have on the workplace is their “strong use of their monopoly power to force employers to pay significantly better wages and benefits.” (Verma, 2005, p. 416) These are the aspects of labour relations that are the most prevalent and visible to the general public; however, there are other areas where unions have a major impact, referred to as “industrial jurisprudence where the union, both their leadership and members gain a significant voice in almost all aspects of managerial decision-making that can have major consequences, not only for the workers, but the organization as a whole.” (Verma, 2005, p. 416) According to this same author, the primary motivation for unions to behave in this manner rests on the pursuit of fairness and to achieve more favourable working conditions as well as maintaining a strong voice in workplace matters. (Verma, 2005, pp. 416-418)

The overarching effect is ...

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...ted with productivity, a word of caution must be included before any such results are to be taken at face value. Meador and Walters in a different issue of the Journal of Labor Research came to the conclusion that many of the studies done that have published their research on the positive effects union have on productivity are problematic. They provide the following reasoning on why this is so: These studies which emphasize an efficiency-enhancing perspective on labour productivity may have been the result of a) skewed higher as a result of unions’ effects on wages, which tend to be higher in most unionized environments and b) an integrated selection process whereby the less productive unionized organizations are excluded through market forces and thus, not adequately represented in the data used to compile and execute these studies. (Meador & Walters, 1994, p. 382)