Trade union

A union (labor union in American English; trade union in British English; either labour union or trade union in Canadian English) is a group of workers who act collectively to address common issues.

In many countries, unions may acquire the status of a legal entity (called a "collective bargaining agent" in the USA). Typical examples, depending on the country, could be all the assembly workers for one employer, all the teachers in a local school district, or all the workers in a particular industry. In such cases, unions have certain legal rights, most importantly the right to collectively negotiate with an employer (or employers) over wages, working hours and other terms and conditions of employment -- meaning that such things are not set unilaterally by management, but must be agreed upon by both parties.

In many circumstances, unions do not have such rights and workers may typically threaten strikes or other collective action to pressure employers to negotiate.

Unions also often use their organizational strength to advocate for social policies and legislation favorable to their members or to workers in general.

The political structure and autonomy of unions varies widely from country to country. American, Canadian and European unions are founded upon democratic principles and leaders are selected by election process, while in the People's Republic of China and Cuba, unions are controlled and run by the state.

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The concept of trade unions began early in the industrial revolution. More and more people left farming as an occupation and began to work for employers, often in appalling conditions and for very low wages. The labour movement arose as an outgrowth of the disparity between the power of employers and the powerlessness of individual employees.

The 18th century capitalist economist Adam Smith noted the imbalance in the rights of workers in regards to owners (or "masters") in The Wealth of Nations. In chapter 8, Smith wrote:

We rarely hear, it has been said, of the combinations of masters, though frequently of those of workmen. But whoever imagines, upon this account, that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labour above their actual rate…
[When workers combine,] masters… never cease to call aloud for the assistance of the civil magistrate, and the rigorous execution of those laws which have been enacted with so much severity against the combinations of servants, labourers, and journeymen.

As indicated in the preceding quotation, unions were illegal for many years in most countries. There were severe penalties for attempting to organize unions, up to and including execution. Despite this, unions were formed and began to acquire political power, eventually resulting in a body of labour law which not only legalized organizing efforts, but codified the relationship between employers and those employees organized into unions. Many consider it an issue of fairness that workers be allowed to pool their resources in a special legal entity in a similar way to the pooling of capital resources in the form of corporations.

The right to join a trade union is mentioned in article 23, subsection 4 of the UDHR, and today a government-imposed ban on joining a union is generally considered a human rights abuse. The UDHR also states in article 20, subsection 2. that "No one may be compelled to belong to an association" and so compulsory state-enforced union membership could also be considered abuse. Most democratic countries have many unions, while most authoritarian regimes do not, although in most Communist countries unions exist as state organs.

Origin of unions

Unions are sometimes thought to be successors to medieval guilds. This is still being debated by historians. Medieval guilds existed to protect and enhance their members' livelihoods, through controlling the instructional capital of artisanship, and the progression of members from apprentice to craftsman, journeyman, and eventually to master and grandmaster of their craft. In the rigid hierarchical world of medieval rights and responsibilities, the guild exhibited aspects of the modern trade union, a professional association and the modern corporation.

The guilds have also been viewed as cartels, limiting the number of producers and thus stagnating the supply and development of products and production methods and hindering the rise of welfare and living standards.

Since the publication of the History of Trade Unionism (1894) by Sidney and Beatrice Webb, the predominant historical view is that a trade union " a continuous association of wage earners for the purpose of maintaining or improving the conditions of their employment." (Webb)

A modern definition by the Australian Bureau of Statistics states that a trade union is " organisation consisting predominantly of employees, the principal activities of which include the negotiation of rates of pay and conditions of employment for its members".

Yet historian R.A. Leeson, in United we Stand (1971), said: "Two conflicting views of the trade-union movement strove for ascendancy in the nineteenth century: one the defensive-restrictive gild-craft tradition passed down through journeymen's clubs and friendly societies,...the other the aggressive-expansionist drive to unite all 'labouring men and women' for a 'different order of things'..."

Recent historical research by Dr Bob James in Craft, Trade or Mystery (2001), puts forward that trade unions are part of a broader movement of benefit societies, which includes medieval guilds, Freemasons, Oddfellows, friendly societies and other Fraternal organizations.

Shop types

Companies that employ workers with a union generally operate on one of several models:

  • In a closed shop, a business may only hire workers who already belong to the union. The compulsory hiring hall is the most extreme example of a closed shop - in this case the employer must procure new employees directly from the union.
  • In a union shop, a business may hire anyone, but workers must join the union within a designated amount of time after they start work (this is known as a "closed shop" in British English)
  • In an agency shop, workers may choose to not join the union, but must pay a fee to the union for its services in negotiating their contract. This is sometimes called the Rand formula. In certain situations involving state government employees, for example California, fair share laws make it easy to require these sorts of payments.
  • In an open shop, a business may employ anyone it likes, regardless of their union status, and workers are not required to associate with a union at all.


Trade unions are often accused to benefit the insider workers, those having a secure job and high productivity, at the cost of the outsider workers, those who are unemployed or at the risk of unemployment or who are not able to get the job that they want. The so-called insider-outsider theory analyzes this problem.

Usually, the marginal benefit of an additional worker decreases as the number of workers increase. This implies that the lower the minimum wage, the more workers a company can profitably employ. Thus, while an increase in the minimum wage benefits the insiders, as a result fewer new workers are employed and fewer retiring workers are substituted by a new one. In a capital-intensive production plant this effect is typically smaller than in a work-intensive service company.

The economic analysis of a cartel applies completely to most unions, to those that try to fix the (minimum) price of work, to limit supply (e.g., by some criteria on membership or education) or to limit competition. On the other hand, unions often have also other functions than those of a cartel: they may advise the workers, warn about disadvantageous contracts or terms of employment etc. These latter functions are usually considered as beneficial for both the workers and for the society as a whole (though not necessarily for corporations or shareholders), whereas the opposite applies to cartel-type minimum terms.

Often the union on a particular industry puts pressure on politicians to subsidize the industry concerned. This benefits both the workers, companies, shareholders and consumers of the product of that industry at a cost to other people. Thus, it depends on the question whether the interests of a trade union are for or against the interests of the companies, workers, unemployed, tax-payers or the society as a whole.

The problem of international comparison

As labour law is very diverse in different countries, so is the function of unions. For instance in Germany, only open shops are legal. This affects the function and services of the union. On the other hand, German unions have played a greater role in management decisions through participation in corporate boards and co-determination than have unions in the United States.

In addition, unions have very different relationships with political parties in different countries. In many countries unions have formed long-term relationships with a political party which is intended to represent the interests of working people. Typically this is a left-wing or socialist party, but there have been many exceptions. In the United States, by contrast, while the labor movement is historically aligned with the Democratic Party, the labor movement is by no means monolithic on that point; the International Brotherhood of Teamsters has supported Republican Party candidates on a number of occasions and the Professional Air Traffic Controllers Organization (PATCO) endorsed Ronald Reagan in 1980 (the following year, Reagan effectively destroyed PATCO, breaking a strike by bringing in permanent replacement workers). The AFL-CIO has refused to take a pro-choice stance on abortion so as not to alienate its large Catholic constituency. In the United Kingdom the labour movement's relationship with the Labour Party is fraying as party leadership embarks on privatization plans at odds with what some perceive as workers' interests.

Finally, the structure of employment laws affects unions' roles. In many western European countries wages and benefits are largely set by governmental action. The United States takes a more laissez-faire approach, setting some minimum standards but leaving most workers' wages and benefits to collective bargaining and market forces.

Trade unions in Britain

The legal status of trade unions in the United Kingdom was established by a Royal Commission in 1867, which agreed that the establishment of the organisations was to the advantage of both employers and employees. Most British unions are members of the TUC, the Trades Union Congress, and where appropriate, the Scottish Trades Union Congress and the Irish Congress of Trade Unions, which are the country's principal national trade union centers. The Labour Party arose from the organised labour movement and still has extensive links with it. Margaret Thatcher's governments weakened the powers of the unions in the 1980s and some within the British trades union movement criticise Tony Blair's Labour government for not reversing some of Thatcher's changes since taking office in 1997.

Labor unions in the United States

Most labor unions in the United States are members of a larger umbrella organization, the AFL-CIO, or the American Federation of Labor-Congress of Industrial Organizations. The AFL-CIO advocates for policies and legislation favorable to workers in the United States and Canada. The AFL-CIO also often works with other international and national unions on global trade issues.

Unions of workers in the private sector are tightly regulated and overseen by the United States Department of Labor under the authority of the National Labor Relations Act (NLRA), passed in 1935, which is Administered by the National Labor Relations Board (NLRB). To join a union, workers must either win voluntary recognition from their employer or have a majority of workers in a "bargaining unit," as determined by the federal government, vote for union representation. In either case, the government must certify the existence of the union.

Unions for public sector workers are governed by labor laws and labor boards in each of the 50 states; in many states, typically those in the north, these laws and boards are modeled after the NLRA and the NLRB. In other states, public workers have no right to establish a union as a legal entity. (About 40% of public employees in the USA do not have the right to organize a legally established union.)

Once the union has won the support of a majority of the bargaining unit and is certified in a workplace, it has the sole authority to negotiate the conditions of employment. However, the NLRA provides mechanisms for the establishment of a union representing only those members of the barganing unit who expressly request representation, in such cases as those members do not constitute a majority (see Charles Morris). This unionization model was once in widespread practice, but was in large part discarded when unions began to consistently win majority support. However, due to recent developments in labor law that unions view as having effectively curbed workers' ability to organize, unions are beginning to revisit the "members only" model of unionism.

The terms and conditions of employment are spelled out in a legally binding contract between the employer and the union. When disputes arise over the contractual agreement, most contracts call for the parties to resolve their differences through a grievance process to see if the dispute can be mutually resolved. If the union and the employer still cannot settle the matter, either party can choose to send the dispute to arbitration, where the case is argued before a neutral third party.

The Taft-Hartley Act, passed in 1947 over the veto of President Harry Truman, severely limits the powers of unions in the United States, and remains in effect. Closed shops are forbidden; union shops are allowed within the limits allowed by the statute and subject to additional conditions imposed by the National Labor Relations Board and the courts. Jurisdictional strikes (where two unions each claim work that they believe should be assigned to the workers they represent) and secondary boycotts (boycotts against an allegedly neutral company that does business with another company with which a union has labor dispute) were made illegal. Unions are no longer allowed to donate money to federal political campaigns.

Most importantly, the bill provided the executive branch of the Federal government with the ability to obtain legal strikebreaking injunctions if an actual or impending strike "imperiled the national health or safety", a test that has been in practice interpreted loosely by the courts.

In the 1950s, many U.S. unions lost much of their prestige when links to organized crime were discovered. Since the 1970s, union membership has been steadily declining in the private-sector while growing in the public sector (that is, unions of government employees).

Right-to-work statutes forbid unions from negotiating agency shops. Thus, while unions do exist in so-called "right-to-work" states, they are typically weaker. Such states are humorously referred to as "right-to-work-for-less" states by union members.

Members of labor unions enjoy "Weingarten Rights." These rights allow union members to request representation by a union representative whenever management questions the member on a matter that may lead to discipline or other changes in working conditions. They are named for the first Supreme Court decision to recognize them. NLRB v. J. Weingarten, Inc., 420 U.S. 251 (1975). [1] (

In protecting the right of workers to organize unions, the NLRA goes farther. It protects the right of workers to engage in any concerted activity for mutual aid or protection. Thus, no union connection is needed. Concerted activity "in its inception involves only a speaker and a listener, for such activity is an indispensable preliminary step to employee self-organization." Root-Carlin, Inc., 92 NLRB 1313, 27 LRRM, 1235, citing NLRB v. City Yellow Cab Co. (6th Cir. 1965), 344 F.2d 575, 582. [2] (

Unions in other countries

Some countries such as Sweden, Finland, and the other Nordic countries have strong, centralized unions, where every type of work has a specific union, which are then gathered in large national union confederations. The largest Swedish union confederation is LO, Landsorganisationen. LO has almost two million members, which is more than a fifth of Sweden's population. Finland's equivalent is SAK, the Central Organisation of Finnish Trade Unions, with about one million members out of the country's 5.2 million inhabitants. France is thought to have one of the lowest union densities in Europe, however unions are much more likely to strike in France than they are in Northern Europe. France also has a much higher unemployment rate than the nations of Northern Europe.

The Australian labour movement has a long history of craft, trade and industrial unionism. While unions have sometimes been very strong, as of 2005 they are relatively weak and in decline, due in part to the actions of Prime Minister John Howard and the Liberal party.

International cooperation

The largest organization of trade union members in the world is the Brussels-based International Confederation of Free Trade Unions, which today has 231 affiliated organisations in 150 countries and territories, with a combined membership of 158 million. Other global trade union organizations are the World Confederation of Labour and the World Federation of Trade Unions.

National and regional trade unions organising in specific industry sectors or occupational groups also form global union federations, such as Union Network International and the International Federation of Journalists.


There are several sources of current news about the trade union movement in the world. These include LabourStart and the official website of the international trade union movement Global Unions (

See also

External links

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