Collective Bargaining 1: Historical Models of Collective Bargaining in the U.S.
Revised by Dr. Douglas Swanson, June 2022
Original author: Paul Rainsberger, JD
The predominant collective bargaining model in the United States is only one of several alternative methods through which workers have historically attempted to exert collective power in the determination of wages, benefits, and working conditions at places of employment. Before evaluating the modern collective bargaining practices and results, it is important to note that alternative methods had been implored, at least temporarily, until abandoned by workers in this country.
The starting point for distinguishing forms of collective action is recognition of the different means through which workers may attempt to achieve input and/or influence over their wages, hours, and working conditions. Labor organizations may be broadly classified as either political or economic organizations. In theory, political unions attempt to exercise power over the organization of work through political action, looking to government or the political process to establish terms and conditions of work and economic security for workers. Economic unions attempt to achieve similar goals through the economic arena, through direct interaction with the employers of workers. Virtually all modern unions in the United States today are economic organizations, albeit with varying significant political agendas. This has not always been the case. Several efforts to establish political movements of workers in this country have occurred over its history. Not one has achieved long-term stability.
The earliest economic labor organizations in the United States were temporary unions. Workers would band together to raise their wages or resist wage cuts then disband without any effort to maintain an organizational structure for future labor disputes. Even when efforts to establish a permanent structure emerged, the new permanent unions tended to have a short life span. Consolidated economic power in times of relative prosperity was generally counterbalanced when those early organizations self-destructed or were destroyed in times of economic depression or panic. In contrast, early political labor organizations tended to be countercyclical. Workers turned to political unions in higher numbers during times of economic downturns and depression. Unlike workers' experience in other nations, efforts in the United States to develop permanent and consistent political and economic organizations simultaneously have never achieved long-term success.
A second major issue when we look at the evaluating alternative models of labor organization is the identification of the intended beneficiaries of labor's collective action. Labor organizations can be classified as either job conscious or class conscious, depending on whether the goal of the union is to advance the economic and workplace security of an identifiable group of workers or whether the goal is to advance broader working or producing class interests. Occasionally, an organizational form emerges for which neither the job nor the class is the dominant bond between the members. Religious labor organizations represent an organizational model that is based on social relations rather than job or class concerns. Contemporary unions in the United States are generally job conscious organizations, although that has not always been the dominant goal of unionism in this country.
Where the more modern unions of today differ is in the determination of which workers, or jobs, get included in the determining of job conscious strategies. Class conscious unions tend to be broadly inclusive, general organizations. While there have been different conceptualizations of a working or producing class historically, craft, industrial, or occupational differences tend to be irrelevant or of secondary importance within a class-conscious organization. The early Congress of Industrial Organizations (CIO) practiced a one big house or tent philosophy and organized ‘wall to wall’ all workers at a given worksite or with a specific company. The older organization, the American Federation of Labor (AFL), practices a trade-based approach to organizing of workers. However, these distinctions lie at the heart of the difference between industrial and craft unions. Craft unions (AFL) attempt to advance the interests of all workers possessing the same skill irrespective of the nature or identity of their employers. Industrial unions (CIO) attempt to organize all workers engaged in production of the same or similar goods or services, irrespective of individual craft or occupational distinctions. For example, although it now represents workers in several occupations and industries, the traditional strategy of the Carpenters' union as a craft organization was to bring into one union all skilled carpenters, whether they were employed in construction, manufacturing, or transportation services. In contrast, traditional industrial union strategy, such as that of the United Automobile Workers, was to organize all workers engaged in the manufacturing of the same product, such as automobiles, whether they were skilled craft workers, semi-skilled, or unskilled productions workers. Most modern unions in the United States began as either craft or industrial unions but now constitute multi-craft or multi-industry general organizations.
Perhaps the first rather than the last question relevant for analysis of union strategy and organizational models is what the goal of the union is. Unions may exist for either pragmatic or ideological reasons. Unions may either accept the existing economic order and work within that order to achieve a favorable set of economic terms and employment conditions, or they may seek to overthrow the existing economic system and replace it with another. The former strategy has been called "business unionism" and was the underlying philosophy of the American Federation of Labor and (AFL) its affiliated unions. Modern unions of today are neither as pure nor as simple in strategic organization, although they still tend toward this ideology in the United States. The best revolutionary union example from U.S. labor history was the Industrial Workers of the World, which thrived for a short period in the early twentieth century. In addition to the pragmatic and revolutionary union ideologies, a variety of other philosophical forms of labor organizations have existed at different times during United States labor history. Socialist, collectivist and uplift unions have all experienced only some temporary success during various eras in this country's history while remaining viable organizations in other parts of the world.
The economic framework for collective bargaining
The model of collective bargaining that has dominated American industrial relations since the 1930s relies on the relative economic power of employers and unions to establish wages, hours, and other terms and conditions of employment for workers covered by specific collective bargaining agreements. While bargaining structures and processes are regulated by public policy through the National Labor Relations Act, as amended, the content of the employment contract beyond legislative minimums is determined by market factors and relative economic power. While the density of union labor in the United States has been declining in recent years, collective bargaining remains the primary method for determining working conditions for millions of American workers.
The feast and famine cycles of prosperity and shortages, most often linked to surpluses and scarcity of workers within demand skills, has contributed significantly over the years workers ability to barter over their labors. This makes the actual impact of collective bargaining on wages and benefits is difficult to predict for a variety of reasons. However, most estimates suggest that wages in the union-represented sector are between 10 and 30 percent higher than they would be in the absence of unions. The fluctuation of the gap over time is attributable to various economic factors that tend to effect short and long-term bargaining power.
In the American Industrial Relations System, union bargaining power tends to be greatest when two factors are present. One is the ability of the employer to meet the wage and benefit demands of the union. The second factor is the ability of the union to make the employer pay, to direct its economic resources toward higher wages and better benefits rather than for other purposes. If either of these factors is not present, union bargaining strategy is unlikely to produce substantial benefits. The critical abilities of the employer to pay and the union to make the employer pay will be influenced by a number of issues. Let’s look at some of them: