Unit 2B - The Market for Labour Flashcards
Labor Markets
- Market where supply of occupational skills interacts with the demand for labor
- Allocates labor to various occupations
Competitive Labour Markets
Non-unionized sector of the labour markets
Demand of Labour
The quantities of a type of labor demanded by firms at their respective wage rates
Non-Union Sectors and the Labor Force
Interaction between demand and supply of labor is what determines wages
↑D good X
↑D labor X
↑P labor substitutes
↑D labor
↑P labor complements
↓D labor
Determinants of labor supply
- Skills
- Education
- Experience
- Training
↑Worker Productivity
↑D Labor
Supply of Labour
The quantities of a service supplied by workers at their respective wage rates
↑Taxes (on salaries)
↓S Labor
↑Workforce Population
↑S Labor
Attitudes in Work
- Women
- Work Hours
Legal Requirements for Unions
Employers are legally obligated to bargain with recognized unions
Elasticity of Supply Determinants
- Skill needed (education, physical capabilities)
- Time needed for training
Right to Strike
Organized unions can withdraw labour services from employer
Restricting Labour Supply
- Unions can restrict labour supply to create higher wage rate
- Increases unemployment
Skilled Worker v. Unskilled Worker Strikes
Craft unions (skilled workers) more successful at restricting labour supply than unskilled members of union
Increasing Demand for Unionized Labour
Unions increase wages by increasing demand for labour for products they produce
Methods of Increasing Union Labor demand
- Discouraging employers from using non-union labour
- Advertising products as union made
- Preventing employers from using labour-saving technology
- Pressuring federal Parliament to restrict cheap foreign imports threatening domestically produced goods
Process of Unionization
- Workers democratically decide whether to join or form union
- Certification vote conducted by Labour Relations Board
The Vote and Effect on Unionization
- If majority vote for union, union becomes ‘certified’ as representative of workers
- If majority doesn’t want to keep union anymore, another vote can decertify it
Union Security Clause
Clause of collective agreement specifying whether or not employees must pay union dues and/or join union
Security Clause: Open Shop
Employees may choose whether or not to join union and pay dues
Security Clause: Closed Shop
Employer agrees to hire only workers who are members of union
Union Shop
New employees must join the union and pay dues after serving a probationary period
Rand Formula
Employees must pay union dues but can decide to actually join union or not
Striking
- Strikes are union’s biggest weapon and is used after mediation and conciliation
- Disputes over alleged violations of existing contract cannot be resolved by strike
Picketing
People walk around plant or building with signs informing workers and public that employer has been unfair
Boycott
Union tries to get people to stop buying things from firm
Work-to-Rule
Workers strictly follow all rules and regulations in collective agreement to get management’s attention
Lockout
Employees are denied access to workplace until they accept employer’s conditions
Injunction
- Court order forbidding union members from carrying activities
- Ex: Intimidating workers, impeding activities of company
Union and Management Conflict Resolution
Employer and union negotiate mutually acceptable collective agreement
Conciliation
Neutral third party attempts to prevent negotiations from breaking down
Mediation
Neutral third party tries to suggest possible compromise
Voluntary Arbitration
- Neutral third party hears sides of dispute
- Sides voluntarily submit dispute to arbitration
- They accept final decision of arbitrator
Compulsory Arbitration
- In some cases, federal/provincial law require compulsory arbitration
- Both parties are required to accept the final decision
- Rare, only for essential services
