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Trade unions: What they are Essay

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1) A and organization of employees united as a single, representative entity for the purpose of improving the workers’ economic status and working conditions through collective bargaining with employers. There are two types: the horizontal union, in which all members share a common skill, and the vertical union, composed of workers from across the same industry.

2) There are approximately 9.2 million people employed in the Australian workforce. Latest union membership figures show around 25% of them are in unions. Over the last two years union membership numbers increased by 24,500 members a year. Union membership currently stands at 1,902,700 members.

3) For trade unions:-Give power to call strikes against employers. A strike is usually the last resort of a trade union, but when negotiations have proved unsuccessful, a strike may be the only effective option left.

-Workers who are unionized will enjoy better working conditions and wages than workers who are not.

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-Improved worker safety-Increased wages for union and non-union workers-Raised society’s standard of living-Reduced hours in a working weekAgainst trade unions:-restrict the supply of labour- Attempt to raise wages above market equilibrium, which may lead to unemployment and inflation of wage rates- Trade unions are often accused of benefiting the insider workers, those having a secure job and high productivity, at the cost of the outsider workers, consumers of the goods or services produced, and the shareholders of the unionized business.

The ones that are likely to lose the most from a trade union are those who are unemployed or at the risk of unemployment or who are not able to get the job that they want in a particular field. The so-called insider-outsider theory analyses 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 recruited and fewer retiring workers replaced. The potential result is higher unemployment rates, especially among the unskilled.

4) Ferry transport strike21st March 2006The strike was prompted by a deadlock in negotiations for an enterprise bargaining agreement. Sydney Ferries took the matter to the Industrial Relations Commission.

An estimated 38,000 passengers had to find alternative transport when ferry masters and engineers walked off the job at 5am, leaving every one of Sydney’s 31 ferries sitting in the docks.

Resolution: Sydney Ferries Corporation said it was seeking an urgent hearing in the Australian Industrial Relations Commission (AIRC) in the next couple of days over Enterprise Bargaining Agreement (EBA) negotiations, but an outcome would not be known later in the week.

5) In response to labour organizing itself in unions on the supply side, employers combine to form their own organizations. Employer associations represent and promote the interest of their members by lobbing the government on matters such as industry assistance and industrial relations policies. They also assist in managing the relations issues, by representing their members in the various industrial tribunals set up to settle industrial disputes.

Employer groups are involved in the wage-determination process. (Help decide on their employees’ salaries.) They also hire their employees, make sure that all employees’ working environments are safe and putting their employees’ superannuation with a company. Employer groups must also help in resolving disputes that an employee or a trade union may have with their conduct at the workplace. They also have a forum for national issues, and they put pressure on government to change legislation relating to workplace reforms when necessary.

6) Trade unions are currently and will be aiming to grow expand existing memberships and hence become more advanced both socially and industrially. The more members they have the greater their bargaining power in negotiations with employers.

After the Howard Government took over, the changes in industries are expected to continue to undermine the collective bargaining power of trade unions. The government is determined to make changes to the workplace relations system to increase productivity. The idea of trade unions will decrease if this idea continues.


Concepts in Commerce by Stephen Chapman, Malcolm Freak, Stewart Ross (printed 1994) published by Jacarandaupdated stats/changes info provided by teacher

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