Challenges Faced By Unionization Of Organisations Business Essay

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A trade union is an organisation made up of members (a membership-based organisation) and its membership must be made up mainly of workers. One of a trade union's main aims is to protect and advance the interests of its members in any given workplace. Most trade unions act independently of any employer. However, unions will try to work closely with the employers as this can sometimes take the form of a partnership agreement between the employer and the trade union which identifies their common interests and objectives. There are several functions of a trade union which mainly includes, negotiate salary issues, grievance meetings and discussing their members' concerns with employers (DirectGov, 2009).


Over the years, employees have joined unions in regards to two general reasons, namely; (1) they are not satisfied with the way the employers treat them and (2) employees believe that the unions can improve their working conditions. People also join unions when they think the management is unfair, terminates employees without any cause and have poor management skills. As wages are declining in many industries due to global competition, workers will want to have higher salary. The salary scale in the service industry can be relatively low, therefore unionization is common in the service line. By joining a union, their interest and objectives can be brought forth together in one voice in any collective bargaining. Unions often have strong benefits package which they are able to extract from the employer or dish out to the employees. Benefits are represented in many ways in terms of medical, shopping discounts, better insurance coverage and savings plan for retirement (Associated Content Inc, 2010).

The below table shows the major factors which causes employees to unionize are issues of management style, working environment, compensation and employee treatment.



Job insecurity.

Unfair policies.

Harassment and abusive treatment.


Dictatorship management.

Lack of recognition.

Use of fear and intimidation.


Low salary.

Inadequate benefits.


Poor working conditions.

Lack of manpower.

Long working hours.

(Lim et al, 2010)


Employers of today would like to remain union-free within their company, due to the fact that unions are cost in-effective (higher labour costs, compensation payout, and collective bargaining costs), there are possibilities of strikes occurring and there might be interference with customer relations (Leeson, 2009). Keeping in mind that a union is formed when there are problems in the workplace which might lead employees to think that a union can "fix" their problems. The primary factor of whether employees unionize is the management. With reasonable compensation, good working environment, fair treatment to workers and effective supervision from bosses, acts as determents to unionization efforts (Lim et al, 2010). Furthermore, employers can also set up a Union-free policy and must be communicated to the employees in a timely manner, and at the same time to provide the position of the company in dealing with problems at work. Employees are likely to accept the policy better knowing that the company is doing its best and has considered their interest. By doing proactive surveys to find out the level of employee satisfaction helps to pin-point areas of concern and as well as receiving feedback and acting upon it if necessary. Complaints by employees should be immediately and fairly resolved. If the employee complains of favouritism and unfair treatment by a supervisor, the management should address it as soon as possible. The process should be viewed as fair and not needing the assistance of a third-party, in this case, a union.

Front-line supervisors and management executives are considered the 'face' of the company. They must understand the risks involved and fully support any initiatives to allow the company to remain union-free, as well as able to communicate effectively to the employees. Making informed assessment of front-line supervisors is equally important to gauge how effective leaders they are, otherwise investing time to educate and impart leadership and people skills complements its cause. A company having a strong human resource (HR) team is essential as it helps to ensure that policies and practices are adhered to in a fair manner. Both HR managers and supervisors must work effectively with unions by being attentive and responsive to its employees. The top management of the company can take steps to show appreciation for good work done, and loyalty shown to the company. Employees that feel invested in a company as part of a team are less likely to join unions. Holding regular meetings where management communicates with the employees about the company and allowing a "bottom-up" approach communication by the employees regarding suggestions for improving work flow processes or production. These methods will give the employees a sense of belonging to the company, thus minimising the formation of a union (Leeson, 2009), (McKitrick, 2010).


The number of union membership varies from country to country. In some countries, there are cases where unions do not exist or the unions are relatively weak. In other countries, some unions are closely tied to political parties. For example, countries like France and Italy usually have large scale protests proposing a change in government policies in regards to pension programs, retirement and higher pay rise.

The union memberships in the United States have been declining. Out of the estimated 120 million workers in the U.S, only about 15.4 million workers belong to a union. This is due to the fact that there was a decline of blue-collar jobs in manufacturing affecting this trend. In Singapore, there was a stagnation of union membership in the early 1990s because the workforce was more educated and received proper training to upgrade their skills. The traditional focus to target the blue-collar workers is no longer viable in this new economic era. In view of the declining union membership, the National Trades Union Congress underwent some internal reviews and it proved effective. There is a 10% increase of membership since 1998 as they have restructured to reach out to all workers regardless of status and occupation getting them to join the union to enjoy union benefits.

The union movement in the U.S has methods different from other countries, such as Singapore. The employers and unions will often compete with one another, resulting in "clashing" with one another to reach an agreement. The collective agreements only spell out compensation, conditions of employment and work rules for several years. In other countries, the contracts are made between the government and the employers usually last for 1 year due to social and political issues.

The National Trades Union Congress is the main labour movement in Singapore, which accounts to almost 100% of all the union memberships, and the NTUC is closely tied with the People's Action Party, which is the ruling political party in Singapore. In Singapore, there is a very strong bond and tripartite relationship with the government, which had become a strategic tool for economic development. A collective agreement in Singapore can last for 2-3 years and it contains all the terms and condition of a contract, covering the entire categories of employees. All the collective agreements are gazetted as official government documents (Lim et al, 2010).

Recently, there was an event called, Singapore Tripartism Forum held on 26 January 2010. The three parties involved in this discussion are from Ministry of Manpower, National Trades Union Congress and Singapore National Employers Federation. This forum is to help formulating a dispute resolution process in 2011 to help mid-level professionals, managers and executives. Quoted from Minister for Manpower, Gan Kim Yong:

"With a better educated and more skilled workforce, PMEs now make up half of the resident workforce. This proposed mechanism is timely.  It will serve as an additional avenue for PMEs and their employers to resolve their employment disputes quickly and amicably.  This in turn will bring about a more harmonious workplace environment that will benefit the businesses, workers and Singapore as a whole"

With MOM taking a lead role in mediation sessions, support will be provided by the Tripartite Partners, NTUC and SNEF. They have in mind to help resolve disputes quickly and cost effectively for both parties.

(Ministry of Manpower, 2006)


The labour movement in Singapore emphases in protecting and exercising collective bargaining rights for the eligible employees. NTUC has transformed the labour movement into a social environment which takes cares of the employees' welfare. This has earned a good reputation for NTUC as people-centric social organization. On top of that, NTUC have provided benefits and perks to its members, as well as having a good and efficient system of tripartism. Throughout the years since it was formed, it has been stable, hence attracting more members to join in union compared to other countries (Lim et al, 2010).

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