I agree — it is a basic human right for employees to engage in collective bargaining, but that doesn’t necessarily mean that unionizing is always a good thing. Like all examples of human decision-making, collective bargaining carries both benefits and costs.
The benefits of collective bargaining are straightforward. A union works for better labor contracts for their members (wage rates, benefit plans, job security and working conditions).
When the costs of re-staffing an entire operation are high, then employers get a bargain by giving laborers better terms rather than re-hiring and re-training an entirely new staff. Take special notice of the important caveat — when the costs of re-staffing are high.
If labor is abundant — when lots of people are unemployed — then employers might be better off hiring cheap and abundant individual contractors rather than signing or extending a union contract. It seems pertinent to mention that the national unemployment rate is very high.
Secondly, those who favor unionization often present the fact that some employees have worked at Loyola for decades without health benefits or pension plans.
One could interpret this is as a moral failure, or simply infer that these employees have persisted to work at Loyola without these benefits because they value this working experience above the alternatives.
Working at Loyola is either really great or working at other places is really crappy — or some combination of the two.
Employers can benefit from unions. In some cases, labor unions impose quality standards on their members. A union effectively says, “hire our union because our employees are better than non-union workers.” When unions provide superior service, employers prefer unions voluntarily.
But, if we instead see a case where an employer is hostile to unionization, it seems reasonable to infer that he does not perceive the union to offer superior service. Yes, unions can carry benefits, but those benefits are not guaranteed. They depend upon the particulars of the case.
What are the costs of unions? With collective contracts it is difficult to maintain good incentives for individual job performance.
Bad employees don’t have to compete against good employees for better wages because everyone bargains collectively. The benefits to becoming a better employee are diminished by collective bargaining, and overall labor quality can unravel.
Lastly, the costs of unions to employers are more obvious. If a union obtains better terms for its members, then the costs of production paid by employers increase.
Several students have written opinion editorials expressing concerns about low quality, heavy traffic and limited options for food at Loyola.
I was therefore very surprised to see the student body simultaneously advocate for unionization. I wouldn’t expect the quality of dining at Loyola to increase if Sodexo is made to pay higher labor costs.
Instead, I would guess that these higher costs will be shared. Students will likely pay higher prices for the current quality of food, or students will continue to pay current prices for a marginally lower quality of dining.
Collective bargaining may be a right, but that does not necessarily imply that unionization is the right thing in every case. A normative support for unions must first begin with a full accounting of both benefits and costs.
In the case at hand, high levels of unemployment might tip Sodexo’s decision to decline a union contract today or decline a renewed union contract in the future — thus collective bargaining could jeopardize the long run job security of Loyola dining employees.
Lastly, students should recognize that trade offs must be made. Higher costs of production may lead to a lower quality of service.
Daniel D’Amico is an associate professor of business. He can be reached at
ddamico@loyno.edu
On the Record is a weekly column open to any member of Loyola’s faculty or staff. Those interested can e-mail
letter@loyno.edu
The Maroon > Editorial and Opinions
Unionizing brings mixed results
On the Record
Published: Thursday, February 25, 2010
Updated: Thursday, February 25, 2010 13:02
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On The Record
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