Labor law 101: Understanding the basics

Mailee Smith

Staff Attorney and Director of Labor Policy

Mailee Smith
/ Labor
September 2, 2016

Labor law 101: Understanding the basics

Familiarity with labor law terminology helps Illinoisans understand the impact of government-worker unions and the need for labor reform in the state.

Summer is passing into fall, and with that comes the annual Labor Day traditions: a day off from school or work to rest, cook out and welcome the forthcoming football games and bonfires.

Of course, that’s not exactly what Labor Day originally was supposed to represent. The U.S. Department of Labor describes the holiday as “a creation of the labor movement.” Dating back to 1882, the day was celebrated as a “workingmen’s holiday” by the Central Labor Union in New York City. According to the Department of Labor, the concept of “labor day” spread with the growth of labor unions.

Illinois has first-hand experience with what the growth of labor unions – and particularly the growth of government-worker unions – can do to a state economy and politics. Currently, the American Federation of State, County and Municipal Employees is deadlocked in contract negotiations with the state. Gov. Bruce Rauner wants to bring union costs more in line with what taxpayers can afford, while AFSCME is making contract demands that would cost the state an additional $3 billion in salary and benefit increases.

Following the situation between AFSCME and Rauner – or any labor union issues, for that matter – can be daunting. What do all of the terms mean?

Starting with the basics is a good first step. Understanding the terms can equip Illinoisans to better understand what is happening with the state’s government-worker unions.

Private-sector vs. public-sector labor unions

The first step in navigating any union issue is understanding the difference between private-sector unions and public-sector unions.

Private-sector unions represent workers in the private workforce. For example, many Illinoisans are familiar with the United Auto Workers union – or UAW – which represents portions of Caterpillar’s workforce. Private-sector unions are governed by federal law – namely, the National Labor Relations Act.

Public-sector unions, however, represent government workers at the state and local levels. This includes state workers, city workers and public school teachers or university professors. Public-sector unions are governed by state law. In Illinois, government-worker unions are governed by the Illinois Public Labor Relations Act; education unions are governed by the Illinois Educational Labor Relations Act.

A union that represents private employees can also represent public employees – a union is not limited to representing just one or the other. But the way in which the union represents the employees will differ. The representation of private employees will be governed by federal law, and the representation of public employees will be governed by state law.

The largest public-sector union in Illinois is AFSCME, which represents approximately 35,000 state employees.

Frequently used terminology

Union issues are unique. There are many terms of art – terms that have meanings used specifically in regard to unions and employers. Those terms may mean something different in the union context than they do in everyday life.

The following are frequently used terms in the labor and union context.

The basics

The following terms relate to some labor basics – the parties involved in bargaining over wages and other conditions of employment.

Bargaining unit – A designated group of employees that is bound together to negotiate with the employer. For example, the Chicago Teachers Union represents a bargaining unit of educators employed by Chicago Public Schools.

Collective bargaining – Negotiations between an employer and a union over wages, hours and other terms of employment.

Collective bargaining agreement or contract – The contract agreed to by the union and the employer. It can outline wages, hours and other terms of employment, including benefits.

Collective bargaining agent or exclusive representative – A union that is granted special privileges. Specifically, it is the union that has been chosen to be the sole representative of the employees in a bargaining unit. For example, AFSCME is the exclusive representative of 35,000 state employees.

Employer – In the private sector, this term is straightforward: The employer is the private company or business employing the workers. But in the public sector, the employer is the governmental unit that employs the workers. This can be anything from a local school district to the state itself.

Fair share payer or agency fee payer – An employee who does not wish to be a union member but instead pays “fair share fees” to compensate for the union’s representation. Under state law, unions must represent both members and nonmembers in negotiations with the government employer. Because fair share payers are still represented by the union, they are forced to pay a “fair share fee” – their “fair share” of what it allegedly costs the union to represent them in negotiations with the government employer.

Union organizing

Unions cannot just pop up without employee support. The following terms regard union organization – the process by which the union begins representing a bargaining unit as the exclusive representative.

Certification and decertification – Certification is the process by which a union is chosen by workers to be their exclusive representative. For public-sector unions in Illinois, that process is outlined in the Illinois Public Labor Relations Act and can involve either a secret ballot election among workers or a card-check process. Decertification, on the other hand, is the process outlined in law for employees to remove a union as their exclusive representative.

Card check and secret ballot election – These are both procedures that a union can use to show that it has majority support among workers and, therefore, should be their exclusive representative. Card check involves a card, given to each worker, that declares the worker’s desire to have a specific union represent employees. An employee who wants the union to represent him or her signs the card, and the union uses the signed cards to demonstrate its claim that the majority of workers want the union. An employer can then voluntarily recognize the union as the exclusive representative of the workers if it appears a majority of employees approve the union.

A secret ballot election is another way for a union to gain status as the exclusive representative for a group of employees. It works the way it sounds – an election is conducted in which workers vote privately on whether to allow the union to represent them.

For public-sector unions, state law governs when each procedure is used.

Day-to-day operations

The following terms relate to the day-to-day aspects of working in a unionized workplace.

Dues check-off – An authorized deduction of an employee’s wages, taken out of the employee’s paycheck by the employer, to pay the employee’s dues to the union.

Seniority – The length of time an employee has worked for an employer. Seniority can determine many benefits for the employee. For example, employees with more seniority can be awarded first preference in scheduling vacation time. Another example involves layoffs. In many cases, the employees with higher seniority are the last to be laid off. In addition, in the union context, seniority typically determines salary increases. Under many bargaining agreements, pay raises are dictated by years of service; the only way to obtain a pay raise is to log another year of work. This is in contrast to merit pay, which allows an employer to compensate workers for doing good work.

Labor disputes

Disputes can arise among employees, the union and the employer. Disputes may involve anything from the dissatisfaction of a single employee to stalled contract negotiations between the union and the employer. The following terms are common when discussing such labor disputes.

Grievance – A formal complaint lodged by a worker against an employer for any type of dissatisfaction in the workplace, including working conditions, unfair treatment or violations of the collective bargaining agreement. Both state law as well as the collective bargaining agreements between a union and an employer can determine how a grievance is handled and resolved.

Impasse – A stalemate between a union and an employer during negotiations over a collective bargaining agreement. Once an impasse is reached, the employer is allowed to move forward and implement its last contract proposal as the final collective bargaining agreement.

Lockout – A work stoppage caused by an employer when it closes its facility to workers. It typically represents an attempt by an employer to encourage employees (and their union) to accept the employer’s contract proposal in negotiations.

Mediation and arbitration – Methods of resolving disputes between a union and an employer. In mediation, a mediator, who is not affiliated with either party, examines the evidence and the parties’ claims and issues a recommendation. The parties typically do not have to follow the mediator’s recommendation. In arbitration, an arbitrator, who is not affiliated with either party, examines the evidence and the parties’ claims and issues a decision. Unlike mediation, an arbitrator’s decision is often binding on the parties – meaning they must follow whatever the arbitrator determines.

Strike – A work stoppage caused by workers who walk out on the job. It represents an attempt by workers to force an employer to go along with union demands. There are different types of strikes: “unfair labor practice strikes” and “economic strikes.” For example, a strike protesting unsafe working conditions would be considered an unfair labor practice strike. A strike intended to force an employer to pay higher wages would be considered an economic strike. Each type of strike carries different repercussions for workers. Strikes that are not allowed under federal or state law, or that violate the terms of a union’s collective bargaining agreement, are referred to as illegal strikes.

Unfair labor practice and unfair labor practice charge – Actions taken by either an employer or a union that are contrary to the terms of the collective bargaining agreement or not permitted under the law. The party claiming that the other has committed an unfair labor practice files an unfair labor practice charge with the appropriate governing body. In Illinois, unfair labor practice charges involving government-worker unions are filed with the Illinois Labor Relations Board.

Labor reforms

Currently in Illinois, government workers who do not want to be a part of the union have limited options. The following are terms used for reforms that could help promote worker freedom.

Right to Work – A labor reform aimed at providing freedom to workers who do not want to join a union. Without Right-to-Work laws, workers who do not want to join a union are still forced to pay “fair share fees” in order to continue employment. Right to Work means that a union cannot force an employee to pay these fees in order to keep his or her job. To date, more than half of the states have adopted Right-to-Work laws. In those states, workers do not have to pay fair share fees, but they are still represented by the unions in contract negotiations – whether they want that representation or not.

Worker’s Choice – A labor reform aimed at providing freedom to workers who do not want to join a union. Worker’s Choice would allow an employee to opt out of union membership and out of paying fees, without fear of losing his or her job. Unlike Right to Work, the employee would no longer be represented by the union. The nonmember employee would be free to negotiate with the employer to settle on contract terms – such as hours and salary – that best suit the employee. This means that in addition to freeing employees from union membership and fees, Worker’s Choice also allows individualized tailoring of employee contracts. In addition, allowing nonmember employees to represent themselves undercuts union opposition to Right-to-Work laws. Unions argue that Right-to-Work laws create “free riders”: workers who are represented by the union but do not pay the union for that representation. Unions cannot make this claim in the Worker’s Choice context, where the nonmember neither pays dues nor is represented by the union.

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