Union vs Non-Union: Which is Best?

union vs non-union - a deep dive analysis

Should an employer let employees decide if they want to unionize? Or should the employer do everything possible within the law to keep unions out? This question is common among employers when some employees and a union are attempting to initiate a union campaign. Some business leaders will fight tooth and nail to keep the union out. Meanwhile, others decide they prefer not to oppose unionization for any number of reasons. The truth is, different approaches will work differently for different companies and workplaces. Below, we will discuss the differences between a union vs non-union workplace.

Before making a decision, it is essential to consider all aspects of not opposing unionization versus striving to remain union-free. It is not an easy decision because there are so many interrelated factors to consider. There are many pros and cons of unions, so we felt a deep-dive analysis might be helpful.

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Remaining Non-Union

Employers who strive to remain non-union generally do so because they find unions are not necessary. They also understand the many disadvantages of unions and typically believe they will do more harm than good. Companies that remain union-free have done so by nurturing good employee-management relationships and positive work culture. Their employees don’t see the need for union representation because the employer treats them fairly. This fair treatment is the most important thing that employees are searching for.

From the employer’s perspective, successfully staying union-free means:

  • Business leaders can proactively engage employees in a variety of ways without interference. This includes giving them opportunities for input into decision-making and providing useful feedback
  • Managers are delivering high quality and consistent orientation of new hires, including successfully sharing the union-free philosophy during onboarding
  • The organization develops better leaders whose employees trust to treat them fairly and respectfully through good communication practices
  • The organization successfully reinforces the company’s union-free philosophy with all employees through high-quality training tools that are available 24/7
  • Leaders develop a collaborative work environment
  • It is possible to create and implement a promotion policy based on merit. This includes exceptional job performance, skills, training completed, leadership qualities, etc.
  • Maintaining the ability to fill open positions with internal or external job candidates, whereas most union contracts have seniority rules
  • Retention of the ability to terminate non-productive or problem employees at-will within legal requirements. They cannot discriminate based on race, ethnicity, religion, age, etc. Union contracts often include a need for proving ‘just cause’ for termination which depends on the context
  • Ability to create more opportunities to increase employee engagement because there is no union interference in employee-employer relationships or communication
  • Being able to reinforce that employees do not have to pay union dues, and employees keep more of their pay
  • Maintaining employee autonomy when making a decision about things like grievances, accepting new job responsibilities, promotions, etc.
  • Better managing of payroll costs – one of the main disadvantages of unions is that the employer is hindered by a collective bargaining agreement. Without a union, there is more freedom for employers to choose benefits vendors and design benefits packages, have full control over the compensation schedule, the ability to design leave policies that work for the employer and the workforce, etc.
  • Retention of ability to motivate employees with opportunities for future job advancement and job redesigns without hindrance from the union
  • Having the ability to reward employees for exceptional performance. This would include the implementation of incentive plans. (Unions typically discourage their members from exceeding performance requirements or going beyond normal job expectations)
  • Being able to encourage employee initiative, individuality and creativity. Typically, unions stifle individuality, requiring employees to adhere to union rules and be supportive of fellow union members; unions get their power and strength through groupthink (think ‘solidarity’)
  • Understanding the fact that numerous federal/state employment laws/regulations protect employee rights and support good leadership practices
  • Staying more competitive in terms of prices for goods and services by avoiding the higher negotiated compensation and benefits costs. This may lead to raised prices.
  • Maintaining more control over community relationships and brand reputation through messaging
  • Avoiding a situation where union-negotiated policies/procedures may negatively impact non-union members should the bargaining unit not include all employees
  • Retention of the ability to institute organizational change or restructuring without having to negotiate with the union
  • Being able to change Human Resources policies and procedures without going through union negotiations
  • Making it easier to maintain an open, supportive culture that makes it easier to attract diverse people and women. This creates a more comfortable and inclusive culture than one which creates specialized groups of people
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Choosing to Allow Unionizing

Employers have many reasons they decide to let the chips fall where they may when employees participate in a union campaign and election. The employer may simply believe it’s too expensive to try and oppose the union. They may also believe that fearful opposition to the union will cause too many problems in the workforce. Or they consider unionization as inevitable, so why spend the money trying to keep the union out.

The thought process is also that unionization does offer some advantages to the employer, as well as employees. When considering the pros and cons of unions, the question the employer must answer is whether the benefits of unionization outweigh the disadvantages.

From the employer’s perspective, unionization:

  • Requires management to give up a significant amount of control over the talent management process. This includes the ability to recruit external job candidates, along with compensation and promotions
  • Restricts the ability of leaders to communicate with the workforce because some issues must go through union representatives first
  • Means the employer can expect more in-house grievances, arbitrations, lawsuits or NLRB complaints, leading to difficult and expensive processes
  • Means the employer loses some decision autonomy because the employer is legally required to bargain with the union in good faith to establish an acceptable collective bargaining agreement and must negotiate with the union during various post-contract events impacting union employees in any way, i.e., implementing organizational change to the infrastructure like closing a manufacturing plant or downsizing a workforce
  • Union contracts require promotion of employees based on seniority. This means the employer will have difficulty promoting someone based on productivity or potential
  • During workforce downsizing or restructuring of jobs, union contracts require termination of employees based on seniority. This ultimately would force the layoff of some employees the employer would like to retain
  • Increases payroll costs due to higher negotiated employee wages and benefits and the likely addition of one or more employees who are responsible for managing union-related activities, like collection and remittance of union dues (as of 2018, the average non-union worker made 82 percent of compensation for union employees)
  • Means benefits are spelled out in union contracts, and the need to negotiate new terms with different vendors each year is minimized
  • Pension plans will need to be initiated, or existing plan costs may increase
  • Adds stability to the compensation schedule. Pay rates, overtime, and wage increase schedules are established through negotiation with the union – and applicable for the length of the contract
  • Means the employer does not have to deal with individual employees anymore. The union negotiates compensation, benefits and leave policies for all union employees
  • Will minimize potential conflict with employees over compensation during the length of the collective bargaining agreement. Employees would know the compensation schedule that the union negotiates with the employer
  • Means job descriptions are established through negotiation, but job responsibilities can become a point of contention in the exercise of supervisory duties, i.e., the employee is asked to do something the union considers to be outside the person’s job description
  • Presents a potential for less turnover. People have better pay/benefits and job security so are less likely to look for another job
  • Increases accounting costs
  • Decreases the market value of the business because expenses go up
  • Means the disciplinary process is pre-defined and union representatives are included in disciplinary actions
  •  Union members can legally strike

Practical Considerations for the Union or Non-Union Argument

Just because a workplace unionizes does not mean the employee-employer relationship suddenly becomes adversarial. Some businesses unionize, and employees and managers maintain a good working relationship. The employer may be able to anticipate potential employee conflicts/disagreements associated with unions to avoid whatever problems may arise.

With that being said, history shows that unions are more likely to create problems for managers. In some cases, unions purposely keep employees agitated and encourage them to feel dissatisfied – that is how they maintain control. Contented employees do not unionize. 

There is a final point to keep in mind. If a union campaign and election are held, remember, this does not guarantee a vote for unionization. The majority of employees can choose to vote ‘no’. Even if the employer decides not to oppose unionization, there is always the chance that employees will decide they do not want union representation.

Unionization is ultimately a risk. Like all risks, the full impacts need to be carefully evaluated and considered. The pros and cons of unions provided are for thoughtful consideration. Each employer and each union is different, making it difficult to generalize.

However, it is important to not fight against unionization only because that seems to be the cheapest and least disruptive path at the time. In the long run, unionization will cost a company more. Ultimately, it will also bring many restrictions that management may not be willing to accept. At UnionProof, we believe it is much more practical and less risky to become an employer of choice and not have to address unionization at all. We are happy to offer you a number of resources when it comes to keeping your employees engaged, your retention low, and your workplace union-free.

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About the author

Walter Orechwa

Walter is Projections’ CEO and the founder of UnionProof & A Better Leader. As the creator of Union Proof Certification, Walter provides expert advice, highly effective employee communication resources and ongoing learning opportunities for Human Resources and Labor Relations professionals.