The New Unionism: Employee Involvement in the Changing Corporation

Abstract

This important, provocative, and highly readable book defies most traditionial ideological pigeonholes. In it Charles Heckscher raises issues in such a way as to make both liberals and conservatives rethink what they believe about unions and their place in the American economic and social system. Heckscher's basic thesis is that the decline of American unions results in large part from New Deal labor law the Wagner Act and the logic of industrial unionism and contrived scarcity upon which it is based. He argues that the Wagner Act framework maintains a rigid, increasingly artificial boundary between workers and management. This boundary accounts for union commitment to adversarial tactics, the importance of the strike as a weapon in bilateral bargaining, and organized labor's insistence that benefits be based upon seniority rather than performance. Of course, this line can also be drawn by management, which is all too often willing to violate standards of fair dealing and tacit agreements for short-term gain and to make adjustments at labor's expense using layoffs to adapt to market fluctuations, increasing worker discipline, and cutting wages and benefits to meet increased price competition. Heckscher acknowledges that workers are capable of solidarity and even militance, of striking and picketing in the traditional fashion, when they are treated as an inferior mass. But he insists that given the choice, they gravitate to less adversarial, more participatory modes of interaction. Heckscher observes that managers have increasingly come to recognize the folly of treating employees as an inferior mass. To win their trust and cooperation and thereby to mobilize their intelligence and creativity, many firms now offer strong guarantees of fair treatment and employment security, and their top managers have established effective mechanisms for employee participation in the direction of the firm. Because such firms can generate an unusual degree of commitment from employees at all levels of the organization, they are often far more successful than their competitors in meeting the challenges of economic change. Heckscher concludes that unions are declining because they have failed to meet the challenge of management reform: to adapt to participatory modes of interaction in which workers share work and allocate their own tasks and in which there is close cooperation among all the members of the organization and a strong sense of team spirit. Unions have failed to adapt because of barriers to worker participation established by New Deal labor law; under the Wagner Act worker participation is not encouraged and may even be illegal. The paradox Heckscher sees in this development is that by displacing unions participatory modes of interaction have tended to concentrate power in the hands of management. Hence, the positive commitment, increased productivity, and higher real incomes that are the goals of management reform remain vulnerable to myopic abuse and deception. Heckscher notes, for example, that many managers are satisfied with the appearance of employee participation rather than the reality. Clearly, any ongoing cooperative endeavor requires a system of formal governance