Presence Of Labor Unions Research Articles

Keeping them honest? Exploring the impact of labor unions on CSR

PurposeThe role of labor unions in relation to corporate social responsibility (CSR) remains both ambiguous and crucial for union members and business leaders. Given the complex relationship between labor unions and corporations, this study aims to address whether labor unions keep corporations honest (by monitoring CSR activities) or potentially render CSR initiatives less necessary.Design/methodology/approachUsing data from the MSCI Kinder, Lydenberg, Domini Database for firms in the Russell 1000 Index, this study examines the link between labor unions and CSR in U.S. companies over a six year period. Generalized least squares models were used to test the hypotheses for 3,937 firm-year observations.FindingsThe findings show that unionized companies generally pay less attention to CSR compared to nonunionized ones. The presence of labor unions and positive union-management relations both show a significant negative impact on CSR ratings, where positive union-management relations negatively affect CSR ratings more than just the presence of labor unions. Further, when considering the environmental, social and governance aspects of CSR separately, the results are more complex, suggesting that the relationship between labor unions and CSR varies depending on specific ESG dimensions.Originality/valueCSR, a well-researched area, rarely addresses the companies' relationships with labor unions. Studies in South Korea and the UK have touched on the impact of labor unions on CSR, but in the USA it remains unexplored. This study extends this line of work by examining U.S. companies.

Aging Workforce, Productivity, and Wages in Japan

Abstract We use a panel data set of Japanese firms from 2005 to 2019 to examine how a firm’s employee age structure affects its productivity and wages. The pooled ordinary-least-squares (OLS) results indicate a negative relationship between the proportion of older employees and labor productivity. However, the effects disappear after applying a fixed effects (FE) model and the generalized method of moments to consider the unobserved heterogeneity among firms. Moreover, the proportion of older employees does not significantly affect firms’ wages. We further examine firm heterogeneity as a factor that contributes to the difference between the pooled OLS and FE estimates. The results suggest that differences in corporate stakeholder characteristics and corporate governance, such as the presence of labor unions and proportion of foreign ownership, may be related to the ratio of older workers and corporate performance.

Association between labor union presence and return to work after occupational injury or illness: A nationally representative longitudinal study in South Korea.

This study sought to examine the association between labor union presence and return to work after occupational injury or illness (RTW) among workers in South Korea. We analyzed the first (2018) and second (2019) wave data from the Panel Study of Workers' Compensation Insurance in South Korea. The cohort consisted of 3,294 workers who had suffered occupational injury or illness and completed their convalescence by 2017. We examined whether RTW was associated with the presence of labor unions in the workplace at the time of the occupational injury or illness occurred. Compared to workers without labor unions, those with labor unions were more likely to report RTW (prevalence ratio: 1.35, 95% confidence interval: 1.20-1.51) after adjusting for potential confounders, including employment status, duration of convalescence, and severity of injury or illness. This study found that labor union presence was associated with RTW among workers who suffered occupational injury or illness in South Korea.

Cultural Challenges of BlueBird Bio Expansion into Germany

BlueBird Bio is a biotechnology multinational corporation (MNC), with headquarters in Cambridge, Massachusetts, specializing in gene therapy solutions for autoimmune diseases and cancer. The company was recently approved, in Germany, for their new drug Zynteglo for the treatment of betta thalassemia. This approval opened the door for further investment in the European market, starting with the contracting of Apceth Biopharma and purchases of new land and equipment to establish a permanent residence in the country. The opening of the new European headquarters will demonstrate new challenges for BlueBird Bio, as cultural and institutional differences between the host country and parent country are quite distinctive. Some of the main differences among countries are their cultural dimensions in dealing with risk, masculinity, and indulgence. Unlike the United States, Germany is risk avert, values input of all in decision-making, and has a general attitude following the best practice approach. The US focuses on the individual dimension of a culture where employees are valued for their independence. Furthermore, the differences between governmental policies in the two countries vary strongly. The German government has strict policies on employee protection and can affect the decision making of the organization. There is also the presence of labor unions and collective bargaining; two aspects of organizational structure US-based companies are trying to avoid. BlueBird Bio is an emerging MNC, and its success depends upon its ability to recognize the differences in cultures and institutions between the countries. The company has already been exposed to multiple countries in Europe and has strong programs in employee education supplemented with strong company benefits for its employees, which is providing excellent groundwork for establishing headquarters in Germany.

Are highly unionised industries socially responsible to their employees?

Corporate social responsibility towards employees (CSR-E) is a vital aspect of modern business that can promote employee rights, justice and standards of employment, which in turn can generate benefits for companies. From the perspective of stakeholder theory, companies are expected to act and react to the demands of their most powerful stakeholders. Therefore, previous studies on CSR-E are skewed towards employees, whom they view as relevant and powerful stakeholders, and view CSR-E as a tool for promoting employee engagement. However, these studies have neglected the labour union power of stakeholders over the CSR-E activities of companies, particularly in Malaysia. The presence of labour unions can increase the tendency for a company to observe a state of democracy, and the negotiation and collective bargaining power of these labour unions can narrow the gap between the expectations of employees and their companies. Nonetheless, the relationship between labour unions and CSR-E is only based on gut feeling and has never been examined in the Malaysian context. Given the differences in unionisation rates across industries, this study predicts that highly unionised industries practise CSR-E to a greater extent compared with non-unionised ones. Therefore, this study examines the relationship between highly unionised industries and CSR-E practice. Banking and financial institutions and real estate and properties were selected as highly and poorly unionised industries in this paper, respectively, and their ratings were calculated based on available data from the Malaysian Trade Union Congress. A total of 100 annual reports for financial years ending in 2017 and 2018 were gathered from 50 companies and were analysed for their content to measure CSR-E. Control variables, including size, profit and leverage, were also used to examine the relationship between CSR-E and unionisation. Highly unionised industries demonstrated a positive relationship with CSR-E practice. Keywords : corporate social responsibility, employees, stakeholder theory, unionised industries

Do anti-discrimination laws alleviate labour market duality?

PurposeThis paper examines whether and how labour market duality can be alleviated through legislation that prohibits discrimination based on employment type.Design/methodology/approachIn 2007, the Korean government undertook a labour reform banning discriminatory treatment against fixed-term, part-time and dispatched workers. By exploiting a gradual implementation of the anti-discrimination law by firm size targeting a subset of non-regular workers, the paper identifies the treatment effects of the anti-discrimination law, taking a difference-in-difference-in-differences approach.FindingsThe results suggest that the anti-discrimination law significantly increases hourly wages and the probabilities of being covered by national pension, health insurance, and employment insurance for targeted non-regular workers in small firms relative to other workers. Anticipatory behaviours of employers and selective transitions of employees in response to the implementation of the anti-discrimination law do not underlie the estimated effects. The presence of labour unions contributes to reducing gaps in labour conditions between regular workers and targeted non-regular workers.Originality/valueThe main contribution of this paper is to provide empirical evidence on causal impacts of equal pay legislation on the gaps in labour conditions between different categories of workers, using a difference-in-difference-in-differences estimation.

Environmental effectiveness of tax compliance policy in the presence of labor unions

AbstractThis paper investigates the impact of a stricter tax compliance policy on firms’ pollution emissions in the presence of labor market frictions. In contrast to a situation with perfect labor markets, we find that under the right‐to‐manage wage formation, a stricter compliance policy increases emissions when the shadow cost of the emission limit is excluded, whereas it has no impact when the shadow cost is included. With efficient bargaining, a stricter compliance policy decreases (or increases) pollution emissions under employment (wage) orientation but has no impact on pollution emissions under wage neutrality.

Gender Pay Gap, Labor Unions and Firm Performance

Using detailed employee-employer administrative data, we analyze the impact of the gender pay gap on the performance of firms and find that it depends on the presence of labor unions. When the firm is not unionized, the gender pay gap reduces profitability. In contrast, when unions are present, the gender gap has no effect on profitability in male-dominated firms and increases profitability in female-dominated firms. Our evidence suggests that when there is no union, giving priority to cohesion and pay equality is value-enhancing. In highly feminized firms, unions provide employees with the option of nonpecuniary benefits, with females opting for better work-life balance and males opting for higher salaries. Our findings indicate that in these firms, the gender pay gap may reflect the divergent interests of female and male employees and can positively affect firm value.

The implications of labour unions in the presence of a merger

AbstractIt is usually believed that the presence of labour unions is detrimental for the consumers since it raises wages. We show that this view may not be true if we endogenize the impacts of labour unions on firms’ corporate strategies such as merger and acquisition. The presence of labour unions may benefit the consumers by deterring merger.

Foreign direct investment, unionised labour markets and welfare

Although empirical evidence on the relationship between labour union and foreign direct investment (FDI) is mixed, the theoretical literature mainly explains the negative relationship between labour union and FDI. We show that a multinational firm may prefer FDI in the presence of labour unions if it is sufficiently technologically superior to its domestic counterpart. FDI (compared to export) makes the domestic labour union better off but it makes the consumers, the domestic firm, the foreign labour union and the foreign country worse off, and may reduce domestic welfare. We show the implications of industry-wide and firm-specific labour unions.

Monetary Union and Pegging in the Presence of Labor Unions*

AbstractAs the European Economic and Monetary Union grows, power over monetary policy is shifting away from the original founders. Previously, researchers have analyzed the impact of replacing an exchange‐rate peg with a monetary union in the presence of labor unions. In these studies, the authors have consistently concluded that unemployment in the country that originally controlled monetary policy will rise, although they cite very different reasons. In this paper, we present a more general model that reproduces the previous results in special cases and clarifies the relations across the results. In addition, the more general model shows that the results are reversed in certain conditions.

Labor unions and productivity: An empirical analysis using Japanese firm-level data

This paper empirically analyzes the relationship between labor union and firm performance in areas such as productivity and profitability by using data on more than 4000 Japanese firms, ranging from listed large firms to unlisted SMEs, in both the manufacturing and non-manufacturing sector. The presence of labor unions has statistically and economically significant positive effects on firm productivity. Unions' effects on wages are also positive, their magnitude being slightly larger than those on productivity. The decrease in the number of employees is greater at unionized firms than at non-unionized firms. The difference in employment growth is mainly attributable to the change in the number of part-time workers. In order to enhance productivity, close cooperation between management and unions is essential.

Central bank independence and monetary policymaking institutions — Past, present and future

This is an extensive survey of worldwide developments in the area of monetary policymaking institutions during the second half of the twentieth century and beyond. In addition the last section discusses current open issues and future challenges. Section 2 reviews the changes that have occurred in the area of central bank independence (CBI) during the last twenty years, discusses reasons for those developments and provides an overview of accumulated empirical evidence on the relation between CBI and the performance of the economy. Section 3 discusses lessons from stabilization of inflation, reviews the evidence and implications of asymmetric central bank objectives and considers the issue of CBI within the broader context of choosing a nominal anchor. Section 4 reviews the impact of independence on economic performance in the presence of labor unions. Section 5 considers future challenges facing modern central banks. The discussion presumes that CBI and price stability are here to stay and focuses on issues relating to the conduct of monetary policy by independent central banks in an era of price stability, like the risks associated with flexible inflation targeting and the impact of central bank capital and finances on its independence.

Union legislation and export platform FDI

This paper examines Foreign Direct Investment in the presence of labour unions. An oligopoly model is developed in which identical firms locate in a host country in order to export to a foreign country. These firms are unionized and compete with foreign firms on the foreign market. We consider the incentives for social dumping via restrictive labour legislation, which we assume can be used by the host country government to affect the bargaining power of unions. We ask whether it is in the interest of the importing foreign country for the host country to relax or to tighten labour laws.

Union Bargaining Power, Labour Standards and Foreign Direct Investment

This paper examines Foreign Direct Investment in the presence of labour unions. An oligopoly model is developed in which identical firms locate in a host country in order to export to a foreign country. These firms are unionised and compete with foreign firms on the foreign market. We consider the incentives for social dumping via restrictive labour legislation which we assume can be used by the host country government to affect the bargaining power of unions. We ask whether it is in the interest of the importing foreign country for the host country to relax or to tighten labour laws.

TRADE POLICY VERSUS COMPETITION POLICY: SUBSTITUTES OR COMPLEMENTS?

This paper deals with the difference between trade policy and competition policy for domestic prices, wages, and employment when product and labour markets are imperfectly competitive. We show that in the presence of country-specific institutions like trade unions, trade policy and competition policy are no longer substitutes in disciplining product and labour market distortions. While both domestic entry and foreign imports affect domestic price-cost margins, they differ in their effectiveness and their impact on the domestic labour market. The results in this paper suggest that enforcement of competition policy without a sufficient degree of openness to imports is typically not a first-best outcome. While domestic entry increases union welfare, foreign imports reduce it. Competition policy in the presence of labour unions is insufficient to reduce labour market distortions, while international competition reduces both labour and product distortions.

State Type and Congressional Voting on the Minimum Wage

How members of Congress vote on increases in the minimum wage is a function of several factors, most notably party affiliation and constituent interest. But also among those factors is the existence of right-to-work laws in the representative's state and the presence of labor unions, especially as they represent a voting constituency. This paper examines congressional voting patterns on the minimum wage from 1949, when the first vote to increase the wage occurred, to 1996, when the last vote occurred, and finds a relationship between union strength and positive voting, a relationship between right-to-work states and negative voting, and a decline in the significance of unions as a factor affecting congressional voting as unionism had declined.

STAGFLATIONARY CONSEQUENCES OF PRUDENT MONETARY POLICY IN A UNIONIZED ECONOMY

Stylized models of the policy game between monetary policymakers and the private sector have suggested that disciplinary policy regimes suffer from an inherent inflationary bias and that precommitment to a target rate of inflation may be desirable. This paper shows that, in the presence of labor unions, the monetary policy game can lead to radically different results: a central bank that is completely indifferent to the level of inflation may obtain outcomes with high employment rates and zero inflation while 'prudent,' inflation-averse central banks generate stagflation with positive inflation and low rates of employment. Copyright 1997 by Royal Economic Society.

Illegal immigration in the presence of labor unions.

"This paper develops a general equilibrium framework of a two-sector economy which incorporates illegal immigration in the presence of labor unions. It demonstrates that stricter enforcement of immigration laws, by reducing the demand for or supply of illegal aliens, benefits all legal workers in the economy. The model is used to evaluate the impact of these policy changes on national income. Results indicate that national income does not necessarily fall when immigration controls are tightened. The existence of a union mitigates the negative welfare impact of a reduction in the number of illegal immigrants."

Illegal Immigration in the Presence of Labor Unions

Illegal Immigration in the Presence of Labor Unions