A labor contract is a contract entered between workers and management covering wages, benefits and working conditions. Labor contract is a legal agreement binding both employer and employee and enforceable by law. Labor contracts facilitate certain benefits to the workers like better healthcare, increased and timely wages, friendly working conditions, etc. Business organizations also benefit by entering labor contracts, as it enables them to work smoothly without any unnecessary labor unrest.
As memberships in unions have shriveled in the manufacturing sector due to phenomenal growth of service sectors, now big labor unions are shifting their focus to white-collared workers. But they may not succeed in this process, as professionals prefer a conciliatory approach to labor-management relations. Almost one out of every five professional in America is a union member, but in recent years this shows a downward trend.
A recent survey conducted by AFL-CIO found that many professional and technical workers are keen in joining unions because they want to have more voice in the workplace. But obviously, they don't want that voice to speak very loudly. The same study found that many professionals shy away from unions because they feel that it may create conflicts at work. The hard-line approach may still find favor with the white-collared workers in public sector unions. But private-sector professionals want their union representatives to be supportive and productive.
Labor contracts some times create problems. In early October 2002, more than 10,000 West Coast dockworkers were abstained from their works after union negotiators failed to reach an agreement with the Pacific Maritime Association. Ten-day shutdown resulted in delayed shipments of more than $12 billion worth of goods in a peak holiday season. To end this impasse American President had to invoke the Taft-Hartley Act first time in 1978. As globalization spread conventional industrial jobs around the world were greatly reduced. Only 9% of private sector workers are under labor contracts, mostly in transportation, utilities, and heavy industries.
