Afrin

Labour Laws and Unions HRM/531 09th April, 2012 Labour Laws and Unions Company Background: Ford motors is the world’s third largest automotive manufacturing company in the world, it was incorporated and established by the founder Henry ford in the year, 1903. The company signed the first four- year labor contract with United Automobile Workers Union in October 2011 and also decided to add 12,00 jobs along with an investment of 6.2$ in the company’s United states plants.(New York times, 2011). Legal Obstacles and Issues: The current economic meltdown has hampered the growth of many automobile giants among which, Ford Motors has also been affected and this has led the unions to take decisions of reducing the workforce to avoid the company from outsourcing its manufacturing activities. This could go against the company and raise a legal issue as the company has entered into a contract with UAW, agreeing to provide 12,000 job opportunities. However, the company currently reduced the risk of any labor unrest, but they would have difficulties in investing capital in the employment and operational activities in the United States, which would go against the clause of investing $6.2 billion in the United States plants. Laws that can be broken due to the legal issues: The biggest legal threat that the company faces would be if Ford Motors decided to lay off their employees due to the current economic crisis. The company could enter in a legal suit with the labor unions if the company cannot show fair reasons to reduce the workforce. The company would also break the local or state laws with regard to the compensation to be provided to each redundant worker due to the financial crisis, if they do not provide the appropriate monetary and other benefits to the laid off workers. Recommendations to minimize the litigations: To minimize any possible litigations arising by breaching any clauses in the labor contract signed with UAW, Ford motors can try to set up guidelines toward the contract by organizing a meeting with UAW. The guidelines set should be in good interest for both, the employees and the current condition of the company so that a just behavior is maintained toward both entities. Organization’s benefits of joining a Union: The company’s unionization process has guaranteed the workers with employment security by a fair wage policy, safe employment conditions and the union voices for the employee’s rights and responsibilities. This in turn has increased the retention and the productivity level of the organization. Unionization Process: After the labor uprisings in competitive companies like General motors and Chrysler, UAW could lay its foundation in these companies in 1937 (Healey, 2011) Ford motors tried to minimize the labor strikes by using internal security forces in beginning however the company workers through a collective bargaining forced Ford motors to sign a labor contract with UAW in 1941.(Healey, 2011). Union Bargaining methods: After the process of unionization, Ford motors have entered into a negotiable agreement with UAW, which has bargained to provide better working conditions, fair wages for the workers. This contract also mentions a clause stating that the organization, and the UAW would agree over this contract for a stipulated time until it expires and after that period the new agreement must be in place by the agreement of both parties or the risk of a labor uprising would arise. Effects of Union bargaining: The current negotiations between the company and UAW have resulted in producing a win-win contract. According to this contract the company has agree to invest and recruit labor within the United States due to huge impact on the company’s sales in 2008. These negotiations will benefit the company’s financial stability by saving overhead costs of outsourcing labor and would provide a job opportunity to the laborers within the United States. References: New York Times, Business Day. (2011). Retrieved from http://topics.nytimes.com/top/news/business/companies/ford_motor_company/index. Healey, T. (2011, March 2). A Guide to How Unions Work in the Automotive Industry. Retrieved November 1, 2011, from About.com Automotive: http://automotive.about.com/od/Unions/a/A-Guide-To-How-Unions-Work-In-The-Automotive-Industry.htm Ford. (2011, October 19). UAW-Ford National Labor Agreement Ratified By Members; Capacity Actions, New Product Sourcing Plans Confirmed. Retrieved November 1, 2011, from http://www.fordahead.com/2011/10/19 /uaw-ford-national-labor-agreement-ratified-by-members-capacity-actions-new-product-sourcing-plans-confirmed/.