Impact of Unionization on Human Resource Management Practices

This essay examines the impact of unionization on human resource management, noting that unionized operations can cost 25% to 35% more than non-unionized ones. While employees may see unions as a way to improve job security and benefits, the essay points out the potential negative financial impacts on businesses, including higher wages and operational costs. Emerging businesses often take a strong stance against unionization to mitigate these costs. Although some argue that unions don't reduce revenues, studies suggest that organizations embracing unionization may experience slower development and losses in equity worth. The essay concludes by highlighting the disinclination of unions to take ownership stakes in structured organizations due to these economic factors.

Running head: HUMAN RESOURCE MANAGEMENT
HUMAN RESOURCE MANAGEMENT
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Several studies indicate the cost of employing a unionized operation is greater to the rate
of 25% to around 35% for a non-unionized operation (Schwartz & Solove, 2014). As
organizations initiate to recuperate from the recent economic predicament, the concept of union
representation can be perceived to be more engaging than ever to employees who have been
concerned related to job security, remunerations along with other beneficiary factors. However,
employees in recent times fail to realize the cost of unionization and to the degree to which their
incidence of a union and its external actions can pose unconstructive influence on business.
Research reveals that organizations with devoid of unionization are required to pay an average
rate of around $20 per hour pertaining both wages and remuneration whereas the union
employers operating in the same sector are compelled to pay over $23 per hour (Hirsch, 2017).
As a result, newly emerging business enterprises such as Wal-Mart, FedEx have been taking
strong stance against concepts of unionization. Reports indicate the way recently developed
organization’s have been acknowledging non-unionization and further witnessing an increase in
their operational costs by 25% of their annual payroll as well as benefit expenditures (Schwartz
& Solove, 2014).
At this juncture it is significant to note that though few union advocates have been at
variance that the role and significance of unionization does not impact in the reduction of
revenues, several reports indicate that progress of organizations with strong embrace on
unionization win organization elections tend to undergo lack of development at businesses where
they are incompetent to succeed (Gigler et al., 2014). It has been noted that the loss in equity
worth initiates with the success of unions. However, the net outcome is considered to be
insignificant with profits of 10-15% which results that the higher the margin of the success of

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unions, the greater the rate of loss in the economic level of stakeholders (Gigler et al., 2014). As
a result, unions reveal severe disinclination to take ownership stakes in structured organizations.

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References
Gigler, F., Kanodia, C., Sapra, H., & Venugopalan, R. (2014). How frequent financial reporting
can cause managerial short‐termism: An analysis of the costs and benefits of increasing
reporting frequency. Journal of Accounting Research, 52(2), 357-387.
Hirsch, B. T. (2017). What do unions do for economic performance?. In What do unions do? (pp.
201-245). Routledge.
Schwartz, P. M., & Solove, D. J. (2014). Reconciling personal information in the United States
and European Union. Cal. L. Rev., 102, 877.