Since 1990, there have been adverse changes to the economy of the world. In the globe, organizations are advancing from time to time. However, these economic changes have had massive impacts to the wellbeing of the welfare of people. There have been direct impacts to the lives of the entire community
One of the main effects of these changes is the continued fall of the weighted deferred wage. This is technique employed by labor unions in collective bargaining to acquire a pay raise, which permits management to save money until the raise gets into effect while at the same moment, permits the union to affirm that it yields a pay increase for the workers involved (Clasquin, 2004).
The fall has been witnessed following existence of independent determination of wages by companies for their organizations. This has prevented the comparison of wages among companies to settle at a common wage size (Clasquin, 2004). This bars labor unions from accusing a company as they do not understand the basis on which the company determines the wages to impose on its employees.
It is also extremely difficult for labor unions to bargain for triumph during tough economic times. This is because, at this moment all companies are looking for strategies that will aid in curbing negative effects deployed by the economy. During hard economic times, companies are always searching for means of cutting on their costs and maximize on profits. One of the methods a company may choose is reducing wages for its employees or sacking some of the employees (Sloane & Witney, 2010). With a visible reason of interfering with employees’ wages, it becomes hard for labor unions to intervene and accuse a company of wrongfully laying off its employees or reducing their earnings.
Therefore, economic changes may have a massive impact on how labor unions react to situations in the labor markets. Some economic forces will lead to interference with the wellbeing of employees in a company.
References
Clasquin, B. (2004). Wage and welfare: new perspectives on employment and social rights in Europe. Brussels: P.I.E.-Peter Lang.
Sloane, A. A., & Witney, F. (2010). Labor relations (13th ed.). Upper Saddle River, NJ: Prentice Hall.
