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Economy
HRM-543
Sec:1
ASSIGNEMENT-01
Unionizing FedEx
-ID-1610756
SUBMITTED TO-
DR.SHOAIB AHMED
UNIONIZING FEDEX
The average union member earns more than the average non-union
worker, however that does not mean that union membership will raise
wages: Few workers who join a union today get a pay raise. The
economy has become more competitive over the past generation.
Companies have less power to pass price increases on to consumers
without going out of business.
It is also fact that FedEx is the last remaining major express shipper that
is not unionized.
Consumers may have to pay a “hidden package tax” to fund this bailout.
Estimates vary, but a mere 10 percent increase in costs would result in
an extra $9 billion cost for consumers.
Consumers may have to pay a “hidden package tax” to fund this bailout.
Estimates vary, but a mere 10 percent increase in costs would result in an extra
$9 billion cost for consumers. Not to mention reduced reliability, longer
shipping times and more limited access to rural markets around the globe.
FedEx’s profit margins will remain the same because it is a publicly traded for-
profit business. As demonstrated above, unions raise a company’s cost of doing
business. Is it unreasonable to assume that a cost increase (the hidden package
tax) will fall on its customers’ shoulders?
FedEx claimed that UPS was trying to receive a government bailout designed
to “limit competition for overnight deliveries.” The disagreement was over a
provision in a Federal Aviation Administration reauthorization bill, which
would reclassify FedEx’s non-airline employees under the National Labor
Relations Act instead of the Railway Labor Act (RLA), making it easier for
them to form local unions. UPS’s ground workers are already covered by the
NLRA, and so its employees are often members of the International
Brotherhood of Teamsters. While UPS claims that FedEx’s ground employees
should be covered by NLRA so employees performing the same function at
different companies have the same rights, FedEx argued that UPS was trying to
force them to expose customers to local work stoppages that could prevent the
delivery of time-sensitive shipments to lower competition.
Why Union is bad for newly joined employees?
Unions do not have the resources to monitor each worker’s performance and
tailor the contract accordingly. Even if they could, they would not want to do
so. Unions want employees to view the union–not their individual
achievements–as the source of their economic gains. As a result, union
contracts typically base pay and promotions on seniority or detailed union job
classifications. Unions rarely allow employers to base pay on individual
performance or promote workers on the basis of individual ability.
Consequently, unions do not negotiate higher wages for many newly organized
workers. As I joined the FedEx recently, it is wise to not sign for unionization
at FedEx.