This chapter is an overview of the study and it offers a background of the study, the problem that the researcher is addressing, the rationale of the study, the research questions, the purpose of the study, the scope of the study, the contribution of the study and definitions of terms.
Background of Study
The strike of 1954 was probably one of the most important economic and political events in the history of Honduras. Also known as the ‘banana strike’, it involved at least 38,000 workers in the country, and it took almost 3 months to settle (Euraque, 1996). It was thanks to this strike, that the first labor union was consolidated in the multinational company used for this study.
Since the formation of this first union, this multinational company has overseen countless strikes from its numerous labor unions. In fact, in the year 2010 alone, $1 million USD was lost on operations due to workers’ strikes (La Tribuna, 2010). Because of this, labor unions have gained a reputation of ‘doing more harm than good’ to organizations in Honduras. As a consequence, many organizations are attempting to close their labor unions. For instance, strikes and financial loss in some of the farms of the multinational company in this study, led the organization to attempt to close 13 farms, which would leave 3,500 families without a source of income. After a series of negotiations which took months to settle, not all of the 13 farms were closed; however, many workers were left without a job (EMI, 2011).
In order to stay competitive and prevent economic loss, organizations in Honduras are more conscious than ever of the need to have positive union-management relations. In addition, labor unions are needed more than ever by workers who demand fair wages and practices. A better understanding of union workers perceptions not only of the union-management environment, but of their voice in labor unions can not only benefit the workers themselves, but it can also benefit firms and companies established in Honduras.
It might help organizations and labor unions work together in a completely distinct manner: instead of having a conflictive relationship that leads to strikes and layoffs, they
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might realize that in the long run, a positive, cooperative environment might provide more benefits to both parties.
Problem Statement
A great number of organizations are opting to move into a non-union environment, which has lead to a decrease in union density around the world (Sano & Williamson, 2008). Latin America is no exception to this decline, and some countries have seen a steady decrease of unions in the past years (Wachendorfer, 1990).
In Honduras, a country in which the phrase ‘workers’ rights’ is still not respected, labor unions are fundamental to society. In fact, according to the US Annual Human Rights Report (2012) union workers in Honduras exercise with difficulty the right to engage in collective bargaining and the government failed to enforce applicable laws effectively. This led many employers to actually refuse to engage in collective bargaining with unions.
In the case where employers actually engage in collective bargaining, workers are mostly dissatisfied with the results and they demonstrate this dissatisfaction by not complying with organizational policies. In addition, this dissatisfaction leads to strikes, which can last from days to weeks. In some cases, private organizations have been forced to close their areas of operation for days because of strikes.
Unfortunately, up to this time, union-management relations in the country have a long history of disagreement. Consequently, there is very little knowledge on how organizations can collaborate with labor unions, and the benefits that a positive union-management environment and perceived employee voice can bring to the organization.
Rationale of the Study
Research on workers’ perceptions of employee voice, union-management environment, satisfaction with collective bargaining and employee compliance are quite few. Moreover, there are very few studies that have been conducted in Honduras that concentrate on union workers.
Needless to say, none of the studies have been applied to labor unions from the agro-industrial sector in Honduras. This research is not only a first of its kind in
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Honduras, contributing to Honduran literature which is in great need of such research, but also proves to be of great value for both organizations and labor unions.
Purpose of the Study
The purpose of this study was to apply the Procedural Justice Theory to investigate the impact perceived employee voice in labor unions had on satisfaction with collective bargaining results and employee compliance. Moreover, it aimed to investigate the impact perceived employee voice in labor unions had on union-management environment. Furthermore, it aimed to understand the impact a positive union-management environment had on satisfaction with collective bargaining results and employee compliance. In addition, it investigated whether a positive union-management environment served as a mediator between perceived employee voice in labor unions and satisfaction with collective bargaining results and between employee voice in labor unions and employee compliance.
Research Questions
This study answers the following questions:
1. What is the relationship between perceived employee voice in labor unions and satisfaction with collective bargaining results?
2. What is the relationship between perceived employee voice in labor unions and employee compliance?
3. What is the relationship between perceived employee voice in labor unions and a positive union-management environment?
4. What is the relationship between a positive union-management environment and satisfaction of collective bargaining results?
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5. What is the relationship between a positive union-management environment and employee compliance?
6. Does a positive union-management relationship mediate the relationship between perceived employee voice in labor unions and satisfaction of collective bargaining results?
7. Does a positive union-management relationship mediate the relationship between perceived employee voice in labor unions and employee compliance?
Scope of the Study
This research studied the relationship between perceived employee voice and a positive union-management environment. Additionally, it studied whether perceptions of the union-management environment had impact on the satisfaction with collective bargaining results, and employee compliance. This framework applied the theory on Procedural Justice to study satisfaction and compliance as outcomes of perceptions of employee voice in labor unions. Therefore, only those factors that have been found to affect procedural justice feelings are included as predictors, such as perceptions of employee voice and perceptions of union-management environment.
This study collected data from labor unions in the Central American country of Honduras. As a very small country whose economy is still developing, it wouldn’t be advisable to generalize the results of this study to other countries. In addition, given that Honduras’ economy is mostly based on agriculture, this study was conducted in a multinational company in the agro-industrial sector. Because the sample from this study came from a specific economic sector, it wouldn’t be advisable to generalize the results to other sectors of the economy.
Moreover, this study focuses on perceptions. It’s important to note that perceptions are not based on reality, but on individual’s view of circumstances (Kannan
& Panimalar, 2013). In addition, only the perceptions of union workers are considered for this study, and there was no study of non-union workers for comparison.
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Definition of Terms
Labor Unions
Labor unions are democratically operated entities established by workers, to represent workers in any company or state enterprise. The main purpose of these entities is to protect workers rights and interests (Napathorn & Chanprateep, 2011) by achieving
“collective goals” (Shmoop Editorial Team, 2008). Some of the goals can be economic in nature, which includes increasing wages and benefits for the workers. Furthermore, there are other goals that go beyond economic purposes, such as providing better training for the workers and making the workplace safer (Tiburcio, 1998).
Union Worker
A union worker is defined as a worker who is member of a union and who has union representation at the workplace. A union workforce can bargain or negotiate its salary and wage rates through a union, as well as employee benefits, complaint procedures, safety procedures, and policy procedures (Richards-Gustafson, 2011).
Procedural Justice
Dogan (2008) defines procedural justice as the extent in which the employees perceive the dynamics of the decision process as fair. In other words, procedural justice is the perceived fairness and transparency in the decision-making procedures made by the organization. Blader and Tyler (2003) specified six principles to promote the perceptions of procedural justice: consistency, bias suppression, accuracy, correctability, representativeness and ethicality.
Perceptions
Halle (2013) defined perceptions as “the process through which we select, organize, and interpret the information gathered by our senses, in order to fully understand our environment”. In other words, individuals give meaning to their environment based on their perceptions. In addition, Kannan and Panimalar (2013) stated that an individual’s perception is not necessarily based on reality, but it is an outlook, an individual’s view of a situation.
6 Positive Union-Management Environment
Union-management environment is defined as the setting in which management and the labor union, directly or indirectly, interact (Trebilcock, 2001). Angle and Perry (1986) supported this definition, stating that union-management environment is the ‘setting in which labor unions and management interact over time’. A positive union-management environment can be described as how positive employees perceive this interaction.
Perceived Employee Voice in Labor Unions
Townsend, Wilkinson, and Burgess (2013) defined employee voice as an opportunity to
‘have a say’: a concept that is essential in most definitions of employee voice. Perceived employee voice in labor unions can be defined as employees’ perceptions of whether or not they ‘have a say’ in their respective labor unions.
Collective Bargaining
The Department for Professional Employees (2011) defined Collective Bargaining as:
“A form of employer–employee relations that allows employees to be heard in the workplace on issues that affect them. It offers workers the advantage of being able to speak with one voice. Professionals use collective bargaining to preserve workplace integrity and respect, and create safe, professional, and rewarding work environments.” (p.1)
Satisfaction with Collective Bargaining Results
Aydin and Ceylan (2009) defined employee satisfaction as “the combination of affective reactions to the differential perceptions of what the employee wants to receive with what he/she actually receives”. Utilizing this definition, satisfaction with collective bargaining results can be described as the differential perceptions of what the employee wants to receive through collective bargaining, with what he/she actually receives.
7 Employee Compliance
Podsakoff, MacKenzie, Paine and Bachrach (2000) defined employee compliance as employees’ internalization and acceptance of the organization’s rules, regulations and procedures. Acceptance will result in a conscious adherence to these regulations and procedures, even when no one is observing or monitoring the employee.
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