The Failure to Negotiate First Contracts: Determinants and Policy Implications

Abstract

This study examines why unions, after winning certification rights, fail to secure agreements in roughly one of every four first-contract negotiations. Hypotheses are derived from Chamberlain's theory that the relative power of the negotiating parties is a function of the costs of agreeing and disagreeing, costs that are shaped by economic, legal, and organizational factors. The author analyzes data through 1982 on 118 cases in which unions had won NLRB elections in Indiana in the years 1979 and 1980. He finds that an employer's discrimination against union activists and his refusal to bargain, measured by section 8(a)(3) and 8(a)(5) charges deemed meritorious by the regional office of the NLRB, have substantial negative effects on the probability that a first contract will be reached. Similarly, negative efffects result from lengthy delay in the NLRB's resolution of employer objections and challenges to lost elections. On the other hand, unions are also more likely to obtain first contracts when firms pay wages well above the industry average, when national union representatives participate in negotiations, and when bargaining units are relatively large and cohesive.