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Ford Motor Corporation - Labor Laws and Unions

Essay by   •  September 9, 2012  •  Case Study  •  700 Words (3 Pages)  •  1,602 Views

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Labor Laws and Unions

This week's assignment will require choosing an organization that is currently part of a union. The organization will identify legal issues and obstacles that must be encountered as part of a union. After these findings, the company will be looking for recommendations. Also, throughout the paper several questions will be examined such as benefits of joining a union, unionization process, union bargain strategies, and effects of union bargaining on the organization.


The Ford Motor Corporation was founded in 1903 by Henry Ford with 28,000 in cash ("Heritage", 2012). When Ford started the company, it changed how the world would move ("Heritage", 2012). Ford Motor Corporation has been a leader in the automotive industry over 100 years. Ford is a global company that employs thousands of employees which includes a large percentage of union workers. The United Auto Workers have 41,000 employees within the United States working for Ford (Vlasic, 2011).

Legal Issues, Obstacles, and Recommendations

Ford Motor Corporation faces many issues and obstacles because of the large amount of employees that are union members. The possibility of a strike by the United Auto Workers has the biggest impact on the Ford Motor Corporation. The work stoppage would cost Ford millions of dollars in lost hours. The union has the legal right to strike if the collective bargaining agreement is being violated. Ford and United Auto Workers must work to keep the communication channels open to prevent any breach of the collective bargaining agreement in an attempt to prevent this action. One suggestion would be meeting on a regular basis such as daily meetings.

Ford's next hurdle would be avoiding the effects from the economic downturn. If Ford was forced to reduce their workforce, what would be criteria for firing individuals? Union officials would assume because of the existing agreement they would have the upper hand. Ford could cut more costs by reducing the union jobs but risk lawsuits if that happens. The recommended path would be eliminating individuals who are retirement eligible by offering a severance package.

Union Benefits

The United Auto Workers benefit as union with Ford because they negotiate directly with the management team to make sure their needs are met. There is no middle person just Ford and United Auto Workers involved within the relationship. The salaries are higher compared to the non-union employees and there is more protection against layoffs.

Unionization Process

Henry Ford considered unionizing of his company as his "greatest disappointment" in business, Ford Motor Company and the union proceeded to work together over the decades to ensure continually



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