September, 2015

How unions help all workers

Unions have a substantial impact on the compensation (wages & benefits) and work lives of both unionized and non-unionized workers.

Some of the ways unions help are:

  • Unions raise wages of unionized workers by roughly 20% and raise compensation, including both wages and benefits, by about 28%.
  • Unions reduce wage inequality because they raise wages even more for low and middle-wage workers than for higher-wage workers, more for blue-collar than for white-collar workers, and more for workers who do not have a college degree.
  • Strong unions set a pay standard that nonunion employers follow. For example, a high school graduate whose workplace is not unionized but whose industry is 25% unionized is paid 5% more than similar workers in less unionized industries.
  • The impact of unions on total nonunion wages is almost as large as the impact on total union wages.
  • The most sweeping advantage for unionized workers is in fringe benefits. Unionized workers are more likely than their nonunionized counterparts to receive paid leave, are approximately 18% to 28% more likely to have employer-provided health insurance, and are 23% to 54% more likely to be in employer-provided pension plans.
  • Unionized workers receive more generous health benefits than nonunionized workers. They also pay 18% lower health care deductibles and a smaller share of the costs for family coverage. In retirement, unionized workers are 24% more likely to be covered by health insurance paid for by their employer.
  • Unionized workers receive better pension plans. Not only are they more likely to have a guaranteed benefit in retirement, their employers contribute 28% more toward pensions.
  • Unionized workers receive 26% more vacation time and 14% more total paid leave (vacations and holidays).

In addition, unions play a pivotal role both in securing legislated labor protections and rights such as safety and health, overtime, and family/medical leave and in enforcing those rights on the job. Because unionized workers are usually better informed, they are more likely to benefit from social insurance programs such as unemployment insurance and workers compensation. Unions are therefore an intermediary institution that provides a necessary complement to legislated benefits and protections.

Unionized workers enjoy the result of union organization and collective bargaining: higher wages; more and better benefits; more effective utilization of social insurance programs; and more effective enforcement of legislated labor protections such as safety, health, and overtime regulations. Unions also set pay standards and practices that raise the wages of nonunionized workers in occupations and industries where there is a strong union presence. Collective bargaining fuels innovations in wages, benefits, and work practices that affect both unionized and nonunionized workers.