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Land

agent (voted in by the majority of the workers). New be negotiated in labor-management contracts. An increase
employees must also join the union under the union-shop in employee-management teamwork and communication
policy. The Taft-Hartley Act, however, allows individual has also reduced the need for workers to be represented by
states to outlaw the union-shop policy. Most union con- labor unions. Thus, labor unions no longer play the vital
tracts negotiated in the 1990s operated under the union- role they once did in American labor-management rela-
shop policy. tions.
The agency-shop policy allows both union and
nonunion workers to be employed by an organization, but SEE ALSO Collective Bargaining; Negotiation
the nonunion employees must pay a union fee equal to
union dues. This policy requires nonunion workers to pay BIBLIOGRAPHY
their “fair share” of the expenses of the union’s represent- Boone, Louis E., and Kurtz, David L. (2005). Contemporary
ing them in negotiations, but none of the cost of the business (11th ed.). Mason, OH: Thomson South-Western.
union’s political activities. The open-shop policy allows Chaison, Gary N. (2006). Unions in America. Thousand Oaks,
voluntary union membership or nonmembership for all CA: Sage.
workers. It does not require nonunion workers to pay any Estey, Marten (1981). The unions: Structure, development, and
union dues or fees. management (3rd ed.). New York: Harcourt Brace Jovanovich.
Masters, Marick F. (1997). Unions at the crossroads. Westport,
CT: Quorum.
LABOR LEGISLATION
Wray, Ralph D., Luft, Robert L., and Highland, Patrick J.
Both labor unions and management have been affected by
(1996). Fundamentals of human relations. Cincinnati: South-
federal legislation since 1932, when the Norris-LaGuardia Western.
Act was passed. This law protects union activities such as
strikes and picketing by making it difficult for manage-
ment to obtain injunctions against them. In 1935 the G. W. Maxwell
Wagner Act (also known as the National Labor Relations
Act) made collective bargaining legal and forced employ-
ers to negotiate with union officials. The National Labor
Relations Board was established by this act. The board LAND
oversees union elections and guards against unfair labor SEE Factors of Production
practices.
The Fair Labor Standards Act of 1938 set a maxi-
mum of forty hours for a basic workweek, outlawed child
labor, and set a minimum wage. The Taft-Hartley Act lim- LAW IN BUSINESS
ited the power of unions by prohibiting unions from such Law governs and regulates virtually all aspects of the busi-
activities as coercing employees to join unions, charging
ness process, from the right to engage in a business or
excessive fees, refusing to bargain collectively with an trade, to the legal form of a business, to agreements for
employer, and using union dues for political contribu-
buying and selling merchandise or rendering services. Law
tions. The Taft-Hartley Act was amended in 1959 by the
regulates the quality of products sold and the advertising
Landrum-Griffin Act, which requires a union to have a
constitution and bylaws, secret-ballot elections of officers, of products for sale. Law governs the employment rela-
tionship, protects business property, and taxes business
and a financial reporting procedure. Management proce-
income. This article explores the relationship of business
dures are also regulated by legislation, such as the Plant-
Closing Notification Act of 1988, which requires and law in several of these areas.
employers to give workers a sixty-day warning of mass lay-
offs or plant closings. BUSINESS LAW AND LAWYERS
Business in the United States is regulated by federal and
OUTLOOK state laws as well as by local ordinances. State law regulat-
Labor unions were born out of necessity, to protect the ing forms of business, business agreements, and some
health and well-being of American workers. Through the taxes is the most important. Federal law regulates such
years, they have provided a unified voice for workers and things as advertising, civil rights, and protection of such
obtained fair treatment of them in the workplace. During property as inventions. Local law typically regulates busi-
the twentieth century, however, laws were passed that ness hours, where one can do business (zoning), and
guarantee employees many of the rights that once had to health and safety.

452 ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION