Similarities and differences between public and private sector unions

Public vs. Private Sector Unions

Public and Private Sector Unions

Collective bargaining in public sector is a recent phenomenon that became common in 1960 and started gaining momentum at the time when unionism in private sector was slowly declining (Reilly, 2012). Changes in the government policies and the legal requirements made the way for the increasing unionism in the public sector. There has always been a debate regarding the issue if private and public sector unions are same; however, Troy (2003) states that public sector bargaining is not the extension of bargaining in the private sector. This paper will answer the problem statement " Are there more similarities or differences between the public sector unions and the private sector unions" by comparing and contrasting the key similarities and key differences between the private sector and public sector unions and labor relations.

Background Information

It is very essential to know the difference between private and public sector in order to understand the similarities and differences between the private and public sector unions. The private sector is composed of the organizations that are owned and run privately. These include all profit and non-profit corporations and partnerships that are not owned by the government in any way. For instance, local businesses, super stores, credit unions and all other organizations operating in the private sector.

The public sector on the other side is composed of all organizations owned and run by government. These organizations are the public authority and include federal, state, provincial, and municipal governments depending upon the structure of the place. For example, police, government educational institutes, government hospitals, prison services etc.

Key Differences: Public Vs Private Sector Unions

Unlike the case of private sector unions, in public unions, the municipal leaders are elected which creates a political structure in the bargaining process (Reilly, 2012). Proper voting is carried out for electing leader in the public unions; but in private sector, there are very rare workers who are shareholders and can take part in the voting and selection of management.

Public sector employees possess greater power outside of collective bargaining compare to the private sector, and therefore they play an active role in affecting the decisions of management (Reilly, 2012)..

Unions in the private sector are made to distribute profits from owners to workers. This approach cannot be applied to the public sector, as government does not make profits. Therefore, it can be said that unions in the public sector have different goals and different approaches to bargaining (Troy, 1994).

Unions in the private organizations work with in the market economy and affect the economic growth, labor supply, consumer process and profits of the firms. In contrast to this, the public sector unions work as a monopolistic and sole provider of the economic resources to the private and public organizations in the bureaucratic way (Reilly, 2012).

Public sector managers and employees both have same interest and both get benefit when a decision is finalized by mutual understanding. For instance, if the budget of the fire department is increased, than both managers and employees will have confluence of interest. The case is different in private sector unions where usually one side gets benefit while other makes a compromise. Therefore, public sector managers often welcome unions, so that voters can convince to approve the public sector budgets (Belman, Gunderson and Hyatt, 1996).

Public sector unions face a lot more government and civil service constraints and hindrances compared to the private sector unions. Therefore, public unions pass through terrible times if they break any law or spend money on antiunion consultants; which has always been a very common practice in private sector unions.

Private sector union employees believe that it is almost impossible to achieve goals without the cooperation of the management. On the other side, public sector union employees have a belief that organizations have a greater chance to succeed without the cooperation of management.

Conclusion

After comparing and contrasting public sector unions and private sector unions in detail, it can be concluded that the purpose of making unions is same in both private and public sectors. However, the goals, approaches and processes of operation are quite different in both sectors.

Despite the fact that the unions of both sectors work for improving the working conditions and wage structure of employees; the differences in the two sectors are due to the political structure of the public sector union, which is not the case with the private sector. Similarly, there are many other prominent differences, which make public sector unions very different from the private sector unions. Hence, it can be stated that there are more differences between the public sector and private sector unions and very few similarities.