Fact Sheet # 5
Unions, Democracy and Economic Prosperity
Unions and democracy
Unions are an important force for democracy – not just in the workplace. They promote democracy within nation states and within the global community. A just and democratic society depends on a healthy and free labour movement. In fact, labour rights are a critical component of human rights and democracy helping to protect and promote the social and economic well-being of the human population.
Unions make democracy work better for workers and their families. Unions press for better social, economic and environmental policies, through various forms of political action and through coalitions with others in society who have common aims.
Unions have been, and continue to be, an important force for democracy, not just in the workplace, but beyond, in the community – locally, nationally and globally. Unions need democracy in order to thrive. Democracy needs unions within each nation state and, in this age of globalization and interdependence, within the global community. The large membership and geographic reach of unions can deepen and broaden support for democratic principles and practices within a country. Unions are often the only mass membership-based organizations that can stand against authoritarian regimes.
As unions are effective within the democratic process, confidence in democracy rises. It is no coincidence that in countries where there are free and active trade union movements, there are more democratic, transparent and representative forms of government.
Unions help nations undergoing economic and democratic change by contributing to the emergence of a stable, fairly paid, working middle-class. If unions succeed in improving the economic situation for working families, democracy is strengthened. In those countries where there is no union movement or where the movement is vulnerable, the vast majority of citizens continue to be trapped in poverty. It is in these conditions that instability and extremism thrive.
A stable, peaceful and progressive international community depends on vibrant democracies.
Vibrant democracies depend on strong and vibrant labour movements
Unions need a stable and democratic environment to protect the political and economic rights of their members. Unions cannot adequately protect workers’ interests if they are subject to the whim of governments that do not respect democratic principles. They need to work within a legal framework that protects their rights and helps to ensure the long-term sustainability of democracy. If that legal framework can be casually set aside by governments or employers, democracy as a whole is threatened and unions cannot do their job.
Unions promote economic prosperity
Not only do democracies benefit from unions, so do economies.
Unions provide workers with a decent wage so they and their families can enjoy a quality standard of living and financial security. They provide workers with comprehensive benefits over and above legislative benefits and universal public programs. Vacations, extra medical insurance, disability and life insurance and a retirement income are all areas where unions have negotiated enhanced provisions. Unions provide workers with job security and thus economic security for themselves and their families.
Beyond the economic benefits provided to workers and their families, unions havehistorically been a major force in humanizing and democratizing the economies of nations. Unions promote higher levels of economic equality and, in many ways, also encourage labour markets to achieve greater economic growth and efficiency. Historically, unions have been instrumental in raising the wages to a greater degree for “low-skilled” rather than for “high-skilled” workers. Consequently, unions lessen wage inequality.
All of this has a positive impact on the economy. Bargaining outcomes produce higher wages and greater income equality and have a positive impact on employment growth. Bargaining achievements such as paid time off the job, restrictions on overtime, early retirement provisions and job sharing arrangements have not only preserved jobs, but have also created employment and enhanced productivity.
Unions also have a key role in promoting sound government policies on economic growth that benefit the whole community. Business, especially foreign owned business, focuses on the interest of the particular business, not on the well-being of the country as a whole. Unions are broadly-based. They reflect the broad interest of working people in having a prosperous economy.
The erosion of bargaining rights in Canada has had a negative impact on the economic well-being of most Canadians. Only a relative few have benefited from economic growth in this period. The growing body of empirical evidence shows that labour laws and practices promoting collective bargaining and providing workers with the right to strike actually make a major contribution to higher economic productivity to the benefit of the community as a whole.