Table of Contents

Research Handbook on the Economics of Labor and Employment Law

Research Handbook on the Economics of Labor and Employment Law

Research Handbooks in Law and Economics series

Edited by Cynthia L. Estlund and Michael L. Wachter

This Research Handbook assembles the original work of leading legal and economic scholars, working in a variety of traditions and methodologies, on the economic analysis of labor and employment law. In addition to surveying the current state of the art on the economics of labor markets and employment relations, the volume’s 16 chapters assess aspects of traditional labor law and union organizing, the law governing the employment contract and termination of employment, employment discrimination and other employer mandates, restrictions on employee mobility, and the forum and remedies for labor and employment claims.

Chapter 8: The union as broker of employment rights

Stewart J. Schwab

Subjects: economics and finance, labour economics, law and economics, law - academic, law and economics


Most employment-law rights are mandatory. Individual workers cannot decline the protections the law gives them. For example, a nonexempt worker must get at least $7.25 per hour and time-and-a-half for overtime, even if she would agree to less. A worker’s pension must vest within five years. If she is injured on the job, a worker is entitled to compensation through a state system and cannot opt out in advance. Interestingly, in these examples and others like them, the law forces its protection only on nonunionized workers. Unions in a collective bargaining contract can bargain away these rights, acting as broker in return for something more valuable to their workers. This chapter examines the choice between waivable and mandatory employee rights and, in particular, whether some rights should be mandatory for individual workers but subject to negotiation by labor unions. Section I sets the stage with two examples. Section II explores why most employee rights are mandatory. Section III asks whether unions should be allowed to waive (or broker, to use a more palatable term) employee rights even when individuals cannot. Section IV documents the large degree to which current employment law already has this feature of mandatory individual rights that unions can broker. Section V then explores whether unions and society should welcome the role of union as broker.

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