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Unions, equality and job security
20 December, 2012
From 2004 until now, Georgia had the most employer friendly legislation in the world. Labor unions were for all practical purposes forbidden from operating. That's changing. There have been very many strikes after the elections and union organizing is enjoying a renaissance.

The attitudes in the US, Europe and the former Soviet countries towards unions are very different. In the US at least after the Molotov–Ribbentrop Pact, communism as an ideal has had zero influence, even among union organisers. Among
the general public there is no fear that somehow unions will lead to communism or socialism or something else dangerous. In fact the fear is that unions will hurt business. In Europe the attitude is more from the point of view of rights. Europeans tend to believe that labor organising and the right of workers to bargain collectively is a fundamental human right. Americans tend to see it as simply a useful tool for workers, but also one that is very dangerous for the economy. And they also see it as an institution very prone to corruption and self serving political lobbying, both of which are accurate assessments.


Georgians tend to see labor unions as a part of the constellation of institutions that were completely owned and operated by the state and party during the Soviet period. After the end of the Soviet Union, Georgia was too corrupt and poor for there to be much interest in unions. Then after Shevardnadaze resigned and the National Movement came in, organised labor became much weaker as did the labor code. There became a philosophical or principled view that any, every and all regulations or restriction on employes will directly hurt business and the economy. There was a tendency to see anybody who was a part of a union as motivated by self interest, anti-progress, and dangerous.


The teachers unions have been one of the best known examples. First of all let's remember that it is completely reasonable that teachers would want to organise. Part of the problem was that that ministry was never clear on how it wanted to treat teachers; wether it liked them or hated them, or did it think of them as the problem. Certainly many teachers were fired by heavy handed leaders in the system. So getting union protection was and is completely reasonable. But there are two problems with this issue and with the teachers union, the first is the job protection aspect, the second is the fact that teachers work for the state.


I very much support unions in general and specifically when they are working on safety for members, and wage increases. Labor should be able to bargain with management collectively. But I do worry when unions or labor codes try to improve job security. The reality is that the pace of change in the world is increasing and it is unlikely that people in the future will live in one place their whole life. People need to be fired, to learn new skills and perhaps move to new places, it is natural and the market must be empowered to encourage people that it is time for a change. Employers should be able to dismiss within reason their employees whenever they want. It is dangerous to try to force employers to justify their firings.


The other problem with teachers unions is that they are public sector unions (as they are called in the US). When government employees unionise they can act in ways that go against what the entire community of citizens may want. In the US for example, the teachers unions are so powerful that they really cause problems for the overall education system. There is a thing called tenure that makes it almost impossible for teachers to be fired in many states in the US. It clearly leads to worse teachers on average but they want the job security so it stays. There are many police and emergency personnel working for state governments in the US that have had very high pensions managed by the states. But the states didn't put in money to the plans and they are soon to be bankrupt. But those retired police and emergency workers are working hard to keep their benefits at the expense of the state.


Unions come about because people don't trust management. The less transparent and trustworthy management is, the more successful unions become. So management and their friends in government should think about that when setting labor and union regulations. They should get the labor code right and enforce it because if they don't, unions will go on strike and rewrite it under duress. Management should be more transparent. Currently in Georgia many of the businesses are owned by shell companies registered in offshore locations.


And finally there is an element of equality in this. It is reasonable for the highest paid full time employee to make ten or even twenty times more than the lowest paid employee in a company and that was the average in the fifties and sixties in the US, when unions where at their strongest. But union membership has declined for several decades in the US and now the highest paid employee can often make one hundred times what the lowest paid employee makes. Some have concerns about that.
Georgia faces the same thing. There are many in Georiga who have no job or very very low paying jobs but looking at the resdurants and cars on the roads, there are others who make lots of money. This tends to be firtile territory for unions to begin a discussion with workers.
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