Because the workers in the labor force are employed by other people, they are called employees. Not included are the self-employed--those who make their living from the fees they receive from their clients or patients.
In the early days of industry most business and industrial organizations were run and managed by the people who owned them. As organizations grew larger, corporations were formed. A corporation is an organization in which a group of persons is permitted by law to act as one person. A corporation is permitted to sell shares of stock--representing ownership--in a business. In this way, many people outside an organization may actually own it.
As corporations grow, it becomes necessary to hire people to manage them. These people work for salary, but their responsibilities are very much like those of the owner-manager. Their job is to represent the owner in running the business. They belong to management.
Management, then, is the group of individuals within an organization that is responsible for setting goals and directing the production of goods or services. This group includes managers who are also owners of the company, as well as managers who are employed by the company. The owner or president and the top officials clearly belong to management, as do managers who represent the owner or those who run the organization.
Agreement and Disagreement between Labor and Management
Labor and management agree in some areas and disagree in others. Both have a common interest in a healthy economy. Both wish to see the economy grow, so that more goods and services are bought. This in turn means that more jobs are provided, bringing increased wages and salaries to the workers and increased profits to the owners.
In an industry or business firm, labor and management have a common interest in producing goods or services that will sell. This means that they must be able to compete in quality, quantity, and price. (Lavan & Martin, 2008)
A labor union is an organization of employees whose purpose is to bargain with an employer or a group of employers over pay and working conditions. Historically unions are traceable to the guilds of the Middle Ages, which operated chiefly to establish quality standards for products and prices that were "just "in the sense that they enabled master workmen to support their families at customary levels while also providing training for apprentices. Their English origins are closely linked to the "de-skilling" effects of the technology of the Industrial Revolution on workers, which altered the traditional hierarchy of skills and their associated wage levels. Nevertheless, it was not until the founding of the Trades Union Congress in 1868 and the subsequent passage of the Trade Union Act that the English labor movement flourished. By the late 1800s, British unions allied with socialists to establish the Independent Labor party (later the Labor party). (Carlton, 2007)
Collective Bargaining, between employers and unions establishes formal rules governing work and conditions of employment. The term applies to negotiations about wages, hours, conditions of work, and fringe benefits, and