Trade Unions and Seniority Employment Rules.

Journal article

Some, but not all, trade union and insider-outsider models assume that a seniority employment rule is used. The authors investigate when firm and union members gain from such a rule and the consequences of their adopting one. Generally, providing a seniority wage scale is also used, they gain if union membership is not too large relative to demand and union bargaining power not too great. Moreover, when outsiders are hired under a seniority employment rule, employment is at the competitive level. These results might explain why bargaining over employment is relatively uncommon and typically occurs only in industries with declining employment.

Authors: Frank, J; Malcomson, J

• Journal: European Economic Review
• Volume: 38
• Publication date: 1994-01-01
• ISSN: 0014-2921
• Language: English