The Union Effect

Unions in Canada have a purpose “to ensure some level of participation and to define and protect employees’ rights through the collective agreement, management/union issues overlap with union issues” (Tittle, 2017). Although unions are a source of protection to employees when it comes to their rights, not all unions benefit everyone. This blog will answer how unions play a role in the financial services industry, how they protect the rights of employees and how their ethical behaviours can be improved to respect employee rights to a greater degree.

In the Canadian financial services sector, there is a low penetration in the market of employment unions. The financial services industry is only about 7.7% unionized as per statistics Canada (Canada, 2019). In Quebec, “approximately 38 per cent of Montreal-based Laurentian’s employees are unionized, making it the only bank on the continent with organized labour” (Post, 2017). At Laurentian, the union plays the role of the employment protector.  As banks become more digitized, they do not require as many front-line staff as they did in the past. The union is currently protecting Laurentian employees and tellers from losing their roles due to the advice-only branch initiatives. This is not necessarily in the best interest of the bank as the business stated in its results of the re-negotiating the collective agreement, “[it] could result in higher costs which could have a material effect on our business, results of operations and financial condition.” (Post, 2017).

As of April 2019, Laurentian has come to a collective bargaining agreement. The union has protected the job transition, as well as the working conditions for employees. As stated, “we can now focus fully on realizing our strategic plan and continue to transform our branch network while providing jobs of the future and becoming more competitive” (NEWSWIRE, 2019). The collective bargaining agreement has included:

• giving access to positions focused on financial advice;
• replaces job security with personalized transition measures, including severance packages;
• prioritizes individual performance and qualifications as key decision-making criteria for appointments, promotions and career progression opportunities for professional positions;
• allows flexible working conditions based on the needs of customers while promoting a better work-life balance for our employees.

This new agreement protects employee work-life balance and career success, while not limiting the business’ success. The union is doing a good job of protecting employee rights as they have not only taken into account workplace issues, but also allowed individualized flexibility for employees. This agreement follows utilitarian ethics as it is set out to benefit the greatest amount of people. The employees that are not able to move forward with the new business direction are being offered severance to ensure their ability to move onto another career opportunity.

Furthermore, the new agreement is also deemed ethical with application of rights theories, especially from the social contract theorists’ viewpoint. As Tittle argues, the rights are guaranteed, and should be ensured, because “[the employees] have done something to acquire those rights” (Tittle, 2017). In other words, as the employees provided services and labour that are required for Laurentian to run the business, the above-mentioned conditions in the agreement are what must be assured.  With this new agreement, the union has not only protected the employee’s rights, but also made an ethical decision by doing so.

Unions in the finance industry are very rare. The example of the Laurentian union shows that unions can help both the business and employees be successful. The ethical behavior of businesses can be closely monitored with a union, as they have more of an ability to make a change than when a single employee attempts to take on business alone. Unions can ensure that employees interests and issues are heard and taken care of in a timely and official way.

In conclusion we can now answer how unions play a role in the financial services industry, how they protect the rights of employees and how their ethical behaviours can be improved to respect employee rights to a greater degree. The role unions play in the financial services industry is to ensure fair working conditions for employees and also continued success of the business. The union protects employees by ensuring their voices are heard. In the Laurentian case, employees were looking for advancement opportunities and work-life balance which has now been incorporated in their collective bargaining agreement. The ethical behaviours of all unions can be improved by ensuring they create a fair and just environment to negotiate and hear their employees.

References

Canada, S. (2019). Union status by industry. Retrieved from https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1410013201&pickMembers%5B0%5D=2.5&pickMembers%5B1%5D=4.1

NEWSWIRE, G. (2019). New collective agreement between Laurentian Bank and its unionized employees in Quebec. Retrieved from https://www.globenewswire.com/news-release/2019/04/01/1790520/0/en/New-collective-agreement-between-Laurentian-Bank-and-its-unionized-employees-in-Quebec.html

Post, F. (2017). Laurentian is the only North American bank with a labour union — and it’s clouding their outlook. Retrieved from https://business.financialpost.com/news/fp-street/laurentian-bank-labour-union

Tittle, P. (2017). Ethical Issues In Business. Broadview Press.