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Study notes

Trade Unions (Labour Markets)

  • Levels: AS, A Level, IB
  • Exam boards: AQA, Edexcel, OCR, IB, Eduqas, WJEC

Trade Unions are organisations of workers that seek through collective bargaining with employers to protect and improve the real incomes of their members, provide job security, protect workers against unfair dismissal and provide a range of other work-related services including support for people claiming compensation for injuries sustained in a job.

Trade Unions in the UK - revision video
Trade union density: Percentage of employees that were members of a trade union in the United Kingdom from 1995 to 2016

Most unions in the UK belong to the Trades Union Congress (TUC). Examples include Amicus, Unison, the Rail and Maritime Union and the National Union of Teachers.

Main roles of trade unions

  • Protecting and improving the real living standards of their members
  • Protecting workers against unfair dismissal (employment rights)
  • Promoting improvements in working conditions, workload & health and safety issues
  • Workplace training and education, accumulation of human capital
  • Protection of pension rights for union members

Trade Union membership

There has been a large decline in union membership over the last twenty-five years.

Unions might seek to exercise their collective bargaining power with employers to achieve a mark-up on wages compared to those on offer to non-union members. For this to happen, a union must have some control over the total labour supply. In the past this was possible if a union operated a closed shop agreement with an employer – i.e. where the employer and union agreed that all workers would be a member of a particular union. However in most sectors, the closed shop is now history.

More frequently, a union may simply bid through bi-lateral negotiations with employers to achieve an increase in wages ahead of the rate of inflation so that real wages rise, and other improvements to working hours and conditions.

Number of trade union members in the United Kingdom in 2016, by industry* (in 1,000 members)

Impact of Trade Unions on Wages and Jobs - revision video

Trade Unions Wages and Jobs - revision video

Exam Technique on Trade Unions in the Labour Market - revision video

A Level Economics Evaluation Skills: Trade Unions in the Labour Market - revision video

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