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Union Tireworkers of America Case Study: Strikes and Wages


1. What are the pros and cons of North American Tire's strategy of hiring replacement workers? How ethical is the behavior of management?

2. Assuming that the firm's goal is to break Local 974 of United Tireworkers of America, what are the advantages and disadvantages of this strategy?

3. What standard should the firm use in setting wage rates (industry or geographic)?

Please provide at least one 1 reference


Solution Preview

1. The cons of North American Tire hiring replacement workers are the messages sent to Local 974 of the United Tireworkers of America; in that the production will not be hurt by the strike. By bringing in replacement workers, the underlying message also conveys to the workers they are easily replaceable. The Local is being told, through actions, that either they agree to the company's "best offer" for a new contract, or they likely will not have jobs as the replacements have proved successful as production was actually increased. Unless there was a clause in the Local 974 contract preventing the use of replacement workers, the company was not unethical in engaging this practice. If there was a clause indicating replacement ...

Solution Summary

This solution is over 450 words and includes a reference, thoroughly addressing three questions related to a case study of Local 974 Union Tireworkers of American and North American Tire Plant. The topics addressed include pros and cons of the North American Tire Plant utilizing replacement workers during a strike, and whether such practice is ethical. Next, there is a discussion about the strategy of trying to de-unionize the work. Last, an analysis is provided on why geographic wage studies are more valuable than industry standards.