Unions exist as a means for employees to organize and protect their rights in the workplace, including through representation in collective bargaining with employers. Collective bargaining is the process of negotiations between an employer and a group of employees, to decide on certain conditions and terms of employment. The result of those efforts is called a "collective bargaining agreement" or CBA. This agreement serves as the starting place for resolution of disputes between an employer and its employees. Collective bargaining and union organization are governed by a federal law known as the National Labor Relations Act (NLRA).

National Labor Relations Act

The National Labor Relations Act (NLRA) governs collective bargaining and organization of unions. Under the NLRA, employees have the right to decide whether to have a union represent them for bargaining purposes. Under the authority of the NLRA, unions are governed by the National Labor Relations Board.

The NLRA does not apply to all workers. The Act specifically excludes from coverage those workers who are:

• Agricultural workers.
• Employed in domestic services in a home.
• Employed by a parent or spouse.
• Independent contractors.
• Supervisors.
• Employed subject to the Railway Labor Act.
• Employed by state, local or federal government.
• Employed by any person who is not defined as an employer under the NLRA.

If the workers in a plant or location agree to unionize, they will then become members of the union and will pay dues into the union to cover the costs of services provided. A company may have union and non-union workers at the same location.

Collective Bargaining

The NLRA establishes procedures for selection of a labor organization to represent employees in a collective bargaining agreement, and employers are forbidden from interfering in this process. Unions represent employees in collective bargaining processes with employers on a number of issues, including:

• Wage and salary negotiations;
• Benefits like health care insurance and paid time off
• General on-the-job working conditions; and
• Health and safety standards in the workplace.

Under the NLRA, the employer is required to bargain solely with the representative chosen by the employees.  Unions representing a large number of workers are usually in a better negotiating position than the workers would be individually.