Union Coverage, Membership and Performance-Related Pay: Are Piece Rates Different?

This paper revisits a literature on the links between unionisation and performance-related pay (PRP), which offers a disparate set of results. Part of the reason for this is the usual inability to distinguish between different types of PRP and the lack of rich panel data containing such measures. Analysis of panel data containing six separate PRP schemes reveals that union members are less likely to receive PRP in general and less likely to receive bonus payments, stock options, or profit sharing than non-members. Furthermore, profit sharing is negatively related to both union membership and coverage. However, union members or those covered by a union contract are more likely to be paid piece rates, providing further evidence that piece-rate pay differs from other forms of PRP.