Trade Unions and the Distribution of Paid Overtime

Abstract

The suggestion has been made by Mulvey (1986) that trade unions may be able to influence the allocation of work paid at premium rates in favour of their members and that this may partially explain the existence of a union/non-union differential in average hourly earnings in Australia. This paper investigates both the general proposition and its particular application to the union/non-union wage differential. with respect to the distribution of paid overtime. Analysis of the Australian Longi tudinal Survey reveals that, while unions do appear to influence the distribution of overtime in favour of their members, the effect is small and would account for only about one percentage point of the union/non-union wage differential.

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