The evolution of the company union in the U.S. is a history of both labor's progress and its missteps. It is a story that, at bottom, speaks to the battle of workers to find an independent, powerful presence on the job -- and to push this clout into the community to help shape the broader public realm.
Unions came into existence organically wherever capitalism developed. As soon as workers were brought together by a small number of employers and compelled to make profits for them, the employees naturally sought to defend themselves. A living wage and decent working conditions failed to emerge through the good will of the employers, unfortunately, so workers took matters into their own hands.
They formed organizations that promoted their interests at the expense of the bosses' profits. And as soon as these fledgling unions became powerful, the owners sought to undermine them. When the unions were too powerful to be drowned in blood, the bosses sought other techniques.
The company union was typically a preventative measure initiated by the employers to lure workers away from real unions. Where workers became militant and bold in their demands, the company would offer a venue for them to voice their concerns and, sometimes, have these concerns properly addressed.
Of course, these company unions were totally controlled by the employer -- they could be whisked away if the workers were impolite or too demanding. These fake unions automatically eliminated the strength workers would have had if they belonged to an independent, larger labor union. Some issues that workers sought to remedy were purposely kept "off the table."
During World War I, the growth of company unions was encouraged by the U.S. government, which sought to stem the growing surge of worker radicalism. Employer-employee councils were set up en masse, and where nothing could be agreed upon, the federal government would swoop in to try and smooth over the conflict.
The union labor upsurge before, during and after World War II was unprecedented, scaring the employer class stiff by exhibiting its organized strength and winning workers demands. F.D.R. used a combination of tactics to defuse the worker-owner conflict: compromise, the National Guard, and finally, appealing to the national patriotism needed to win workers support for WWII.
F.D.R. also set up the National Labor Relations Board (NLRB) in an attempt to "balance" the conflict between workers and their employers. The NLRB falsely claimed that it would remain objective in its work, but it functioned inside a government where giant corporations dominate the political system.
F.D.R.'s Labor Relations Act effectively banned the company union in practice, but the essence of the phenomenon would linger until the present, where it maintains its historic, poisonous influence. The fundamental aim of modern company union ideology is to promote the concept of identical interests between workers and the employers. It is a philosophy of cooperation and teamwork, where in reality bitter hostility and mutual distrust are accurate reflections of the attitudes of workers and owners -- emotions based on the real antagonism between wages and profits.
The 1947 anti-worker amendment to the Labor Relations Act -- Taft-Hartley -- was a counter-attack on the organized workers' movement. In it, a surplus of anti-worker measures are outlined that to this day render the union movement harmless in conflicts with employers (since most union officials refuse to disobey the unjust law).
In addition to making it impossible for unions to support one another during strikes, a special provision of Taft-Hartley is often incorrectly viewed by some union officials as being "pro-labor." The bill cleverly outlined an organizational body that today encompasses bank accounts of hundreds of billions of dollars. Taft-Hartley "funds" are employer-employee financed accounts that help workers save for retirement, pay for health insurance and buy homes, etc.
These accounts are presided over by an equally-weighted labor-management team, where often the fund is managed like a corporate bank, and the employers and employees view themselves as partner shareholders. The Taft-Hartley bill was a very conscious attempt to disarm the labor movement. By merging the interests of workers and management into a pot of money, sections of the labor movement found it difficult to demand their "fund partners" pay higher wages, etc. Some workers identified themselves more and more as investors and used these funds to enrich themselves, or as stepping-stones into the corporate world of finance. In any case, the company union philosophy blurred the interests of workers, who sometimes found difficulty in determining if they should go on strike or merely consult an investment broker.