Future Business Leaders of America (FBLA) Business Law Practice Exam

What is the definition of an organization of employees formed to promote the welfare of its members?

1. Trade association

2. Labor union

3. Non-profit organization

4. Professional guild

The correct answer is: Labor union

A labor union is defined as an organization of employees that is specifically formed to advocate for the rights and interests of its members. These organizations aim to improve working conditions, secure better wages, and provide a collective voice for employees in various industries. Labor unions engage in collective bargaining with employers on behalf of their members, focusing on negotiating terms of employment and ensuring fair treatment in the workplace. The other options do not fit this specific definition. A trade association typically represents the interests of a particular industry rather than the welfare of individual employees. Non-profit organizations generally pursue broader social or charitable goals and may not be limited to employee welfare. Professional guilds focus on members of a particular profession, setting standards and providing educational opportunities, but they do not primarily function as unions advocating for labor rights or better working conditions. Thus, the focus of a labor union on enhancing the welfare of its members aligns perfectly with this definition.