I would argue that no, prisoners should not be allowed to form unions. For one thing, they're not workers. Although they may perform work while they're serving their sentences, they do so only as punishment. They are compelled to work; they have not freely engaged in a contract of employment with an employer. That being the case, it is difficult to see how such an arrangement could possibly give rise to the formation of labor unions when there are no legally enforceable workers' rights to protect.
Another reason for not supporting the formation of labor unions among prisoners concerns the right to strike. Most people accept that workers have the right to withdraw their labor and go on strike against their employers. But how would that work out in a prison setting? In America's overcrowded, underfunded prisons, it's hard enough as it is to maintain order. Just imagine how much harder it would be if prisoners had the right to strike. This would make it virtually impossible to keep the prison population in line, with potentially life-threatening consequences for both inmates and prison staff alike.
Furthermore, if prisoners were allowed to form labor unions, it would be all too easy for them to use strikes as an excuse for general disorder in prisons, thus undermining the authority of the Warden and his or her staff.