Collective Bargaining in Labor Relations -- an Overview of Chapters 5-8 of Labor Relations, by Arthur a. Sloane & Fred Witney
In an effective relationship of labor relations and management, the entities representing labor and management must not view one another simply as adversaries, but as potentially complementary parties in the pursuit of a general, common goal of agreement. This does not mean that representatives of labor and management cannot also see themselves also as occasionally adversarial parties with strategically different objectives. The labor organization wishes to gain the best possible settlement for its workers. Management wishes to maximize profitability and cut costs.
These simultaneous but conflicting desires may mean that the goals and roles of management and labor may be at odds in many tactical situation, regarding many specific points. In other words, management may view cutting workers benefits or even jobs as the best way to achieve certain cost objective. Through the bargaining process, these differences must be -- or at least, hopefully redressed. However, in any negotiation process, the active discussion of differences cannot be effectively resolved in an agreement if the discussion is carried on in a purely argumentative fashion, much less in an angry fashion. Rather, adversarial positions must be collectively resolved on a point-by-point basis and the existence of an alternative point-of-view must be respected and acknowledged, if not always validated.
In the ideal situation, the bargaining process need not be adversarial at all. In the initial stages, each side must carefully craft its arguments and determine the points and potential areas of crisis within its own spheres. Ideally, the early stages should be marked by a setting out of differences, followed by a mutual broaching of areas of conflict, followed by a discussion of ways to address specific conflicts. However, in the real world, things do not always evolve in such an ideal fashion and the occasional crisis may occur at various junctures of the process. The testing and proofreading process of the negotiated contract, once arrived at, may require additional series of negotiations, as the 'fine points' or small differences may not seem so fine, even once the larger and broader philosophical issues negotiated between representatives of the union or labor, and management stand have been resolved.
Moreover, the nature organizations in negotiation will often affect the process. For instance, multinational organizations with different policies in different areas of the world, or with different ways of viewing the relationship between management and labor, may deploy different negotiating strategies. Unions in the manufacturing industry may view themselves in regards to management differently than representatives of professional organizations, such as teachers, negotiating with administrative staff.
Not all labor negotiations are between unions and management, either. Grievance procedures are instated institutionally in many companies for disputes between individual employees as well as between the entities representing the interests of labor and labor organizations and representatives of management. Arbitrators can exist in-house to iron out such agreements. Also, arbitrators are often called in as independent and disinterested personnel to more effectively negotiate areas of conflict between labor and management. Arbitrators can help iron out difficulties that have occurred between individual employees, between higher and lower level staff members, as well as between union and management representatives. One of the disadvantages of having arbitrators come in from the outside is that they incur additional costs however to the company and also indirectly thus take away funds that could otherwise be paid to workers. However, arbitrators are also trained in non-conflict producing and disinterested negotiating styles that can be ultimately a cost-cutting measure, as negotiations may be less protracted with their aid.
Numerous wage issues may be touched over the course of negotiations between labor and management. One of the most critical is the determination of the base wage rate, a contentious issue for manufacturers most particularly, and one of the first issues to come under consideration and conflict in the unionization movement historically. But even once this base wage is determined, numerous areas of potential conflict still exist. Rates of wage escalation dependant on shifts in costs of living must be negotiated, and determined on a region to region basis as well as a general, overall policy for the company. Companies located in many different areas of the country may find these issues particularly cumbersome and fraught with complications, as a unified policy for workers of various levels cannot always be set easily, without taking into consideration local rents and costs of sustenance foodstuffs in the area.
Wage differentials between workers of various levels of seniority, education, performance, and time spent at the company can be another controversial issue and may even become vexed between workers themselves. How much should initial education of various employees become valued when reckoning salaries and raises? How much should loyalty and seniority count as opposed to job performance?
Overtime and flexible hours are other issues of contention between workers, as some workers resent individuals who work part time, and part time employees may feel that they are not accorded adequate benefits and respect. Two tier wage systems, although lauded for the ability to give individuals caring for children or ailing parents the ability to work in a convenient fashion, may be viewed by the company as a luxury it can ill afford during difficult times, or by other workers as bestowing potential favoritism to workers with families as opposed to workers who lack families.
The subjective area of job performance evaluation is another controversial area of much vexed consideration between employees themselves as well as between labor and management. How and who determines what is a quality performance at the job, and how much should such periodic reviews count, when determining job performance? This area of subjective evaluation highlights that labor and management are not the only polarized entities, potentially, within any corporate or negotiating structure.
Besides all of these questions, the idea of the company's debt to its loyal and well-reviewed employees is thrown into even sharper relief in the question of pensions, retirement funds, and vacations. During hard corporate times, companies may view these as perks or potential negotiable issues, even if workers have come to rely upon their existence. Paid vacations and health benefits are other potential negotiable in the view of management that may need to be cut during hard times, but for those workers who depend upon them, may seem them as absolute necessities.
Concessions must be made for such issues to be ironed out. The concessions that are deemed to be amenable will obviously vary from context to context and group to employable group. The degree to which management and labor's desire may be viewed as amicable may also vary, depending on the attitude of the union, and the types of workers being represented in the context of negotiation.
One of the most controversial views of labor and management in negotiation, to make just one example of the different theoretical overviews of the negotiation process that are debated between scholars as well as individuals living in the 'real world,' is that of Boulwarism, an idea that management and labor are inherent partners in the profitability of any company, and that their desires are never fundamentally split. This idea was originally derived from the theoretical concepts of General Electric towards the end of the 1940's and was quite controversial and derided by union activists of its day. Now that unions have become more professional in their organization and ideology, it is less demonized as a theoretical concept. However, the viewpoint still is tenuous -- assuming that both groups rely upon the financial survival of the corporation in question, the needs of management and labor are always seen by Boulwarists as harmonious rather than in conflict.