Negotiation concepts and applications

Negotiation

few days ago, there was a settlement of a labor dispute between P & H. manufacturers and their union. The company is a leading manufacturer of surface mining equipment and has it factory at West Milwaukee at 44 W. National Avenue and 4107 W. In Orchard St. (P&H Mining, United Steelworkers settle contract)

The company has been in existence for a long time, and was started more than a hundred years ago, and the main mode of transport were horse and buggies. From that stage, it has developed into manufacture of highly reliable mining equipment for the cost-focused surface mining industry of the world. There are some equipments of the company working at all times, and these are equipment like drills, shovels, draglines and other similar products. The company has a large number of dealers all over the world to attend to the equipment and the brand name of P & H. itself now represents a symbol of quality and reliability that has gone on for more than a hundred years. The company was set up by two individuals on December 1, 1884 through the setting up of a small machine and pattern shop which was being used to make component and device ideas to models and patterns. (An Enduring Symbol of Reliability)

The founders were Alonzo Pawling and Henry Harnischfeger. The craftsmanship of these individuals was well appreciated and the production of the company spread into knitting, grain drying, stamping, brewing and brick making, in addition to the contracts they got for repairs. Their movement into the area of specialized equipment came up with the rebuilding and improvement of a damaged overhead crane, the contract for which was got by Harnischfeger. The design was improved and the design was changed through supply of power through three electric motors, and this change immediately got the company a lot of orders from factories, utilities and railroad repair shops all over America. The company also developed a number of new products, and in 1911, one of the partners; Alonzo Pawling decided to sell of his interest in the business to his partner. The new proprietor decided to keep the old and renowned brand name of P & H. In a new corporation called the "Harnischfeger Corporation. These changes took place in 1912. (An Enduring Symbol of Reliability)

The new company started on a lot of new products and one of them was earthmoving equipment. The machines for cutting trenches and wheel loaders are among the first machines that were prepared by the company and these were followed by crawler mounted digging equipment and wheel type trenches. The company also made a lot of efforts for the nation in the First World War, and their main production was to make the overhead cranes. However the company continued on its usual production after the end of the war. The company developed the first gasoline engine powered dragline, which were mounted on crawlers. This development was followed by other equipment which also was mounted on crawlers and this was a shovel type excavator.

The Second World War gave another boost to the company and the contribution by the company was to produce more of the cranes and excavators for helping of the war effort. This led to the awards from the Navy and the Army for the efforts of the company in meeting the extra requirements for the war. The efforts of the company for the development of new products continues even today, and in 1999 they introduced a bigger, faster, and smarter loading tool which was for the use of the mines that were using the haulers of 240-tons, 320-tons, and 360-tons. In 2001, there was another product that could carry payloads of more than 100 tons, with faster times of the cycle and better systems for control. This was to help the mines achieve better performance and increased productivity. There was a further effort of the company for oil sands mines and this industry was served with new models. (An Enduring Symbol of Reliability)

The company is a leader in the world for the manufacture and service of the most modern large excavating and drilling machines. The machines are used in the mining of copper, coal, iron ore, silver, gold, diamonds, oil sands, phosphates, molybdenum, potash and other minerals and bedded materials. The large majority of ninety percent of the surface mines in the world uses the machinery manufactured by this company. The line of machines produced by this company can be separated in three lines and these are listed as electric mining shovels, rotary blast-hole drills and walking draglines. The history of the company is full of innovation and continuous improvement of its products and today the company is best known by its 4100 series of electric mining shovels.

The leader among the shovels is the bigger, faster and smarter 4100 XPB, and that is considered to be the powerhouse of the industry. The machine is capable of picking up a 115 ton payload in just one scoop and the giant mining trucks that are used today can be filled up by the machine in just three or four loads. The method of providing power to the shovels is through the sophisticated PLC control system and this gives them easy maneuverability. The machines are the workhorses that are used in the mines of today. This is supported by the huge draglines which are 22 stories high; 400 feet long and has a weight of 5700 tons. The bite taken by the bucket excavates a space in which four cars can go in. These draglines are considered to be the powerhouses of the industry for the removal of overburden and reclamation of land from where coal and phosphates have been removed.

The biggest of these machines are now working in Canada and Australia, and the other type of machines offer a "hole package" in the area of drilling. The company supplies blast-hole drills which can be used for getting well crushed rock for the excavating and loading equipment. This is useful for saving wear and tear on the equipment and provides better quality of rock to the equipment used for crushing and processing. These can be customized for the company's drilling systems which are at the front of the mining process. The help is in terms of lower costs per ton, or per hour of production. The machinery for the company is produced in Milwaukee, Australia, Brazil, and South Africa and at a Japanese plant of an affiliate. The total factory area used is over 1.2 million sq. ft. (P&H - A Preferred Partner to the Surface Mining Industry)

Issues:

In the industrially advanced countries like Canada and the United States, the main method of gaining success to the demands of the workers is the question of the union that takes up the issue for the workers. Let us look at a present situation in Canada. In the entire area across Canada there is a union called the United Steelworkers, who are the representatives of more than 180,000 men and women who work in different types of industries. During the current year, 2004, the union is supposed to be negotiating 200 collective agreements and these agreements are supposed to cover some 28,000 members of their unions in different units.

There are many different negotiations that are scheduled to come up for discussion during the year and they include the negotiation for office employees in Sudbury that was done of 31st March; the discussions that were held with the Canadian Automobile Association in Thorn hill of Ontario held on 25th April; the discussions scheduled at Uniroyal Goodrich Tires in Kitchener of Ontario scheduled for 31st of May; with GDX Automotive planned for 1st June in Welland in Ontario; with Stelco in Nanticoke on 31st July; Amcan Castings Limited scheduled on 18th October in Hamilton; Collins and Aikman Plastics Limited in Stratford planned for 27th October; Teck-Corona Operating Corporation at the David Bell mine in Marathon on 31st October; Potash Corporation of Saskatchewan Inc. At the Cassidy Lake Mine in Sussex on December 31st, and North Atlantic Refining Limited in Come-by-chance also on December 31st. (Steel workers set to negotiate on behalf of 28,000 Across Ontario and Atlantic Canada)

There are also other meetings scheduled for the resolution of the difficulties of the seasonal workers in fish packing plants on the Acadian Peninsula that were due for renewal on 31st March, but the meetings were not fixed. An agreement had to be reached in Labrador for the collective agreement of the Rio Tinto controlled Iron Ore Company of Canada. This was due by the end of February as the previous agreement was expiring at that time and was expected to cover 1,089 employees. This was supposed to be a very important agreement as the company had a very bad record on human and worker's rights according to the workers of the company. There were also other workers who were covered as a group of security guards working in different firms like Falck, Securitas, Aeroguard, Garda, Rentokil Initial and other similar companies. (Steel workers set to negotiate on behalf of 28,000 Across Ontario and Atlantic Canada)

The total number of workers involved in this group was over 4,000. In certain cases, the settlement into new agreements is not smooth as was the case at Gerdau Ameristeel Corporation in Whitby, where there was a 13-week strike at the end of the previous contract that the 534 workers had with the company earlier, which was then known as Co-Steel Lasco. The agreement had expired at the end of February last year. There are also contracts expiring at Algoma Steel in Sault Ste. Marie which will expire on 31st July, and these contracts affect thousands of workers in the two unions working in the units there. (Steel workers set to negotiate on behalf of 28,000 Across Ontario and Atlantic Canada)

Thus we can see that there are professional negotiators who represent a large number of workers in different companies, in different industries, spread over certain areas of the country. To become a member of these unions, the workers concerned have to pay certain fees and accept the commands of the union, and the commands of the union are the biggest reasons for settlement of any worker trouble.

Now let us see how the unions are chosen by the workers in a certain industry and unit. The union that is referred by us in the discussions for the negotiations in the original case has a control over a hotel, Flamingo Hilton-Laughlin. This control was received after the union won a second election in April 1999, and this was at the end of their six-year long effort to become the representatives of the 829 eligible workers in the hotel and casino. The difficulty for the union to gain recognition was from the government and not from the workers it says it represents. The union now represents all the full-time and regular part time workers, in uniform in the departments of housekeeping, food and beverage, warehousing, front desk, bell, valet parking, retail sales and cash departments. Certain sectors of the workers in the hotel are not represented by this union and they are in the area of the casino, security and administration. The owners of the hotel are the Park Place Entertainment Corporation of Las Vegas, and the owners of the hotel did not like to provide the investigators with any comments on the entire issue of the union. (Steelworkers try negotiating first contract with Laughlin resort)

The hotel workers were not very keen initially on being represented by this union and the first round of voting on the issue was held in 1993. In that election, there was a vote of 495 to 389 through which the workers refused to be represented by this union. In spite of the decision of the workers, the authorities in the government, the National labor Relations Board gave a declaration that the union had won the elections and that the fair elections could not be held in the hotel due to the conditions that were imposed on the hotel by the management which made fair elections impossible. In turn, the management appealed to the United States court of Appeals in Washington DC, and the court of appeals ruled finally that the board had not provided adequate justification for its order on the hotel management for the recognition of the union. By the time the decision came, a lot of time had passed and the superior court felt that it was then possible to hold another election. (Steelworkers try negotiating first contract with Laughlin resort)

This decision of the court led to the second election in 199 which led to the selection of the union in April 1999 and the votes in favor of having the union was then 469 for and 304 against. The management now complained against the conduct of the union during the second election to the National Labor Relation Board, but the board found the management's objections untenable. The board then declared this union as the official representatives of the employees of the hotel-casino for collective bargaining under the relevant laws. This gives the union exclusive rights of collective bargaining. (Steelworkers try negotiating first contract with Laughlin resort) Thus it is clear that there are certain interests in the bargaining for workers in their union disputes with the management and often the decisions are taken totally by the unions. They normally do not give this information to the people outside as this will harm their own interest.

Now let us look at the procedure how the unions enter the different companies as representatives of their workers. The first step is to get employees of the company as their members even though the union may not be the official representatives for the workers. Let us take the case of Chart Industries in New Prague of Minnesota. Chart Industries is among the largest manufacturers of cryogenic products and has manufacturing facilities in many locations across the United States as also in several countries, including China and the Czech Republic. The union decided to take up the case of the workers and the first step that they undertook was to organize a protest at the annual meeting of the shareholders of the company that was being held in the town. According to the representative of the union, the union and the company had earlier met some 17 times, but there was no settlement that was reached. (New Prague workers to protest at Cleveland shareholders meeting)

This led the union to instruct the members of the local unit in the organization to finish their work at the factory and drive throughout the night to reach the venue of the meeting which was scheduled outside. The union then was claiming that it was the representative for 250 of the workers in two factories of the company in New Prague and Lonsdale. These factories were being used for the production of storage tanks for a number of uses including bio-medics, industry and commerce. The total number of workers at the production unit was 400 till 1997 when the unit was called Minnesota Valley Engineering, and these employees had voted for representation by the union. When the representation by the union was about to start, the factory was bought by Chart Industries and this also laid to the removal of a 100 workers. (New Prague workers to protest at Cleveland shareholders meeting)

In spite of getting the recognition, the bargaining between the management and the union lasted a long time of two years and a total of 50 meetings of bargaining before any contract of the union was accepted by the management. In the meantime, the management tried to get the union de-certified in February 2002 and then began a second round of talks between the management and the union. The objective of the union for this second round was to make further improvements in the working conditions of the workers. At the same time, the management was very conscious of the financial difficulties of the organization. The attempt of the union was not to get any immediate financial benefits, but get the right to be informed of any changes in the terms of the pensions or 401(k).

The union wanted to now make the issue of retirement as its priority in the discussions with the company. The other changes that the workers are seeing are some modest benefits for the wage and related benefits, and the most important changes are languages in the terms of the contract. To put additional pressure on the management, the union was getting its other members from the area to take part in the movement. The protest outside the hall of the meeting was followed by the entry of the union members into the meeting of the shareholders and aired their concerns. (New Prague workers to protest at Cleveland shareholders meeting)

Thus the clear strategy followed by the unions is to try and get some benefits for the workers through a process of embarrassment of the management, especially during their special sessions. The strategy followed is different in the case of each union and each company and depends mostly on the situation that the company is in. The worse the position of the company, the stronger will be the attitude taken by the union. In the case of the company that was taken for our reference, the situation of the company can be termed as reasonable, and there was also not a long history of trouble. Thus the method followed was mainly of discussions. These are available in the records of the company and the union, and will not be divulged by them to others.

Alternatives:

The discussions with the management and the union are a process that is being followed for a long time, and has become a tradition in the history of the United States. It is unlikely that this process will change and this movement is marked internationally with the celebration of the Labor Day on the 1st of May. The other important reason for this sort of a discussion is that while the management may be represented by one person or group of persons, there are many workers, and it is not possible for all of them to take part in all discussions. Thus the workers have to be represented by a union. The alternative would be for all the labor to come together in a group and meet the management to present their own personal points-of-view, and this process is still followed in small units where there are a small number of workers. In those cases, the management is also often more directly aware of the difficulties of the workers, as they have often built up the organization together.