Ford Motor Company's wage and economic supplement strategy

Wage Issues and Economic Supplements

The interview for this assignment was conducted with the human resources manager of Ford Motor Company. The company has prolonged its partnership with the United Automobile Workers union. The interview questions and their answers are listed below.

How do you rate the wage level in your company in relation to the minim wage?

Ford Motor is a company that attributes its success on the quality of its manufactured vehicles. These high quality standards can only be achieved with the quality input of our workers. Therefore, their performance becomes connected with their job satisfaction, which relies on the wages they receive for their work. We want high quality work, and we pay higher than average wages.

Q2: Are there any types of jobs within your company where you pay minimum wages?

A2: There most certainly are. We have positions where unskilled workers are required. For such positions, like cleaning positions, or food provision positions, we pay the minimum wage. These are jobs that are not affected by a high level of safety issues and do not require higher pay. We are also not interested in the loyalty of employees in such positions, as their occupants are usually individuals that are in search of more interesting jobs, so there is no need to invest in retaining them.

Q3: But in these cases do you offer these workers any additional economic supplements?

A3: Yes. If we do not invest in retaining such personnel, it does not mean that we are not interested in their welfare. Therefore, these minimum wage workers receive the same economic supplements are the rest of skilled workers. These can be monthly meal tickets, holiday meal tickets or other shopping vouchers. We believe in not discriminating our workers, regardless of their wage, skills, and position.

Q4: Employees in higher positions benefit from economic supplements of greater value?

A4: Yes, they do, and this is perfectly normal. Here, at Ford, we believe in rewarding people in accordance with the skills that are required by their job, with the level of requirements of each job, and with their performance. Therefore, people in management positions, whether it's top or middle level, benefit from significant economic supplements. In addition to meal tickets that are offered on a monthly basis, managers benefit from vouchers they can use at spas and recreation centers, apparel stores, and entertainment centers. We provide such vouchers that can be used by employees with their families on a periodical basis, usually quarterly.

Q5: Do you provide other perks and benefits to your employees?

A5: We also develop team building programs, some of them are organized abroad, in different countries that our employees would like to visit, but do not often have the opportunity. This is intended to increase their satisfaction, and improve their engagement with the company. It also helps employees develop and improve team relationships.

Q6: In developing this wage and economic supplements strategy did your company consult with union representatives?

A6: As in most situations where large companies employing workers must deal with union requests in their collective bargaining process, our company was also forced to bargain with the Automotive Workers Union.

Q7: Was this collective bargaining successful? Was thin a win -- win situation, or do you feel that one side won more benefits in comparison with the other side?

A7: I think it was very close to a win -- win situation. It was not possible for us to satisfy each of the union's requests. This is mostly the case of wage levels. The company cannot provide the exact level of wages requested by the union. This is one of the reasons for which we provide economic supplements to our workers.

Q8: How do you feel about unions, do you think they are helpful in managing the relationship between companies and their employees?

A8: There are numerous opinions revealed by different newspapers that provide interviews with company representatives that consider that unions are not good for collective bargaining (Masterfano, 2013). I happen to share this opinion.

Conclusions

It seems that the human resources manager of Ford Motor Company has a liberal view on establishing wages and economic supplements. However, this does not mean that the company does not collaborate with union representatives in order to identify the best solution that would allow the company to improve the performance of its employees while investing reasonable amounts of finances in their wages.

The policy of the company is to provide its workers average wages in accordance with the standards of wages established by the automotive industry. In order to improve performance, the company supplies workers' wages with different economic benefits intended to assist workers in shopping or other activities they require.

Q6: What does the company's management do when you request salary increases?

A6: They usually try to convince us that the company would have difficulties in supporting wage increases. But they also try to convince us that are requests matter to them by developing a rewards system that is based on providing workers different economic supplements.

Q7: Do you find economic supplements satisfactory for improving your union members' condition?

A7: Economic supplements help, but they cannot significantly influence people's situation. However, we are satisfied that we can determine the company's management to provide additional benefits to employees.

Q8: How flexible do you consider the company's management is?

A8: I think they are more flexible in comparison with other company's managers, but there is still room for improving their flexibility. This is because when they do not want to satisfy some of our demands, they try to offer us something else. Like the situation where we ask them to increase wages, they say they can't, but they provide certain economic supplements to workers.

Conclusions

The union representatives that negotiate with Ford Motor's company managers seem to be satisfied with the labor relationship between the company and its employees. The interview was intended to determine whether bargaining between Ford and its union follow the usual process. In most cases, the bargaining process starts with each side assigning the negotiation team. Union members then try to identify the needs expressed by workers, and to develop negotiation proposals. The negotiation team of the company also prepares certain proposals that it can offer to union representatives. Most of these negotiations rely on anticipating the other party's interests and objectives (Budd, 2012). Identifying these issues makes it easier to find agreement. An important success factor at the bargaining table is represented by the flexibility revealed by unions and companies. In this case, union representatives consider that the company's management has a high level of flexibility. This is useful for unions because they get more from this company, and it is important for them to show their union members that they are able to stand up to management and defend their rights.

Institutional Issues

This is interview was also conducted with the union representative of the company. Institutional issues must be addressed together with union members in order to determine whether assumptions made on this issue are correct.

Question 1: There are many that consider unions to be political institutions. How do you stand on this?

Answer 1: It can be understandable why some people consider unions to be political institutions. The history of unions is full of examples of unions, union members and leaders that were influential in different political issues. In addition to this, certain unions have been the tool of politicians or state institutions in their attempt to gain in political. This can also be observed in other countries, where union members, like miners have been manipulated by authorities into entering strikes, or even engaging in violent activities intended to counteract the effects determine by other individual associations.

Q2: Do you think this is also the case of Automotive Workers Union?

A2: No, the Automotive Workers Union does not consider that political involvement can be beneficial to our members. We think that it is important to develop strong relationships with the state authorities, and with different parties, but we do not want to favor some of them.

Q3: Are you saying that your union does not have institutional power?

A3: No, I am not saying this at all. Of course our union has institutional power. If we did not have such power, we could not develop strong negotiation sessions with the company's managers.

Q4: How does the company's management acknowledge this power?

A4: By being cautions in our negotiations. They are aware of the fact that we have the power to command our members to go on strike, or to engage in behavior that can damage the company's activity. The management respects our influence.

Q5: How about your union members? Are they satisfied with your work?

A5: Most of the time they are satisfied. We cannot obtain everything we intend to when bargaining with the company, but we obtain better work and pay conditions for them. This makes them trust us, and to tell us what they need.

Q6: What is your opinion on unions that seem to be politically owned?

A6: In my opinion, unions should not interfere with politics. The unions that are associated with politics make a bad name for other unions that have nothing to do with this.

Q7: Do you think that by associating with politics, unions can benefit?

A7: In medium term it is likely that they have important benefits. They benefit from the strong support of certain institutions. But by associating with certain parties, they can reduce their chances of having good relationships with other parties.

Q8: Do you think your union can increase its institutional, power?

A8: The power of you union is developing in accordance with the automotive industry. This business can be developed. If the industry increases, it is likely that our union members number can increase. This means that our institutional power can also increase.

Conclusions

It is obvious that the union representative is aware of the institutional power that the Automotive Workers Union has on the industry. However, the union representative does not want to publicly acknowledge this during the interview. This reaction can be determined by the fact that those unions that are thought of having great power of influence and connections to the political world are not considered as having a good impact on labor relations.

This is because highly institutionalized unions are more difficult to handle. They are considered rigid. This makes it difficult for companies in developing flexible negotiation strategies at the bargaining table. Therefore, it is normal that the union representative does not want the Automotive Workers Union to be associated with such situations.

It is important that the company evaluates the influence that the union has on its workers. By evaluating the level of influence, the company can better understand the union's strategy, and determine what requests they are likely to focus on. This also helps the company adapt its negotiation strategy. Its relationship with the union is also reflected in its relationship with employees. If the company does not respect the union, its employees can take this as a lack of respect towards them. Therefore, the company must increase its attention on relationships with the union. In addition to this, having a good relationship with the union helps the company improve its relationship with employees

However, this does not mean that the company must accept all requests demanded by union leaders. In such cases, the company is likely to reduce its strength, and increase the power of the union. The company's managers must be careful in reaching a balance in their relationship with the union (Budd, 2012). They must keep their strong position in this relationship, while acknowledging the influence and importance of the union. In addition to this, the union and the company must have their interests in mind, but they must focus mostly on the interests and needs of employees. This means that there are situations where employees' needs are not the main focus on union. In such cases unions have political interests that are negotiated with the company. It is important to determine what unions can do for employees and increasing their productivity.

Reference list:

1. Masterfano, M. (2013). Unions: The Good, the Bad, the Ugly. The Huffington Post. Retrieved October 6, 2013 from http://www.huffingtonpost.com/michele-masterfano/unions-the-good-the-bad-t_b_3880878.html.

2. Budd, J. (2012). Union Bargaining. Retrieved October 7, 2013 from http://answers.mheducation.com/business/management/labor-relations/union-bargaining.

3. Budd, J.W. (2012). Labor Unions: Good or Bad? Retrieved October 7, 2013 from http://answers.mheducation.com/business/management/labor-relations/labor-unions-good-or-bad.