Unit 6 Lecture Negotiations Preparation Negotiating the First Labor Contract According to the National Labor Relations Board (NLRB), "after employees choose a union as a bargaining representative, the employer and union are required to meet at reasonable times to bargain in good faith about wages, hours, vacation time, insurance, safety practices and other mandatory subjects." "It is an unfair labor practice for either party to refuse to bargain collectively with the other, but parties are not compelled to reach agreement or make concessions." "If after sufficient good faith efforts, no agreement can be reached, the employer may declare impasse, and then implement the last offer presented to the union. However, the union may disagree that true impasse has been reached and file a charge of an unfair labor practice for failure to bargain in good faith. The NLRB will determine whether true impasse was reached based on the history of negotiations and the understandings of both parties." "If the Agency finds that impasse was not reached, the employer will be asked to return to the bargaining table. In an extreme case, the NLRB may seek a federal court order to force the employer to bargain." The U.S. Labor Movement has been at odds with employers and the Federal labor laws affecting labor contract negotiations, especially first contract rules, for many years. According to JohnPaul Ferguson and Thomas A. Kochan of the MIT Sloan School of Management's Institute for Work and Employment Research (March 2008,) "Even after a majority votes for a union, many units fail to get a contract. Only 56 percent of units in which a majority of employees voted for a union and were certified for bargaining by the NLRB were successful in reaching a first contract. Only 38 percent of such units reached a contract within one year." And, since the Union is only guaranteed a majority status for one year under NLRB rules, the primary objective of the Union is to "get a contract." In the highly publicized and currently un-passable Employee Free Choice Act (also known as the "Card Check Bill" by it's opponents) introduced March 10, 2009, by Sen. Edward Kennedy (D-Mass.) in the U.S. Senate and Rep. George Miller (D-Calif.) in the U.S. House, "provides that when an employer and newly formed union are unable to bargain a first contract within 90 days, either party can request mediation by the Federal Mediation and Conciliation Service (FMCS). If no agreement has been reached after 30 days of mediation, the dispute is referred to binding arbitration. All time limits can be extended by mutual agreement. This change eliminates current incentives for employers to delay and stall negotiations and will dramatically reduce the delay, frustration and animosity generated by the company-dominated system." (per the AFL-CIO website.) In a March 2007 article by Gavin S. Appleby (a Labor Relations consultant with Littler Mendleson Consultants) entitled Employee Free Choice Act: It's More than Just a Misleading Name, the author states that "first contracts following a union election provide a challenge to both the employer and the union. The employer's goal typically is to retain as much of its rights as possible. By contrast, the union's challenge arises from the fact that it wants to live up to promises it made to the workers, but not at the risk of failing to obtain a labor agreement (absent an agreement, the union will not be able to recoup the investment it has made through the collection of dues). Under these difficult circumstances, first contracts take time and, while a union is guaranteed majority status for a year, some unions fail to achieve a first contract due to a combination of lack of employee support and legally permissible 'hard bargaining' by employers." Union Preparation for the First Contract In a 2003 The Labor Educator article by Harry Kelber entitled A New Game Plan For Union Organizing, he suggests several steps Union Organizer should take in negotiating the first labor agreement with a newly organized employer. For details, please click the following: http://www.laboreducator.org/gamplan7.htm Management Preparation for Negotiations Dr. Kenneth M. Lynn, an independent management consultant, published a July 2002, HR.com article entitled, Preparing For Labor Negotiations: An Overview, specifying some of the more critical issues for management negotiators to plan for prior negotiating a labor contract. For details, please click the following: http://www.mediate.com/articles/lynnk.cfm Negotiations Impasse and Settlement Once the NLRB has certified that a Union has the authority to represent an employer's workers both parties have a duty to bargain in good faith, as we've stated before. In the following article by Alan I Model, Esq. for the Grotta, Glassman & Hoffman Law Firm, entitled How To Play Collective Bargaining Hardball with the Union, he defines in detail how an negotiations "impasse" occurs and how it is ultimately settled. Please click, http://www.lawmemo.com/articles/hardball.htm Running Head: DISCUSSION FOR MAINTAINING THE ORDER IN NEGOTIATION 1 Ordinarily non-economic or non-wage issues are tackled first during a Labor Contract negotiations with wage and benefit issues settled as a package near the end of negotiations Student name: Institution name: Date of submission: DISCUSSION ON MAITAINING THE ORDER IN NEGOTIATIONS DURING BARGAINING 2 The National Labor Relations Act of 1935 was enacted, and collective bargaining has been a force for which the workers in the United States negotiates terms and conditions of employment with the prospective employers. However, it is evidenced that the number of workers in the unions has steadily reduced resulting to debate on the future operation of the unions in the United States. Parties explore cooperative innovations and sort to adversarial extremes to determine the course of action to be undertaken. The non-economic issues and nonwages are tackled first during a Labor Contract Negotiations while the wages and benefits issues are tackled at the end of the negotiations. The primary objective of any negotiation is developing better terms and conditions for employment that will be in equilibrium point as per the employer and the workers. The vital argument for which the order of negotiation is maintained narrows to the fact that the conditions and terms of the works dictate the benefits and the wages to be offered to the employees. The issues provide an insight into the relative power of the parties and areas of mutual, liberal agreements. Some of the non-economic issues addressed include; employment security which entails both the job security and union security, committees which involves labor-management committee and health and safety committee, work arrangements ; team-based work system or rotation, workers participation , work rule flexibility, pay for knowledge, profit sharing or gain sharing among others and finally the negotiation on the wages and benefits which include; base wage reduction, benefit reduction, wage freeze, wages increase and benefit increase., (Anstey et. al..., 2011) Reasons for such order and case As a means to develop the wage rate and labor cost The union forms a committee to participate in the negotiation process; the main objective of the committee is developing and evaluating all the factors in the employers firm or company DISCUSSION ON MAITAINING THE ORDER IN NEGOTIATIONS DURING BARGAINING 3 to come up with the possible wage rate for the employees before the actual signing of the job contract. The committee develops critical interest with the number of hours for the work in a day, the number of days to attend the jib in a week, the average output required by the employer for each worker, allowances for overtime work or additional output, un-worked paid hours, periods such as lunch and breaks as well as the wash-up period (http://www.mediate.com/articles/lynnk.cfm). After a detailed analysis of the above aspects, the committee can negotiate the payment terms and conditions that the employees will expect. These information acts as the basis for the negotiations of the cost of labor required and effective for the nature of the work. The higher the number of hours and days required by the employer, the higher the wage rates expected by the workers. The wage rates and the cost are in portioned to the amount of work done by an employee (http://www.lawmemo.com/articles/hardball.htm;http://www.laboreduca tor.org/gamplan7.htm). Create desirable work morale among employees and meet the expectation of a new job Worker representation in the negotiations acts as a motivating factor that will either increase the labor productivity of the workers of hinder the productivity of the workers. Labor productivity of the employees would mean efficiency of the operation of the firm; a company realizes high productivity and returns on the capital employed from the extensive use of the labor force that aims at minimizing the input and maximizing the output of the firm. With a relative advantages and benefits, employment security, the company of employer can realize low staff turnover in the long term and short term hence specialization. Such non-economic issues or nonwages boast the staff morale before the actual delegation process to the work and inculcates the willingness of the workers to achieve the set objectives; mission and vision of the company thus DISCUSSION ON MAITAINING THE ORDER IN NEGOTIATIONS DURING BARGAINING 4 better understanding of work. Developing basis for commitment to terms and condition of the work The negotiations based on the non-economic and non-wages aspect of the work forms the basis of evaluation of the employer and the workers, employees are evaluated to meet the obligation as agreed to the terms and conditions and facilitate commitments to the job responsibility as per the coverage of terms and conditions. The employers have the obligation to fulfill all the requirements of the work that are spelled out in the agreement. Failure to do so, and then the union is held responsible for taking legal measures against the employer in the event of failure (Herman, Faaborg & Program on Negotiation at Harvard Law School, 1993). Review of the employers company Unions access the extent to which the company or employer will remain consistent in the operation of the business to ascertain whether the employer can withstand the level of the wages rate before the actual contract is entered. The operational aspect of the company is analyzed Production rates of the company, prices attached to the product in the markets, production levels to determine the number of workers to determine the cost, sales made by the company from its past operational activities and revenue volumes that accrues from the markets and profits realized by the company in relative to the labor input utilized (Anstey et. al..., 2011). Thus, this helps to determine the labor cost strategy to be applied in the negotiations. In essence, the order of issues has to be maintained by the unions to determine the cost of labor and the anticipated benefits and employment security accurately. The employer accepts to operate within the set terms, and conditions and failure would mean a legal action being taken against the employer. In a personal view and from the economist point of view, the order has to DISCUSSION ON MAITAINING THE ORDER IN NEGOTIATIONS DURING BARGAINING be so and procedural to arrive at the final stage of wages and benefits having gathered enough information and data about the kind of work to be offered by the employer. 5 DISCUSSION ON MAITAINING THE ORDER IN NEGOTIATIONS DURING BARGAINING References Herman, E. E., Faaborg, R., & Program on Negotiation at Harvard Law School. (1993). Ethical and unethical conduct and the collective bargaining process. Cambridge, Mass: Harvard Law School Anstey, M., Grogan, J., Brand, J., Ngcukaitobi, T., & De, B. A. (2011). Collective bargaining in the workplace. Claremont, South Africa: Juta. Online sources: http://www.laboreducator.org/gamplan7.htm http://www.mediate.com/articles/lynnk.cfm http://www.lawmemo.com/articles/hardball.htm 6